Examination of Witnesses (Questions 80-99)
MS VICTORIA
JOHNSON, MR
JONATHAN MITCHELL,
DR MURRAY
SIMPSON AND
MS GILLIAN
COOPER
10 FEBRUARY 2009
Q80 Chairman: Good morning, thank you
very much, all of you, for coming in to help us with this inquiry.
I wonder if you could introduce yourselves for the benefit of
the shorthand writer; if we could start with Mr Mitchell.
Mr Mitchell: Good morning; my
name is Jonathan Mitchell, I work for the Overseas Development
Institute, just across the river, a development policy think-tank.
I head the tourism programme and the rural livelihoods programme.
Ms Johnson: I am Victoria Johnson,
I work for the New Economics Foundation, Climate Change and Energy
Team. It is a think-tank based in Vauxhall and is an economic
think-tank looking at environmental issues, social justice and
well-being.
Dr Simpson: I am Dr Murray Simpson,
a senior research fellow at Oxford University, working in the
School of Geography on tourism, climate change and development.
Ms Cooper: I am Gillian Cooper
and I work for Tourism Concern which is a non-profit organisation
looking at maximising the benefits of tourism to developing countries
and communities.
Q81 Chairman: Thank you very much
for that. As you will appreciate, the title of our inquiry is
Sustainable Development in a Changing Climate and we mean the
physical climate and the financial climate; we are looking at
both aspects of how these things impact developing countries and,
in particular for this session, the role of aviation and tourism
and fresh produce and so forth. I wonder if I could start with
you, Victoria Johnson, as you take a rather different perspective.
In your report Plane Truths you are in favour of a carbon
tax, focused at a sufficiently high level to discourage demand
for air travel, which is a perfectly understandable concept. But
first of all could you actually explain what level you are thinking
of, what impact you believe would be necessary to have an effect
on discouraging air travel. Also, are you talking about a distinction
between long and short haul flights, because clearly they are
different options?
Ms Johnson: First of all in the
report we did not set an actual level for a carbon tax, although
we did look at some economic analyses that had looked at the Air
Passenger Duty as it was in 2001 and a doubling of that, which
has happened now, and another Conservative Party-proposed green
tax, all of which we set at a level of €15 per tonne of carbon.
The analysis showed that that would have a very small effect on
air travel, one of the reasons being that the elasticities for
air travel vary, but we did make a distinction between short haul
and long haul flights for two reasons, mainly that it is much
easier to substitute the mode of transport for short haul flights.
In the Plane Truths report we looked at tourism flows from
the UK to tourist destinations and found that around three in
every four flights are short haul flights, a large proportion
of which are under 500 kilometres and it is actually perfectly
reasonable to assume that you can use other modes of transport
for that distance. A lot of the travel is also short breaks, and
in terms of the Committee meeting today and the impact of the
tax on developing countries and the tourism industry there we
found that only 9% of all the flights leaving the UK actually
go to what are classed as global south countries. Other than that
if you reduce short haul flights significantly and have a higher
tax for short haul flights there will be less impact on long haul
flights, in particular those to developing countries.
Q82 Chairman: We might explore that
also with the other witnesses in terms of how much of an impact
that would have, but in terms of the money raised, do you have
a view as to how it should be applied? One suggestion is that
it should be allocated to developing countries to cope with climate
change adaptation; is that something that you would support or
that you have a view on? Is it just a tax to discourage aviation
which disappears into the general coffers, or do you believe it
is a tax that should be specifically applied in a particular way
and perhaps do you think it could be applied in ways that would
be directly beneficial to developing countries who are suffering
from climate change rather than causing it?
Ms Johnson: In the report we suggested
that the tax be used for investment into low carbon modes of transport
such as rail links and also contributing to adaptation aid for
developing countries.
Q83 Chairman: You mentioned statistics
about the number of flights and the percentage of flights going
to developing countries, but do you accept that there could be
an implication either now or in terms of future development for
countries which have either developed niche markets to supply
fresh produce to Europe or to America, or who have developed a
tourism industry to encourage long haul tourists? Do you accept
that for some countries that could be a significant disincentive
or deterrent to the development of these sectors?
Ms Johnson: One of the key analyses
that we did in the report was looking at the impact of curbing
aviation growth or halting aviation growth from 2009 and we forecast
the impact on total GDP from 2009 to 2025. In that analysis we
looked at four countries which were Kenya, Dominican Republic,
Thailand and the Maldives, so they were four very different countries.
