Tourism and Economic Realities in the Caribbean

Abstract

The economic importance of tourism to Caribbean Small Island Developing States (SIDS) and indeed to the wider global economic system cannot be overstated. As has been shown in Chaps. 1 and 2, most Caribbean SIDS depend heavily and some almost exclusively on the tourism industry for economic sustenance. In the Bahamas, for instance, tourism accounts for 70% of national income (Karagiannis, N., & Salvaris, C. D., “Tourism and Economic Development in the Caribbean and Jamaica: Towards an Alternative Developmental State Framework.” In I. Boxill & D. Ramjeesingh (Eds.), Tourism Reader for the Caribbean [pp. 122–139. Kingston: Arawak Publications, 2013]). Tourism is far-reaching in the global economic chain because it appears in every sphere of most economies. It involves the movement of persons, the production of goods and services, the development of accommodations and attractions and facilitates the employment of millions directly and indirectly. The Caribbean tourism economy has shown remarkable resilience and growth. In 1970, the Caribbean region welcomed close to 4 million tourists and more than 30 years later this has skyrocketed to over 17.1 million, achieving an estimated rate of increase of around 5% per annum (Karagiannis and Salvaris).

These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

The economic importance of tourism to Caribbean Small Island Developing States (SIDS) and indeed to the wider global economic system cannot be overstated. As has been shown in Chaps. 1 and 2, most Caribbean SIDS depend heavily and some almost exclusively on the tourism industry for economic sustenance. In the Bahamas , for instance, tourism accounts for 70% of national income (Karagiannis and Salvaris 2013). Tourism is far-reaching in the global economic chain because it appears in every sphere of most economies. It involves the movement of persons, the production of goods and services, the development of accommodations and attractions and facilitates the employment of millions directly and indirectly. The Caribbean tourism economy has shown remarkable resilience and growth. In 1970, the Caribbean region welcomed close to 4 million tourists and more than 30 years later this has skyrocketed to over 17.1 million, achieving an estimated rate of increase of around 5% per annum (Karagiannis and Salvaris). Caribbean tourism has weathered the storms of recessions in the 1970s, 1980s, and 2000s, the global oil crisis, international wars, and the September 11 terrorist attack on the United States. Tourism has become the leading growth sector in most economies, as stagnation persisted in traditional agricultural, manufacturing, and commercial sectors. The region has not only thrived where stopover visitors are concerned, but it has remained the premier cruise destination in the world, with its share of world cruise bed days averaging 51% in the last decade. Trends in the contribution of travel and tourism to Caribbean economies have been well noted by the World Travel and Tourism Council (WTTC). According to its 2017 report, the direct contribution of travel and tourism to Caribbean GDP was US$17.9 billion (4.8% of total GDP ) in 2017, and is forecast to rise by 3.6% per annum, between 2018 and 2028, to US$26.5 billion (5.6% of total GDP ) in 2028. In 2017 the industry also directly supported 758,000 jobs (4.3% of total employment). This is expected to rise to 965,000 jobs (5.1% of total employment) in 2028. Visitor exports generated US$31.8 billion (19.8% of total exports) in 2017. This is forecast to grow by 3.9% per annum, from 2018 to 2028, to US$48.5 billion in 2028 (24.2% of total). Undoubtedly, therefore, Caribbean tourism is here to stay and can remain a shining beacon of hope for the economies of these SIDS , particularly if governments are able to support the industry with the necessary tools to diversify and become more resilient to internal and external shocks.

The Tourism Economy

The direct contribution of tourism industry to a country’s GDP reflects the internal spending on the sector and is calculated from the total internal spending from the net effect of the purchases made by varied tourism sectors. The indirect contribution includes jobs supported by investments (an important aspect of both current and future activity that includes investment activity such as the purchase of new aircraft and construction of new hotels), spending on attendant support services such as food and cleaning services by hotels, fuel and catering by airlines, and IT services by travel agents. Mention should also be made of the induced contribution which measures the GDP and jobs supported by the spending and reintegration of cash into the local economy by those who are directly or indirectly employed by the tourism industry.

The tourism economy is therefore far-reaching, and for some SIDS all-encompassing; it is a system of correlations emerging during the process of fulfilling tourist’s needs and meeting the tourist demand (Panasiuk 2013). Tourism demand is known as the element that influences the organization of the other aspects of the tourism product. Various characteristics and requirements of tourism segments have to be taken into account by the industry in order to organize a competitive tourism supply. This is even more critical in Caribbean SIDS which are competing not only with a global market, but with each other for that critical tourist dollar. The tourism economy also has a symbiotic and co-dependent relationship with other economic sectors such as agriculture , transportation , construction, and IT, which benefit directly from tourism and which are in turn provide valuable inputs to tourism. Importantly, the development of tourism as a vibrant economic behemoth has forced the classic economic model of labour, land, and capital to shift focus to include service, information, and knowledge which are integral to the production of new economic models (O’Sullivan and Sheffrin 2003). Within the tourist economy exist key assets, which must be present to ensure a workable and sustainable system and keep tourist demand alive and well. These include but are not limited to accommodations, transportation , various tourism services, and information.

