Dominican Republic - Approaches Towards a Sustainable Tourism Development

A Strategic Concept

Diploma Thesis, 2001

197 Pages, Grade: 1.3





Figures and Tables

1 Introduction
1.1 Problems and Objectives
1.2 Scope and Limitations
1.3 Structure of the Work
1.4 Methodology and Information used

Part 1: Theoretical Background

2 Development and Structure of International Tourism
2.1 Tourism: A Definition
2.2 The Mass Tourism Phenomenon
2.2.1 The Historical Context
2.2.2 The Mass Tourism Development in the ‘North’
2.2.3 The Development of ‘North- South’ Mass Tourism
2.3 Development of International Tourism
2.4 Contemporary International Tourism Trends: Year 2000
2.4.1 World and Regional Tourism Arrivals
2.4.2 Tourism Spenders
2.4.3 World Market Shares
2.5 Future International Tourism Trends
2.6 Epilogue: Global Tourism Industry in Crisis?

3 Precursors of Sustainable Tourism Development
3.1 Definition of Development and Theories
3.1.1 Economic Growth Theory
3.1.2 Modernization Theory
3.1.3 Dependency Theory
3.1.4 Neoclassical Counter-Revolution
3.1.5 Alternative Development
3.2 Tourism and Development Perspectives

4 Impacts of Tourism Development
4.1 Economic Impacts
4.1.1 Foreign Exchange Earnings
4.1.2 Income and Employment Effects
4.1.3 Regional Developmen
4.2 Socio- cultural Impacts
4.2.1 Demonstration Effect
4.2.2 Cultural Clashes and Inequalities
4.2.3 Resource Use Conflicts
4.2.4 Transformation of Values
4.3 Environmental Impact
4.3.1 Depletion of Natural Resources
4.3.2 Pollution
4.3.3 Physical Impact
4.3.4 Environmental Awareness Rising
4.4 Summary

5 Demand Driving Forces and the ‘New Tourist”

6 The Challenge: Sustainable Tourism Development
6.1 Sustainability versus Sustainable Development: The Historical Context
6.2 Soft Tourism: Integral Part of Sustainable Tourism Development
6.3 Sustainable Tourism versus Sustainable Tourism Development
6.4 Principles and Objectives
6.4.1 Emphasizing Community-based Tourism
6.4.2 Carrying-capacity Approach
6.5 Strategic Planning and Sustainable Tourism Development
6.5.1 Life-cycle Concept
6.5.2 Strategic Planning Process
6.6 Competitive Strategies
6.6.1 Cost Leadership
6.6.2 Differentiation
6.6.3 Focus
6.7 Limitations of Sustainable Tourism Development
6.7.1 Lack of Government Intervention
6.7.2 Anti- competitive Practices
6.8 ‘Sustainable’ Mass Tourism versus Eco-Tourism

Part 2: The Case of The Dominican Republic

7 Introduction

8 General Aspects of the Dominican Republic
8.1 Location
8.2 Natural Resources and the Environment
8.2.1 Topography and Hydrography
8.2.2 Flora and Fauna
8.2.3 Climate
8.3 History
8.4 Demographic Overview
8.4.1 Language and Culture
8.4.2 Population
8.4.3 Education and Health
8.5 Economic and Social Environment
8.5.1 Economic Development of the Past
8.5.2 Basic Economic Indicators
8.5.3 Economic Sectors and Employment
8.5.4 Economic Performance 2001 and Outlook
8.6 Government and Politics
8.6.1 Political Influencing Parties
8.6.2 Foreign Relations
8.7 Tax System, Capital Repatriation and Investment Climate
8.8 Infrastructure
8.8.1 Electricity
8.8.2 Water supply
8.8.3 Telecommunications and Internet
8.8.4 Transportation and Road Network
8.9 Access to the Dominican Republic
8.9.1 Access by Air
8.9.2 Access by Water

9 Tourism Industry in the Dominican Republic
9.1 Tourism Trends in the Caribbean Region
9.2 Historical Tourism Development
9.3 Recent Tourism Development
9.4 Supply Analysis
9.4.1 Attractions
9.4.2 Dominican Lodging Market
9.4.3 Marina Supply
9.4.4 New Tourism Development Projects
9.5 Main Competitors
9.6 Demand Analysis
9.6.1 Tourist Arrivals by Air until 2000
9.6.2 Tourist Arrivals by Air in 2001
9.6.3 Tourist Arrivals by Sea
9.6.4 Tourist Market Segments
9.7 Impacts of Tourism in the Dominican Republic
9.7.1 Economic Impacts
9.7.2 Socio- cultural Impacts
9.7.3 Environmental Impacts
9.8 Government Planning for Tourism
9.8.1 Structure and Legislations
9.8.2 Planning for tourism
9.9 Summary

10 Critical Evaluation of the Tourism Industry: SWOT- Analysis

11 Formulation of a Competitive Strategy

12 Plan Development-Recommendations and Actions
12.1 Integrate Tourism in National Strategy
12.2 Equity
12.3 High Quality Experience of Tourism Product
12.4 Improve Quality of Life of the Host Community
12.5 Improve Institutional and Legislative Framework

13 Limitations and Challenges

14 Conclusion




illustration not visible in this excerpt

Figures and Tables:


Fig. 1: Development of Tourist Arrivals and Revenues 1950-2000

Fig. 2: International Tourist Arrivals in Industrial- and Developing Countries In Market Shares

Fig. 3: Development of International Tourist Arrivals In Regional Market Shares (1950-1999)

Fig.4: Regional Trends, % change 2000/99

Fig. 5: Market share of World Total International Arrivals 2000

Fig. 6: WTO Tourism 2020 Vision: International Tourist Arrivals Market Share (%)

