Manual on Module V – Trends and Issues in the Tourism and Hospitality Industry

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Manual on Module V –

Trends and Issues in the Tourism and Hospitality Industry

(Fine-tuned version)


Dr. Thomas Bauer

School of Hotel and Tourism Management, The Hong Kong Polytechnic University and

PSHE Section, Curriculum Development Institute



© The Government of the Hong Kong Special Administrative Region

All rights reserved.

The copyright of this manual belongs to the Government of the Hong Kong Special

Administrative Region. Commercial use is strictly prohibited. Offenders will be liable to legal responsibility.

Schools need not apply for permission to copy this manual in whole or in part for non-profit making educational or research purposes. All other uses should gain prior permission in writing from the Government of the Hong Kong Special Administrative Region. Requests should be directed to the:

Education Bureau

13/F, Room 1319, Wu Chung House 213 Queen’s Road East,

Wan Chai Hong Kong


We would like to express our gratitude to the following persons and organizations for giving us the permission to reprint some of the pictures and /or providing us with information for completing the curriculum support package:

3d Man With Laptop In Speech Bubble – image by Master isolated images, published on 02 March 2012 courtesy of ( in the front cover)

Smartphone With Social Media Icons by Kanate, published on 19 October 2013 courtesy of ( in the front cover)

Vacation Icon by digitalart, published on 24 July 2011 courtesy of ( in the front cover)

Airplane by Salvatore Vuono, published on 21 June 2010 courtesy of ( in the front cover)

Recycle Icons by digitalart, published on 24 July 2011 courtesy of ( in the front cover)

Paper Airplane Out Of The Computer Screen by Phiseksit, published on 31 March 2011 courtesy of ( in the front cover)



A set of curriculum support package of tourism and hospitality learning and teaching materials is being developed by the Personal, Social and Humanities Education Section of Curriculum Development Institute, Education Bureau for the implementation of the senior secondary Tourism and Hospitality Studies fine-tuned curriculum in schools. The curriculum support package is comprised of five manuals, and they are developed to broaden students’ knowledge of the five different units of the Tourism and Hospitality Studies curriculum.

The content of this manual – Trends and Issues in the Tourism and Hospitality Industry, should enhance students’ understanding of the dynamic nature of the tourism and hospitality industry.

In addition, the manual includes activities to deepen students’ understanding and help them to apply theories and concepts. Furthermore, students should be able to develop enquiry, problem-solving and decision-making skills through these activities.

All comments and suggestions related to this curriculum support package may be sent to:

Chief Curriculum Development Officer (PSHE) Personal, Social and Humanities Education Curriculum Development Institute

Education Bureau

13/F, Room 1319, Wu Chung House 213 Queen’s Road East,

Wan Chai Hong Kong

December, 2014



1. Introduction to Current Issues in Tourism and Hospitality 1

2. Sustainable Tourism

2.1. The Concept of Sustainable Tourism

2.2. Tourism and Sustainable Development - Application of Its Principles in Tourism 2.3. UNWTO’s Definition of Sustainable Tourism

2.4. Guidelines For Achieving Sustainable Tourism - An Agenda for Sustainable Tourism and Its Twelve Aims

2.5. Sustainable Tourism Development Case Studies


3 4 5 6


3. Tourism and Hospitality Issues Induced by Globalization

3.1. Globalization

3.2. Cultural Homogenization

3.3. Mass Tourism and Sustainability 3.4. Exploitation and Fair Trade


18 22 28 30

4. Trends in Tourism and Hospitality - Economical Aspect

4.1. Tourism Sector 4.2. Accommodation Sector 4.3. Food and Beverage Sector


39 46 55

5. Trends in Tourism and Hospitality - Social-cultural Aspect

5.1. Social-cultural Aspects of the Tourism and Hospitality Industry 5.2. Trends Relating to Social-cultural Aspects


62 67

6. Trends in Tourism and Hospitality - Environmental Aspect

6.1. Tourism Sector 6.2. Accommodation Sector 6.3. Food and Beverage Sector


77 83 88


7. Trends in Tourism and Hospitality - Technological Aspect

7.1. Tourism Sector

7.2. Accommodation Sector 7.3. Food and Beverage Sector


102 108 143


The field of tourism and hospitality is a fast changing one. Because tourism is not a single discipline but is connected to many other aspects of life it is constantly changing. Think for a moment what has to happen for a person we shall call Ms. Wong in Hong Kong to become a tourist in say New York and you will appreciate how many factors are involved. First Ms Wong has to have an interest in leaving Hong Kong to become a tourist. This will require her to have a motive for traveling.

Why should she leave Hong Kong to go travel to another part of the world? What is there that she can’t find at home? If it is shopping that is her main interest why should she bother to travel to New York when there are thousands of shops in Hong Kong? To be able to afford to travel she has to save enough money to be able to pay for an air ticket and accommodation at the destination and she has to have enough days of paid holidays accumulated to be allowed to leave her place of work. She will need to arrange for air transport and for accommodation in New York, will require a permit to visit the United States (called an entry visa), and she will have to take the seasonality of her visit into consideration (will it be winter or summer when she arrives in New York?)

Tourism has a connection to many other disciplines including politics, religion, agriculture, economics, environment, health, finance, transport, society, immigration, and education just to name a few. All of these fields of human endevour are constantly changing and changes in one field will impact on other fields and hence also on tourism.

As a practical example you can think of the changes that were brought to Hong Kong tourism during the outbreak of the Severe Acquired Respiratory Syndrome (SARS) in 2003. Because of the fear that they may catch the disease when visiting Hong Kong, tourists stayed away. Our hotels, some of the best in the world, were empty; arriving flights carried only very few passenger; farmers in Guangdong Province were not able to sell their vegetables to Hong Kong hotels and employees of tourism related businesses either worked fewer hours or lost their jobs. This is a reminder that demand for tourism products can change very quickly, sometimes over night, and it is an industry that is very sensitive to changes and trends in its operating environment.