Transportation has to be assured by both the infrastructure (roads, motorways, railways, ports, and airports) and the transport organization towards the area (number of flights and trains and proper road conditions). The ease of access to tourism destinations and ease of movement between and among attractions obviously makes the commercialization of the tourism product easier. Tourism services are also critical to the survival of the industry and include all services provided by local and international operators in order to make the tourism assets meet the tourism demand. These may include public services provided by the state and private services which are concentrated in the hands of tourist entities such as accommodations, customer service, airport transfer services, tourist guides, entertainment, events and festivals, among others. The existence of so many varied types of needs of the tourism sector can result in far-reaching positive economic effects in SIDS , which are heavily tourism dependent. Information is often among the most important yet sidelined aspects of the tourism ecosystem. Information is key for the tourism product as it bridges the divide between the holiday motivations of the tourist and the tourism assets of the destination. The information system allows the knowledge of the tourism product, creates a good image of the tourism assets, influences the tourist choice, and creates added value to the tourism supply. In the age of rapidly evolving information technology, this information also needs to be easily accessible, social media ready, sensitive to language and disability needs, and evolving as quickly as new information is available.

However, the economic spin-off of tourism enterprises is not always positive. Dependence on the industry in SIDS can lead to a lack of diversification of local economies and a reliance on a fickle industry susceptible to exogenous shocks, climate change, and local natural and man-made disasters. Typical tourism models also subject Caribbean economies to dependence on external rather than indigenous resources, making the region vulnerable. Some scholars have also critiqued the relative lack of meaningful linkages between tourism and other sectors of Caribbean SIDS and the repatriation of profits to countries which invest in accommodations, in particular all-inclusive hotels (Crick and Campbell 2013; Smith and Spencer 2013). In many ways, tourism economic models in Caribbean SIDS have mirrored the historical legacy of core/periphery relationship of the colonial era. As former plantation economies, most Caribbean SIDS inherited a system of close relationship with nations of the Global North, which are more powerful and wealthy and more often than not their former colonial masters. The slavery era not only engendered economic dependence on the colonial mother country, but stifled internal economic development and regional cooperation by insisting on exploitative trade relationships with countries outside the Caribbean. This has in many ways continued into the twenty-first century as SIDS in the region tend to be structurally underdeveloped and dependent on external buttressing to survive. This dependence is driven by neoliberal polices, globalization, and free-market ideals, which lead to demands among consumers which cannot be met by local resources. For instance, the proximity to and relationship between Caribbean SIDS and North America, as well as the fact that this region is a main source of tourists for the Caribbean, has led to local demands for goods and services not locally produced (Karagiannis and Salvaris 2013). This in turn has resulted in high levels of importation of foreign goods, and low exportation rates, which increased the debt-to-GDP ratio and further dependence on the Global North for aid and high interest loans.

Tourism, therefore, can be seen as a double-edged sword. On the one hand, the industry has been sustaining and will likely continue to sustain Caribbean SIDS economies, being the fastest-growing economic activity in the region in the last 30 years. On the other hand, the industry sits on fundamentally flawed and weak economies that often utilize tourism as a panacea for a range of economic woes. In addition, critical aspects of the industry including cruise tourism remain unsteady as a beneficial economic staple. Nonetheless, tourism is being heralded as one of the main drivers of growth in Caribbean SIDS economies and, if properly managed, will continue to reap benefits for the region on a whole.

Cruise Tourism

Consideration also has to be given to the importance of the cruise ship industry, which is forecast to outdo stopover business in the next ten years. Indeed, the Caribbean boasts among the largest share of cruise visitors accounting for close to 40% of all global cruise destinations in 2014 (Cleare 2016) with the top Caribbean destinations being the Bahamas , Cayman Islands, the US Virgin Islands, and Puerto Rico as indicated in Table 3.1. The Bahamas in particular had a peculiar case with cruise arrivals constituting over 70% of all arrivals to the islands in 2013. As Tables 3.2 and 3.3 indicate, the Bahamas has remained the consistent leader in cruise arrivals, edging out even Cozumel by a million visitors every year. Cruising has also proven to be critical to the economy of St. Kitts and Nevis . In the 2011/2012 cruise ship season, St. Kitts saw over 500,000 cruise passengers disembark at Port Zante. According to Business Research Economic Advisors (BREA) Economic Contribution of Cruise Lines for St. Kitts during the 2010/2011 cruise season was US$4.9 million while the visitor spending of US$108.90 per passenger accounted for US$61.1 million. The spend of US$46.00 per crew accounted for US$4.6 million (Cleare 2016: 35).

Undoubtedly, cruise tourism facilitates employment of locals, both directly and indirectly. Direct employment opportunities include tour operators, store clerks, taxi drivers, craft vendors, port pilots, port security, and port restaurant staff. Such jobs are created as a result of the industry (usually close to the ports) and are sustained as a result of the vibrant cruise industry. This in turn facilitates buoyancy in the economy as these persons become financially empowered to spend their earnings to sustain their lives, referred to as the multiplier effect.

