Economics of Travel

Preserving destinations for the future traveller

April 23, 2025

What’s the most alarming worry about the state of Travel & Tourism globally? It’s the realization that by the time many travellers gather the resources to explore the world’s wonders, those destinations may cease to exist or become inaccessible for tourism. This sobering reality reflects the critical issue we face. An industry under siege from the accelerating impacts of climate change, threatening not just economic livelihoods but the very landscapes and cultures that make travel meaningful.

Climate resilience directly contributes to the stability of tourism destinations. By implementing measures to mitigate and adapt to climate change, destinations can protect their natural resources, which are often the primary attractions for tourists. For instance, destinations like Puerto Rico and the Philippines have developed sophisticated resilience strategies that include climate risk assessments, biodiversity conservation plans, and hazard mapping.1,2 These measures help preserve beaches, forests, and other natural assets that are crucial for tourism.

What’s the most alarming worry about the state of Travel & Tourism globally? It’s the realization that by the time many travellers gather the resources to explore the world’s wonders, those destinations may cease to exist or become inaccessible for tourism. This sobering reality reflects the critical issue we face. An industry under siege from the accelerating impacts of climate change, threatening not just economic livelihoods but the very landscapes and cultures that make travel meaningful.

What SMEs can do to become more sustainable

  • Be adaptable: Change is the only constant, and the pandemic has further highlighted the need to be flexible in the face of adverse situations. Hence, with the climate becoming more and more unpredictable, it is important to be able to adjust and adapt to the changing tides.
  • Use technology: With the help of technology, SMEs can track their sustainability and also convey their efforts to their consumers, who wish to be more green in their travel decisions.
  • Engage with local communities: Engaging with local communities can foster positive relationships that can enhance a business’ sustainability efforts and impact. This can help with waste reduction, policy making, and other conservation efforts.

Climate change and the threat to destinations

Extreme weather events such as hurricanes, floods, and wildfires, are increasingly devastating tourist destinations. The recent wildfire in California is a testament to a warming climate. A scientific study by World Weather Attribution confirmed that climate change significantly contributed to the hot, dry conditions fuelling the devastating fires. It increased the likelihood of such weather by 35%.  

This growing threat is even more pronounced for Small Island Developing States (SIDS), where tourism is the backbone of the economy. SIDS, which are disproportionately dependent on tourism, are particularly vulnerable. Nations of Macau, where Travel & Tourism contributes over 90% of GDP, or the Maldives and Aruba, where the sector accounts for over half of the economy, the stakes are existential. Beyond economic risks, the degradation of cultural and natural heritage diminishes the very experiences that draw tourists, reducing the sector's attractiveness and cutting off opportunities for local communities.

Moreover, climate change disproportionately impacts marginalised groups. According to a recent UN report, women and informal workers, who form a significant portion of the tourism workforce, bear the brunt of disruptions caused by environmental changes. This inequity underscores the broader social responsibility of the Travel & Tourism sector to embrace more sustainable and inclusive practices.

Carbon footprint of travel

Transport connectivity, a cornerstone of modern tourism, is a significant contributor to climate change. The sector’s transport-related emissions account for three-quarters of its total CO2 output, and these emissions are forecast to rise, reaching 5.3% of all human-made CO2 emissions by 2030. Air travel, cruise ships, and other carbon-intensive modes of transport are a double-edged sword: while they enable global tourism, they also accelerate the sector’s environmental impact.

Failing to address these emissions will exacerbate the climate crisis, leading to further environmental degradation that directly undermines the future viability of the industry. For tourism-dependent economies, this could mean a catastrophic collapse of both livelihoods and GDP.

Rethinking tourism for sustainability

To secure its future, Travel & Tourism must undergo a transformative shift towards sustainability. This includes prioritising eco-friendly transport options, such as expanding rail networks and promoting carbon-offset programs for flights. Destinations must adopt resilient infrastructure to withstand extreme weather and invest in preserving biodiversity and cultural heritage. Governments and industry leaders must work together to create incentives for green tourism practices, from energy-efficient accommodations to waste reduction initiatives.

Equally important is the empowerment of local communities, particularly women and informal workers, to participate in decision-making processes. By fostering equitable growth and reducing reliance on exploitative practices, the sector can become a catalyst for positive change rather than a contributor to inequality.

A path forward

The time for incremental change has passed. Climate-driven degradation is not a distant threat; it is a present reality. If the Travel & Tourism sector fails to adapt, it risks not only its own survival but also the livelihoods of millions of people and the natural wonders that inspire global travellers. Sustainable tourism is no longer optional anymore. It is a moral, economic, and environmental imperative. The journey may be challenging, but the destination, a healthier planet and thriving communities, is well worth the effort.

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