Tourism destinations like Barbados should focus on governance and the rule of law, taxation, liquidity, physical infrastructure and connectivity, destination planning and sustainability, service culture, government aid, and upskilling the workforce if they want hotel investment in the industry to rebound.
These areas were recommended in the World Travel & Tourism Council’s (WTTC) new report Critical Factors To Attract Hotel Investment.
Its advice came in the context of efforts to continue the industry’s recovery from the COVID-19 pandemic.
The report revealed that capital investment in travel and tourism “fell substantially from US$1.07 trillion in 2019 to US$805 billion, representing a 24.6 per cent drop”.
In 2021, there was “a further 6.9 per cent decline in the sector’s investment to reach US$750 billion. Investment in hotels represents a key component of overall investment and the development of the broader travel and tourism sector”.
“As the sector begins to recover, it will be essential to attract sufficient capital investment to enable its full growth potential,” the report stated.
“While the WTTC projections point to a strong growth in travel and tourism investment over the next decade – with an expected global average annual growth of 6.9 per cent – governments can support this by creating an enabling environment that will attract more investment into travel and tourism related assets including hotels.
“Governments will be competing with those of other countries to attract some of these investors, and therefore those with the most attractive policies will be more successful,” it added.
The publication also said “in addition to clear, open and consistent government action and support – which has proven to be paramount during the pandemic – a well-established rule of law, political stability, favourable tax incentives, the free movement of currency, sufficient liquidity and access to capital markets remain prerequisites to attract hotel investments”.
Safety and security with regards to issues such as crime and the threat of terror attacks and natural disasters “are also important considerations for investors,” it noted.
WTTC president and chief executive officer Julia Simpson, saw hotel investment as “absolutely key for the recovery and growth of the travel and tourism sector”.
“Destinations must have a clear commitment and take a holistic approach to become resilient and competitive. As we recover from the pandemic and we build back better, investments not only need to benefit destinations economically, but more importantly, socially and environmentally,” she said.
The report said that as countries built back better, sustainability and inclusion must be at the heart of a more resilient and competitive travel and tourism sector”.
“As such, future investment needs to benefit destinations not only economically but also socially and environmentally. Destinations with a clear commitment and plan to reach net-zero emissions and those which take a holistic approach to destination planning by integrating socio-economic and environmental elements will be ahead of the game in attracting investment,” it stated. (SC)