rethink sustainability
Journeying to a better world: sustainable tourism critical to ecological development
Tourism is one of the fastest growing industries in the world. After a sharp dip in 2020 and 2021 caused by Covid-19 lockdowns, the sector is quickly heading back to its 2019 high, when 1.5 billion tourist arrivals1 contributed more than 10% of global GDP2 – nearly 6% annual growth is forecast between now and 2032.3 As millions of people are jetting off for summer holidays, hundreds of millions more are reliant on their travels – around the world, tourism creates one in every eleven jobs.4
This vast economic contribution brings with it an equally vast environmental footprint. In many places, tourism causes localised ecological damage through overdevelopment and high visitor numbers; the industry is also responsible for 8% of all man-made greenhouse gas emissions (GHGs)5, more than the entire construction industry6.
Increasingly, tourist destinations themselves are being threatened by the global warming caused by these emissions. Recent two-week-long wildfires in Greece were followed by devastating fires on the island of Maui in Hawaii, with tinderbox conditions believed to have been exacerbated by climate change7. From an environmental perspective, the solution may appear simple – the less tourism the better. But is it really that straightforward?
Does the environment need a break from tourism?
In 2020 and 2021, Covid-19 lockdowns caused traveller numbers to plummet by more than 70%. As planes sat motionless on runways and ferries stayed in port, carbon emissions and other pollution fell sharply – air quality in our cities improved, previously dirty waterways became clear. At first this appeared to be a silver-lining to the tragedy of the pandemic – “Nature is healing,” the headlines declared.
But the lack of travel had a darker side. Around the world billions of dollars of tourism revenue, vital for funding nature restoration projects, and for supporting protected areas and local communities, disappeared overnight. In Kenya, for instance, income from visits to wildlife parks fell by 75%, devastating communities that relied on tourism. In turn, wildlife in protected areas came under growing threat from hunting.8
In some places, the loss of funding meant that conservation efforts were reduced or even paused altogether – the International Union for Conservation of Nature reported that across 60 countries, 1 in 5 protected area rangers lost their jobs.9 Deforestation and illegal mining rose as loggers took advantage of the drop in patrols and desperate locals sought new income streams.10
As tourism returns to its post-pandemic normality, sustainability-conscious tourists are left to grapple with a dilemma – tourism is at once both a threat to the environment and an essential source of funds for ecological protection. So, how can travellers be sure they are having a net-positive impact?
Alternative travel
For holidays close to home, changing the mode of travel can make the biggest difference. Plane flights are the biggest single contributor to tourism’s environmental footprint – a single short-haul flight can be responsible for more GHGs than the average person in some developing nations generates in an entire year11. Switching to the train, ferry, or coach is likely to be significantly lower impact than flying12 – for instance, a train journey from London to Madrid emits less than one sixth of the CO2e (carbon dioxide and equivalent GHGs) per passenger than the same trip made by plane.13
The electrification of our economy is helping tourists cut their carbon footprint further. While trains are already one of the most energy-efficient ways to travel, the switch to electricity is making them cleaner still – the UK’s Network Rail estimates that electric trains currently emit up to 35% less carbon per mile than diesel trains14. Around the world railways are being electrified on a vast scale – in India, for instance, thousands of kilometres of routes are going electric every year. Meanwhile electric cars already make up 13% of all new vehicle purchases and are continuing to make rapid inroads into automotive market share. Driving EVs (electric vehicles) both to reach holiday destinations and while on holiday can minimise travel-related emissions.
The Lombard Odier Future Electrification strategy looks to capitalise on this rapid transition away from fossil fuels, identifying shifting profit pools and both accelerating and profiting from the move to emissions-free travel. As national grids expand the rollout of renewable electricity generation this could eliminate emissions from electric trains and EVs entirely.
Minimising flight footprint
Air travel is harder to abate. In 2021, the world’s airlines jointly committed to achieving net zero emissions by 205015. In the short-term, the most likely solution will be for planes to be powered by sustainable aviation fuel (SAF), a “drop-in” liquid solution based on organic materials. However, for these fuels to be truly sustainable, a shift from first generation feedstocks (e.g. food crops like palm oil) to second generation (e.g. wasted-based feedstocks like used cooking oil or animal fats) is needed to achieve their full emissions reduction potential16,17.
Sustainable tourism does not mean avoiding flights altogether, however, nor does it mean only making short journeys. Some of the communities and regions most in need of tourism income are also the most remote, and, for many visitors, are accessible only by plane.