These fast moving changes require that tourist companies must be constantly on the alert to

1. Introduction to Current Issues in Tourism and Hospitality



their businesses. This includes being prepared for unforeseen circumstances and changes in their operating environment. One way of doing this is by constantly scanning the media for trends that may impact on the firm and by setting aside money to meet unforeseen developments that are out of the control of the company.

In the following pages we will look at some of the trends and issues that are current as of the time of the writing of this manual. Some of the issues we will explore such as the sustainability of tourism and climate change will be with the industry for a long time, while other trends, especially if they are driven by fashion will change, sometimes very quickly.

Let’s explore.


Get a copy of the South China Morning Post and scan it for articles that relate to tourism. You will need to read the articles and draw conclusions because very few of them will actually have the word “tourism” in the text. Compare your findings with those of your classmates who have looked through different parts of the newspaper.


2.1 The Concept of Sustainable Tourism

The most commonly used definition of sustainable development is still that given in the report of the World Commission on Environment and Development (1987), i.e. sustainable development is ‘a process to meet the needs of the present without compromising the ability of future generations to meet their own needs.’

Sustainable development is therefore about creating a better life for all people in ways that will be as viable in the future as they are at present. In other words, sustainable development is based on principles of sound husbandry of the world’s resources, and on equity in the way those resources are used and in the way in which the benefits obtained from them are distributed.

The concept has evolved since the 1987 definition, notably through Agenda 21, the plan of action which emerged from the UN Conference on Environment and Development (Rio, 1992), and the plan of implementation from the World Summit on Sustainable Development (Johannesburg, 2002). Three dimensions or ‘pillars’ of sustainable development are now recognized and underlined. These are:

• Economic sustainability, which means generating prosperity at different levels of society and addressing the cost effectiveness of all economic activity. Crucially, it is about the viability of enterprises and activities and their ability to be maintained in the long term.

• Social sustainability, which means respecting human rights and equal opportunities for all in society. It requires an equitable distribution of benefits, with a focus on alleviating poverty.

There is an emphasis on local communities, maintaining and strengthening their life support systems, recognizing and respecting different cultures and avoiding any form of exploitation.

• Environmental sustainability, which means conserving and managing resources, especially those that are not renewable or are precious in terms of life support. It requires action to minimize pollution of air, land and water, and to conserve biological diversity and natural heritage.

It is important to appreciate that these three pillars are in many ways interdependent and can be both mutually reinforcing or in competition. Delivering sustainable development means

2. Sustainable Tourism



2.2 Tourism and Sustainable Development - Application of Its Principles in Tourism

Tourism is in a special position in the contribution it can make to sustainable development and the challenges it presents. In economic terms, the dynamism and growth of the sector, and the major contribution make to the economies of many countries and local destinations. In terms of social and environmental, tourism is an activity which involves a special relationship between consumers(visitors), the industry, the environment and local communities.


Watch ‘An Inconvenient Truth” under the guidance of your teacher and discuss the issues raised in the film. Pay particular attention to the tips provided on the inside of the front cover of the movie that gives you ideas of what YOU can do to help in the fight against our changing climate.


2.3 UNWTO’s Definition of Sustainable Tourism

Sustainable tourism is tourism that takes full account of current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment and host communities. It is not a special form of tourism; rather, all forms of tourism may strive to be more sustainable. In its definition the UNWTO and UNEP included environmental, socio-cultural and economic aspects of tourism development. The three aspects must establish a suitable balance between these three dimensions to guarantee its long-term sustainability.

(Source: UNWTO,UNEP 2005). Thus, the term ‘sustainable tourism’ is defined as:

Make optimal use of environmental resources that constitute a key element in tourism development, maintaining essential ecological processes and helping to conserve natural heritage and biodiversity.

Respect the socio-cultural authenticity of host communities, conserve their built and living cultural heritage and traditional values, and contribute to inter-cultural understanding and tolerance

Ensure viable, long-term economic operations, providing socio-economic benefits to all stakeholders that are fairly distributed, including stable employment and income-earning opportunities and social services to host communities, and contributing to poverty alleviation.

Sustainable Tourism vs Ecotourism

A clear distinction should be made between the concepts of ecotourism and sustainable tourism:“The term ecotourism itself refers to a segment within the tourism sector with focus on environmental sustainability, while the sustainability principles should apply to all types of tourism activities, operations, establishments and projects, including conventional and alternative forms (Source: UNEP - International Year of Ecotourism 2002 available at



2.4 Guidelines For Achieving Sustainable Tourism -

An Agenda for Sustainable Tourism and Its Twelve Aims

Sustainable tourism development guidelines and management practices are applicable to all forms of tourism in all types of destinations, including mass tourism and the various niche tourism segments (Source: UNWTO,UNEP 2005). An agenda for sustainable tourism can be articulated as a set of twelve aims which list out all the key elements to be considered and give clear guidelines of how sustainable tourism can be achieved in three different aspects:

economic, social and environmental aspects as shown in Figure 2.1.

Figure 2.1: Sustainable Tourism Development

The agenda formulated in this way can then be used as a framework to develop policies for more sustainable tourism that recognize the two directions in which tourism policy can exert an influence:

 minimizing the negative impacts of tourism on society and the environment; and

 maximizing tourism’s positive and creative contribution to local economies, the conservation of natural and cultural heritage, and the quality of life of hosts and visitors.

The twelve aims of the agenda for sustainable tourism are categorized into three different aspects. The order in which these twelve aims are listed does not imply any order of priority,

and each one is equally important.

Economic Sustainability

Socio-cultural Sustainability

Environmental / Ecological Sustainability

Sustainable Tourism Development

Figure 2.2: Relationship Between the Twelve Aims and the Pillars of Sustainability


A. Environmental Sustainability

1. Physical Integrity

To maintain and enhance the quality of landscapes, both urban and rural, and avoid the physical and visual degradation of the environment.

Examples of measures include:

- Ensuring that new tourism development is appropriate to local environmental conditions, such as the siting of new structures with respect to physical landform, vegetation, and coherence of existing urban structures;

- Maintaining high quality rural and urban landscapes as a tourism resource, such as avoiding the proliferation of advertisements and signing.