Fig. 7: Tourist Originating Countries in 2020

Fig. 8: Value Chain: All- Inclusive Package Tour

Fig. 9: Butler Tourism Destination Life Cycle Model

Fig.10: Steps in the Tourism Planning Process

Fig. 11: SWOT Analysis

Fig. 12: Porter, M.E. (1992). Competitive advantage: Generic Strategies


Fig. 13: The Dominican Republic in the wider Caribbean

Fig. 14: Country Map of the Dominican Republic

Fig. 15: Domestic Travel Times in the Dominican Republic

Fig. 16: Analysis and Synthesis of the Tourism Industry

Fig. 17: Outbound Travel Growth Forecast: 1997- 2006

Fig. 18: Touristical Zones in the Dominican Republic

Fig. 19: Distribution of hotel rooms in different regions

Fig. 20: International tourist arrivals 1975- 2000 (in 1000)

Fig. 21: Dominican Republic and the Caribbean: Tourist Arrivals 1995- 2000

Fig. 22: The six most important tourist-originating countries: Stays in Santo Domingo compared with Beach Resorts Sojourns

Fig. 23: Tourist Arrivals by Sea 1993-2000

Fig. 24: Cruise passenger arrivals 2000

Fig. 25: Share of Tourism GDP- TSA results

Fig. 26: Participation of the sub-sector Hotels, Restaurants and Bars In GDP (%): 1970-2000

Fig. 27: Foreign exchange generators, selected by industry sectors: 1995-2000

Table 1: Key Economic and Social Indicators (Billions of US$ unless otherwise indicated)

Table 2: Structure of the Economy (billions of US$ unless otherwise indicated)

Table 3: Percentage of Employees Working in Economic Sectors (in 2000)

Table 4: Number of Regular and Charter Flights in 1999-2000

Table 5: Number of Seaport Arrivals in 1999-2000

Table 6: Hotel Rooms Supply and Occupancy Rate

Table 7: Hotel room development: Dominican Republic and the Caribbean

Table 8: International Arrivals in the North

Table 9: Change of Tourist Arrivals: 1980- 2000 Market Shares (in%)

Table 10: Tourist Arrivals according to Nationality

Table 11: Tourist Arrivals according to Country of Origin: January-June 2000/2001

Table 12: Hotel Occupancy Rate in different regions: First semester 2000-2001

Table 13: Income per tourist

Table 14: Percentage of Employees working in the tourism sector

Table 15: Relation Imports of goods& services and Foreign Exchange Earnings from Tourism

Table 16: Distribution of Investments in Hotel Resorts* by country of origin: 2000

Table 17: Strengths and Weaknesses of the Dominican Tourist Product

Table 18: Opportunities and Threats

“El costo de la vida sube otra vez

el peso que baja

ya ni se ve

y las habichuelas no se pueden comer

ni una libra de arroz ni una cuarta de café

a nadie le importa qué piensa usted

será porque aquí no hablamos


ah ah es verdad

do you understand?

do you, do you?"

“The cost of living is going up again

the peso which is dropping

can’t be found

and you can’t eat beans anymore

or a pound of rice or a measure of coffee

no one cares what you think

could it be because we don’t speak


Ah, that’s the truthem

do you understand?

do you, do you?"

Juan Luis Guerra "El costo de la vida”

1 Introduction

1.1 Problems and Objectives

Often referred to as the ‘smokeless industry’, tourism has become one of the fastest growing, most dynamic sectors of economic growth in the world. Between 1980 and 2000 the share of international tourism in global economic activity rose globally by 4.6% a year on average and is expected to continue to grow at the same rate per annum in the next decade. With an estimated 698 million international arrivals in the year 2000, tourism has become the world's largest trade.

Tourism is now a key sector or is likely to become so in many developing countries, which show potential. However, over-reliance on tourism, especially mass tourism carries significant risks to tourism-dependent economies. Especially, if tourism development is seen as a unique alternative to a declining agricultural industry or other economic sectors in crisis. Critics point out that tourism in developing countries can create foreign dependency, but as well the creation of separate enclaves, the reinforcement of socio-economic and spatial inequalities, rising cultural alienation and vulnerability to factors outside the control of the destination.

By the early 1990s, national tourism authorities had generally come to realize that the economic benefits of tourism would not be achievable in the long run unless tourism was properly planned and managed. Thus, in 1996 the tourism industry was the first sector to have launched an industry-specific action plan based on Agenda 21, a comprehensive program of action approved by 182 governments at the 1992 United Nations Conference on Environment and Development (UNCED), the Rio Earth Summit. It provided a global blueprint for achieving a sustainable development of tourism, identified as one of the key sectors of the economy, which could offer a steady source of tourism income and eliminate poverty in the long term.

However, the established policy objective of tourism – to stimulate economic development – should be widened to include the condition that any such development must also embrace an explicit concern for the social and environmental assets upon which its future prosperity depends. Tourism’s role in economic development is important, but it cannot be considered in a vacuum.

Since the launch of the document by the three organizations WTTC (World Travel & Tourism Council), WTO (World Tourism Organization) and the Earth Council, they have begun a series of regional seminars to increase awareness of the conclusions, and to adapt the program for local implementation. Furthermore, the WTTC has established the Green Globe program, which offers advice and promotional support for tourism enterprises willing to commit themselves to ‘improvements in environmental practices’. Other international industry bodies have also taken action. For example, the IFTO (International Federation of Tour Operators) has funded projects in Majorca and Rhodes, to identify specific targets for sustainable tourism; and the International Hotels Environment Initiative has sought to make hotel management more environmentally friendly by compiling a manual of good practice and giving advice to its members, including major hotel chains. The United Nations (UN) and its agencies have addressed the importance of tourism and sustainable development on various occasions. More recently, the General Assembly declared the year 2002 as the International Year of Eco-tourism, which should encourage eco-tourism practices and promotion in developing countries within the framework for the development of sustainable tourism.

As a result, many developing countries have since espoused the principle of sustainability in shaping their tourism policies. However, few of them have been able to convert this into concrete action owing to the short-term economic interests to which, all too often, priority is given, to the detriment of protecting social and environmental assets.

In summary, tourism presents a great opportunity, but there are a number of challenges to be met if the potential for sustainable development and poverty elimination is to be realized. An active policy implementation process for sustainable tourism development forges partnerships and dialogues between different parties with different interests like private enterprises, governmental institutions, international organizations, but as well local communities.