Table 3.1 Top Caribbean cruise tourism destinations: 2003 and 2013

Table 3.2 Cruise passenger arrivals: 2015 and 2014

Table 3.3 Cruise passenger arrivals: 2016

However, according to statistics from the Bahamas Ministry of Tourism, the 4.7 million cruise visitors spent far less than the 1.3 million stopover visitors for the same year, with cruise passengers accounting for only 18% of income to the islands (Cleare 2016). In addition to this is the very real concern that cruise ships invariably have negative effects on the natural environment (Hyun and Kim 2015). Though many major lines are attempting to go green, with, for instance, the Disney Cruise line receiving an “A” grade for its attempt to mitigate degradation by the Friends of Earth cruise report card, the environmental footprint of ships cannot be overlooked. Ballast water, grey and black water, chemical pollution, solid waste, and oil are some of the pollutants created and expelled by cruise ships. Air pollution is also a factor, as is noise pollution, which disrupts marine mammals. The conundrum, therefore, for Caribbean SIDS is very real. The cruise industry is undoubtedly a critical part of the future of sustainable tourism futures; however, the economic benefits to port cities and countries in general is nominal when compared to the impact stopover guests have on local economies. Cruise passengers, according to the Caribbean Tourism Organization (CTO), account for approximately 6% of total tourism expenditure in the region, with the majority of this being spent on duty-free shopping and less on indigenous art, food, and culture.

In an attempt to mitigate some of the more harmful effects of cruising, the Cruise Ship Policy (CSP) adopted in Belize can be assessed as a case which aims to maximize the benefits from the cruise industry, while sustaining the natural resources of Belize . In this policy, a daily visitation limit of 8000 cruise passengers is recommended and an Environmental Compliance and Monitoring Plan has been put in place and must be signed by cruise lines as part of the licensing process. In addition, licensing requires cruise ships to offer passengers excursions owned and operated by Belizean tour operators and conducted by licensed guides. A guideline maximum level of visitation at each attraction/site is well articulated and ensures that the natural ecological resources for which the country is so well known are protected. Entrance fees at attractions and sites are also implemented, and the cruise ship company must develop an orientation programme to inform their visitors of the natural resources and the importance of preserving the environment. Other specifications include anchorage at predesignated sites and harbours, and the use of phosphate-free detergents for cleaning the decks. Policies such as this ensure that cruise lines are held to account for their environmental conduct and socioeconomic responsibility to host nations while maintaining a fruitful and mutually beneficial presence.

Diversification of the Tourism Economy in Caribbean SIDS

In an increasingly competitive marketplace, typical models of “sun, sea, and sand”, while still lasting in appeal, are increasingly being accompanied by more modern and unique products which offer a diverse experience to travellers. Indeed, it is important to offer tourists goods and services that are specific to the local area. Whether buying local crafts or enjoying an annual festival, local activities enrich the destination experience leading to more referrals, repeat business, and an enhanced destination brand and image. For instance, shopping is a vital component of any holiday and tourists want to buy goods that are particular to their destination. If they are sold items which are imported from another country, or worse still another continent, then the authenticity and quality of the destination is called into question and the competitive edge is lost. In the Caribbean, many of the curios are imported, some from Asia . One way to raise tourism expenditure is therefore to provide tourists with high-quality opportunities to spend more while in the destination. To this end, in Jamaica plans are under way to construct five distinct artisan villages in Montego Bay, Falmouth, Ocho Rios, Negril, Port Antonio. These villages will house artists trained at the newly developed Craft Development Institute (CDI) which is mandated to train local artisans in various forms of artistry. Each village will be associated with uniquely themed local products, with a distinct focus in each of the five geographic areas. This will create diversity in offerings to tourists and encourage “village hopping” and more engagement with the local communities and expose tourists to varied attractions near the villages.

Of critical importance to the proper management of the industry is a keen understanding of the distinct categories of markets interested in the Caribbean region and the burgeoning expectations of the new tourist. Traditionally, North America (United States and Canada ) has made up the lion’s share of the Caribbean tourist market. As Karagiannis and Salvaris (2013: 126) indicate, the United States has always been the largest tourist-generating market for the region, providing over half the total arrivals (stopover and cruise). However, the European market has shown steady growth since the 1990s and new markets such as Asia , Eastern Europe, and South America are being tapped as the new frontier for tourism growth and development. Each market comes to the region with its own tastes and interests which Caribbean SIDS have to facilitate in order to maximize the benefits that will come with each. For instance, holidaymakers from the United Kingdom and other European originating markets are seeking more fulfilling experiences in the destination, and opportunities to venture beyond the confines of their hotel or resort. Ecotourism , health and wellness travel, culinary and gastronomy tourism as well as cultural, community, and heritage-based travel packages are gaining traction with the twenty-first century traveller, particularly repeat visitors who look forward to new and fresh experiences on each trip even to the same destination.

Interestingly, island states have sought to achieve economic growth through a range of service sector activities, including tourism and offshore finance, but also through the provision of “flags of convenience” and passport sales (Connell 2013). In addition, Aruba , Grenada , Antigua, and other Caribbean territories have hosted offshore gambling sites. In general, business tourism has the potential to stimulate the economy through the continuous flow of foreign exchange, create job opportunities, encourage infrastructural and social development, establish linkages with other industries. In addition, many destinations in the Caribbean have developed critical partnerships in order to organize multi-country holidays. Pairs of countries and territories with substantial reciprocal traffic include Jamaica and the Cayman Islands; Trinidad and Tobago and Grenada ; and Antigua and St. Kitts and Nevis.