2. Biological Diversity

To support the conservation of natural areas, habitats and wildlife, and minimize damage to them.

Examples of measures include:

- Working with national parks and other protected areas, such as preparing national guidelines on sustainable tourism in protected areas;

- Promoting development and management of ecotourism, such as development of certification system for ecotourism products.

3. Resource Efficiency

To minimize the use of scarce and non-renewable resources in the development and operation of tourism facilities and services.

Examples of measures include:

- Taking account of resource supply in the planning of tourism development, such as planning provision of water and energy supplies in tourism development projects;

- Promoting a reduce, reuse, recycle mentality, such as the creation of markets to recycle tourism supplies (paper, glass and plastic in particular).

4. Environmental Purity

To minimize the pollution of air, water and land and the generation of waste by tourism enterprises and visitors.



- Promoting the use of more sustainable transport, such as travelling by rail and boat which are less polluting when compared with air travel;

- Reducing the use of environmentally damaging chemicals or products, such as the disposal of chemicals present in cleaning products or the release of CFCs into the atmosphere from cooling systems.

B. Social-cultural Sustainability

5. Social Equity

To seek a widespread and fair distribution of economic and social benefits from tourism throughout the recipient community, including improving opportunities, income and services available to the poor. Tourism policies concerned with social equity should seek to benefit disadvantaged people by delivering economic and social benefits to them.

There are many reasons why tourism is well-placed to reach disadvantaged people, mainly because it is a labour intensive service industry with relatively low entry barriers and an activity that in situ within communities.

Examples of measures include:

- Developing income earning opportunities for disadvantaged people, such as encouraging the development of small, individual or community-owned tourism businesses within disadvantaged communities;

- Utilizing income from tourism to support social programmes, such as raising funds by taxation on tourists or tourism enterprises and use it for education, health and social welfare.

6. Visitor Fulfillment

To provide a safe, satisfying and fulfilling experience for visitors, available to all without discrimination by gender, race, disability or in other ways.

Examples of measures include:

- Improving access for all, such as ensuring tourism facilities and infrastructure are accessible and usable by people with disabilities;

- Monitoring visitor satisfaction, such as maintaining a regular survey of visitors to destinations and encouraging enterprises to obtain feedback from their guests.


7. Local Control

To engage and empower local communities in planning and decision making about the management and future development of tourism in their area, in consultation with other stakeholders.

An example of measures includes:

- Fully engaging the local community in the development of tourism policies and plans, such as undergoing the process of wider consultation for the community and other stakeholders.

8. Community Wellbeing

To maintain and strengthen the quality of life in local communities, including social structures and access to resources, amenities and life support systems, avoiding any form of social degradation or exploitation.

Examples of measures include:

- Reducing congestion, such as managing demand and reducing seasonality by marketing and pricing techniques to promote off-season visits;

- Promoting mutual use of facilities and services by residents and tourists;

- Influencing the behavior of tourists towards local communities, such as regulating certain aspects of visitor behaviours, e.g. noise and littering, etc.

9. Cultural Richness

To respect and enhance the historic heritage, authentic culture, traditions and distinctiveness of host communities.

Examples of measures include:

- Ensuring effectiveness management and conservation of cultural and historic heritage sites, such as securing more money from visitors for conservation through promoting greater use and management of admission income;

- Working with communities on the sensitive presentation and promotion of culture and traditions by informing tourists about local traditions and culture before and during the trip, while at the same time, informing local communities about the cultures of their potential visitors.



C. Economic Sustainability

10. Economic Viability

To ensure the viability and competitiveness of tourism destinations and enterprises, so that they are able to continue to prosper and deliver benefits in the long term.

Examples of measures include:

- Understanding the market, such as identifying markets that will continue to deliver business in the long term through market research of travel patterns and tastes;

- Delivering visitor satisfaction, such as attention to value for money and the overall competitiveness of the destination; and obtaining regular feedback from visitors;

- Maintaining and projecting an attractive destination, such as creating a positive and consistent image through effective destination branding and ensuring safety and security are available to visitors.

11. Local Prosperity

To maximize the contribution of tourism to the economic prosperity of the host destination, including the proportion of visitor spending that is retained locally.

Examples of measures include:

- Reducing leakages, such as support locally owned businesses and encouraging employment of local labour so a higher proportion of profits is likely to be retained within the community;

- Strengthening links between business to encourage and facilitate local sourcing of supplies, such as encouraging tour operators to use locally based service providers and products that are most likely to benefit local communities;

- Influencing levels of visitor spending through attracting higher spending markets and increasing length of stay by increasing the availability of spending opportunities.

12. Employment Quality

To strengthen the number and quality of local jobs created and supported by tourism, including the level of pay, conditions of service and availability to all without discrimination by gender, race, disability or in other ways.


An example of measures includes:

- Increasing employment opportunities, such as creation of jobs that are stable and that provide fair salaries and benefits.

- Encouraging enterprises to provide skills on the job training and career advancement.

In short, the twelve aims of sustainable tourism thus aspires to be more energy efficient and more climate sound (for example by using renewable energy); consume less water; minimize waste; conserve biodiversity, cultural heritage and traditional values; support intercultural understanding and tolerance; generate local income and integrate local communities with a view to improving livelihoods and reducing poverty. Making tourism businesses more sustainable benefits local communities, and raises awareness and support for the sustainable use of natural resources. (Source: United Nations Environment Programme (UNEP) and World Tourism Organization (UNWTO – Tourism in the Green Economy 2012)

Crowding on the Nathan Road sidewalk creates an unpleasant experience for visitors and local people.



Respect for wildlife in all its forms is required to make natural attractions sustainable.

Air pollution combined with cloudy skies can reduce the attractiveness of a tourist destination.

On a clear day, the tourist destination is much more attractive.