The purpose of this paper is to create and formulate clear, firm and equitable guidelines in a tourism policy concept that is set in the context of sustainable development and aims further to raise the competitive position of a destination. Theory will be demonstrated in practical terms in the case of the Caribbean tourism destination, the Dominican Republic.

1.2 Scope and Limitations

The proposed sustainable tourism concept should serve as a framework and orientation for national and international stakeholders or investors who should in future contribute with their actions to an ecologically balanced and socially acceptable tourism development in the Dominican Republic. Due to the limited volume of this study, it only comprises the first approaches and cannot be seen as a fully completed strategic concept. The results and recommendations in the study will, rather, ‘provide a basis for enhancing the tourism planning process’ in the country, where data and relevant information was available. The planning process must include further studies that will be undertaken as well at local and community levels.

Due to the specific characteristics of this Caribbean island, the outcomes presented do not necessarily apply to other tourism destinations.

Furthermore, impacts mentioned in the theoretical part are limited to negative and positive effects that are relevant to the specific case study.

Nonetheless, what underlies this work is a competitive strategy, which nowadays seems to be the most effective one: the concept of sustainable tourism development is recommended as a broad strategy for all destinations.

Detailed measures that could be taken by tour operators or agencies could not be considered here, as this would have gone beyond the scope of the study. However, some remarks will be made where they seem necessary for the understanding of the context.

Though the study had already reached an advanced stage, the impact of the New York attacks and the subsequent tragic plane crash, and their effects specifically on the Dominican Republic, have been considered as far as possible, where information could be assembled.

1.3 Structure of the Work

The present paper is structured in two major parts, including (14) chapters. The first part provides the basic theoretical background.

After an introductory section, the second chapter presents some information on the historical and recent development of tourism, with a main focus on the mass tourism phenomenon, as well as some future tourism trends.

In the third chapter the precursors of sustainable tourism development will be outlined. Some relevant development theories that can be considered in the context of tourism in developing countries will be summarized.

The main positive and negative impacts of tourism development will be outlined in the fourth chapter.

The fifth chapter will quote the general trends that make a sustainable tourism development indispensable in our common future.

Finally, a theoretical insight of the strategic concept of sustainable tourism development will be provided in the sixth chapter. It also concludes the tourism planning elements for the successful implementation of a tourism concept and a general overview of fundamental competitive strategic decision-making options. Some limiting factors of sustainable tourism development end this chapter.

The first part will be closed with a reflection or comparison between ‘(sustainable) mass tourism’ and ‘(sustainable) eco tourism’ as forms of tourism development.

The second part will attempt a practical application of theory in the case of the Dominican Republic.

After an introduction, the next chapter, of the second part presents some general aspects of the Dominican Republic.

The second chapter in part 2, starts with some tourism trends in the Caribbean and the historical development of Dominican tourism, before analyzing the supply and demand side as well as its main competitors. This includes also the role tourism plays for national authorities and the identification of the general tourism market structure of the island. An evaluation of the economic contribution or negative economic, social or environmental impact of tourism in the Dominican Republic will as well be done in this chapter. This will comprise some quantitative economic data, but also provides some qualitative socio-cultural and environmental considerations.

A critical evaluation of the Dominican tourism industries’ strengths and weaknesses, in consideration of future trends, will be part of the tenth chapter.

The results will be used in the eleventh chapter as terms of reference for the formulation of the grand strategy; as well as for essential future recommendations and necessary actions that will be given in the twelfth chapter.

The work will close with a critical assessment of limitations or challenges for sustainable tourism development in the Dominican Republic and ends with a final conclusion.

1.4 Methodology and Information used

To accomplish these ends recent studies from the supporting consulting company, Horwath Sotero Peralta& Asociados, were reviewed and research data collected. However, to guarantee an overall objective evaluation, supplementary papers and statistics were gathered from a broad range of national and international institutions (e.g. National Bank, Chambers of Commerce, CPT, Kiskaya Alternativa, UNDP, USAID). Other sources like local universities, private and public libraries as well as some newspapers and the Internet (e.g. websites of CTO, CEPAL, OPI- RD and CAST) provided further information. Moreover, an important source of information has been the library of the German NGO Tourism Watch in Bonn.

Besides secondary research, primary information was basically obtained through the series of informal interviews with key government officials (e.g. Tourism Ministry and Ministry for Women), private sector stakeholders (e.g. ASONAHORES, GTZ), agents of tour operators and hotels as well as representatives of NGO’s (e.g. CEBSE, DED). All these interview partners were asked to identify issues, recommend strategies or assess options for the future tourism development of the Dominican Republic. With this methodology it was intended to receive input from various key stakeholders together. These activities not only helped to clarify specific issues but had to a certain extent a brainstorming character. As a result of travel to almost all important tourism areas, and of work experience in the tourism sector, the author of this paper has been able to make a certain comparison with personal experience and judgments. Thus, some of the results are descriptive or qualitative in nature.

The process of gathering information was often delayed due to the fact that sometimes two or three meetings were necessary as the data required was either not available or not provided in a timely or efficient fashion. It also appeared that tourism-related businesses were not able or willing to supply the literature needed. This difficulty in collecting information was very time consuming.

It is well-recognized that tourism plays an important role in the economy of the Dominican Republic. However, there have been few comprehensive studies that measure the economic impact of tourism and its linkages to other sectors in the economy. The latest detailed secondary literature in this area tends to be incomplete or out of date. Thus, collecting and analyzing up-to-date information has often involved considerable challenges.

Furthermore, it was hard to find latest tourism research literature; even public libraries or the most popular private universities where ‘Tourism’ or the ‘Hospitality Industry’ are subjects of study, could not provide two important European and especially English tourism research journals, like the Annals of Tourism Research or Tourism Management. This might be a result of the general strong North American influence, or the lack of a profound research culture in the area of tourism in the Dominican Republic.

Part 1: Theoretical Background

I n the Middle Ages people were tourists because of their religion, whereas now they are tourists because tourism is their religion.

