The Future of UK Tourism: Developing the Visitor Economy

I’ll be speaking at this Inside Government event on 7th December in London.  My talk will examine the links between economic development and tourism in the UK, in the context of the economic crisis.  Click on the image below to go straight to the event booking page which has a list of all the invited speakers.  I’ve copied some of the information about what looks to be an excellent day underneath.

Tourism is essential to Britain’s economy. Government statistics show that tourism generates £97 billion each year, employs over 3 million people and supports thousands of businesses. The government aims to help tourism achieve its potential as a central part of Britain’s growth strategy.

Britain’s landmarks, monuments, countryside and culture attract visitors from all over the world. Major international events such as the Royal Wedding, Diamond Jubilee and the 2012 Olympic and Paralympic Games provide a great opportunity to boost tourism, showcasing what Britain has to offer, and created a sustained tourism legacy.

Developing the visitor economy is a priority for the coalition government. The Government Tourism Policy, published in March 2011, aims to harness the potential this area holds to grow Britain’s economy. Objectives include growing the overseas market across the country using London 2012 and other sporting and cultural events, strengthening the domestic tourism market, increasing private sector investment and increasing flexibility for local tourist organisations. There is also a focus on improving Britain’s international gateways and national transport infrastructure.

The tourism strategy is driven by a local agenda. Destination Management Organisations will work with Visit England, local authorities, local enterprise partnerships, and local businesses to regenerate and market their area in the most effective way.

A £100 million partnership marketing fund, co-funded by the government and the private sector, will aim to draw 4 million extra visitors to Britain over the next 4 years, which equates to a £2 billion spend for Britain’s economy, and 50,000 new jobs. The government has also announced the Regional Growth Fund (RGF), worth £1.4 billion, which supports projects that use private sector investment to create regional economic growth and employment.

Agenda

This forum comes at a time of exciting growth for the sector, and will offer delegates the opportunity to understand the implications of the new government tourism strategy in boosting the tourist industry. Key issues to be discussed include strategies for promoting the growth of the visitor economy, and best practice for delivering services, partnership working and localism.

Speakers include representatives of:

Department for Culture Media and Sport

Visit Britain

ABTA

Olympic Park Legacy Company

People 1st

National Trust

Broads Authority

British Library

Marketing Birmingham

 

*photo courtesy of Chris Campbell: http://www.flickr.com/photos/cgc/

Tourism and the Economic Crisis: Where are going?

I’ve posted on here about tourism and the economic crisis, and have taught about it this year as well.  One of the things that strikes me regularly about the crisis is the unsystematic way in which it tends be analysed – one day a report of bankrupt airline, another day stories of industrial action or falling visitor numbers

I’m going to use this post to apply David Harvey’s ‘seven moments’ model of the economic restructuring process that I heard him speak about here and that he has most recently outlined in an essay for the Monthly Review that you can read online here.  I have adapted these seven moments to analyse the tourism industry in this period of restructuring; it will be interesting to see whether this adds some clarity or helps us to think about how the tourism industry will emerge from the crisis.  

Some of these topics I’ve already written about, some have suggested new areas of investigation.  Over the next few months I’m going to post on each of these topics and then, eventually, bring them all together to summarise this period of restructuring in the tourism industry.

1. The organisation and technological forms involved in producing tourism products and services

It is likely that technological changes within the tourism industry will accelerate during this period of restructuring.   The effects of an increasingly competitive marketplace and problems of over-supply are combining to produce a favourable climate for innovations in the online packaging and knowledge-gathering aspects of the industry and  price-concious customers are driving an increase in competition between web sites, which seems to be providing a stimulus for big providers to move into web 2.0 provision, so as not to lose their competitive advantage.  Where the previous waves of web development have increased efficiencies for tourism businesses and helped to reduce prices for consumers, it is likely that this next wave of web 2.0-style developments will illuminate differences between providers and give new prominence to tourists as expert reviewers of tourism products.

Another aspect of tourism development that it might be interesting to focus on here will be the emergence of new destinations.  This will be driven by three factors, as we have seen in previous crises:

  1. Decline within specific resorts and regions, as part of the fall-out from the economic crisis
  2. The growth of new tourism markets, as the national and regional ‘winners’ of the crisis emerge
  3. Socio-cultural changes that occur as a consequence of the restructuring and as a way of integrating it into pre-existing cultural frameworks.