The Dominican Republic has a very high level of all-inclusive
resorts and Kenya, Thailand and the Maldives are developing countries,
with the Maldives being a small island state, all of which have
quite a high dependence on tourism, particularly tourists from
the UK. In that analysis we compared the halt in growth with the
forecast provided by the UN World Tourism Organisation and we
found that from the UK only—and I should make it clear this
was specifically halting growth in aviation from the UK—the
impacts on GDP were not as high as we had expected. If I can just
read out some figures and I will then explain them in some more
detail, for Kenya by halting growth the real revenue lost between
2009 and 2025 was 0.07%; for the Maldives it was 3.42%; for Thailand
0.17% and the Dominican Republic 0.39%. In that figure we did
include something called leakage which I am sure you are familiar
with but includes the money that basically leaves the national
economy. We looked at a number of different leakage rates from
30% to 60% and we also looked at linkages as well which means
the money that actually stays within the economy. Whilst there
is a loss and you cannot deny that there would be a loss—it
is only logical to assume that there would be a loss to the economy—it
is less than we would have expected. Our conclusion from that
was that because such a large amount of money was repatriated
to international tour operators and spending on imports, tighter
regulation of the tourism industry, which is one of the most unregulated
industries, would actually be one solution to dealing with such
a loss so you would not necessarily have to grow tourism in order
to increase the real revenue to developing countries, based on
the examples that we used in the report.
Q84 Chairman: If I have understood
that correctly what you are saying is that the same amount of
business could grow the economy if it was more fairly shared.
Is that the implication of what you are saying?
Ms Johnson: Yes, in the sense
that if more money was spent in the local economy and used to
support the local economy rather than leaving the country that
would be the case.
Q85 Chairman: I have to say that
some of your figures for those countries, particularly for somewhere
like the Maldives, seem surprisingly small but I accept that is
your evidence. Perhaps I could bring in the other witnesses, not
necessarily to comment on that, although you are welcome to do
so if you want to, but given that that is a proposal on aviation
tax, to try and discourage aviation, and obviously we try to evaluate
how that is going to affect poorer countries, what is the likelihood
of there actually being either a global carbon tax or any other
form of tax on aviation, perhaps in time for the summit in Copenhagen
this year? Is there a realistic prospect of that happening?
Dr Simpson: In terms of a direct
answer to your question there are a number of countries looking
at aviation tax and obviously the EU Emissions Trading Scheme
is one of those elements that may put pressure on for an aviation
tax to come in, but it is not as simple as just an aviation tax,
there are other issues surrounding the price structure of aviation,
not least oil prices of course, but we know from experience that
that fluctuates dramatically. Also, there is carbon offsetting,
which is a voluntary scheme that at the moment is completely unregulated,
which certainly should be regulated as soon as possible because
at the moment it is pretty free and footloose out there with the
internet and people setting up companies to try and charge money
for carbon emissions on flights. I would certainly agree that
tax or offset payments should be directed towards the developing
countries or regions to which travellers are going, but I would
have to contest a couple of the remarks by my colleague here,
particularly on the impacts on GDP, not just the fact that those
figures are probably too small, but also the benefits derived
from tourism to communities and the economy of developing countries
and regions such as the Caribbean are far, far wider than just
figures on a Gross Domestic Product scale. The livelihoods of
the communities in, for example, the Caribbean region are highly
dependent on tourism, including secondary sectors, and the economies
of those nations as well as other developing countries would be
severely affected by a drop in travel to those destinations. Having
said that, as you said Mr Bruce at the beginning it is very vague
as to what the price would have to be as a tax to actually restrict
either people's ability or inclination to travel. Work that we
carried out at Oxford and with other colleagues last year at the
time of the extremely high oil prices indicated that basically
there would be little or no effect on travel to long haul destinations
by an increase of, say, £60 on a flight per person. I would
like to make that point as well. The complexities involved in
the tourism and travel distribution chain are perhaps one of the
key issues here, and the reason I raise that is because an aviation
tax on its own to try to deliver adaptation finance or the ability
for developing countries to mitigate their carbon emissions is
not going to be sufficient on its own to address the problems
and complexities of climate change in those countries. Tourism
is, as I said, a complex distribution chain and interventions
would need to be made at every stage of that chain, including
on the ground and in hotels, prior to travel and also activities
that are conducted by travellers when they are there in the destinations
as well.
Q86 Chairman: Can I just ask the
other witnesses about Copenhagen? It seems to me that there are
proposals coming from the developed countries and proposals coming
from the developing countries; which one is more likely to gain
ground; is anything likely to be agreed particularly on aviation?