Perhaps among the most sustainable, however, is the evolution of medical/wellness tourism, which has proven to be an important expansion and diversification model for many SIDS. Tourism has long been associated with improved health, through sale of the concepts of rest and relaxation, as well as the emergence of spas, yoga retreats, and connections with local healing techniques. In Jamaica during World War I, at the time of lowest tourist arrivals to the island, former Mayor of East Front Street city in New Jersey, L.V.F. Randolph, gave a glowing tale of his therapeutic vacation in Jamaica , published by the Plainfield Courier News. He visited in March of 1918 and found accommodations with Mrs. Edgar deCordova at “La Bocage” in St. Andrew. In his letter, reproduced in The Gleaner on April 23 he said:

As this old fellow was somewhat on the invalid list, and therefore of no particular use at home, and as his doctor advised a change from frigid conditions, he hied himself away to Jamaica , the Gem of the Antilles. The scenery in Jamaica is beautiful beyond description … no snow at the highest altitudes. Perpetual summer everywhere … my health has much improved.

Focusing on Jamaica’s unpatrolled scenery, lush vegetation, and wonderful food, his review served as a reminder of the original intent of Jamaican Tourist Authorities: that of promoting Jamaica as a wellness destination (Bean and Spencer 2015). More recently a more targeted model of medical tourism has grown with increasing numbers of people travelling for various treatments, including cosmetic surgery and dentistry at cheaper rates than available in the Global North . As Connell (2013: 116) indicates, in the past two decades a form of “reverse globalization” has brought patients from developed countries to the Global South for medical care, for a combination of reasons involving cost, access, service, and quality. While contemporary medical tourism is often regarded as having begun in Cuba , it has been adopted to varied degrees by other SIDS as a result of its economic benefits. The spin-offs from medical tourism are clear: patients pay substantial costs to local hospitals and health centres, while travel agents, airlines, hotels, and restaurants also benefit from the patient’s spending. Importantly, medical tourists/patients rarely travel alone, as assistance is needed in recovery stages. These accompanying friends and family members are also considered part of the medical tourism sector and their spending and mobility can add meaningful value to the supply chain. The fact that medical tourists also need medium- to long-term recuperation time before returning home also redounds to the host country’s benefit as well. Medical tourism also has the potential to be a conduit for other related forms of tourism, particularly diaspora tourism. Increasingly, diaspora tourism has become significant in many Caribbean states, as migrants return for nostalgia and kinship (Duval 2003; Connell and Stanley-Niaah 2008). Returning home for healing and wellness purposes has been increasingly part of Caribbean people’s pull and return to the region.

The most successful attempts at medical tourism in the region include services in the Dominican Republic, Mexico, and Panama, with the English-speaking Caribbean lagging behind. While Caribbean Community (CARICOM) governments recognize the benefits, many in the region are hardly in a position to provide first-class medical care to locals, and even less so to visitors. There is often the lack of trained staff for an uptake in patients; poor medical facilities, limited funding for public hospitals and health centres, and a lack of sufficient cutting-edge technology have dogged many English-speaking SIDS. Much more would need to be done in the area of equipping local health care facilities before the region can seriously compete. However, some have made valiant attempts to develop the industry including Bermuda, the Bahamas , Barbados , Turks and Caicos , and the Cayman Islands and have been making inroads in specialized niche areas of prostate cancer treatment, fertility treatments, and orthopaedic surgery. St. Kitts and Nevis also developed a US$15 million medical and surgical centre in Nevis. According to Connell (2013), while one objective is to discourage local people from leaving St. Kitts and Nevis for treatment overseas, the hidden motivation was to attract patients from other Caribbean islands and the United States.

In addition to medical tourism, Caribbean SIDS are investing more and more in attractions that highlight the natural environment, indigenous ecosystems, and heritage. Indeed, a diverse national tourism sector grounded in the natural environment and tangible and intangible aspects of our rich heritage will not only capitalize on attractions that already exist in these spaces and can lead to increased protection of natural reserves, but it can also help tap into the allocentric traveller, who is more likely to seek authentic experiences related to the natural and sociocultural backdrop of their vacation. Travellers from the United Kingdom and other European originating markets tend to seek all-encompassing experiences in the destination, and opportunities to venture beyond the confines of their hotel or resort. Excursions provide memorable experiences and “stories to tell”, particularly when based on direct interaction with local people. They can also encourage repeat visits by introducing tourists to other parts of the country and showing that there is more to be seen. Excursions can spread the benefits of tourism, particularly in all-inclusive resorts, and enable tourists to buy directly from craft producers or to contribute through entrance fees to the maintenance of natural and cultural heritage.

However, while ecotourism has been recognized as a viable form of sustainable tourism development based on its ability to engender economic benefits, Caribbean SIDS were slow on the uptake, favouring sun, sand, and sea tourism. From 1992 to 1996, the CTO convened six Caribbean Conferences on ecotourism where it was recognized that despite the growing importance of ecotourism and a general concern for the protection of the environment, “the Caribbean region has, with the exception of a few countries, not made any serious efforts to examine the potentials which this type of tourism may hold for the region or to capitalise on any advantages which the region possesses”.

The turn of the twenty-first century, however, brought with it a growth in the appreciation for ecotourism in the region. As stated in the Trinidad and Tobago national tourism policy, for instance, the

Government recognizes that the environment is an important resource base for tourism. Accordingly, tourism shall be developed responsibly and with due care and regard for the natural and cultural treasures of the country. Government shall ensure that development of the tourism sector is in accordance with the physical environmental policies of the country and evolving international environmental standards.