Read more about sustainable aviation fuel (SAF) here: How sustainable aviation fuels can put the industry on course for net zero
Maximising positive impact
In 2018, the Seychelles entered into a unique ‘debt for nature’ swap, in which a large proportion of the island’s debt was effectively written off in exchange for a promise by the Seychelles government to protect 30% of its ocean territory, some of the world’s rarest and most beautiful marine ecologies. The debt deal alone is not sufficient to fund the conservation work, however. An environmental sustainability levy is imposed on all tourist stays in the country (tourism contributes 40% of Seychelles GDP18), and tourist income is essential in order to ensure the ongoing preservation of an area of ocean that covers 158,000 square miles19.
The jewel in the Seychelles’ crown is the Aldabra Atoll, a Unesco World Heritage Site that plays home to many threatened species, including the world’s largest population of giant tortoises and the white-throated rail, the last flightless bird in the Indian Ocean. Without tourism income, the research that monitors the atoll’s unique flora and fauna, and the patrols that keep the island and its lagoon free of harmful fishing, would come to a stop.
Across the globe many regions are similarly reliant on tourism income. In Costa Rica, for instance, where the world’s most successful large-scale reforestation project has seen forest cover restored to more than 50% of land area, tourism income provides locals with jobs in the services industry and in forest preservation and management20. Without this, the Costa Rican rainforest, a carbon sink of global importance, would be at risk of degradation for mining and agriculture. For tourists, choosing destinations where tourism income is used to preserve nature is a way to ensure maximum positive impact.
A growing market
This nature restoration work is an essential part of tackling the climate challenge – it is estimated that nature-based solutions can achieve around a third of the emissions reductions we need to achieve the Paris Agreement temperature target21. At Lombard Odier we look for opportunities to restore nature by converting undervalued and underperforming land into regenerative landscapes that lock in carbon from the atmosphere, while simultaneously building new revenue streams, such as from agroforestry, in the process.
Read also: Climeworks: combatting global warming by sucking CO2 out of the air
Within the tourism industry, many firms and non-profit organisations are dedicating themselves to the same cause. For example, The Long Run, through a collective of some of the world’s most sustainable resorts and travel destinations, now conserves over 23 million acres of biodiversity and ecologies of global importance, from Indonesian coral reefs to Brazilian rainforest.
Recent research demonstrates strong consumer demand for more sustainable travel, with 76% of travellers saying they hope to make this year’s holiday more sustainable22. This fast-growing demand is creating new opportunities for resorts and travel firms to profit from tourism while contributing to both environmental and social development.
According to the United Nations, “Harnessing tourism’s benefits will be critical to achieving the sustainable development goals and implementing the post-2015 development agenda,”23 a plan to make clear, measurable progress towards environmental and social goals by 2030. For tourists, this means there is a balancing act to be struck between the environmental cost of the travel itself and the long-term benefits of tourism income – where this balance is found, sustainable travel can play a key role in the journey to a just and sustainable future.
1 International tourist arrivals worldwide 1950-2022 | Statista
2 Travel and tourism: share of global GDP 2023 | Statista
3 Chart: Travel and tourism is one of the fastest growing sectors | Statista
4 Sustainable tourism: A driving force of job creation, economic growth and development (ilo.org)
5 This figure encompasses the emissions that originate from transport, electricity, construction, and food The carbon footprint of global tourism | Nature Climate Change
6 Tourism responsible for 8% of global greenhouse gas emissions, study finds - Carbon Brief
7 Devastating Hawaii fires made ‘much more dangerous’ by climate change | Hawaii fires | The Guardian
8 What does it mean to travel sustainably in 2021? | National Geographic
9 COVID-19 fallout undermining nature conservation efforts - IUCN publication | IUCN
10 The hidden toll of lockdown on rainforests - BBC Future
11 How your flight emits as much CO2 as many people do in a year | Carbon footprints | The Guardian
12 Which form of transport has the smallest carbon footprint? - Our World in Data
13 Climate change: Should you fly, drive or take the train? - BBC News
14 Electric and hybrid trains power ahead to cut emissions | Financial Times (ft.com)
15 IATA - Net-Zero Carbon Emissions by 2050
16 Microsoft Word - 47C468D4-69BA-281F40.doc (energy.gov)
172020_05_REDII_and_advanced_biofuels_briefing.pdf (transportenvironment.org)
18 Seychelles: tourism value added to GDP 2005-2020 | Statista; Seychelles GDP - Worldometer (worldometers.info)
19 The deal that saved Seychelles’ troubled waters - BBC Future
20 This country regrew its lost forest. Can the world learn from it? | CNN
21 Nature-based Solutions for climate | IUCN
22 Survey of travellers finds 76% want more sustainable options | World Economic Forum (weforum.org)
23 Tourism in the 2030 Agenda | UNWTO
Important information
This document is issued by Bank Lombard Odier & Co Ltd or an entity of the Group (hereinafter “Lombard Odier”). It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a document. This document was not prepared by the Financial Research Department of Lombard Odier.
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