~ Robert Runcie ~

2 Development and Structure of International Tourism

The core of the whole study is the development of tourism in a developing country that is known as a mass tourism destination – the Dominican Republic. Thus, this paper starts with an introduction to tourism, with a main focus on the mass tourism phenomenon. Following this, the latest tourism figures of international tourism and future trends will be presented.

2.1 Tourism: A Definition

A variety of definitions exist for the term ‘tourism’, which is a relative newcomer to the English language. It was first used to define ‘pleasure travel’ only, and in particular, the early package ‘Cook’1 tours. Hunt and Layne (1991: 11) acknowledge that ‘travel’ was the most accepted term until 1987 and that since that time ‘tourism’ is the accepted expression, used to "singularly describe the activity of people taking trips away from home and the industry which has developed in response to this activity".

Many people believe that tourism is a service ‘industry’, like Leiper (1990: 400) who suggests that: ’The tourist industry consists of all those firms, organizations and facilities, which are intended to serve the specific needs and wants of tourists’. Others think, “there is no single Standard Industrial Classification Code called 'tourism (although the satellite tourism accounts should remedy this problem)” and, thus, “tourism should not even be referred to as an industry” (Mill and Morrison 1998: 2). Other experts, such as Gunn (1994: 4) believe in a much broader definition that tourism "encompasses all travel with the exception of commuting" and that it is “more than just a service industry”.

According to the definition of the World Tourism Organization "Tourism comprises the activities of persons traveling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes". Further, the WTO divides tourism into ‘domestic tourism’, that “involves residents of the given country traveling only within the country” and ‘international tourism‘ that “involves non- residents traveling in the given country” (WTO 1998a: 17).

The Swiss professors and founders of the Swiss Tourism Research Institute AIEST in Bern, Walter Hunziker and Kurt Krapf, published their general theory of tourism in 1942 and defined the subject as

The totality of relationships and phenomena linked with the travel or stay of foreigners in a locality provided they do not exercise a major, permanent or temporary remunerated activity’ (Kaspar 1991: 18).

The following study employs this internationally accepted and frequently used definition of tourism as well as the WTO’s formulation of ‘domestic’ and ‘international tourism’. ‘The totality of relationships and phenomena’ covers the diversity of manifestations of tourism, embedded in the economic, political, social, cultural and ecological systems and conditions that influence its extent and structure. It is important to point out that this definition includes e.g. congress or business tourism, but explicitly excludes business or cross-border commuters (Aronsson 2000: 24).

Another term that requires some attention in this context is ‘mass’ tourism. Generally, it is clear that the expression ‘mass’ implies a large number of people. But the term can have many nuances. The current practice is to rank countries on the basis of the total number of visitors received annually. However, countries vary in their geographical and demographic size. Receipt of five million visitors annually by France and Belgium, for example, is not the same matter given their vast territorial difference. Furthermore, the seasonal fluctuation in tourism is an important aspect (Wahab and Pigram 1997: 51).

A detailed definition was found in Poon (1993: 32), who relates mass tourism to two main characteristics: a) participation of a large number of people in tourism; b) the holiday is standardized, rigidly packaged and inflexible; and c) offered to an undifferentiated clientele.

2.2 The Mass Tourism Phenomenon

2.2.1 The Historical Context

Travel for leisure in Western Europe began a century ago, but it was limited to privileged classes. These included members of the aristocracy, bourgeoisie, political elite and some well-off urban dwellers. ‘Holidaying’2 was thus a symbol of economic affluence and social prestige. Travel distances, however, remained short, generally within the country. The Alps were one of the first major destinations that involved some travel.

An early result of the development of railways in Europe increased travel to the Mediterranean coast by privileged European tourists, especially from the 1920s on. But tourism advanced significantly only when industrial workers in different European countries began to receive paid and extended holidays, with reduced working hours (Becker et al. 1996: 12-13).

Tourism in the U.S. developed for the same reasons as in Europe- the development of the railway opened up the country to travelers. A rapid development in transportation, especially involving the steam locomotive, made travel easier and faster. This opened up the possibility of traveling longer distances as well. The Industrial Revolution produced a class of wealthy people who had the time to travel. Touring became popular and by the late 1800’s, the USA was also attracting Europeans who came to see the natural beauty, hunt buffalos or were fascinated by travel for religious reasons (Mill& Morrison 1998: 12).

It is estimated that until the Second World War, about 10% of the population went annually on vacation in industrialized countries, including the United States and Canada (Becker et al. 1996: 13).

2.2.2 The Mass Tourism Development in the ‘North’

Mass tourism, as we know it today is a post Second World War phenomenon, which has been an integral part of European and North American lifestyles since the 1950s. An expanding economy in the western industrial nations, on the one hand, and sustained labor movements, on the other, allowed workers to obtain increased wages and benefits. By the 1960s, about 40% of the mainly urban European population took leisure holidays, which were seen as an escape from metropolitan stress, insecurity, unhealthy environment (e.g. pollution) and so forth. Holidaying in general was taken as a synonym of relaxation and comfort, reflecting the growing consumer culture. Higher education levels and greater awareness of other areas of the world also led to a desire on the part of more people to travel.

With the massive creation in the 1960s of ‘package tours’, today’s new form of traveling, the ‘organized’ group and ‘inclusive’ tourism type was initiated, and this marks the beginning of mass tourism (Inskeep 1991: 9).

Modern long-distance tourism and economic travel by large numbers of people has been favored through major improvements in transportation including the development of commercial jet aircraft services and train and highway networks in Europe, the USA, and elsewhere (Hein 1997: 20). In the past decade changes also included improved worldwide computer technology or reservation networks on the supply side (Becker et al 1996: 13).

For mass tourism to develop, there has to be on the demand side a strong participation of the large middle class, as well as the relatively better-off strata of the lower classes. This has been the case in regard to the evolution of mass tourism in Europe, and it is a process that seems to be repeating in many developing countries and regions (Ghimire 1997: 6).

Tourism has reached the point where, as Urry (1990: 4) states, “ To be a tourist is one of the characteristics of the ‘modern’ experience. Not to ‘go away’ is like not possessing a car or a nice house. It is a marker of status in modern societies.”

