Twenty-seven of the Commonwealth’s 53 members are Small Island Developing States (SIDS) with populations of less than 1.5 million. Ashe (2005), like many others, highlights their vulnerabilities in terms of environmental disasters, limited human resources, economic resources and security. SIDS (including low lying coastal countries) share similar sustainable development challenges, including small populations, lack of resources, remoteness, susceptibility to natural disasters, excessive dependence on international trade and vulnerability to global developments. In addition, they suffer from a lack of economies of scale, high transportation and communication costs, and costly public administration and infrastructure. SIDS also have limited availability of human, institutional and financial resources to manage and use natural resources in a sustainable way, and ever increasing demographic and economic pressures on existing natural resources and ecosystems (Ashe, 2005).
Scheyvens and Momsen (2008) disagree with this view, claiming that SIDS do not embrace their potential to chart their own paths in the global economy and provide self-determined futures for their people. Furthermore, they suggest that SIDS can capitalize on their size, economic performance, socio cultural and natural capital, respect for traditional holistic approaches to development, strong international linkages and political strength. Remoteness, a frequent feature of SIDS, is an advantage for tourism because relative isolation can render the
destination “more attractive, exotic and enticing, especially in the case of small islands”
(Scheyvens & Momsen, 2008, p. 498).
Tourism is widely seen as the driver behind economic activities in SIDS. In a growing free trade environment, it became clear that island states could no longer rely on guaranteed markets or prices for their traditional export earners, primary products, and thus, many island states sought growth in the tourism sector. According to UNWTO (2013) the number of international tourists visiting SIDS destinations has been significant: from 28 million in 2000 to 41 million in 2013. In the same period, exports from tourism grew from US$26 billion to
73 in at least seven SIDS and represents 9% of the overall exports (US$61 billion). Tourism has been key in the recent graduation of Samoa, Cabo Verde and the Maldives from Least Developed Country (LDC) status (UNWTO, 2013). Similarly, according to the International Monetary Fund (IMF) tourism contributes to economic resilience in SIDS where there is growing revival of tourism in the aftermath of the global economic crisis, and there is growing momentum for economic recovery, leading to improved fiscal stance, more social spending, and balanced budgets (UNWTO, 2013).
Many SIDS have demonstrated continued economic and social development during the last thirty years, proving that size does not hinder sustained growth (Read, 2004). Hence, it is not surprising that in most SIDS tourism is the main economic activity (Neto, 2003), bringing in most of their foreign currency earnings (Ashe, 2005). Not surprisingly, in most SIDS tourism also provides the largest source of employment generation (Scheyvens & Momsen, 2008). However, in spite of these positive outcomes, the global tourism industry is also believed to
have a negative impact upon SIDS. As Rosalie (2002, p. 95) stated, “Tourism in the
developing world has both the potential to be an agent of social and economic development ... or a source for friction and alienation within the local community.”
A lack of resources often makes natural environmental assets the only means for economic development for SIDS (Ashe, 2005). But, when tourism development is dependent on fragile ecosystems it causes immense pressures on these resources (Neto, 2003). The extent of the impact can be understood when the small land area and population of most SIDS is weighed against annual tourist arrivals per year, which often exceeds several times that of the total population (Scheyvens & Momsen, 2008). In addition, SIDS are among the countries that are most vulnerable to the threats of climate change such as rising sea levels (Quarless, 2007). Unfortunately, due to limitations in human and financial capabilities, these countries are often less capable of protecting their natural heritage than their larger counterparts (Rosalie, 2002). At the same time, tourism is blamed for fostering unbalanced dependency and the spread of unequal socio-economic development (Milne, 1997). While tourism provides much needed employment and revenue for SIDS, its overall contribution to a country’s national income and any tourism multiplier effects are significantly diminished due to the high leakage of tourism benefits (Ashe, 2005). A considerable drain on tourism earnings from SIDS comes from the high rate of imports in comparison to domestic production. Unable to generate sufficient domestic investment for tourism development, these countries turn to foreign investors and
74 leads to leakage of tourism revenue as repatriation of wages and profits, loss of control of the tourist industry by the host country and the creation of tourist enclaves detached from local communities. In addition, SIDS rely on “the management skills, technological know-how and access to international markets” from MNCs for the successful development of tourism (Bende-Nabende, 2002, p. 82). This is one of the 20 reasons why MNCs are described as “key agents for economic activity in SIDS” (Read, 2004, p. 366). However, the dominant role of MNCs in SIDS contributes to a number of adverse effects. Among these are the leakage of tourism revenue as repatriation of wages and profits, loss of control of the tourist industry by the host country and the creation of tourist enclaves detached from local communities (Bende- Nabende, 2002). These negative effects are further aggravated when tourist hotels establish supply systems with foreign suppliers cutting out local businesses, as is often the case in SIDS.
High dependency upon tourism also makes an economy susceptible to external shocks from both global and regional incidents. The impact is often more profound on SIDS whose tourism industries often rely on long-haul flights for the majority of their incoming tourists. The devastating impact on tourism after the September 2001 terrorist attacks in the United States, and the spread of Avian Flu and severe acute respiratory syndrome (SARS) in Asia (Kuo, Chen, Tseng, Ju, & Huang, 2007) are examples of how external shocks can affect local tourism industries. In addition, any event that causes changes in tourists’ travel patterns, such as political unrest in a region, e.g. Fiji, or a rise in oil prices can have a direct impact on tourism-dependent economies. Excessive reliance on a particular economic sector, particularly when combined with unstable social and economic conditions, is said to create an ideal situation for political insecurity which may impede sustainable development (Sönmez, 2002).
When most investment and development is focused on tourism, development in other economic sectors can be overlooked. Neglect and decline in industries such as fisheries and agriculture can cause locals to abandon these occupations for jobs in tourism, and the motivation for developing, expanding and modernizing local production may be restrained. Tourism multipliers can be limited and the resulting inequalities of income distribution can lead local farmers, fishermen and others who work in food sector to feel alienated from the tourism industry (Jamal & Lagiewski, 2006). This may eventually foster hostility among local communities towards tourism and lead to social unrest (Telfer & Wall, 1996). Participation and involvement of local communities is necessary for the successful and sustainable
75 not be ignored (Dodds & Butler, 2009). Although the above inherent characteristics make sustainable development a challenging task for SIDS (Ashe, 2005), due to their lack of other resources, any diversion from tourism as a major economic activity may create further economic hardships for SIDS.