What is the prospect, for example, of a levy, taking your point
that probably it would not actually have much effect on travel
but would raise some income to be applied specifically to developing
countries? Do any of the other witnesses want to comment on that?
Ms Cooper: I do not necessarily
have a comment on the cost of the levy, but to support my colleague
here in some of the comments that he has made in terms of the
dependence of a lot of communities, particularly Caribbean communities—and
I come from the Caribbean—on tourism. The impact of a reduction
in long haul flights would be extremely damaging, looking again
at the many levels of the economy that are dependent on tourism.
One of the things I can say is that if the cost of that levy was
put towards assistance to adaptation, to changes, certainly some
of the policies would suggest that there needs to be a lot more
emphasis placed on incentives and concessions for small and medium
enterprises within destinations so that they can take better advantage
of the tourism industry—because at the moment a lot of the
concessions and incentives are focused on large and multinational
businesses—and so that they can have more of the linkages
that are needed to ensure that other sectors of the economy can
benefit from tourism. At the moment very few of those concessions
and incentives are applied locally and nationally within the economy
so I think a levy that would help those kinds of adaptations as
well, so that they can get more impact from tourism, would be
very important. At the moment we are already seeing a real impact
on the economy because of the economic climate. There has been
a huge loss of jobs and those may translate into very small GDP
figures but actually the impact nationally is extremely significant
in terms of loss of jobs. There are very few other comparative
economies and small countries have very little opportunity to
compete otherwise within the global economy.
Dr Simpson: If I might jump back
to the aviation tax, you were asking about the likelihood and
I can see you would like an answer to that question. Probably
the short answer is that it is unlikely and if any aviation tax
was applied it would have to be structured very, very quickly
to make sure that the benefits are derived by the developing countries
because the last thing that would be most beneficial to the communities
and to the global warming situation is for funds to simply go
into government coffers. There is a proposal that is in process
at the moment with the Inter-American Development Bank from our
partners, the Caribbean Community Climate Change Centre—Oxford
University is working with the five Cs on projects in the Caribbean—that
we would try to establish some carbon neutral destinations which
would involve a trust being set up, and the World Bank and the
Inter-American Development Bank and probably the Caribbean Development
Bank would be administering that trust. It is not in place at
the moment and the project is not yet funded, although we are
anticipating that it will be, but that would be a framework within
which to operate such a tax.
Q87 Chairman: Thank you, that is
helpful. Mr Mitchell.
Mr Mitchell: If I could just make
a few comments. One would be the caveat that I have not read the
report—I will read it and we would be quite happy to make
a submission on that. My other comments would be that I agree
with you, I think the GDP impacts for highly tourist-dependent
poor countries are likely to be higher than the figures I have
heard. As I say, I have not looked at the analysis but I will
do so before confirming that. The work that we do in ODI is basically
in the low-income, long haul tourist destinations that Victoria
was speaking of, and my feeling is that they would be very seriously
impacted if a tax was implemented on long haul flights that was
sufficient to reduce or indeed halt the increase in demand. If
I could just paint the scenario as an economist: in the destinations
we are talking about often the contribution of tourism to the
economy is between 10 and 20% of the economy. Quite often the
contribution of tourism to exports is between a quarter and a
third of the exports, so these are very significant economic sectors
within the kinds of countries that we have been talking about.
The work that we have been doing at ODI though is not to just
focus on the macroeconomic figures from an office in London—we
have gone out and we have traced the tourism dollar. We have now
done that in about 10 countries across South East Asia and Africa.
What we find is that the official statistics do not tell you the
whole story, exactly as a number of my colleagues have related,
because what the official statistics tell you is what the spending
is in hotels, the transport sector and in restaurants. What they
do not count are people in the craft sector, they do not count
the thousands of very poor people working in the agricultural
sector and they also do not tell you about the spending of tourist
workers through induced impacts elsewhere in the economy. What
we have found is that actually the benefits of tourism to fragile,
poor economies vary but they are nearly always very much larger
than the official statistics will tell you, if you roll your sleeves
up, actually go into a destination and look where the money is
spread around. Generally between the low level of about 10% and
the higher level of about a quarter of in-country spending is
going to the very poor, so the stereotype that tourism only benefits
the elite within countries—they do benefit disproportionately
but the idea that the benefits do not trickle down to the poor
fortunately is only the case in a small number of countries such
as Cambodia, where there are very poor linkages between tourism
and the local community. The benefits, particularly for the poor,
are much larger than the official figures would suggest. The very
short paper that we wrote on leakages has also been circulated
to the Committee and there we found some of the more hysterical
figures that actually have remarkable impact in the literature,
such as that 75% of the benefits of tourism leak out of developing
countries, generally are wrong; the arithmetic is just wrong and
the paper explains why. I am quite happy to go into that if you
are interested. Generally the leakages at the very worst from
developing countries are about a third. If you have a country
like Cape Verde, which is essentially the tourist destination
of sandy islands in the middle of the Atlantic Ocean, they import
almost everything and the leakages are about one-third of the
in-country tourism spending, much lower than the figures of half
or 75% which, unfortunately, are bouncing around in the literature.
