Thematic Paper | Tourism
Why is MDF involved in the tourism industry?
MDF works in Fiji, Sri Lanka and Timor-Leste to support sustainable and high value tourism. Tourism is a valuable sector for development, as the value chain is heavily interconnected with other economic sectors, and successful tourism initiatives have a multiplier effect on the domestic agriculture, construction and retail industries. Inclusive tourism growth is also a key driver of employment for women, many of whom are involved as entry-level and front office workers or as hotel food and entertainment suppliers.
Up until 2019, international travel was experiencing a boom, fuelled by the growing purchasing power of the Asian middle class, increased affordability through digital platforms such as Airbnb, and the ubiquity of travel influencers on social media. MDF was experiencing strong momentum in its tourism interventions in all three countries. However, the emergence of the COVID-19 pandemic in early 2020 and the resulting closure of international borders has devastated the tourism industry.
High-value tourism is characterised by authentic and enriching experiences that engage the local community and are operated under socially and environmentally responsible business practices.
COVID-19 and tourism
In Fiji, 93 per cent of all hotels and resorts closed and 40,000 tourism employees lost work. As the largest contributor to GDP, foreign exchange and employment, the survival and revitalisation of the tourism industry are critical to Fiji avoiding economic collapse. In Sri Lanka, the tourism industry employs more than 200,000 direct workers and anywhere between 800,000 and 3,000,000 indirect workers. As in other sectors, these workers have been most affected by the crisis, with an estimated 80 per cent losing work. In Timor-Leste, businesses offering tourism and hospitality services have suffered, with most experiencing an 80 to 90 per cent revenue decline.
However, through a facility-wide effort to understand the impact of the pandemic on tourism and a parallel assessment of new market requirements, MDF has successfully pivoted its tourism portfolio. MDF will continue to work in tourism because of its long-term potential to contribute significantly to growth and create additional jobs and income for the poor, especially women. Post-COVID tourism will be fiercely competitive, and MDF is supporting its partners to prepare for the resumption of international tourism with improved marketing, product offerings, data collection, research and industry collaboration.