2. The relationship to the environment

From the mid-1990s onwards, the concepts of sustainable development and eco-tourism have been central to debates about the future of tourism and have provided acres of newsprint for the broadsheets’ travel supplements as middle-class tourists have differentiated themselves from the masses by seeking our ‘responsible’, ‘ethical’, ‘sustainable’, or ‘green’ holidays.  With predicted declines in the market for organic food, ethical fashion and fairly-traded products – has this mode of tourism development also suffered and what is the future for this sector after the downturn?

3.  Social relationships within tourism

Along with the rising importance of green perspectives on tourism, ethical concerns over the social relationships brought about through tourism have been a key element of tourism discourse since the 1990s. 

This area has mainly been focused on the nature of the host-guest interaction within destinations, but has also included concerns over representation in and governance of tourism destinations, authenticity and exploitation.  As with sustainable / eco-tourism, it remains to be seen how organisations that work in this area will fare during a depression.  Recent problems at Tourism Concern are hopefully not indicative of a gradual lessening of support for ethical tourism initiatives from the public and the tourism industry.

4.  Conceptions of tourism and its values

The core question to be answered here is ‘what is tourism for?’  Historically, tourism has been seen variously as a privelege, a human right, a leisure activity, a cultural form and as a social practice.  I wrote here about contemporary developments in the relationship between tourism, social policy and regeneration.  The current crisis provides two non-exclusive conceptions of tourism within the public sphere. 

Firstly, and most likely to gain prominence quickly, is the assertion of the direct and indirect economic benefits of tourism.  In a period of a weak national currency tourism can be a key export for the UK economy and a parallel rise in domestic tourism places tourism in a position of potential growth, even if that growth is relative rather than absolute.   This potential could see tourism taking a stronger role in economic and regional development strategies, perhaps displacing retail and creative industries development in the development zeitgeist.

Secondly, it is possible that the new economics of tourism, if coupled with a sense of corporate social responsibility or development levies of some kind, could create a more favourable climate for social tourism in the UK.  In many European countries, tourism plays an important role in social policy.  Social tourism can take many forms: In France, subsidised tourism channels tourism spending to particular destinations whilst in many part of Scandanavia tourism is seen as a human right, creating obligations on the state to secure this right for its citizens.  In the UK, organisations like the Family Holiday Association have a history of providing tourism opportunities for disadvantaged groups, but this approach has never been mainstreamed into public policy. 

5.  Industrial relations within tourism

We have seen a sharpening of industrial relations within many sections of the economy over the last twelve months.  Disputes at Visteon, Vestas, Lindsey and the Royal Mail appear to be the harbingers of a new period of renewed labour militancy in the UK, but the mixture of compromises and legalistic disputes that have postponed resolution of the BA strike and the Royal Mail strikes mean that it is unclear as yet whether unions are likely to become more or less powerful through the restrucuring currently underway in response to the economic crisis.  The activities of unions in the travel and public sectors are likely to have the greatest impact on the tourism industry, but rising worker militancy generally could lead to changes in the way that non-unionised workers (the majority of tourism employees) react to threats of closures, job losses, pay cuts and work intensification, as the employees of Thomas Cook in Dublin show in the video below:

6.  Tourism policy and politics

In the UK, most public agencies are in a state of paralysis at the moment as they wait for an election and the almost inevitable period of regime change that will follow it.  The smart money seems to be on an early election in March, so until then it is going to be very difficult to get a feel for how tourism policy in the UK is going to develop.  The incoming conservative party have let it be known through various outlets that they plan a ‘bonfire of the quangos’ and no doubt this will hit our tourism agencies.  However, every incoming government since 1979 has promised exactly this and then, faced with the prospect of losing control over spending or developing truely accountable structures of governance, has tended to spend a lot of money on the restruturing and rebranding of the quangos instead.

7.  The social reproduction of tourism

Within Harvey’s model, this seventh term relates to the social reproduction of labour within capitalism and the way in which systems of production are maintained and developed through social processes.  Within this adaptation, I will develop the final category as a synthetic product of the preceding areas of analysis.  Once the 6 areas above have been considered dialectically, it will be possible to draw some initial conclusions about the ways in which the tourism industry is being maintained and developed as the crisis progresses and the strategies of restructuring become more clear. 

Each of these seven areas will provide material for blog posts throughout 2010, with a final article being produced towards the end of the year.