The way I would look at the analysis is to go beyond the official
figures and I would certainly question leakage figures if they
were higher than that because that is the worst case scenario
that we found. In, frankly, weak economies—we are doing
a lot of work in Ethiopia at the moment—the leakage rate
there is actually miniscule; it is extraordinary that in countries
like Tanzania and Ethiopia, some of the poorest countries in the
world—
Chairman: Can I bring Richard Burden
in here because I think you are moving into an area that he has
questions touching on so it might be appropriate to bring him
in at this moment.
Q88 Richard Burden: You may have
been moving on to it generally, not simply in relation to leakage,
but a lot of the discussion so far seems to be about what the
impact may be in the event of levies, taxes and so on. I suppose
I would just like to explore a bit more things from the other
way round, about what contribution tourism does make to developing
countries as far as trying to look at the potential of tourism
for poverty reduction is concerned, what the benefits are but,
perhaps more particularly, how they could be increased. What are
the areas that we do need to be looking at?
Mr Mitchell: That is exactly the
area that we have been focusing on. Our interest is to reduce
poverty in developing countries—we are not actually interested
in tourism per se, it is how it can be used as a tool for achieving
that, so where it does not work, like Cambodia, we say so. The
reason, just to give you an example: Cambodia and Vietnam are
neighbours—about 7% of the money spent in Cambodia goes
to poor people but in Vietnam, next door, about 25% of tourist
spending in the country goes to poor people, so why the difference.
There is a whole range of issues, but at the higher level the
regulatory and enabling environment are extremely important. Quite
often when you are dealing with tourism as a private sector-led
activity people forget the importance of actually having an educated
population that can mobilise the opportunities offered by tourism,
of having infrastructure which allows tourists to get into the
poorer areas. For instance, in Cambodia, where there is an extremely
high level of corruption, a lot of the benefits of tourism are
sifted off by a very markedly small number of people within the
elite rather than being spread around the population, but what
we have found is that the indirect linkages between tourism and
the non-tourist economy are where the majority of the poverty
reduction takes place. Within tourism, working in hotels and restaurants,
poor people do disproportionately get jobs in those sectors because
they are unskilled or semi-skilled, so you do have a bit of poverty
reduction there, but where it really works is ethnic minority
women selling silk goods in the highland areas of Vietnam, for
instance, or in Laos. There are 1500 fishermen in Lake Chamo in
Ethiopia and the majority of the tilapia and Nile perch that they
catch are being sold at two or three large hotels in Addis Ababa.
It is those indirect linkages, therefore, where you can get tourist
spending to move out of the tourist sector and into the agricultural
and craft sectors for instance that are important. They can have
a dramatic influence but again it does not count for much on the
national accounts because these people are earning, perhaps, one
or two dollars a day, so you can have thousands of people earning
that amount of money and it hardly registers, but it has a colossal
impact in terms of people and the socio-economic impact.
Dr Simpson: Work by the Department
for International Development and other agencies is important
to highlight the knock-on positive effects that Jonathan has just
described there to raise awareness of travellers from developed
countries like the UK as to how benefits can best be derived,
to make choices to travel to destinations, stay in hotels and
conduct activities that are going to have a positive effect on
the secondary industries and on the livelihoods of individuals
who are involved in providing things like fish and foodstuffs
to hotels that they are staying at. At the same time, as Jonathan
says, it is also important to strengthen the regulatory frameworks
within individual countries so that that process is enabled. Things
like micro-finance, where we have seen good examples in India
and other countries where poor people, people living on below
$2 a day, are able to access finance to start very small businesses
to be able to provide services to hotels and activities that are
being used by tourists. I would just re-emphasise that factor
of benefits going to the poor through livelihood activities such
as money from tourism encouraging the development of communications,
the installation of fresh water supplies, roads, increased food
security, all of these are very hard to measure and it is important
to be able to go down into rural communities and establish what
is happening there, how it has happened and what sort of strategies
can be employed to encourage it. It is not a perfect world, certainly
research that we have conducted and colleagues of mine have conducted
shows that often it is the case that a small minority of a real
community are the people who benefit, not the vast community,
and that can be a problem, but the point is that there are benefits
to be achieved and we need strategies to try and maximise those
benefits as much as possible.