2.5 Sustainable Tourism Development Case Studies

The Case of Hong Kong – Tai O Heritage

Hong Kong Heritage

Tai O Heritage Hotel looks at raising awareness for heritage among Hong Kong citizens Travel Daily News - 22 October 2012, 09:52

After decades of destroying its historical heritage, Hong Kong tries to preserve what

ever remains to be seen... The new Tai O Heritage Hotel in Lantau, opened last March, is the right step to promote heritage conservation and sustainable tourism in the former British colony.

HONG KONG - Heritage and Hong Kong form certainly the most unlikely marriage. The former British colony with scarce lands in its urban areas, conducted since the late sixties a systematic policy of destroying most of its historical heritage to give way to speculative developments along its shores. Old mansions and Victorian style buildings made then ways to skyscrapers, malls and offices – not always from the best architectural standard.

Even in relative recent history, Hong Kong showed no mercy to some of its most grandest old buildings: gone in 1978 was the classic Kowloon Station; the same fate was shared in 1981 by the Hong Kong Club Building, a beautiful Victorian structure and in 1982 it was the turn of the Repulse Bay Hotel, which saw celebrities such as Marlon Brando, Spain Prince Juan Carlos or Peter Seller.

A few buildings remain today from old Hong Kong in Central district around the Legislative Council building while in Kowloon, the most striking fassade is still the one from the

Peninsula Hotel. But times are changing. Since reverting to China PRC, Hong Kong people rediscovers the need for history and started recently to value again their heritage- probably as they see it as part of their roots.

Recently, the Old Tai O Police Station, built in 1902 on Lantau island, has been revitalised and converted into the ‘Tai O Heritage Hotel’, in celebration of the timeless local cultural heritage. The Old Tai O Police Station originally housed policemen posted to combat pirates who roamed the surrounding waters. As crime rates declined over the years, it ceased to operate as a police station and functioned as a patrol post from 1996 to 2002 as it just faces Mainland China maritime territories.

The Opening Ceremony was even attended by the former Chief Executive Chief Executive of the Hong Kong Special Administrative Region, Donald Tsang who then declared that,



cultural destination for both local and overseas visitors. I wish this project can continue to engage the public in bolstering Tai O's economy and achieve synergy with other local facilities. In addition to promoting heritage conservation, tourism and green living, this project is expected to preserve Tai O's unique cultural tradition and give Hong Kong people and overseas tourists an impressive experience."

The historic building in the charming fishing village of Tai O was able to conserve its unique architectural features, while modern interventions tastefully inserted. It is one of the six projects under Batch I of the Development Bureau's Revitalising Historic Buildings with the idea of conserving 20th century colonial architecture and combining the beauty of Chinese and Western architectural styles.

The Tai O Heritage Hotel engages local communities to appreciate heritage conservation.

The project contributes to the sustainable development of Tai O tourism through a series of tailor-made eco-tours and cultural experience tours. Running as a non-profit social

enterprise, the Hotel has a gross floor area of 1,170 sq m, with nine colonial-style rooms and suites, establishing a publicly-accessible Heritage Interpretation Centre, an exhibition area displaying the history of the former police station and that of Tai O people.

Tai O Lookout is also a glass-roofed restaurant featuring Tai O specialties, which also showcases Hong Kong and Tai O artists' ingenious creations. Free guided hotel tours are offered daily.

To establish a close connection between this historic site with the community and the people in Tai O, the Hotel provides employment opportunities and training to Tai O residents.

Among the 16 full-time and 4 part-time staff, about half are Tai O natives. The heritage hotel is another opportunity for travellers to rediscover Hong Kong colourful past.

Source: Travel Daily News. Available at:


Questions For Discussion:

Based on the information provided in the above article and your understanding of sustainable tourism, try to discuss the following questions:

1. What types of tourists will be attracted to visit Tai O?

2. How can the local community of Tai O benefit from the development of heritage hotel?

3. Suggest how sustainable tourism can be achieved in three different aspects of sustainable tourism mentioned in Figure 2.1.


The Case of Macau – Sustainably Tourism Development of Macau

Macau Heritage

Economic growth must be sustainable: Pansy Ho

Macau Daily Times - 30 Oct 2011, 21:09

“We have shown to the world that we can grow in a short period of time. And everybody asks the same questions: Is this sustainable?,” Ho told journalists on the sidelines of the opening ceremony of the ‘Global Tourism Economic Research Centre’.

Macau must prove that the strong economic growth recorded in the past few years is sustainable for the future, said local businesswoman Pansy Ho Chiu King on Saturday.

Quoted by Portuguese news agency Lusa, the president of the new Centre stressed that the MSAR enjoys a favourable location in the south of China and strong political support from the Central Government.

“From the 12th Five Year Plan to the cooperation with Guangdong provinces we know right from the start that in the next few decades there will a big investment in infrastructure to link Macau and bring it closer to other regions,” said Ho.

The managing director property developer and ferry operator Shun Tak also emphasised the territory’s ability to both “attract capital from the investment funds’ market” and generate

“heavy incomes, which we know will be reinvested in Macau in order to turn it into an even more attractive market”.

“We do not face the same issues as other tourism economies. Here we are talking about a perfect scenario, where we have the resources and, at the same time, policies. Everyone envies this formula. Everybody wants to come to Macau to learn from our experience,” she said.

Gaming balance

The daughter of gaming tycoon Stanley Ho Hung Sun said she was “confident” about the future of the MSAR due to “a stable environment to show that politics and investment will be linked in a way that benefits society”.

“If you look at the issues that other regions are facing, Macau is very well positioned,” she said, also because it went from “micro-visions” to “a tourism economy, which is much more comprehensive”.

Although gaming is the dominant feature in the local economy, the government has set restrictions on the growth of casino tables and pledged to issue regulation banning gaming parlours within residential districts by mid-2012.

“This is a very prudent way to regulate. That is exactly the issue. While policies have helped



found, or at least a view on how the market should be regulated that everyone can agree upon”.

The ‘Global Tourism Economy Research Centre’ will be aimed at promoting “sustainable tourism development” in Asia. “We are taking another step to keep Macau at the frontline as a world-class tourism destination,” said Ho.