Thus, traveling patterns changed from being a luxury or prestigious for the upper classes to an ‘essential need’ in the modern world (Weinhold 1989:20). However, “the pleasure of traveling, enjoying nature or other cultures is by no means a basic human need, but bound to a certain social development level” (Spode 1988: 41).

2.2.3 The Development of ‘North- South’ Mass Tourism

Previously, well-defined groups traveled to the South – explorers, traders, colonizers, missionaries, scientists and administrators, especially in the wake of mercantile trade and colonization (Hein 1997: 21).

Since the 1950s developing countries have received increasing numbers of international tourists, largely from developed countries. At this time, governments began to see tourism as an important tool for economic development - one that was also believed to result in a net resource inflow from the North. The tourism industry was considered a more reliable source of foreign exchange than minerals, raw materials, cash crops and manufactured goods, which had increasingly unstable prices. Tourism was also seen as an exceptional opportunity to valorize national culture, wildlife and unique natural features. Important investments were made in infrastructure, tourism training, accommodation and other tourist facilities.

Mass tourism involving travel from the industrialized North to the developing countries of the South is a more recent phenomenon, beginning basically in the 1970s. Rising standards of living in the countries of the North, declining long-haul travel costs, increasing holiday entitlements, changing demographics and strong consumer demand for exotic international travel have resulted in significant tourism growth to developing countries.

The private sector, and transnational corporations (TNCs) in particular, were attracted because of the high growth potential of the tourism sector in developing countries. Another important frame condition in the making of mass tourism to the South was the existence in developing countries of several generous incentives that encouraged multinational hotel chains to invest. This included repatriation of profits, cash grants, assistance with project financing, equity participation, loan guaranties, tax-free bonds, tax holidays, investment and other tax credits, double taxation relief and so on (Poon 1993: 33). Therefore, to some extent, the massive arrival of Northern tourists over the past 25 years has reflected the ability of Northern travel businesses and TNCs to promote travel in the South, especially through package tourism. A small number of them have probably been attracted by adventure, learning and encounters with new territories and people. But the majority of Northern tourists seem to have been attracted mainly by the pleasures of sun and beaches – and, in some cases, sex (Hong 1985: 70-81; Truong 1983: 53-54).

2.3 Development of International Tourism

The growth in world travel and tourism since the 1950s has been phenomenal. Indeed, between 1950 and 2000 annual world tourist arrivals increased nearly twenty-eightfold from about 25 million to 698 million, representing over one tenth of the global population. In the year 1960, about 69 million arrivals were counted, while in 1975 already 222 billion were registered, despite a temporarily decline due to the oil crisis in the years 1974/75. After another recession at the beginning of the 80s, ending with the year 1985, high increases in tourist arrivals led to a global rise of more than 5% a year on average until the year 2000. Pauses in the growth of tourism were only noted during the Gulf War in 1991, and during the financial and economic crisis in South East Asia of 1997/98, which led to high unemployment rates in many industrial countries (WTO 1999c: 1).

In addition, there are domestic tourists who are not included as figures for them are not available on a global basis. However, according to the WTO, domestic tourism is estimated to be about ten times that of international tourism based on tourism trips taken, which means that the total number worldwide would amount to approximately 6 billion tourist arrivals a year (WTO 1998b: 15).

Fig. 1: Development of Tourist Arrivals and Revenues 1950-2000

illustration not visible in this excerpt

Sources: Tourismus in Entwicklungsländer 2000: 12 ; WTO 2000b: 11

Between 1950 and 2000 revenues from international tourism grew from US$ 2.1 to US$ 476 billion, which is a two hundred and twenty-six fold increase. A first remarkable rise was between 1975 and 1980, from US$ 40.7 to US$ 105.3 billion. However, due to the above-mentioned recession, the revenues at the beginning of the 80’s stayed relatively steady, except for a 6.1% decline in 1982 (Stäbler and Vielhaber 2000: 12). From 1985 tourism revenues grew faster than the rest of international trade, between 1989 and 1998 about 8.1% a year on average (WTO 1999c: 8).

Revenues from international tourism in developing countries also increased strongly and between 1990 and 1997 alone showed a rise of 9.7%, from US$ 70.6 up to US$ 134.8 billion. However, due to the Asia crises it declined in 1998 to US$ 130.6 billion (Stäbler and Vielhaber 2000: 20).

Official statistics indicate that in 1998, over 30% of international tourist arrivals occurred in the developing world (WTO 1999c: 18).

Fig. 2: International Tourist Arrivals in Industrial- and Developing Countries In Market Shares

illustration not visible in this excerpt

Sources: WTO 1999c: 18; Aderhold& Vielhaber 1981: 13

In particular, the East Asia/Pacific region has seen a remarkable growth in tourism (6.4% average annual increase between 1990 and 1999), despite a short decline in 1997 and 1998 due to the financial crisis. It is now the third region in importance after Europe and the Americas. Africa and the Middle East have experienced more restrained progress (see figure 3), probably due, in part, to political instability. Although the regional market share of South Asia is considerably small, the average growth per year in the 90’s was with 6.7% relatively high.

Between 1990 and 1999, the growth of international tourism arrivals on the American continent, was with 3.2% smaller than the world average yearly growth figure of 4.2%, followed by Europe with an average annual growth of 3.7%.

Fig. 3: Development of International Tourist Arrivals In Regional Market Shares (1950-1999)

illustration not visible in this excerpt

Sources: Deutsches Fremdenverkehrspräsidium 1994: 28; WTO 2000a: 4 Statistisches Bundesamt 2001: 250

Of course, not all of the international tourists visiting the Southern countries come from the North. Indeed, a significant proportion of the international visitors originate from the developing world, and the majority of travel is intra-regional (464 million in 1995) according to the WTO (2000a: 5). But the information on domestic tourism in developing countries remains obscure. Certain developing countries have experienced a significant increase in the number of their nationals traveling inside, as well as outside, the country. This indicates that a considerable section of the world population that had previously not been considered in this context may already be involved in leisure travel. Mass tourism involving Southern domestic and regional travel is becoming an important phenomenon in several areas of the developing countries (Inskeep 1991: 10).