Ms Cooper: If I can add, it is
important to remember as well that often the fishermen and the
women craft-makers and so forth are eking an existence out of
what is already there and those regulatory frameworks are extremely
important for strengthening those linkages. At the moment they
are making an existence and living from what is there without
those kinds of policies that strengthen the linkages that they
can have so there is not an exclusive but an agreed system where
they can sell their craft products to particular locations, within
the hotels, that can then be used within a local network. Often
there is an emphasis placed on creating tours with tour guides
and so forth, but often that does only benefit a small number
of people within a community and there needs to be a lot more
creative analysis as to how those benefits can be spread and how
to spread those linkages. If I can also say, the whole policy
development process needs to be looked at in a much more holistic
way. For many countries tourism affects the entire national development
but the decision-making about how tourism is developed is done
in isolation of national development planning, and so many people
in small and medium enterprises, in poor and marginalised communities,
benefit from tourism but do not have an opportunity to participate
in how those policy development processes take place. There needs
to be a broadening of how many people can be involved in those
development processes. Often cultural products as well which have
a benefit for the national and local society can add value to
tourism products and have a certain amount of resilience in times
of economic decline, and those need to be developed a lot more.
I just wanted to broaden it a little bit more, not just from looking
at the destination at a local level but looking at the global
value chain for tourism, and you can see often where the linkages
happen in the global value chain, so there is the commission that
is taken from the tour operator which then puts pressure on the
price and often the wages at the destination. You then have situations
often where tour operators have late payment for operators in
the local destinations and often cancellation of those fees, so
that those fees do not get paid in destination countries. There
is a real vertical integration by the large-scale tour operators
and they often compete with in-bound operators who are based locally,
so there are all of these levels within the global value chain
where money is lost and where the local destination does not often
benefit from it. New enterprises that develop, even if they are
new attractions or events or crafts and so forth that are developed,
they need to kind of break into that market, which is often structurally
determined and they find it difficult to then get themselves on
the tourist route. There needs to be support for that as well
so that new enterprises can be encouraged and benefits derived
from that. One other thing to add as well is that a lot of foreign
exchanges losses that you see are also absorbed within the destination
and not by the tour operators and the big tour companies based
here, so all of those things within that value chain also need
to be assessed as to where those losses can be minimised.
Q89 Richard Burden: One last question
from me: is it possible or helpful to generalise about whether
high end tourism or mass market tourism is going to actually be
generally better from a development viewpoint? You have placed
a lot of emphasis on the regulatory system in the countries concerned,
on how far there is activism in developing linkages and the right
kind of promotion to tourists from abroad about what kind of tourism
is better from a development point of view. Is that really it
or in general terms is high end tourism likely to be easier to
develop than the lower end or mass market or is it just irrelevant
and it could be either?
Dr Simpson: There is not conclusive
research to say that high end is better or mass is better for
benefits to poor people. Very quickly, mass tourism is of course
looked down on by a lot of researchers as perhaps detrimental
to a destination, but in fact if the frameworks are in place for
the provision of, for example, foodstuffs by local people to those
all-inclusive hotels, it may well be that an all-inclusive hotel
is much better for the local community or the regional community
in the developing country than a small boutique, high end tourist
facility which is supposedly more eco-friendly. I am using very
broad, generalised terms here but it is very important to be careful
not to generalise about mass tourism being bad and the supposedly
small eco-tourism good; it is not as simple as that.
Mr Mitchell: If I could just add
very briefly on a more uplifting level perhaps, what we found
is exactly what Murray is saying, there is not a good type of
tourism and a bad type of tourism if your concern is poverty alleviation
in destination. Package tourism is not bad, it can be very good,
and independent tourism can be very bad. We have also found that
there is no segment of tourism that is either good or bad. We
have got excellent examples of cultural tourism that has a huge
positive impact on the poor, but in other places not at all—there
is game-viewing that is great in, for instance, Tanzania and not
very good in Central Africa in terms of gorilla tourism as relates
to benefits to the poor. I think those kind of easy handles where
this is the good type of tourism do not actually hold up to empirical
analysis, and that is a good thing because countries do not then
tend to choose the type of tourism that they have, it tends to
be given by God or a bit of clever marketing. The implications
of what I am saying are that any country, whatever type of tourism
it has, can make it more pro-poor through the kinds of measures
that I and my colleagues have mentioned, which is a positive message.