The independent and non-profitable centre will try to share knowledge and information with governments and other institutions working in tourism, in order to “follow up the latest developments and trends in Asian tourism”.

The centre will also organise the annual Global Tourism Economic Forum, with the first edition slated for next year, in Macau.

Source: Macau Daily Times. Available at::


Questions For Discussion:

1. What are the unique advantages and challenges of Macau to achieve sustainable tourism development?

2. Can the formula mentioned in the article be applied in the case Hong Kong for sustainable tourism development? What are the shortcomings and advantages of Hong Kong when compared with Macau?


Macau Daily Times available at: sy-ho.html

Travel Daily News available at: UN Conference on Environment and Development (Rio, 1992) available at: UNEP (2002) International Year of Ecotourism available at: UNEP and UNWTO (2012) Tourism in the Green Economy.

UNWTO (2005) Sustainable Development of Tourism available at:


World Commission on Environment and Development (1987) available at:

World Summit on Sustainable Development (Johannesburg, 2002) available at:



3. Tourism and Hospitality Issues Induced by Globalization

3.1 Globalization

3.1.1 Globalization and Its Effects on Tourism Development

“Globalization is essentially a process by which an ever tightening network of ties that cut across national political boundaries connects communities in a single, interdependent whole, a shrinking world where local differences are steadily eroded and subsumed within a massive global social order” (Mowforth and Mundt 1998:12). It is facilitated by the rapid movement of people, information , money and ideas around the globe.

How is globalization felt in the tourism context? We can think of several ways which include the following:

 Commodification and trivialization of local cultures – everything takes on a practical and commercial (for money) aspect

Money is king!

 Americanization through McDonald’s , KFC and Starbucks

McDonald’s fast food outlets can now even be found on islands in the South Pacific such as in Fiji.


 Homogenization – all cities of the world look the same. Experiencing the diversity of building styles, dishes and cultures was once a main reason to visit cities. Today as one travels around the world one finds that many airports, hotels and cities are more or less the same – this takes the fun out of traveling.

Welcome to New York, London or Paris? No, welcome to Beijing.

 Free flow of money around the world where it can earn the highest rate of return on investment

 The location of manufacturing shifts to where wages are the lowest at the expense of local people. Souvenir production is an example whereby Australian koala toys are manufactured in China or where coconut souvenirs sold in the Maldives are made in Bali.

 Small scale operations such as Peregrine Adventures, a Melbourne based tour company, are bought out by bigger companies (First Choice in the UK) who in turn are purchased by even larger companies (TUI of Germany).

 Most of the economic restructuring (change in ownership) is in the interest of big business not in the interest of the public and of the local people.

 The Hilton Hotel Corporation was recently sold to an investment fund that is primarily interested in a high rate of return on its investment for its shareholders and not in the wellbeing of guests, local people, and employees or in corporate social responsibility.

 Multinational companies such as CNN present consumers with their idea of the “truth”

behind the news. They tell us what is important and what is not. They show us places we should want to travel to

 National Geographic brings the world’s most exotic travel experiences to our living room and we become “armchair travellers”. This raises the question whether we still have to travel to places when we have already ‘experienced “ them on our flat screen



Globalization is felt particularly in less developed countries, many of which see tourism as an important development option. Unfortunately developing tourism can require that poor countries have to take out billion dollar loans to build the necessary infrastructure for tourism development and this can be a problem because they may not be able to pay back their debts.

Airports, roads, hotels, restaurants and theme parks may be built but they are of little use to locals who can’t afford to fly or stay in those hotels.

Tax concessions (tax holidays) are often provided to outside developers to provide them with incentives to develop tourism infrastructure such as hotels in developing countries. By allowing developers not to pay local taxes for the first 5 or more years they are depriving the local government and hence the citizens of revenue but often no infrastructure would be build if such concessions are not offered.

International tourists demand international style hotels, food and drinks and hence developing countries have to import up-market building materials such as marble from Italy, food (oysters from Australia) and drinks (Scotch whiskey) from abroad which means that much of the tourism earnings flows abroad. This is called leakage because the money leaks out of the local economy and it can’t be used to benefit local people.


3.1.2 Driving Forces of Globalization

1. Technological development

Globalization has been facilitated by two technologies. First, the development of transportation technology has reduced the time cost and monetary cost of long distance travel.

There are now low-cost carriers (e.g., Spring Airlines in the Mainland, Tiger Airways in Singapore, EasyJet in the UK) offering low fares which enable not-so-wealthy passengers who are willing to accept few in-flight services to travel.

Second, the rapid development of the Internet technology in recent years has facilitated international communication and enabled potential travelers to explore the attractions in a destination and search for small businesses.

Through the development of global on-line booking systems such as,,,, and, people can reserve air tickets and accommodations easily on their own without the help of travel agents.

2. Economic drivers

People in western countries enjoy more disposable incomes and annual days of vacation, which enable them to pursue international tourism more frequently.

3. Increased familiarity with own country

Westerners are more experienced and knowledgeable, who have now grown familiar with their own country and similar countries of the West. The same applies to the Chinese as well in the recent years. The richer people have been to the major popular destinations in the Mainland and Hong Kong, and therefore now look for places that are new and distant such as



3.2 Cultural Homogenization

One of the potential negative consequences of globalization and tourism is homogenization of culture. It refers to the transfer of ideas, values and lifestyles of the dominant countries (especially America) into other countries throughout the world.

That is to say, people in major tourists destination use the same kind of things, eat similar food, have similar lifestyles, and believe in material, technology and competition as the people in developed countries do. In particular, hotels of international chains (e.g., Holiday Inn, Hyatt, and Marriott),

international fast food outlets (e.g., McDonald’s, KFC, Starbucks), and people wearing fashionable clothing and footwear and using branded smart phones and digital cameras can be found in almost all tourist destinations, including Paris, Barcelona, Tokyo, Moscow and Beijing. Even in the Middle East, the heart of Islam, a Starbucks is opened in Saudi Arabia’s sacred city of Mecca, serving its signature coffee to Muslim pilgrims who come from various places over the world.