To this end, the twin island republic has embarked on a policy framework that encourages and promotes knowledge, information, and innovation that complements the natural advantages of Trinidad and Tobago and encourages communities to develop tourism products based on authentic, diverse, indigenous cultural traditions and practices. Concomitant with any such direction is the involvement of local communities in the growth of the tourism sector. It is the objective of many Caribbean governments to engage and empower local communities in the planning and decision-making process for the development, management, and ownership of tourism products and services. It is important to establish feedback links with the local communities so that concerns regarding tourism visitation can be addressed at an early stage in order to prevent negative repercussions. The people themselves are an intrinsic part of the tourism product and need to be sensitized about the importance of tourism to the economy. Such sensitization will result in visitors feeling welcome and reduce the chances that locals will feel subjected to the prying and intrusive tourist gaze. To comprehensively include local stakeholders in the local tourism product development, for instance, the 2001 Green Paper on the Sustainable Development of Tourism in Barbados pledged to “develop mechanisms for obtaining comments and feedback from the general public on tourism matters”. During the development of the Green Paper, an extensive supplement on sustainable development of tourism was published in the print media to inform the general public of the policy components ahead of the public meetings to be held the following month. The Barbados government now holds an annual consultation with key tourism stakeholders to encourage information sharing and address areas of major concern for the sector.

In addition, many countries in the Caribbean region use the annual World Tourism Day on September 29 to raise awareness concerning the positive impacts that tourism has made. Jamaica , Trinidad and Tobago , and St. Maarten all initiate activities in conjunction with World Tourism Day. Examples of activities to put the focus on tourism include street banners, tourism-focused radio talk shows, awards ceremonies, and school activities. In St. Maarten, participants in the Junior Tourism Minister Competition learn about the tourism industry by visiting a cruise ship and touring the new Princess Juliana International Airport. Successful examples of heritage tourism include the St. Lucia Heritage Tourism Programme, which is an initiative of the Government of St. Lucia , jointly funded by the European Commission (EC). Initiated in 1998, to establish heritage tourism as a viable and sustainable component of St. Lucia’s tourism product, it has facilitated a process of education, capacity building, marketing, and the promotion of environmental and cultural protection for the benefit of host communities. The programme focuses on public awareness and community mobilization, institutional strengthening and capacity building, and product development. Emphasis is also placed on collaboration with relevant national and regional partners in order to define and market the heritage tourism product, as well as promote the island as a sustainable tourism destination.

Voices of the Present: Julian Patrick Director, Product Development & Community Tourism, TPDCo , Jamaica

Destination Assurance and Community Tourism: The Framework for Sustained Competitive Advantage in Tourism for Caribbean Economies

There is a common dialectic within the tourism space globally which interrogates the need for a common approach or solution to the challenges faced by the industry. The search is on for the right ingredients, the intervening practices that will underpin survival and success in a hypercompetitive market. The exigencies of the sharing economy have far outpaced the policy and legislative capacity of most countries, political and regional priorities have dulled the assurance optimisation of others and the ever present circumstance of natural disasters exacts a worrying toll on the mind of tourism interests vis-à-vis vulnerabilities. Within this maelstrom there are two separate but equal concepts that entail and can enshrine the only platform for sustained competitive advantage for Caribbean nations.

Sustainability and Community Tourism

If the consensus amongst scholars is that the “Environment Is the Product” then the urgency of initiatives would undertake a requisite alacrity. Unfortunately, there is very low support for the “line in the sand” measures that are necessary now, today. The tourism product is the ultimate example of death by success, whereby consumption of the product brings it closer to the doorsteps of decline, both in the natural environment and in the cultural modalities that combine to create the Caribbean experience. Whereas the broad area of sustainability intervenes on macro perspectives, the element of community tourism obtains a more granular level of involvement by stakeholders and could lend itself to a gargantuan shift for Caribbean economies along all quantifiable and some non-quantifiable measures of development.

Whether as a facilitator of induced consumption or as a destination comprised of unique experiences, the excavation of this concept requires Caribbean nations to explore all the consequences and circumstances unique to their stories, culminating in a more sophisticated and robust appreciation of the value inherent in their preservation and articulation. Our understanding of this value will unlock mechanisms to protect and monetise these stories. It is my belief that countries which understand these nuances soonest and are agile enough to respond will ultimately be able to create the unique selling positions required to create sustained competitive advantage within the next 15–20 years. The natural migration of the entire flock of tourists will incline invariably to the countries that offer the greater diversity of products.

Marketing

Diversification of the Caribbean SIDS tourism product is only part of the equation however. Successful marketing is key to the long-term sustainability of tourism in the Caribbean. In particular the marketing must fit into specific frameworks and policy directions. In some cases, it may be useful to focus on specific products. St. Lucia , for instance, has had a tremendous impact on the weddings and honeymoon niche market. This success has been based on setting clear objectives, planning and implementing specific marketing campaigns, and building an appropriate brand image, based to a large extent on the natural beauty of the island (Vodenska 2013). The case of St. Lucia indicates that marketing needs to build on the comparative advantages that the Caribbean has over other destinations, particularly in the face of increasing competition from comparable destinations across the world.

Tourism is essentially an export industry, and it is therefore vital that the products on offer reach the quality levels expected by key markets. The marketing of products with a poor quality will naturally have a detrimental effect on the credibility of the national tourism sector. The Quality Assurance Unit at Dominica’s former National Development Corporation (now Discover Dominica Authority) developed tourism standards for the full range of tourism sector services: accommodation, food and beverage, hair braiders, taxi drivers, tour guides, travel agencies, vehicle rental, vending, and water sports. These are integrated into the licensing process as part of the 2005 Tourism Regulations and Standards.