Dr Simpson: If I might just add
to that it is useful to think more about sustainable tourism being
the way all tourism should be and try to put aside ideas of eco-tourism—which
is a very misused term anyway—and/or mass tourism. But if
you look at issues of sustainability and sustainable development
and try to apply those to all tourism then you are starting to
go down the right path to delivering the benefits that we are
talking about.
Q90 Mr Singh: It has been a very
interesting discussion so far but let us try and pin it down a
little bit. What should the UK Government be doing; should it
be encouraging long haul flights to developing countries or discouraging
them?
Ms Johnson: I agree with a lot
of the points that my colleagues have been saying but I do still
feel very concerned that some developing countries are specialising
in a market which is extremely vulnerable to exogenous shocks
from oil prices, to public health outbreaks or scares, to conflict,
to climate policies as we are talking about today, to changing
consumer tastes, recession and so on. I do think that is something
that we ought to bear in mind but I do not think encouraging long
haul flights is anything that I could possibly support. Bearing
in mind again, as I mentioned earlier, that in terms of aviation
the distribution between flights is very skewed towards short
haul, that is something that I would encourage the Government
to discourage by using the right financial instrument. Linked
to the issue of vulnerability also is something I did not mention,
that is vulnerability to geophysical events or extreme weather
events which have the potential to have huge impacts on tourism
destinations. Parallel to that are the changing global climate
conditions, and if you link all those up together that to me does
not seem like a sensible strategy. I would add also that in our
report we made some reference to the bilateral trade agreements
that the EU has made with a number of countries and one particular
case that we made reference to is Mexico where regulations have
effectively made it illegal for Mexico to regulate its own industry.
The UK Government and other European governments have actually
supported those bilateral trade agreements and I would say that
one thing would be to address that immediately as a means of improving
and also allowing some of the more pro-poor tourism strategies
to develop.
Dr Simpson: It is too complex
to answer that question so simply. As I mentioned right at the
very beginning the tourism supply chain is so complex interventions
are required at every level regarding addressing climate change
and, in particular, very briefly going back to Richard Burden's
point about working in countries, DFID needs to be looking at
the impacts of climate change on the livelihoods of the people
in developing countries that are involved in tourism at every
different sector that is linked with tourism. In many countries
that are dependent on tourism to a great degree every sector is
linked, so there is an inherent need to look at that on a macro
level but also going into micro sectors. I suppose in summary,
to try to answer your question if I can, again based on work that
I and colleagues conducted last year, the general emphasis—in
some ways supporting what Victoria is saying—is that less
frequent travel over short distances is important. So if I can
simplify that perhaps by saying if somebody is going on holiday
six times a year for three days then it would be much better if
they went on holiday three times a year for five days each, so
less frequent travel over short distances and, by definition,
you could extrapolate that to say longer holidays over longer
distances. If we are trying to marry the complex problem of delivering
benefits to developing countries which are by their nature long
haul, then I suppose if pushed you would have to come down on
the side of saying that it is better that somebody travels to
developing countries for two or three weeks once in a year than
travels five times to the south of Spain in that year because
overall the damage to the planet will be less and the benefits
to poverty reduction will be greater.
Q91 Mr Singh: Trying to bring it
to a very local level, I have a constituency where the ethnic
minority population is largely made up of Kashmiris from Kashmir
and Pakistan. They travel not as tourists but as family visitors,
to keep family links. They also have an impact on the economy
they travel to, a huge impact; if there was a carbon tax which
the consumer was paying—and these constituents of mine are
not advantaged, they are disadvantaged—would this not be
an unfair tax on the poor people in society and would it not discourage
the economic impact that they have?
Dr Simpson: Absolutely. I have
just one sentence on that and again it comes back to something
we mentioned at the beginning of the session, which is that an
increase in the cost of travel will not have a great impact on
arrivals except on people of a medium to low income, you are absolutely
right. If anything, therefore, you are actually affecting the
human rights and freedom of movement of the people who actually
should be able to do that, yes.
Mr Mitchell: Your point is an
important one because there are lots of stereotypes in tourism
about what a tourist is and quite often they are not who they
are meant to be by the stereotypes. What we find generally is
that diaspora tourism is hugely important in South Asia; in Cape
Verde it is driving the whole economy, it is not just visiting
friends and relations. Very often we find that when tourism begins
to develop the economy, people actually go home, they can actually
go home, and we have seen that in Cape Verde and in Ethiopia.