2.4 Contemporary International Tourism Trends: Year 2000

Tourism is undoubtedly a main economic activity. The WTO’s updated results for 2000 show that 698 million people spent at least one night in a foreign country last year. This represented an increase in international tourism of 7.4 per cent in 2000 – its highest growth rate in nearly a decade and almost double the increase of 1999. Nearly 50 million more arrivals were recorded, the same number of new tourists that a major destination such as Spain or the United States receives in the entire year (WTO 2000a: 10).

International tourism receipts combined with passenger transport currently total more than US$ 575 billion – making tourism the world's number one export earner, ahead of automotive products (US$ 571) and chemicals (US$ 574 billion) (WTO 2001).

The WTTC estimates that in 2000 the travel and tourism industry contributed 11.7% to the world’s Gross Domestic Product (GDP), or US$ 3,550 billion. Tourism has grown 1.5 times faster than the World GDP with no sign of slowing down in the future. Air transport increased its share against road in international holidays; together these two account for 85% of all international trips. Rail and sea transport remain below 8% each.

Travel and tourism also directly and indirectly accounted for almost 200 million jobs worldwide, or 8% of the world’s total employment (WTTC 2001: 1).

These preliminary estimates confirm that 2000 was an excellent year for the tourism industry.

2.4.1 World and Regional Tourism Arrivals

East Asia and the Pacific (EAP) was again the world’s fastest growing region (14.7% over 1999) with big increases in China and its special administrative regions of Hong Kong and Macao, followed by the Middle East (12.9 %).

Southeast Asia - especially Thailand, Malaysia, Cambodia and Vietnam - is becoming, with 6.3 million international tourist arrivals one of the world’s favorite tourism destinations with demand outstripping tourist facilities (9% over 1999), even if numbers are still quite small compared to other parts of the world (0.95% world market share) (WTO 2000a: 27).

Tourism to Europe grew in 2000 by 6.2% under the world average growth (7.4%), followed by the Americas with 6.5%. Nevertheless it is worth noting the growing popularity in 2000 of Turkey (+39.6%) and the Russian Federation (+23.2 %).

North America made an increase of 5.7% over 1999, doubling the trend of growth during the period 1995-2000.

Well above the world average stood sub-regions such as the Caribbean (7.5%), Southern Europe (8.4%) and Eastern Mediterranean Europe (26.1%).

Fig.4: Regional Trends, % change 2000/99

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Source: WTO 2001c:13

2.4.2 Tourism Spenders

Spending on international tourism reached US$ 476 billion, a growth rate of 4.5% over 1999. When interpreting this figure, the fact that it is expressed in current dollars and that the dollar has appreciated steadily increases in value in respect of a number of other currencies in the last few years, should be taken into account.

The world’s top tourism spender in 1998 was, by far, the European Union, with over US$ 160 billion. The most important spenders among them were Germany (2nd world ranking), US$ 46.3 billion; the United Kingdom (3rd), US$ 32.2; France and Italy (5th), each US$ 16.6 billion, the Netherlands (6th) US$ 10.3 and Austria (9th), US$ 10.1 billion. The world’s number one spender is the United States (1st in world ranking) with US$ 56.1 billion, followed by Germany and Japan (3rd) with US$ 28.8 billion.

2.4.3 World Market Shares

Europe (57%) and the Americas (19%) are as well the main tourist receiving. But since other regions are growing at a faster pace, their respective shares in the world total show a declining tendency. In particular, the East Asia and Pacific region had outstanding results in the past decade and already gained 16% of the world market shares of international arrivals.

Fig. 5: Market share of World Total International Arrivals 2000

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Source: WTO 2001c: 11

2.5 Future International Tourism Trends

Tourism is a booming business. Despite general economic stagnation in the affluent North (from 3.2 to 2.7%) and worsening of poverty in certain parts of the developing world, international tourism is expected to grow strongly by an average 4.3% a year in the future. The WTO’s study, Tourism: 2020 Vision3, predicts that 1.5 billion tourists will be visiting foreign countries annually by the year 2020, spending more than $2 trillion – or more than $5 billion every day. In other words, in the coming twenty years, there would be nearly three times as many international tourists, spending nearly 4.5 times as much as in the year 2000.

Further, the WTTC forecasts that by the year 2010 travel and tourism will directly and indirectly contribute 11.6% to the world’s GDP (US$ 6,771 billion) and will employ 254 million people (WTTC 2001).

Fig. 6: WTO Tourism 2020 Vision: International Tourist Arrivals Market Share (%)

illustration not visible in this excerpt

The total tourist arrivals by region shows that by 2020 the top three receiving regions will be Europe (717 million tourists), East Asia and the Pacific (397 million) and Americas (282 million), followed by Africa, the Middle East and South Asia.

East Asia and the Pacific, South Asia, the Middle East and Africa are forecasted to record growth at rates of over 5% per year, compared to the world average of 4.1%. The more mature regions Europe and Americas are anticipated to show lower than average growth rates (WTO 1998b: 10f).

The vast majority of tourists will continue to come from the developed world, but it is not too far-fetched to imagine that economic expansion and per capita income growth in populous developing countries - such as the Russian Federation, China (see fig. 7) and India - will, over the long term, provide considerable impetus to the upward trend. AS WTO trends for 2020 predict, Japanese will be traveling twice as much as today. In 1999 about 4.06% of the travelers came from Japan, in 2020 the WTO estimates that about 8.8% of all tourists will be originating form this country.

Fig. 7: Tourist Originating Countries in 2020

illustration not visible in this excerpt

Source: WTO 2000a

Long-haul travel worldwide will grow faster, at 5.4% per year over the period 1995-2020, than intraregional travel, at 3.8 per cent. Consequently the ratio between intraregional and long haul travel will shift from around 82:18 in 1995 to close to 76:24 in 2020.

Therefore, tourism in the 21st century will not only be the planet’s biggest industry, it will be the largest by far that the world has ever seen. Along with its phenomenal growth and size, the tourism industry will also have to take on more responsibility for its extensive impacts– all of which will be increasingly scrutinized by governments, consumer groups and the traveling public.

