The View from Europe
  By David Jessop
   
  Do governments fully understand the importance of tourism; the industry that now underwrites the regional economy?
   
  This is the underlying theme in a sequence of reports produced over the last eighteen months that illustrate the positive economic impact that the industry has in areas such as employment, taxation, domestic agriculture and foreign exchange.
   
  The studies have been produced variously by the World Travel and Tourism Council, leading international firms of consultants, supported with European Union resources and actively encouraged by the Caribbean Tourism Organisation (CTO) and the Caribbean Hotel Association (CHA). They set out to demonstrate to government and regional institutions that the industry has become the predominant force in the regional economy.
   
  Taking the reports together the following facts emerge: Caribbean tourism is expected to generate US$56.1 billion of economic activity and employ directly fifteen per cent of the regional workforce in 2007; between now and 2017 earnings from tourism will grow by 3.3 per cent per annum; the Caribbean is the most economically dependent region of the world on the industry; hotels source in the region 74 per cent of vegetables, 84 per cent of services; 93 per cent of utilities and 47 per cent of light manufactures, but only small quantities of seafood; and tourism accounts for on average twenty one per cent of regional investment rising to as much as 70 per cent in some nations. 
   
  A third just published study looks at the effect of taxation on the industry’s competitiveness. 
   
  The reports make clear that this is not a form of special pleading by a small group of hoteliers but is about Caribbean self-interest and the need for a changed policy environment. 
   
  Together the studies argue for seeing tourism as an industry like no other in as much as it brings into every Caribbean nation very large number of individuals who spend significantly and contribute directly or indirectly to virtually every aspect of each nation’s hard and soft infrastructure.
   
  Running through the text of each document is the clear message that if the industry does not remain competitive then the economy of almost every Caribbean nation will decline and along with it the fortunes of most Caribbean citizens.  
   
  These studies stem from a frustration felt in the industry that few in Governments are giving tourism the holistic high level policy attention that it deserves. Instead tourism ministers, who in most states are relatively junior cabinet members, are expected to be able to influence their colleagues on every development touching on the competitiveness of the industry whether it be aviation policy, public health or the environment.
   
  In private, industry leaders say that the objective of these reports is to cause Prime Ministers, Finance Ministers, leaders of regional institutions and Governments outside the region to recognise that every decision they take impacts on the tourism economy. 
   
  The studies are also intended to raise questions about the absence of any formal institutional structure in Caricom whereby tourism ministers are able to move issues directly up to regional heads of government. A further objective is to suggest to regional institutions that tourism issues should more frequently lead the regional economic or political agenda at meetings with external partners. 
   
  In this latter context a demonstration of the seriousness with which the region takes the issue will arise in a matter of days in the final services negotiating session for an Economic Partnership Agreement (EPA) with Europe. As matters stand, the regions detailed four page tourism annex prepared by the Caribbean Regional Negotiating Machinery with the support of CTO and CHA, stands in stark contrast to the European Commission’s one page generic offer on tourism. 
   
  It may be true that some aspects of the tourism text are better dealt with using alternative language elsewhere in the EPA, but at stake is much more than the sometimes impenetrable language of services liberalisation. 
   
  The EC seems not willing to accept that by giving formal recognition to tourism in an EPA or by creating a formal basis for EC/Caribbean dialogue on the sector it will affirm the importance of the industry that will represent in years to come the largest part of the region’s economic relationship with Europe.
   
  To their huge credit Caribbean trade negotiators are now preparing to argue that a substantive text on tourism is an essential component of an EPA and that this must address real issues such as European market access for Caribbean service providers or the mutual recognition of tourism credentials.
   
  Speaking recently about the importance of this, Peter Odle, President of the Caribbean Hotel Association said: “Our industry needs a full text in the EPA. Past agreements with Europe have treated tourism as if it was we are in some way marginal to regional development. By every measure we are central to the future prosperity of the Caribbean. If Europe means what it says about supporting the creation of a vibrant regional economy it must agree to a viable text and the creation of an institutional basis for an ongoing dialogue on tourism”. 
   
  The issues that face the Caribbean tourism industry are the issues at the fault lines of globalisation and interdependence. 
   
  If the coral bleaches and the beaches erode, the environment, the product that sells tourism, will require more than the intervention of environment ministers to make the region’s case. In future Ministers of Trade, Foreign Affairs, Education, Labour, Health, Agriculture and Finance will all have to play a role in ensuring the industry’s sustainability whether the policies they pursue relate to taxation, public health education, training or employment. 
   
  Commodities and preference defined the regions economic interests in the past; services describe much of its future.  There is now extensive evidence of the overriding economic significance of tourism and the need to ensure its sustained competitiveness. The challenges its faces should now take centre stage in Caribbean economic and political decision making.
   
  David Jessop is the Director of the Caribbean Council and can be contacted at [log in to unmask]
  Previous columns can be found at www.caribbean-council.org
  September 20th, 2007
   
   

       
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