TUI releases ‘groundbreaking’ report into tourism impact

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TUI Group has partnered with PwC and the Travel Foundation to measure the impact of 60,000 TUI customers who visited eight hotels in Cyprus during 2013. 

The report provided a snapshot of Cyprus’ tourism sector.

The ambitious pilot study, based on customers visiting Cyprus measures and values a wide range of economic, social, environmental, and tax impacts.

TUI says the report highlights the inadequacies of measuring success using only proxy indicators such as visitor numbers – which does not provide clear insight into the impact of those visitors.

The research also shows the importance of going beyond basic economic measures. For instance, tourism tax receipts are not often discussed as a benefit for destinations, but were found to be a very significant benefit for Cyprus, equivalent to €25 per customer per night. Airport departure tax accounted for just 10 percent of this total, which includes other taxes such as corporation tax, VAT and income tax.

Furthermore the study shows that a significant amount of the total impact of tourism comes indirectly from supply chain activities and tourism spend. For example, supply chains and other services used by customers were found to generate almost 14 times as much waste as the hotels themselves (1.8kg of rubbish per customer per night from hotels compared with 25kg from the supply chain).

TUI claims the results reveal that its operations generate overwhelmingly positive benefits. But the project also shows that whilst the environmental damage caused by one tourist may be small, this is multiplied by millions of tourists over the years, and thus needs to be carefully managed, if a destination is to stay attractive for years to come.

“This is a groundbreaking investigation by PwC and The Travel Foundation which reveals the extent to which our holidays bring positive benefits to a destination. It gives us brand new insights into how to further improve the positive and minimise the negative impacts of tourism. Our business and our customers’ satisfaction is dependent upon thriving communities and well-managed environments, so as well as taking action ourselves, we are sharing the learnings from this project with the wider industry and with destination governments, so collectively we can make a difference”, said Jane Ashton, TUI Group director of Sustainability.

Key findings of the report include:

* The positive economic and tax benefits are by far the greatest impact – amounting to €84 per guest per night – far exceeding the negative environmental (-€4) and social (-€0.2) costs. However, this is a one-year (2013) snapshot and does not take account of the construction of the hotels. In addition, many environmental and social impacts will accumulate over a longer timeframe.

* Greenhouse gases (GHG) are the most significant environmental cost – although this represents less than 0.01% of total GHG emissions in Cyprus. GHG impact more than doubles if flights to/from Cyprus are included.

* The most significant social benefit identified across all of the social impact areas is that associated with ‘on the job’ experience, with an upper estimate of €6.2 per guest night. This highlights the tourism sector’s significant role in developing skills in the Cypriot workforce, which is important in the context of the Cypriot economy where unemployment has increased in recent years, particularly among young people.

* Work placements, where a placement is a condition of an individual’s degree, yielded the highest social impact per person (€8,800 per work placement student). However, its relatively small overall impact is primarily driven by the small number of Cypriot work placement students currently benefiting at each hotel.
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