A lot of the tourism investors are people that know the international
market and so they are well-placed to open hotels; the same in
Vietnam actually, so it is much more significant than going back
to see mum once a year, sometimes it allows people actually to
create a vibrant economy that allows them to make the choice to
go back, maybe at retirement but increasingly at working age.
Could I go back to your first question very briefly? There are
several levels at which the British Government could think about
intervening. One is a point that has been made very well already
which is to make sure with the existing tourist flows that the
maximum benefit is extracted for the destination countries, and
there we are talking about things that actually fit in very well
with DFID's development agenda about improving the business environment,
empowering women and reducing crime. These are the things that
stimulate linkages and stimulate development, so that is one level.
Also there is a real window of opportunity with the private sector
and we in a sense are blessed in Britain in that we have some
of the largest and most powerful international tour operators.
If you go along the panel we will all have different views on
them, but it is a real asset because an incremental change in
their business practice has a tremendous influence on the destinations
and what you have at the moment with a couple of the very large
tour operators is, probably for the first time, some very responsible
practice coming in at board level within those organisations—for
instance, with the travel life programmes they are rolling out
for the hotels that they are working with in terms of both environmental
and socio-economic improvements. I have seen it at destination
level and it has a huge impact; if the British Government could
work with that through UK companies that would be tremendously
important. Finally, tourists are people so I would make sure that
you prosecute sex tourists when they come back to Britain; I would
help educate tourists that actually out-of-pocket expenditure
is very important and that that is what benefits poor people.
I would deal with the big stuff up here, therefore, but also at
a very individual level as to how people should behave.
Q92 Mr Singh: Why do we need to have
this discussion about poor countries, developing countries, least
developed countries given that their carbon footprint is so small?
Why can we not just exempt them from taxes, levies, offsetting?
Mr Mitchell: There are people
much better qualified to answer but if I could make one very brief
comment on this.
Q93 Chairman: You are all going to
have to be brief because it is a very interesting discussion but
we have still got quite a lot of questions and we are going to
run out of time. I do not want to constrain anybody, but could
people be brief.
Mr Mitchell: Very briefly, I share
your bewilderment, to be quite honest. I understand the Committee
is going to go to East Africa and, having spoken to our Climate
Change Group, you will each generate under two tonnes of carbon
which, at the current shadow price of carbon, will be £45.
That will be the UK Government's view of the total cost to the
environment of your trip. The benefit to East Africa of you being
there, as business tourists in this case, will be 20 or 30 times
that. Development is about trade-offs and it amazes me that we
obsess about the £45 worth of damage and we fail to see the
hundreds of pounds of benefit to the developing countries. I share
your bewilderment.
Ms Cooper: To be really brief,
we need to look at this in the context of the fact that, for myself,
coming from the Caribbean, this is after having had the removal
of a preferential market for bananas, the loss of commodity prices
for bananas as well as sugar, and so this is the only economic
avenue that many countries have, and so now many people within
the region see it really as a slap in the face. I agree that it
is a real frustration.
Dr Simpson: It is very hard to
define where you are going to draw the line.
Q94 Mr Singh: DFID has definitions
of developing countries.
Dr Simpson: Of developing countries,
yes, but most of the Caribbean does not fall into that category
so what you will do, for example, is that you will actually discriminate
against the Caribbean. By applying such a line using the 32 Least
Developed Countries you will actually create more of a problem
in the Caribbean because they will be suffering to a greater extent
because they are more dependent on tourism than perhaps one of
those less developed countries.
Q95 Mr Singh: You could refine the
criteria.
Dr Simpson: It would be pretty
hard to do it in three minutes, but let us say, for example, one
way of addressing it is to have a higher rate on short haul so
we have a blanket tax, if that is the way the Government decides
to go, with a higher rate on short haul, so then what you are
doing is saying it is an even playing field apart from the areas
that we do know are creating more emissions because of the frequency
of travel to those short haul destinations.
Q96 Chairman: With the proviso that
short haul is quite often essential if you are talking about islands.
Dr Simpson: That is right, and
trying to encourage the trains to work better and things like
that I suppose.
Q97 Andrew Stunell: It has been a
fascinating discussion with lots of stuff about linkages and leakages.
The first is good and the second is bad and quite a lot of the
figures that you have been talking about are clearly in dispute.
We have had over the last decade a lot of discussion about fair
trade products; how do we get fair trade tourism so that those
leakages are actually much more positive linkages?
Dr Simpson: There was a project
which was launched two or three years ago on fair trade tourism
by the fair trade organisation and my understanding, but I stand
to be corrected, is that the project was not completed. It certainly
has not been implemented widely enough if it was completed and
I agree it should be done. I know Tourism Concern were involved
in that; perhaps you can shed some light on what happened.