Even though the hotels and dining outlets can really serve the needs of the local people and the tourists, some cultural critics have pointed out that they may make the local culture westernized or Americanized. Even for European countries such as France, the people are worried that their own cultures may be threatened. The French people in the first few years of the opening of Disneyland Paris (in 1992) once disliked the Park partly because Disney Paris initially did not serve alcohol within the Park but having wine for a lunch is an essential part of French culture. Also, in 2004 when Starbucks opened its first store in Paris and American tourists were excited when they could get over their homesickness with a cup of the American coffee, some critics accused the


American coffee shop of invading the Parisian cafe culture. In a conventional Parisian café, one cannot get and take away the coffee in under 20 minutes, and at a price Starbucks offers.

Cultural homogenization is of particular concern in rural communities of developing countries because the imported culture may seriously change the people’s traditional lifestyle and the values of the younger generations. For example, in a Thai hill village, the younger members of the community preferred the clothing styles that tourists wear, and now the children wear T-shirts and baseball caps in order to look like the tourists. They aspire to the material standards and values of the tourists but were unable to achieve them. Anthropologists called this the “Demonstration effect”. Their change of lifestyles led to the conflict between them with the other generation.

Cultural homogenization is considered a problem because

1. Homogenization means lowered “diversity”, which is often considered the key to vitality, resilience and innovative capacity of a living system. The General Conference of UNESCO took the position in Article 1 of the Universal Declaration on Cultural Diversity that

“...cultural diversity is as necessary for humankind as biodiversity is for nature”. Cultural diversity is about existence of multiple forms of knowledge, wisdom and energy which all contribute to improving and moving the world forward.

2. Homogenization also means that destinations are getting more similar to visitors’ country of origin. People usually choose to visit a place which provides new experience rather than what they can find and see at home. If what people can see and experience in the destination are just what they can see and experience at home, they will lose their interest in travel.



The following three factors are usually considered the causes of cultural homogenization through tourism.

1. Demonstration effect. The people in host destination, especially in developing countries, copy the lifestyles of the tourists. Local people see that visitors use advanced digital equipments, wear precious watches and dress in beautiful fashion. Some of them aspire to these and hope one day they can escape from their rural community and possess jewelry and digital products like the tourists do.

2. Destinations bringing in western products to satisfy the tourists.

Though most tourists wish to look for exotic elements in the other cultures during their tour, they still expect to enjoy the daily amenities that they enjoy at home. That is to say, they want the food and drink they usually consume, their hot showers, comfortable beds and the instant news from back home. Such amenities (e.g., refrigerators, western-style furniture, TV sets) therefore have to be transported to the destination to meet the visitors’

needs. Western style food and drinks are also offered. At the same time, some local people are actively engaged in servicing these amenities.

They learn how to prepare and serve the western-style drinks, make the bed, and fix the shower. Therefore, their own lifestyles are also gradually modified.

3. Multi-national corporations have taken the opportunities to extend their services to various places in the world to satisfy the needs of western tourists. McDonald’s, KFC and Starbucks are opened in Beijing, Tokyo, Madrid and Paris as these cities are popular tourist destinations.

Similarly, Coca Cola is promoted and sold in major tourist cities all over the world. These


corporations bring the American food products to other places in Asia and Europe and to some extent have changed the food culture of these cities.

Some scholars asserted that the effects of homogenization are more than about the types of objects people use or consume. For example, Benjamin Barber, a political theorist, argued that American fast food (the McDonald’s as an example) is not just about the food. It is about “fast”, and fast is an attack on how people in other cultures live. For example, in Europe, the family members after coming home from work and school normally sit together for three hours to enjoy their family dinner. “Fast” food destroys the idea of family dinner as an occasion for family members to talk and share daily experiences. It also destroys the French idea of the cafè as a place to sit and read the newspaper.

Similarly, when rural people in destinations give up their traditional clothing and wear the rugged jeans, it is not only about the type of dress they wear. It is about “rugged”, which means that people do not need to care for the gracefulness of their clothing any more. When rural people (also in Europe) bring in air conditioners instead of relying on natural breeze for comfort, it is not only about the use of a technology. It is about a mentality that man should use technology to master nature rather than live harmoniously with nature.

When rural people begin to use fashionable products, the issue is not only about products but “fashionable”. It means that when people buy things, they will not ask whether the product is “durable” but “fashionable”. They fall into consumerism that being trendy is important.



However, other scholars queried the observation that cultures in other countries have been Americanized. Instead, they argued that cultures over the world have become diversified rather than homogenized.

1. The economist Tyler Cowen argued that when people of one society interact with people of another society, though the two societies become more alike, diversity within society actually goes up and consumers have greater choice. For example, Cuban music was produced largely for American tourists who went to nightclubs in Cuba in the 1950s, and Persian carpets were produced in large numbers in the 19th century to sell to European buyers who sold to North American buyers. Cuban music and Persian carpets were brought back to their home countries by the travelers and now can be found in many places over the world.

International tourism has increased diversity within countries and allows people to see products (food, music, clothing etc.) which originated from other parts of the world.


2. Globalization is not a one-directional process in which American culture spreads to other countries, and the other countries just passively accept it (the so-called “Americanization” phenomenon).

While forces of globalization enable American culture to get into other countries, other countries also spread their lifestyles throughout the world. For example, India cultural practices such as meditation, yoga and spiritual healing are learnt by people over the world.

Japanese foods such as sushi are also becoming highly popular in many western countries. In a globalizing world, cultures of different countries are spread

to other countries (including the US), making the culture within different countries more diversified.



3.3 Mass Tourism and Sustainability

Since the beginning of the 19th century, tourism opportunities were becoming more available to the lower classes of the United Kingdom and many European countries. England first introduced the European spa movement, in which the industrial working class went to the seaside to enjoy spa and other recreational activities. This movement later extended to various European countries such as Germany, France and Italy. After the Second World War, it became popular for people to join standardized and all inclusive package tour for their holiday.