2.6 Epilogue: Global Tourism Industry in Crisis?

In the aftermath of the terrorist attacks in the United States, it is still too early to determine the implications for international tourism. The situation is exceptional. Past experience, however, shows the inflexibility of tourist demand, its resilience to crises and a great capacity to overcome adverse situations of political and financial instability or natural disasters.

Three main factors are currently wreaking havoc on the tourism industry: lack of consumer confidence in the safety of air travel; uncertainty about the near future; and weakening of the global economy in recent months.

Thus, air transport companies have been affected, in general, and United States air transport companies, in particular. Although there have been few cancellations of ready-booked trips, figures for new booking, however, have fallen. Nevertheless, it is hard to assess whether reluctance to use of air transport will last long. This depends, on the one hand, on how the conflict develops, and, on the other hand, on the reactions of tourist services providers. Furthermore, a possible fall in demand, the extra costs associated with stricter operating and control procedures and the increases that may take place in some areas, such as in insurance policies or the oil prices, cannot yet be evaluated.

Results for 2001 will, undoubtedly, be affected by these events and in the medium term, growth will be delayed for a matter of months. One of the possible scenarios would be a redistribution of total demand with the focus on regional or domestic tourism, with no major changes in the motivations for the trips, together with possible changes in total spending and average length of stay. The air transport industry might be more severely affected than other forms of transport. The impact on long haul journeys might be greater than on domestic or short flights. However, a severe decline in world travel demand in the long- term is not anticipated (WTO 2001a).

The negative impact on a specific destination associated with a crisis situation depends to a large extent on how crises are handled- crisis management such as actions related to specific public relations, promotion, communications and marketing campaigns, might help to scale down the impacts (WTO 2001a).

The problem of development is the problem of learning; the process of development, of living is the process of learning from mistakes. There can be no end to the process.

~ Mahatma Gandhi ~

3 Precursors of Sustainable Tourism Development

Tourism growth has not proceeded without a series of tensions, in particular in developing countries. There is increasing awareness that without proper attention to the resource base upon which the industry is built; the development of tourism - shorn of controls - will lead to the degradation and long-term destruction of the environment, as well as negative sociocultural effects. Today, the clarion call is for ‘sustainable tourism development’.

The following will map out the background, which has given rise to this call. As the discourse of tourism in developing country closely mirrors the development debates since the 1960’s (Hein 1997: 23), the first theoretical elaboration of the main ideas of ‘development’ will now be highlighted. Although there is in reality a considerable overlap both in the content and timing, the most relevant theories for tourism in developing countries will be identified and presented, in order to indicate the precursors to ‘sustainable development’, and thus, ‘sustainable tourism development’ (Wahab and Pilgrim 1997: 35).

Although in its early formulations ‘development’ focused primarily on economic matters, the definitions have tended to be broadened over time. The term has gradually come to apply to a social as well as an economic process, which involves the progressive improvement of conditions and the fulfillment of potential (Binns 1995: 304). Though ‘economic development’ is often used as a synonym for ‘development’, in the following section the latter, broader term will be used, without, however, intending to minimize the importance of the former.

3.1 Definition of Development and Theories

Dominant development concerns have changed over the past four decades and the very definition of development is being challenged, not only in its economic interpretation but also in its non-material and non-quantifiable social, political, and human dimensions as well.

The simplest definition is that “development means change” that is “generally associated with positive social change, which means moving forward to something that is better than the present“ (Aronsson 1994: 31). According to Friedmann (1980: 4): ‘Development suggests an evolutionary process, it has positive connotations...It is often associated with words such as under or over or balanced: too little, or just right...which suggests that development has a structure, and that the speaker has some idea about how this structure, ought to be developed.’ D. Smith (1977: 203) notes that ‘the most common measure of development is an economic indicator - GNP per capita’. He argues, however, that development means ‘welfare improvement and a better state of affairs, with respect to who gets what where.’ Nohlen and Nuscheler (1982: 54) presented a more detailed definition with their magic pentagon of development and its interdependent goals: ‘work/employment, economic growth/structural changes, participation and independence’.

These examples show there is no single, unequivocal definition of ‘development’ due to the different uses of the term by different disciplines and changes over time. However, the central point of discussion has always been, how best to measure development and what the indicators in fact tell us (Aronsson 1994: 31). Generally the change has been away from a narrow economic usage to embrace other attributes through a number of schools that have emerged since the Second World War. The most important theories that can be considered in the context of tourism are: the school of growth and modernization, the neo-classical counterrevolution, the dependency school and the new alternative development (Wahab and Pilgrim 1997: 35) (Pearce D. 1988: 8). Each of these development theories will be summarized below.

3.1.1 Economic Growth Theory

Development has often been equated with growth. Especially in the early post Second World War period, development was interpreted narrowly in terms of economic growth with priority given to ‘increased commodity output rather than to the human beings involved in the production’ (Pearce 1998: 8). Growth in turn was defined as “a rapid and sustained rise in real output per head and attendant shifts in the technological, economic, and demographic characteristics of a society” (Mabogunje 1980: 36).

A common expression of this in the ‘underdeveloped’4 countries was concentration on export production and the emergence of a ‘dual economy' that led to increasing inequality in the early stages of economic development. Lewis’s Dual Sector Model of Development describes the parallel existence of two different socio-economic systems in developing countries, e.g. both a modern center that is technologically advanced, with high levels of investment operating in an urban environment, and a traditional agricultural hinterland that is assumed to be of subsistence nature characterized by low productivity, low incomes, low savings and considerable underemployment (Vorläufer 1984: 13). Lewis suggested that the modern industrial sector would attract workers from the rural areas, as industrial firms could offer wages that would guarantee a higher quality of life than that offered by rural areas. Profits earned within the industrial commune are reinvested in new capital stock and this further raises demand for labor (Wahab and Pigram 1997: 36).