Ms Cooper: Yes, I can say it is
something that Tourism Concern has been working on for about 10
years and trying to really decide what are the principles of fair
trade tourism. We had a project which we tried to get some funding
for last year, which unfortunately did not go through, which would
have worked in partnership with many of the fair trade movement
key players. The trouble with fair trade is that at the moment
it has been applied to products and it is much more of a complex
picture in terms of putting a fair trade stamp on a service, so
which bit of that global value chain do you look at as being fair
trade, where do you put the stamp on it? Is it the product, is
it the tour operator that is selling the product, is it both of
them? It is a much more complex analysis that needs to be taking
place but we do feel that not only is it certainly very much needed
but it is something that can be done, so it would need to have
a real analysis as to where that links with the commitment of
all of the different people within that value chain who can look
at it. Certainly the key principles of a fair trade tourism product
would be ensuring that the workers within the tourism sector are
organised and able to influence decision-making policies, that
they have very good linkages within communities that ensure that
inputs and services are provided by the local community, that
the tour operator who is selling the product also has fair trade
principles and markets it in a way that ensures that people understand
what we are trying to achieve by fair trade tourism. Certainly
now is the time—in the sense that the movement has really
grown, particularly in the UK which has the greatest amount of
fair trade customers or purchasers—to try and talk about
what would be a fair trade tourism product.
Dr Simpson: There is a plethora
of certification for tourism out there already. That is one of
the problems, to be honest: there are so many certificates. We
have got to the point now where the United Nations have even got
together to provide a certificate for the certifications. Whilst
there may be some merit in that, it is a pretty bizarre position
to be in. As I have mentioned before, the principles of sustainable
development are what need to be applied to tourism. There are
examples that can be used, but it is very complex because of the
complexity of the distribution chain.
Q98 Andrew Stunell: I wish we had
longer to explore this. You have defined leakages as bad things
and linkages as good things. There has been an interesting contribution
from Mr Mitchell about possibly tour operators developing their
corporate social responsibility to be more effective. That is
what has happened with Fairtrade goods, the voluntary movement
has begun to influence the commercial sector. Do you see scope
for that happening? Are there ways in which that can be supported
by what the Government does, either by taxation or regulation
or in some other way?
Dr Simpson: Perhaps I could give
you a practical example. In the Caribbean there is the Sustainable
Tourism Zone of the Caribbean, a project which has been instigated
by the Association of Caribbean States, which is an organisation
that works at ministerial level across the whole of the Caribbean
Basin—so 32 members, which includes the Central American
states as well. They have established, with the assistance of
my colleagues and I, a set of indicators for sustainable tourism
which can be applied to address all of the different complexities.
It is not perfect, but it is designed to do exactly what you have
just said: to drive the demand for destinations under membership
of the Sustainable Tourism Zone of the Caribbean. It works in
the same way as Fairtrade, but more investment is required, more
members are required, and so on and so forth.
Mr Mitchell: I think there is
a great opportunity here, because you have the corporate sector,
in my view—I think there are different views, but this is
my view—tackling this seriously for the first time. The
thing about tourist corporates is that they do not know much about
development. They know a lot about flying people around and running
airfields, but they desperately need an official development of
support for what they are doing. They are charging their own customers
a levy, they are creating quite a lot of money through organisations
like the Travel Foundation, and, to be frank, they need support
from development practitioners and some official recognition of
what they are doing so that those funds can be used more effectively.
I think there is a real opportunity for the private sector, which
sees its responsibility and is raising money, and the UK Government,
which has in DFID a lot of development expertise and can recognise
the efforts that are being made by the private sector. Finally,
I do not think leakages are always bad. There is a leakage in
Laos, where most of the rice is brought from Thailand. It is poor
rice farmers producing that, so it is a loss to the economy of
Laos but in terms of poverty I would not distinguish between a
poor Laotian farmer and a poor rice farmer in Thailand. In terms
of poverty, it is fine. Being able to distribute the benefits
of tourist spending over a wider geographical area, so it is not
focused just on destination, is a positive thing.
Q99 Andrew Stunell: Would you pick
out one single thing that DFID could do to help that process forward
that you have been describing?
Mr Mitchell: At the moment DFID
has an interesting position because it invented a lot of the stuff
we have been talking about today. In 1999 DFID funded a lot of
the work that fed into the UN conference at that time that developed
pro-poor tourism as an idea. It supported it for a couple of years
after that and has now back-pedalled from it, to the point where
there is quite a strong position that they will not support tourism.
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