The term “mass tourism” was used to describe this kind of activity. Many different forms of mass tourism exist but the most common are mass beach tourism (sun, sea and sand tourism) and mass winter sports tourism.

It was criticized that mass tourism creates intense pressures on the environment because it involves a large number of tourists visiting the same areas within a certain period of time (the high season).

To cope with the large number of tourists, facilities such as hotel complexes, theme parks and marinas have to be constructed. The construction of these facilities affects the natural scenery. In addition, garbage disposal from hotels, littering by tourists, and oil leakage from cruise ships and other motorized boat traffic all

cause damage to the environment. This leads to direct degradation, pollution, and destruction of the soils, vegetation, water, wildlife and the ecosystems (coastal, mountains and inland).

Take the example of tourism development in Kenya. Seemingly, the development of tourism in Kenya has been an African success story. The tourist industry in the country is the second largest source of foreign exchange revenue followed by agriculture. However, as many resorts and hospitality facilities were built in an unplanned manner and in large scale in fragile coastal and marine ecosystems of the country, the quality of its tourism resource declined sharply. In the wildlife parks and reserves, excessive accommodation facilities have been built in important and fragile wildlife habitats (near the breeding grounds or important feeding areas). This destroyed the beauty of the park and threatened the habitats of the animal species.

Furthermore, high concentration of tourists in fragile marine environments has led to problems of overcrowding, trampling, and damage to marine resources such as coral reefs, mollusk


shells and marine turtles. Unplanned mass tourism weakened the quality of Kenya’s tourism product, and the country gradually lost its appeal.

Apart from the coastal areas, mountain landscapes are the second major environment where tourism impacts are serious. In the Alps, infrastructures such as hotels, ski-lift or cable cars have been built for mass winter sport tourism. In the Mainland, to meet the needs of the large number of visitors in famous destinations such as Zhangjiajie and Taishan, cable cars and escalators have been constructed. These to some extent destroyed the natural scenery of these attractions. In addition, there are also difficulties in disposing of rubbish and problems due to improper disposal of human waste in the mountains.

Environmental impacts are not limited to the natural environment; the human and physical environment can be affected as well. Take the example of Spain. Because of the increased interest of tourists in the coastal villages such as Torremolinos, Benidorm and Lloret del Mar, many tourism facilities were built and the images that were shown on travel posters of these villages

are no longer seen. On the coasts of southern Spain, the Italian Riviera, the Viareggio Coast and the Adriatic Sea, uncontrolled building has completely destroyed the natural character of those areas.

Hundreds upon hundreds miles of shoreline has been changed by the construction of hotels, restaurants, bars and houses, creating permanent visual pollution.

In addition, the noise from discos and bars, traffic fumes, and overcrowding during the high season have made these places a less desirable destination than before.

Other cities like Venice and Barcelona also experience similar congestion problems. The St Mark’s Square in Venice and the historical places in Barcelona (the Guell Park, the Sagrada Familia and the Pedrea) are totally overcrowded most part of the year, which makes the stay



One of the features of globalization is that tourists have plenty of choices in the selection of their destination. Once the quality of a destination declines, it will become less popular to the tourists, and they will visit other countries which offer similar tourist attractions. Tourism business in the community is gradually declining. The destination will only be left with degraded resources, under-utilized facilities and unfulfilled business opportunities.

3.4 Exploitation and Fair Trade

3.4.1 Exploitation

Tourism development has been once considered a tool to help poor countries. Tourism enables the countries to earn foreign exchange income, create jobs and achieve economic growth.

However, a critical evaluation of the development of tourism in some developing countries reveals that it is not all happy stories. The countries can be exploited by multinational companies of developed countries, and the benefits of tourism can be limited. These can be explained by several factors.

1. Concessions given to the multinational companies. Because the developing countries are not able in providing high quality services demanded by

international travelers. Many governments in developing countries granted tax concessions to multinational investors and developers as incentives for them to build tourism infrastructure such as hotels and resorts. The developers are allowed not to pay local taxes for the first few or more years, which reduce the revenue of the

local government and the citizens. For example, in the small island states comprising the Eastern Caribbean Currency Union (ECCU), tax concessions have been employed as a strategy to attract investment in tourism. Because of the concessions, the ECCU received less tax revenues, as they expected that increased foreign direct investment could bring


additional financial benefits. However, a report supported by the International Monetary Fund shows that overall revenue losses from concessions had been large in the ECCU countries, ranging between 9.5 and 16 percent of gross domestic product a year.

Unfortunately, it was also found that the benefits due to granting concessions were marginal at best.

2. Low paid jobs provided. Many employees in the tourism sector need specific qualifications, such as foreign language proficiency. However, local people in destination areas often do not have such qualifications and education, and training schools are not even present. For example, the Sheraton Hotel in Santa Cruz,

Mexico required 100% English language fluency for front desk applicants and 80% fluency for maids. The majority of people in Mexico did not meet these requirements. In most developing countries, highly qualified and well-paid positions are usually occupied by managers from developed nations, particularly with international

hotel chains, whereas unqualified and low-paid jobs or seasonal jobs are offered to local people.

3. Demand on local natural resources. Due to the limited bargaining power of the developing

countries, the

multinational tourism investors may oblige the government of the destination to follow their

requirements and conditions; otherwise they will not be willing to invest in some projects.

For example, in the case of Kenya, the large corporations may demand building resorts in lagoons, fragile sandy beaches and coral reefs, or accommodation in fragile wildlife habitats. They exploit the natural resources of the destination without thoroughly considering the environmental impacts.



4. Economic leakage. With the advancement of communication technology, major corporations nowadays can develop strategic alliances to enhance their competitive advantage. Some international travel companies (e.g., Six Continents Hotels, the German tour operator TUI, Star Alliance in air travel industry) provide the entire package of services to the traveler, from itinerary planning and purchasing of tickets, right through to travel, accommodation, food, and local tours. In

so doing, most of the expenses are taken by the international companies. The tourists spend only a small amount of their money in the destination, and the local community receives little benefit. The local people may only provide services such as selling handicraft, petty transport (taxis), shopping guides etc. which can generate little income.