However, critics argued that wages do not rise because the extra demand is met through migration. Therefore, profits remain high and can continue to be reinvested in new capital stock. Within this model there is no trade in goods with the hinterland, which exists only as a labor reserve (Wahab and Pigram 1997: 36). Further, the assumption of a constant demand for labor from the industrial sector is questionable, due to increasing technological improvement that may be laborsaving. In addition, if the industry declines, the demand for labor falls. Funds for investment and growth will not be available either if entrepreneurs and laborers spend their higher incomes rather than save. Moreover, urban migration might replace rural poverty through urban poverty. Thus it was argued that another criterion – social well being – should be added to the significant role of economic growth in development (Bearse and Vaughan 1981: 309).

3.1.2 Modernization Theory

Modernization theorists have tended to view societies as passing through series of development stages similar to those experienced by many western countries. Development still has been seen in the sense of economic growth; however, a social dimension was incorporated (Naanen 1985: 25). The most widely (though not universally) accepted concept was Rostow’s five stages theory of economic growth, which claimed that economic growth in world history, occurred in five stages (Traditional Society, Transitional, Take-off, Maturity and the High Mass Consumption stage). According to Rostow, there exists a natural path to economic growth, which nations have to follow (Hoy and Merrill 1984: 342-421).

The modernists further encouraged state involvement. They believed in trickle-down effects, whereby benefits diffuse to disadvantaged people and regions giving rise to development.

However, many development economists argued that “the concept of modernization is firmly cast within the ethnocentric background of western achievement” and a synonym of Westernization. Like many of the other models of development it is essentially a growth model and does not address the issue of development in the wider context (Eckl and Prüm 2000). The modernization theory further ‘involves limited discussion of the role of local involvement, as it suggests a unidirectional path which all must follow in order to develop’, and thus, ‘implies the maintenance of tradition, and modernization may not be compatible with goals in ‘underdeveloped countries’ (Wahab and Pigram 1997: 36).

3.1.3 Dependency Theory

Underdevelopment is seen as the result of unequal relationships between rich developed capitalist countries that have a technological and industrial advantage and poor developing countries. Dependency theorists like Senghaas see the lack of development as being attributable to external forces more than internal causes, with power at the ‘center’ exploiting a disadvantaged ‘periphery’ as described in center- periphery models. ‘Under- development’ or ‘growth without development’ in Third World nations was seen as a result of exploitation by developed countries, often in the form of colonialism (Vorläufer 1984: 11). Dependency theorists see a dualism between the rich and poor, the powerful and the powerless, both between and within individual countries, and they see development as being best promoted by favoring domestic markets, import substitutions, protectionism and social reforms (Vorläufer 1996: 6). Self-reliance was a crucial imperative and partnerships between underdeveloped countries were fostered (Matthies 1980: 188).

This tendency towards protectionism and isolationism contrasts with the modernization theory, which fosters increased external economic links. It is criticized as a fairly abstract and rather pessimistic viewpoint. Dependency theory is often seen more as a critique of the prevalent approach to development than a method of development (Wahab and Pigram 1997: 37).

3.1.4 Neoclassical Counter-Revolution

By the end of the 60s, the old theories and ideals were considered to have failed and the expected trickle-down effects with economic growth had not been achieved. Developing countries claimed a new “redistribution of future growth opportunities” (Naanen 1985: 39). Following the oil crises and the international debt crisis of the 1970s and 80s, a group of ideas evolved which may be termed the neoclassical counter-revolution. Proponents stressed the role of privatization and the free competitive market. Development prospects in developing countries were to be enhanced by welcoming foreign investors with minimum state involvement. Developing countries were considered to attract investment due to their comparative advantages, like low initial investment costs due to low land prices and implementation cost, high annual increment, cheap availability of labor and so on. The World Bank was a major proponent of this perspective, advocating structural adjustments and reliance upon market forces and competitive exports.

The major criticism of this approach is that the financial strategies are unlikely to help the disadvantaged who are most in need. Also, the scale of some of the projects, which were supported, and the lack of detailed consideration of local conditions on the part of some of their advocates were a further cause of concern (Britton 1982, Nash 1989).

3.1.5 Alternative Development

Advocates of alternative development place emphasis on the satisfaction of basic needs: food, housing, water, health and education. An alternative approach should analyze the context, and provide solutions from a holistic perspective (Aronsson 2000: 32).


1 The deeply religious English Baptist preacher, Sir Thomas Cook, is known as the founder of the organised package tours. In June 1841 he hired a train to take some 500 religious men, each paying a shilling, and arranged a twelve mile journey from Leicester to Loughborough and back in open carriages. Cook later also organised continental tours, e.g. to Germany and France.

2 The term ‘holiday’ comes from holy day- days for religious observances. Ancient Rome featured public holidays for great feasting and later in Europe that became Christian. After the Industrial Revolutin, the religious holidays gradually became secularzied, and the week holiday emerged.

3 An essential outcome of the Tourism 2020 Vision are quantitative forecasts covering a 25 years period, with 1995 as base year and forecasts for 2000, 2010 and 2020. These forecasts are based on one hand on the analysis of past performance and on the other hand on assessment by a group of experts (Delphi method) of growth expectations in the forecast period.

4 The terms ‘underdeveloped’ as well as ‘Third World’ were common at that time. Nowadays, they are less used due to their imprecise definition and connotative overtones; more common is now the distinction between ‘ developing countries ‘ or ‘less developed countries’ that are not yet fully industrialised and the poorest ‘ least developed countries (LDC)’. However, they all tend to have the following features: per capita GNP is smaller than in developed countries; there is a shortage of foreign exchange; agriculture is more important than manufacturing; there is limited specialisation and exchange; human resources are weak and unemployment rates high; there are low savings to finance investment; the population is expanding too rapidly for available resources; there is a low standard of living (bad health and education systems) and inequalities (Mathieson 1987:40). A developed country is fully industrialised and has a high standard of living.

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Dominican Republic - Approaches Towards a Sustainable Tourism Development
A Strategic Concept
Heilbronn University
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Dominican, Republic, Approaches, Towards, Sustainable, Tourism, Development, Strategic, Concept
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