It was two years ago, at a UN event, that I first encountered a city official with the job title of ‘chief resilience officer’. In this case, the person served this role for the city of Tbilisi. I haven’t seen this specific job title on any other business cards yet, but the word ‘resilience’ crops up more and more and seems to be front of mind for cities worldwide. Our cover story examines what is behind this trend, what resilience means, and what role FDI can play in building it. Look for this topic to only grow in importance in the coming years. It is one we will be covering closely.
Tourism, meanwhile, has been a top area of focus for us in 2019 and the year of coverage culminates in our Tourism Locations of the Future 2019/20 rankings and awards. It is often targeted as a fickle sector that works against economic resilience, but it need not be if cultivated carefully. Of course, FDI is central to tourism viability and durability.
Tourism FDI has been on an upward trajectory in recent years and is continuing to accelerate: 2018 marked a peak year according to our database, fDi Markets, with 613 greenfield FDI projects in the sector launched or announced. These amounted to more than $57bn in total investment and nearly 140,000 in estimated jobs created. This compares with only $11bn in 2014.
Given these figures, there should be no doubt about the centrality of tourism in the global FDI paradigm, nor about the importance of investment in creating prosperity through tourism. FDI and tourism are no longer on different paths, but rather are fellow travellers on the road to sustainable economic development. This is a point that Zurab Pololikashvili, secretary-general of the UN World Tourism Organization, has made strongly.
Despite the increase in tourism FDI, investment volumes have lagged behind the growth in international arrival figures and many tourism destinations are suffering capacity constraints in terms of accommodation, connectivity and infrastructure. More investment is still needed, and of a productive, sustainable quality. This includes investment in tourism-related technology and support for innovation. FDI in technology and innovation are intrinsic to the success of the tourism industry.
Tourism as a sector has its own unique challenges and variances – and it is indeed very sensitive to economic ups and downs, consumer spending power, and currency fluctuations. But that doesn’t mean it can’t be a stable pillar on which to build a resilient economy, as long as it isn’t the only pillar. And as with any other sector, growth and stability in tourism is reliant upon attracting investment in the right type and volume in order to build for the future in a sustainable way.
Courtney Fingar is editor-in-chief of fDi Magazine. Email: email@example.com