St Lucia’s new Minister of Tourism and Aviation, Allen Chastenet, has a refreshingly different perspective on government. He feels that too many decisions are taken by ministers operating in a vacuum, with little reference to practicality and with little understanding of their commercial implications. His decidedly private sector view is that much of what is said and done by governments in the region is not based on hard fact, research or statistical evidence.
As if in response to his concerns, the Caribbean Hotel Association (CHA) has just published a study that tries to quantify the role of the Caribbean accommodation sector as a consumer of locally produced goods and services and as a provider of revenues to government.
The report – funded by the European Union through Proinvest and produced by Tourism Global Inc, a regional consultancy – provides, for the first time, hard evidence of just what the tourism sector contributes to the regional economy through its vast purchasing power.
The report notes in its introduction that the previous absence of such statistics has probably caused decision-making relating to the tourism sector to be sub-optimal. It argues that as an industry tourism is a consumer of a vast range of goods and services extending from finished buildings, though foodstuffs to insurance, legal advice and priests for weddings.
It suggests that since such consumables are purchased at the expense of the visitor, any nation that can produce or provide such services or goods locally or regionally, can benefit exponentially.
The study contains some fascinating statistics. It suggests that the industry is a major consumer of utilities and a significant consumer of local vegetables and dairy produce, but that more than 70 per cent of fish, 75 per cent of fruit and astonishingly 90 per cent of eggs are purchased from outside the region. However, when it comes to manufactured items it seems that up to 50 per cent are locally or regionally sourced, with bread, soft drinks, uniforms and printing leading the way.
Space does not permit me to go into a lot of detail about the report’s other findings, but more generally it suggests that 84 per cent of services are sourced locally; 21.7 per cent of all regional investment originates with the tourism sector; the industry supports a vast array of small businesses; and based on the sample undertaken, spends around 19 per cent of its turnover in taxes.
Although study makes clear that sample was small and there is the need for further and more comprehensive studies, it provides a first indication of just how important the industry has become as a driver of demand and by extension to the economic fabric and viability of suppliers across the region.
Where this and earlier studies are leading is to an industry-wide desire to seek a more substantive dialogue with Caribbean governments based on facts about the economic importance of the industry.
As the study suggests, recognition by government that the industry has become the single most powerful economic entity in the region is long overdue. It also indirectly makes the case for the region’s business sector, including agriculture and fisheries, to look more closely at the opportunities that exist for developing closer commercial relationships in order that significantly more of what the industry spends remains in the region.
Both the Caribbean Hotel Association and the Carib-bean Tourism Organisa-tion (CTO) have embarked on a number of initiatives to try to move these and other industry concerns up the regional political agenda.
Amongst the new approaches that are being argued for is a structural change at a regional level to enable policy issues affecting the industry’s viability to reach the agenda of Caribbean Heads of Government.
CHA cites the example of the last full Caricom Heads of Government meeting in July 2006. At that meeting no tourism issue was discussed because no institutional framework for Caribbean ministers of tourism exists to meet and then report through Caricom to the Heads of Government.
To address this the industry is now proposing that Caricom should rapidly create a forum for Caribbean ministers of tourism as currently exists for other Caricom ministerial portfolios.
Both CHA and CTO believe that the time for a summit between the industry and heads of government is long overdue. They argue that the confusion surrounding the issuing of visas for world cup cricket is indicative of the absence of any joined up approach to government when it comes to their industry.
They note that there is a pressing need to discuss at this level both external and internal issues affecting competitiveness, ranging from how to respond to administrative decisions in Washington, Brussels or elsewhere on issues such as passports, the environment, airline passenger taxes in Europe, visitor taxes in the region, the growing lobby in North America and Europe against air travel and a host of other issues.
They also suggest that ministers of tourism be seen as much more than as promoters and regulators. They point to the absence of any political understanding on a constituency by constituency basis of the interests of large numbers of voters who depend on tourism’s fortunes.
The tourism industry’s two representative institutions have recognised the need to act responsibly and together, whether it is in respect of trade negotiations, marketing or advocacy. They have moved to employ regional experts able to develop policy papers and have commissioned studies that provide the facts about their industry.
It is now up to heads of government and Caricom to afford the industry the importance that its economic role deserves.
Previous columns can be found at www.caribbean-council.org