 

Chris Harman 1942-2009

This is a recording of Chris Harman, the influential British Marxist and SWP activist who died suddenly this weekend in Egypt, speaking at Marxism 2009  in the summer.  Chris will be greatly missed by the left for his activism and inspiration.   You can read a tribute to Chris written by Alex Callinicos by clicking here.

Hey big spender!

Will Hutton is interviewed about the economic crisis in this week’s Big Issue magazine. Despite Hutton’s position in the mainstream media as a bit of a maverick, he normally makes quite conservative predictions about economic and social matters, trumpeting the rise of China or promoting economic / managerial approaches to social and cultural change. As director of the Work Foundation, he is certainly not a radical voice and for that reason we should look at his predctions as representative of a current within mainstream political circles, albeit one that he is able to voice publicly due to his ‘outsider’ status in the media.

 

Hutton points out that an economic recovery will require a rise in spending, by consumers or businesses. The consumer, claims Hutton, is concentrating on rebuilding savings, while businesses are becoming debt-minimizers in order to future-proof themselves against difficult economic times. Whether the British are re-building savings or merely starting to save after years of credit-fuelled spending is a moot point, but the likely outcome of this is stagnation in the economy, as happened in Japan in the 1990s after their economy crashed following a sustained boom. Stagnation of course, is even more problematic than a recession for a capitalist economy. A recession and a collapse in asset values at least offers the opportunity for growth and the restoration of the rate of profit; a prolonged stagnation denies capitalists the ability to grow their capital and limits the potential for competition, destroying the engine of the economy.

 

The stagnation that Hutton predicts however, doesn’t look like stagnation at the level of the individual worker or their communities. In order to maintain profit levels, it is likely that the current rate of job losses could continue at 60,000 per month for another three years before stabilisation is achieved. This could (should) lead to a period of social change as the economy and social provision is restructured to reflect this new socio-economic reality. Whether this period of change can be politicised to promote positive political developments remains to be seen, but already the possibilities of workforce mobilisation and collective responses to the crisis are facing up to the use of the recession to intimidate and manipulate workers. Politicians are keen to avoid taking the blame for the current crisis, as each country seeks to line up other markets or ‘the world financial system’ as the villains of the piece. This tactic creates a moving, camouflaged target for the public at large to aim at, and one that is obscured further by techno-managerial jargon and PR.

 

Will Hutton’s prescription for the crisis is a super-Keynesian level of fiscal stimulus, mainly based around a massive programme of public works similar to that which helped to lift the US economy out of the great depression in the 1930s. This might include large engineering projects and the development of a green economy. Of course, after the 1930s the US was left with a vastly expanded productive capacity which could only be usefully employed on a war footing over the following 60 years. The government funded expansion of production can only fix the system in the short-term, eventually the levels of state production work against competition and so have to be reduced and the debts incurred have to be repaid.

As David Harvey has pointed out, the current crisis offers an opportunity, as do all crises, for the reconfiguration of society within a different ideological framework. A more equitable society is not the necessary outcome of this process. Previous crises have seen the deepening and strengthening of the current system of power and attempts to provide a stimulus to return the economy to ‘normal’ are attempts to do just this.  The human costs of this will be enormous, and should shame journalists and politicians out of their current fetishisation of the fiscal stimulus as they hide behind superlative descriptions of it’s size and importance.

David Harvey ‘The Crisis Today’ @ Marxism 2009

By far the best thing I saw at the conference and an insightful, challenging analysis of the next steps in the crisis in which David Harvey presents a new model of restructuring around seven ‘moments’ that offers an opportunity to the left for a reconceptualisation of it’s approach.

Can tourism be a new driver for regeneration?

Click on the image below to read a short article I have written for the British Urban Regeneration Association.  In it, I question whether the tourism industry, conceived solely in economic terms, is an appropriate partner for regeneration or whether we need to develop an understanding of tourism as a social force before we turn to it as an income stream during the economic crisis.

fivepoundpint-001

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Impacts of the economic crisis on regeneration

Brendan Nevin has written a gloomy article in the April edition of New Start, looking at the likely impact of the current economic crisis on regeneration policy in the UK.

