Media Statement by the office of Mr Marthinus van Schalkwyk, Minister of Tourism
The way we reform, redesign and enhance our collaboration should recognise that tourism and aviation depend on each other as well as on global conditions for their prosperity. Failure in one cluster has a massive impact on the system as a whole.
On behalf of the South African government, I wish you a warm welcome at the WEF Summit on Green and Shared Growth in Aviation, Travel and Tourism. We feel privileged to be hosting this summit, and to receive so many of our friends here in Cape Town.
It goes without saying that tourism is a key pillar of the South African economic development strategy, and is recognised as such at the highest tiers of government.
I am a firm believer in the value of these kinds of public-private partnerships. The travel and tourism sector in particular is a sector in which the public and private sectors simply cannot function in silos. Yet, in many countries and international institutions, the silo mentality persists, inhibiting the growth of our sector.
The same holds true for how we often fragment our planning in the aviation and tourism components of what is actually an integrated value chain.
It is important to understand that fragmentation and silo thinking are not only the result of institutional failure at the level of multilateral governance, or of ignorance. Instead, fragmentation and silo thinking are directly linked to the heterogeneity of the sector as well as a peculiar industry structure.
The tourism component is characterised by a very large number of players operating in multiple market segments. Moreover, the tourism sector is dominated by small, medium and micro-sized enterprises, with a few big operators at the top of the pyramid mostly calling the shots. And while the larger global players are linked institutionally through industry bodies such as the WTTC, it remains a challenge to forge truly inclusive institutional links with the proliferation of smaller players throughout the remainder of the value chain.
The aviation component, on the other hand, is dominated by a relatively small number of commercial airlines – and is well organised in IATA – but is fairly poorly linked to their tourism counterparts as well as the “new model” airlines such as the low cost carriers.
Despite admirable efforts to enhance coordination, I believe the gaps between those global institutions representing industry in its different silos, and between industry and those multilateral institutions responsible for global governance, simply remain too large.
Also within the United Nations (UN) family, I believe that silo-based thinking on aviation and tourism still is too deeply entrenched. Historically, aviation and tourism have been institutionalised and regulated in silos. This historical institutional architecture and the lack of dynamic interaction between UN agencies do not reflect the fundamental changes in tourism and aviation over the past few decades.
The world of tourism today is a vastly different world than that of 1950, or even 1990. In 1950, we had 25 million international tourists; last year, we had 935 million; within a decade, this figure is forecast to increase to 1,6 billion. Of these, 378 million will be long-haul.
The growth and internationalisation of tourism have thus created an umbilical cord between the aviation and tourism sectors. This challenges us to find new ways to organise our work – not only between industry bodies, but also by reforming and strengthening institutions for global governance, including in the UN.
The way we reform, redesign and enhance our collaboration should recognise that tourism and aviation depend on each other as well as on global conditions for their prosperity. Failure in one cluster has a massive impact on the system as a whole. For example, aviation and tourism are:
1. equally affected by archaic global legal frameworks that govern the airspace and ownership of airlines;
2. equally vulnerable to terrorist attacks and political instability in tourist destinations, including the threat of cyber-terrorism (for example the sabotaging of air traffic navigation systems); pandemics like the H1N1 influenza, or natural disasters like the 2010 Icelandic volcano eruption; and
3. equally exposed to global exchange rate volatility, rising oil prices, new security costs, external economic shocks like to the 2008/9 economic downturn, and non-tariff barriers like visa requirements, travel advisories and discriminatory travel taxes.
The case for a systemic view holds at a policy level, but also at an operational level. In the Web 2.0 Internet economy, aviation and tourism are linked through online travel information sources, social media and the mobile web, online booking and payment systems, and the increasing integration of the selling and managing of land and air transport, accommodation, tourist attractions and ancillary travel services.
In the face of these challenges, and opportunities, we should break out of the silos at the political, policy and operational levels. The sector is in dire need of greater policy coherence and collaboration at a global level.
We must find a way to get multilateral institutions, global industry bodies and private corporations and governments – who each has substantial contributions to make – to look beyond their partial views when they respond to climate change, trade negotiations, taxation and new security risks, and rather consolidate their respective inputs. If we fail in this task over the next few years, we will fail in giving the aviation and tourism sector an opportunity to speak and act with the political weight it deserves as the creator of one in every ten jobs globally (direct, indirect and induced jobs).
Two particular challenges that we should address are social inclusion and climate change. We must create decent jobs - and in the process build more balanced societies that include women as fundamental drivers of economic growth. In responding to climate change, we also need to forge much stronger cross-industry and public-private partnerships.
Together, we must put in place the frameworks for implementing the technology and infrastructure needed to decarbonise air transport. For tourism, there needs to be more collaboration across the value chain on creative innovations which can allow the whole sector to decarbonise.
Without sounding self-congratulatory as participants in the activities of the WEF, I think we can safely say that the WEF has managed to create one of the few platforms that break out of the historical institutional and mental silos.
Through the work of the Aviation, Travel and Tourism Industry Council, the WEF has made major strides in gathering us all around the same table to discuss shared risks, and to explore the synergies that could help us to unlock shared opportunities. The most recent work on the transformation to a low-carbon sector, and the ongoing work programmes that underpin our excellent agenda for the remainder of today, testify to that.
Over the next year, as an industry, we may want to consolidate these and other initiatives by working towards an Aviation, Travel and Tourism Low Carbon Manifesto that captures our shared vision and roadmap for green growth up to 2050.
In conclusion, if we are serious about changing the policy and institutional landscape, the debate on breaking down the silos needs to be elevated to the next level. We need a serious discussion on the implications for UN reform, for example the strengthening of UN institutions and collaboration, but also for the way we position our issues in the G20 and elsewhere.
We will have to work harder than ever to make ourselves heard; to make the world understand that the travel and tourism sector is an important vehicle to help achieve shared green growth.
Aviation, travel and tourism can be decarbonised through balanced voluntary action, market mechanisms and regulatory incentives. This will not only contribute to 2050 climate targets, but will create decent jobs, attract socially responsible investment, and encourage entrepreneurs. It will also stimulate two-way trade, reduce poverty in developing countries, and strengthen rural economies.
The G20 could respond by recognising tourism as a key driver of green growth, infrastructure expansion and job creation; by encouraging incentives for investment in the sector, for example for energy-efficiency retrofitting or renewable-energy roll-out for accommodation, increased fuel efficiency in transport, and intensified research for low-carbon aviation operations, as well as by reducing barriers to travel by avoiding discriminatory taxation
These issues were high on the agenda when the T.20 tourism ministers, a ministerial platform inaugurated in South Africa last year, met in the Republic of Korea prior to the G20 Summit last year, and will be further pursued when the T.20 ministers are hosted by France, the incoming G20 President, later this year.
I look forward to an afternoon of constructive, frank and open engagement in the Davos tradition as we brainstorm these issues, and particularly how we could unlock further opportunities on this continent of Africa – which is the theme of our next session.
Ministry of Tourism
Tel: +27 21 465 7240
+27 83 242 7763
Natasha N Rockman
Deputy Director: Communications
Ministry of Tourism - South Africa
120 Plein Street
Tel: 021 465 7240
Fax: 021 462 5237
Cell: 076 429 2264