Also, fundamental changes are taking place in user behaviour in key markets for the Caribbean as countries move towards knowledge-based, digital economies. Tourism is an information-intensive industry, and developments within information and communication technology (ICT , in particular internet accessibility) are revolutionizing the way the business is being managed. The importance of proper integration of ICT in tourism marketing cannot be overstated. High-tech tourists in high-access countries (which make up the generating markets for Caribbean SIDS ) who prefer to interact in the electronic marketplace may not succumb to marketing efforts which are still low-tech. Destination images may be affected when high-tech tourists are unable to sufficiently interact with the destination in cyber space. According to Govers et al. (2007: 19), “covertly induced and autonomous agents, in particular, have a dramatic influence” over destination image in the minds of consumers. These agents include television, magazines, and the internet. For instance, up to 2010 a significant amount of Jamaica’s marketing budget was spent on television advertising (Williams and Spencer 2010), with internet promotion and interaction receiving far less attention. The major implication is that initial television exposure may lead potential tourists who are high-tech in search of information and booking options on the web, which may create a poor destination image when these needs are not met.

Advances in ICT are having major implications for the operations of organizations throughout the tourism value chain. The information storage and data analysis functions are vital for the analysis of tourism statistics, as well as for reservation systems. Moreover, the opportunities provided by the internet for the online sale and distribution of products enable traditional handicraft manufacturers to access new markets. Technology which facilitates knowledge transfer allows for competitive advantage for businesses and the use of ICT in marketing offers highly cost-effective opportunities for tourism marketing by facilitating booking, information distribution, and communication directly with customers and within the industry. The evolution of the internet represents a paradigm shift in the information-intensive tourism industry. It offers highly cost-effective opportunities for tourism marketing by facilitating booking, information distribution, and communication with customers and within the industry. It has also dramatically altered the process of booking holidays, with estimations of the online travel market predicting continued substantial growth rates, as consumer confidence grows and technologies improve. Finally ICT is a powerful tool in business management and its applicability for information management in terms of recording arrivals and forecasting business and inventory management indicates that it is used in all sectors.

It is thus vital that e-business strategies are integrated into the daily operations of tourism enterprises in the Caribbean. Without sufficient allocation of resources and IT training, Caribbean countries run the risk of continuing to be on the wrong side of the digital divide (James 2004). In an age where visitors are booking independent vacations through Airbnb and other bed and breakfast platforms, there is no option but to integrate e-tourism strategies in the broader framework of national ICT policies. Public authorities should be involved in providing the infrastructure and human capacity for ICT relevant to the tourism sector. In addition, national tourism policies must tackle the need for a national enabling environment for the uptake of ICT in tourism including access, capacity building, and the legal framework. Importantly, ICT skills within the tourism workforce should be encouraged through the teaching of ICT at all levels of the educational system and the use of ICT by tourism Small-Medium Sized Enterprises (SMEs) should be facilitated by providing low-cost access to ICT solutions. This is particularly important in remote ecotourism spaces where connectively may be limited.

A look at the case of Belize indicates how these recommendations have been utilized to good effect. The website Toucan Trail enables visitors to explore Belize and book using ICT while still experiencing the authentic ecology of the island. At www.toucantrail.com visitors have access to small hotels at reasonable rates. The website features a destination guide and a request form that can be used to search for accommodation using predefined criteria. A list of properties that match search criteria is developed featuring links to the hotels. Clicking on a link to an accommodation provides a range of information including a photo gallery, list of amenities, reviews from previous guests, as well as contact details for the user to communicate with the chosen accommodation provider.

Product development is an essential part of the marketing mix, and national governments are able to shape tourism product development through a range of policy measures. There is also a need to increase the contribution of national and regional investors to product development, as has been done in the Jamaica Tourism Product Development Company, vis-à-vis foreign direct investment (FDI), thus increasing ownership of the product. In order to mainstream community tourism in its product development, the TPDCo Jamaica has undertaken a plan to develop a transformational Community Tourism Enterprises (CTE) Ecosystem that puts CTE on the map for Jamaica and builds a critical mass of products and generates sufficient press and interest to take off and be sustainable. To this end the TPDCo has undertaken the following:

• 1. Form market-based clusters around CTEs

  • (a) Map market demand and buyers for CTE—priority

  • (b) Develop criteria for clusters—pre-paid

  • (c) Assess product and governance in short list of clusters

  • (d) Identify clusters around CTEs with an anchor attraction/CTE

  • (e) Hold preliminary consultations to assess interest, governance, and readiness

  • (f) Decide on clusters

• 2. Cluster development process

  • (a) Hold tourism awareness training and assist community to develop a tourism plan and possible tourism cluster cooperative

  • (b) Launch competitive call for proposals to assist new and existing operation to apply for funds

  • (c) Train new businesses in team Jamaica, business development, and so on

  • (d) Support existing businesses with business support services, digital marketing training

• 3. Enabling environment

  • (a) Conduct licensing review and cost/benefit analysis to assess examples from elsewhere

  • (b) Strengthen interagency communication

  • (c) Support the formation of a community-based tourism (CBT) association, organize domestic study tours

  • (d) Improve and update training materials adding innovation and climate elements

• 4. Marketing

  • (a) Develop and implement a CTE marketing brand

  • (b) Hold one or more CTE-focused events

  • (c) Develop a CTE App

• 5. Infrastructure

  • (a) Leverage Tourism Enhancement Fund (TEF) for roads

  • (b) Identify community members to provide other shared services, for example, bathrooms, charging stations