Nevin starts with the (reasonably conservative) prediction that the UK’s annual budget deficit may reach £200bn by 2011, 12% of GDP and the highest in the developed world.  The financing of this debt, during a period of recession when government receipts will fall, will be a huge burden on the economy, leading to pressure on “the structure of state expenditure” or, in other words, large cuts in public spending.  Could this involve the intervention of the International Monetary Fund, recently re-capitalised with $1.3 trillion by the g20 to support countries struggling in the downturn?  In 1976, when the UK government turned to the IMF during a period when it could no longer service it’s debts, a 25 year period of belt-tightening followed.  Now, with the IMF at the vanguard of globalised neoliberalism, would the IMF impose the same ‘structural reforms’ on the UK as it has on ‘developing’ nations seeking it’s help over the last twenty years?  This could be a trigger for the extension and deepening of the privatisation of UK public services and the capitalisation of the public sphere that has been the main goal of the neoliberal project here since 1979.

So how might this likely squeeze on the public purse effect regeneration policy?  Nevin argues that the coming period should see a re-evaluation of the generic finance and property development-led economic regeneration strategies that many of our urban areas have chosen since 1997.  As these sectors become less obvious drivers (i.e. funders) of regeneration, government subsidies will need to be re-targeted to other sectors, perhaps producing more local / regional diversity in regeneration policy with more sustainable future outcomes.

Paradoxically, the only way to maintain current levels of spending within regeneration may be to provide a greater role for the private sector in funding projects, at a time when private sector investment is grinding to a halt.  To do this will mean promoting more obvious returns on private investment, privatising the benefits of regeneration by  increasing the private ownership of new assets and revenue streams and probably by reducing the levy on private sector profits that has recently delivered an income stream for projects without an obvious profit-rationale, such as community facilities and social infrastructure.  We can expect to see the value of Section 106 and other ‘developer contributions’ falling as a way of incentivising private sector investment in development.  This will reduce the funding available for social infrastructure, while the need for strong social supports continues to increase as this recession bites.

So long as we continue to attempt to shore up existing models of regeneration funding, it is hard to see how the current, historically high, levels of spending on regeneration can continue.  The great danger is that in an attempt to carry on regardless, we slip into a more private sector-led mode of development that deepens inequality rather than addresses its causes.  New thinking about regeneration funding and policy is needed to avoid reversing the significant improvements made to our declining towns and cities over the last ten years.

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South East tourism and the economic crisis – TV update

You can view the report on the BBC Politics Show South East about tourism and the economic crisis by clicking here.  The link will open up theshow in the  BBC iPlayer.  The whole article starts 30 minutes in and I am interviewed along with two other contributors from 38 minutes.

TV appearance – Sunday 22nd March, BBC Politics Show

I’ll be appearing on the BBC’s Politics Show, in the south-east section this Sunday.  I’ll be talking about the impact of the economic crisis on tourism in the south-east region of the UK.  For those of you not able to watch it between 12.30 and 12.50 on Sunday, you can view it on the BBC iPlayer by clicking here on the day or for seven days after.

WTTC Economic Impact 2009 study published

The World Travel and Tourism Council (WTTC) has just published its annual economic analysis, looking forward to 2009.    After four years or strong growth, the WTTC are predicting that the global tourism economy will contract by 3.9% in 2009 and that will only expand by 0.3% in 2010.   Long term, the WTTC still forecasts strong growth, with tourism’s contribution to world GDP rising to 19% ($10.5bn) by 2019.

These are sobering figures, reflecting the macro economic crisis and a clear indicator of the global nature of this structural shift in the world economy.   The last great structural recession heralded the start of this era of capitalist globalisation, as governments and corporations grappled with how to respond to a period of falling profits and industrial change.  For the tourism industry this involved the decline of many of the traditional mass tourism destinations and their replacement by new ones – we can see this in the emergence of the Mediterranean resorts – but the fallout from this period also saw the emergence of new forms of tourism such as urban tourism and eco-tourism.

This recession will be truely global, with no significant economies operating outside of the prevailing neo-liberal structures, meaning that every economy will feel the effects of the restructuring process.  As with previous recessions however, these effects will not be spread evenly and there will be winners and loser in the tourism industry at the global level.  The emerging tourism generating countries such as Brazil, Russia, India and China (BRIC) will become more important as the global balance of economic power shifts, prompting the world’s main tourism destinations to restructure to meet their needs.  This is a process that has been going on for some time, slowly, but that will probably accelerate now.  We may see currently popular destinations decline, especially those with a dependence on Western tourists.  Conversely we should see new destinations emerge along with, potentially, new forms of tourist experience as the BRIC countries flex their tourist muscles in the long term.

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