Furthermore, because the host destination may not be able to produce the quality of goods that satisfies the demand of international tourists, consumer goods may need to be imported from other countries to satisfy the demands of the visitors. For example, hotels in Jamaica (an island country in the Caribbean Sea) imported three-quarters of shrimp consumed by tourists. According to United Nations Environment Programme, it was estimated that in some extreme cases, out of each US$100 spent on a vacation tour by a tourist from a developed country, only around US$5 actually is retained by people in a developing-country destination. Other more modest studies estimated that 70% of all money spent by tourists ended up leaving Thailand, 80% of tourists’ money left the Caribbean, and 40% left India.


3.4.2 Fair Trade

1. Definition of Fair Trade

According to the World Fair Trade Organization (WFTO), fair trade is defined as “a trading partnership, based on dialogue, transparency and respect, that seek greater equity in international trade. It contributes to sustainable development by offering better trading conditions in the South, and securing the rights of, marginalized producers and workers – especially for developing countries.”

Source: World Fair Trade Organization (WFTO). Available at:

2. Meaning of Fair Trade in Tourism

Many developing countries are now heavily relied on tourism for income. Fair trade in tourism ensure that the people whose land, natural resources, labor, knowledge, and culture are used for tourism activities actually benefit from tourism. It can maximize the benefits from tourism for local destination stakeholders through mutually beneficial and equitable partnerships between national and international tourism stakeholders in the destination. It should support the right of indigenous host communities, whether involved in tourism or not, to participate as equal stakeholders and beneficiaries in the tourism development process.

Source: Tourism Concern – Action For Ethical Tourism. Available at:

3. The Importance of Fair Trade in Tourism

The promotion of the fair trade concept is not only limited to the trading of agricultural products but is also extended to the development of tourism and hospitality industry in developing countries.

The tourism industry is dominated by powerful multinational corporations based in developed countries. The impoverished communities whose environments, people and cultures are exploited to provide holidays for the wealthy rarely have a voice in the development of the tourism economy and, as a result, rarely benefit from it.

According to a report of UNWTO in 2012, tourism ranks fourth after fuels, chemicals and food in the worldwide export category, while ranking first in many developing countries. Yet, with the industry dominated by big multinationals and much of the profits flowing back to the developed world, little of the benefits are reaching the poorer communities that provide the cultural and environmental resources the industry depends on.



For example, according to the UN, as little as 10% of the price of a holiday can remain in the local economy (UNCTAD). From 2000 to 2005, the money flowing into Africa from tourism more than doubled from $10.5 billion to $21.3 billion, yet poverty levels there remain acute.

Nevertheless, tourism is increasingly seen and promoted as a means of addressing poverty.

However, tourism will only support local livelihoods if the inherently unfair terms of trade are addressed, local communities are able to retain control of tourism development, and a means of marketing and distribution is found that is not dominated by international corporations based in the developed world.

A process that enables fairly traded tourism products to reach their core Northern markets, developed within a transparent decision making process that involves the producers, service providers and communities, and based upon clear development principles, can create an alternative trade in tourism which will enable long-term, sustainable benefits for local economies and communities.


Tourism Concern – Action For Ethical Tourism. Available at: World Tourism Organization (UNWTO). Available at:


A Case of Fair Trade in Tourism –

Fair Trade Tourism - South Africa (FTTSA)

FTTSA provides a framework for fair and sustainable development in tourism. It has clear standards of supporting disadvantaged producers and staff along the whole supply chain, with fair trading standards and

prices, and a fair trade premium for social development in South Africa. Along the lines of fair trade in products, Fair Trade Tourism is aimed at improving the living conditions of disadvantaged small entrepreneurs and employees in tourism, at securing their livelihoods, and at enabling them to live in dignity.

The FTTSA certification programme for tourism products was launched in 2002, and their accredited portfolio of accommodation and activities are increasing annually. The vision of FTTSA is to encourage a fair, participatory and sustainable tourism industry in South Africa.

The certification programme endorses establishments that meet stringent criteria and acknowledge the FTTSA principles to ensure fair and responsible business practise. There are a total of six objectives to be achieved under this programme, which include:

Table 3.1

Fair Share Participants are entitled to a fair share of income directly proportioned to their contribution to a specific tourism activity.

Democracy Employees are entitled to participate in decisions that concern them.

Respect Respect for human rights, culture and environment, which includes safe working conditions, gender equality, reduced consumption and protection of natural resources.

Reliability Service delivery should be reliable and consistent, and basic safety and security for both host and visitor should be ensured.

Transparency Ownership of business should be clearly defined, sharing of profits, benefits and losses must be transparent.

Sustainability Increase knowledge through capacity building, share resources through partnerships, encourage the responsible use of resources and reduce leakage through local purchasing and employment.

Source: Baobab – Fair Trade Tourism. Available at:



4. Practices of Fair Trade in Tourism

Below are some examples of fair trade practices that can be applied in tourism:

Equitable consultation and negotiation taking into account the interests of local community stakeholders, including tourism enterprises, and indigenous residents not involved in tourism;;

Transparent and accountable business operations through environmental and social audits;

Employment of local resident and indigenous people to develop human potential;

Training and development at local community level for managerial positions, if appropriate as part of a public, private and civil society partnership;

Investors aware of and adhering to national, regional and local planning and environmental regulations;

A fair price, negotiated in partnership with local suppliers;,

Fair competition between foreign and domestic investors to enhance opportunities for domestic investment and competitiveness;

Shared tourism revenues to ensure that the return from the use of public assets for tourism, benefits and enhances public social and environmental resources in the destination;

Use of local products and materials where appropriate (ecologically sustainable if possible);

Compliance by foreign investors with destinations’ tax regulations. Present transfer pricing policies of transnational corporations should be reviewed to ensure adequate liability.

Source: Tourism Concern - Fair Trade in Tourism. Available at: smconcern.pdf




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