  • (c) Develop a signage programme with selfie points

  • (d) Include interpretation points

In order to provide an enabling environment for tourism product development, Caribbean SIDS must consider strengthening policy guidelines to ensure that the approach used to promote and approve development projects in the sector is consistent with the national development plan, the national investment policy, and the principles of sustainable development. There is also a need to review on a regular basis the effectiveness and transparency of the incentives regime to attract tourism sector investment. For example, Antigua and Barbuda found that their investment process was complicated and disjointed. This led to the proposed drafting of the Antigua and Barbuda Tourism Development Act to encode the regime of fiscal inducements and concessions common to all categories of investors. Similarly, the Jamaica Trade and Investment (JTI) organization has a specific tourism sector mandate, because tourism is a targeted sector of the National Industrial Policy. The organization provides guidance to new investors on incentives and opportunities, and gives the investor a one-stop shop for tourism investment information.

Caribbean SIDS have also had to grapple with improvement in social services and tourism-supportive industries in order to improve the economic benefits from travel and tourism. As has been previously explained, air and sea access and internal transportation infrastructures and services are key factors for stimulating economic development, and in particular tourism. In the Caribbean, several port, airport, and road infrastructures and services that have been developed in order to satisfy specific tourist needs are also used by the local population and entrepreneurs. Agriculture also remains a key sector of several Caribbean countries and has a double advantage from tourism development. The first advantage is connected to the consuming of food and beverages by the tourists during their holidays. The second is related to all tourism activities development by local stakeholders connected to agriculture (e.g., ecotourism , rural tourism). In this case, tourism has been useful in order to create new job opportunities, revenues and so on, and SMEs (enterprises/handicraft). Small producers are often enabled to easily market and sell their products to the tourists. The Sandals Chain in Jamaica , for instance, has worked with small farmers to produce exotic vegetables such as Duke Tomato, snow peas, zucchini, and red cabbage for its consumption for domestic use and for the export market. Sandals has also worked with the Rural Agricultural Development Authority (RADA) to provide training in horticultural methods. The project began with only 10 farmers supplying 2 hotels, but has grown to incorporate at least 80 farmers on 5 localities island-wide, supplying Sandals hotels in Negril, Montego Bay, and Ocho Rios.

In Tobago the Travel Foundation works in association with the Hilton Tobago and the Mt. St. George Farmers Association, to conduct a pilot of the Adopt a Farmer’s Group Project. This aims to forge greater links between the Agricultural and Tourism sectors and to decrease the dependency on imported produce. The success of the plan has led to an expansion of the current plan to involve more farmers and hotels in making this an island-wide initiative. The Travel Foundation also operates the Organic School Garden Programme, which involves three primary schools that supply the Tobago Hilton with fresh herbs on a regular basis. Proceeds from the sale go directly back into the school, and the children learn valuable practical skills in agriculture .

Importantly, the tourism sector is perceived as an attractive tax target for governments whose other tax sources are coming under threat. Recently elected Prime Minister of Barbados Mia Mottley announced, for instance, that effective January 1, 2020, the rate of value added tax levied on the tourism sector will move from 7.5% to 15%. Passengers flying outside of the CARICOM region will also pay US$70 and those within CARICOM US$35. This fee will be in addition to the departure tax. It is expected that these measures will raise upwards of US$95 million to support the national budget. One of the most contentious issues in the region is the inequitable treatment of land-based tourists compared with cruise passengers. The former pay significant departure taxes while the latter pay only a token port charge, if anything. Policies are therefore necessary to shift some of the burden from stopover guests to cruise visitors, which the region eagerly attracts.

Pro-Poor Tourism

No commentary on the economic futures being afforded by tourism to Caribbean SIDS would be complete without an overview of pro-poor Tourism, which is grounded in the forging of linkages with the local economy (Ashley et al. 2006). Poverty is a fact of life for many in the Caribbean and although the sector is a major source of employment and a central part of the Caribbean economy, there is potential for tourism to contribute much more to the livelihoods of poor people, particularly in the areas around tourism resorts. In doing so, tourism stakeholders can contribute to national economic goals without compromising their financial interests. This will help the sector to enhance its own security and operating environment, and gain opportunities to upgrade the product and enhance the quality of the tourist experience.

There are many kinds of linkages that tourism companies can develop with local people, some of which have already been discussed in this chapter. Hotels can purchase directly from small and micro businesses, as well as increase recruitment and training of local unskilled and semi-skilled staff. Hotels and tour operators can also enter into neighbourhood partnerships to make the local social environment a better place to live, work, and visit. And they can support the development of local arts, crafts, cultural products, and tourism services, both by developing new excursions and by encouraging tourists to spend in the local economy. Hotels and tour operators can build reputation, adapt to customer trends that seek more interactive holidays, and secure repeat business. Local linkages also assist to address risks associated with reputation and public image. When staff see their company investing in the local economy, it can boost recruitment and retention and thus customer service. Importantly, working with the communities will increase awareness and skills to promote and preserve the local natural and cultural heritage, thereby contributing to the sustainability of the tourism product and empowering the people themselves to see themselves as part owners of tourism. Invariably also, pro-poor tourism enhances local communities, brings improved infrastructure, and improves water, electricity, and ICT penetration. Finally, the various tourism products have different impacts on the poor. Some, such as rural tourism, ecotourism , and cultural tourism, are considered to have a high impact on the poor especially in terms of job creation, handicraft development. On the contrary, other products (cruise, etc.) have a low (or very low) impact, as they often do not usually involve local communities.

There are numerous benefits that can be accrued from pro-poor tourism models for private businesses as well. For hotels, buying from local producers creates opportunities through utilizing more distinctive products that differentiate the hotel environment and enhance the brand for instance. Profit margins can also be increased through a widening of the range of local activities, which in turn increases motivation to stay and contributes to an extended length of stay and more spending. In Dominica , Dominica Coconut Products began supplying coconut soap to cruise ships after a personal conversation between its proprietor and a top cruise line official. In Barbados , Earth Mother Botanicals produces and sells beauty products made with locally grown herbs and other island produce to the Sandy Lane Hotel and Spa. In St. Lucia , the big hotels were using local floristry services for flowers and flower arranging. In Antigua, Curtain Bluff Hotel maintains a list of suppliers of local produce.

In St. Kitts, Ocean Terrace Inn has a Food and Beverage Manager and world-renowned chef who understand the value of utilizing local produce and producing first-class appetizers and entrées. This has made the inn a popular choice for dining out and supports the purchase of local produce from small farmers. In Trinidad and Tobago, the Annual Culinary Program aims to strengthen rural communities, attract festival-goers, and blend community-based, export-driven use of local produce with local creativity. Since the programme began, links with local communities have improved and employment rates have increased, as have opportunities for entrepreneurship, revenue generation, and capacity building. In Jamaica , the Sandals Montego Bay START programme offers training positions to young people from the nearby (and volatile) community of Flanker. On completion of their training, apprentices are employed by Sandals or given certificates and recommendations to work in other hotels in the area. An important case also exists in Antigua: at the Curtain Bluff Resort, top and middle managerial positions are occupied by Antiguans. Some have come through tertiary education facilities and some are locals that have a firm grasp of business and have risen through the company via local training programmes. In St. Lucia , the Village Inn & Spa (locally owned) has invested in local staff who have gone on to pursue training opportunities that have benefited the property. The skills gained have been used to enhance the operation of the property or enhance its marketing potential.

While there are numerous cases of successful pro-poor /community-based tourist ventures in Caribbean SIDS , there are some notable challenges which should be borne in mind when embarking on such models. There is the possibility that host communities can be disadvantaged when local shops and service providers are lost in favour of retail outlets geared specifically to the needs of tourists, such as duty-free gift shops and cafes. Of more significance is leakage of tourism receipts, which occurs at different stages of tourist spending (Ajagunna 2014). Karagiannis and Salvaris (2013) argue that there are three levels of leakages in tourism which are not accounted for in figures stated in government statistical reports. The first level relates to direct imports such as building materials and food supplies intended for the tourism industry. Foreign investments and profit repatriation account for the second level of leakage. The third level relates to direct promotion, advertising, and general marketing activities designed to attract increased tourist arrivals.

At times, opportunities to purchase goods and services locally are often not exploited because local people produce goods that could be used in hotels, but the quality, quantity, and reliability of supply are often unreliable. The sheer scale of food and produce necessary to maintain large hotels often outstrips the production ability of small and local farmers. At times also, local producers are not sufficiently aware of hotel requirements, health and safety regulations, and how to match tourist preferences to the required quality. Added to these issues is that the seasonality of local goods often does not coincide with the tourist season, so goods have to be sourced from other suppliers who have high-tech facilities to produce and/or store goods for long periods of time. Importantly, while local excursions can provide adventure, security and safety concerns cannot be overlooked, particularly in countries with high crime rates such as Jamaica . Tourists also have to be held responsible for their conduct in restricted reserves. For instance, it is important that visitors do not carry diseases to ecological sites, nor take away plant or animal material that is indigenous to the site. They need to recognize the long-term advantages. Begging and hassling by locals who have direct access to tourists can also undermine the quality of the tourism experience and keep tourists away.

Conclusion

Tourism has contributed significantly to the diversification of Caribbean economies; however, the tourism sector can make an even more significant contribution to this process if the linkages between tourism and other sectors of the national and regional economy are fully realized. Linkages permeate through a vast variety of economic activities including construction, manufacturing, as well as service sector activities such as the provision of health and wellness services, consulting, and the creative arts. Stakeholders have also stressed that regional linkages need to be considered by policymakers at the national level, in terms of imports as well as for exploiting the opportunities of this market. Critical sustainability challenges identified with respect to linkages include that a change of attitude is needed nationally and regionally to fully realize the economic potential offered by linkages, and that tourism has to be better integrated into the national and regional economy. Institutional capacity needs to be established at the national level to ensure that there is a permanent knowledge base on building linkages. Forward and backward linkages need to be established between communities and the tourism sector in order to support the development and distribution of goods and services, local arts, crafts, and cultural/heritage products to both locals and visitors. These linkages would also minimize foreign exchange leakages and add to Caribbean countries’ domestic tourism thrust. CBT needs to be strengthened to help realize linkages by bringing local handicrafts and other producers in contact with tourists and preference needs to be given to those nationally and regionally derived materials, products, and services which are supplied on a sustainable basis. Niche tourism markets, which feature a high utilization of goods and services from other economic sectors, such as ecotourism and health and wellness, should be strengthened.