Sustainable Destination Management
Strategies in the OIC Member Countries
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International and regional bodies and development organizations have actively been involved
in financing sustainable tourism through a variety of initiatives. The United Nations
Environment Program has partnered with the global financial sector, including banks, insurers,
and investors, to promote sustainable finance. The participating institutions from the financial
sector sign up to the “UNEP Statement of Commitment by Financial Institutions on Sustainable
Development” to provide specific funding programs for sustainable tourism. An example of a
participating institution is Triodos Bank, which makes loans available to sustainable tourism
businesses that are – or on their way to becoming – Green Tourism-certified.138
In EU countries, the European Commission provided funding, under the Program for the
Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) to around
100 projects over the period 2014-2016, including projects aiming at developing transnational
cycle or hiking routes, environmentally-friendly tourism, and European Cultural Itineraries.
Furthermore, the European Commission financed along with national governments, under the
European Destinations of Excellence (EDEN) initiative, the promotion of 140 lesser-known
destinations who had outstanding sustainable tourism engagement. The European Commission
also developed “A Guide on EU Funding to the Tourism Sector” to enable those seeking financing
to identify the various existing sources. In the Baltic region, the Nordic Investment Bank
provides financing for sustainable projects. As of 2017, financing was provided to five projects
in the tourism-related areas, including a wastewater treatment system in the city of Bergen in
Norway, green road infrastructure projects in Finland, and environmental projects of SMEs in
Iceland.139
Survey Insights
Findings from the destination management organizations and tourism industry survey conducted in
the framework of this study indicate that themost common funding source for sustainability activities
is domestic public funding (67%) followed by domestic private funding (54%), with foreign funding
being the least identified source by survey respondents (44%). When asked to choose from possible
means to improve funding, 68% indicated that government can provide collateral for tourism SMEs
to obtain loans for sustainable tourismactivities, while 63% indicated the need to increase awareness
of international and regional funding/financing opportunities for sustainability. 59% of survey
respondents thought government providing interest-free loans can improve funding of sustainability
activities. Commercial banks providing low interest loans was also identified by half of the
respondents as a viable option, while 38% cited voluntary contributions from tourists as a possible
alternative to funding sustainability activities. Only 31%of the respondents identified crowd funding
as a possible solution to increase funding for sustainability activities.
1.2.3. Innovative Sustainable Tourism Financing Tools
Innovative tools have emerged for sustainable funding as a way to reduce transaction and
borrowing costs. Some of these innovative tools used to finance sustainable tourism include
green bonds and sukuks, energy efficiency facility loans, smart incentives for eco-certification,
enterprise challenge funds, crowdfunding and voluntary contributions from tourists. Green
138 OECD. (2018). OECD Tourism Trends and Policies 2018 . Paris: OECD Publishing.
139 OECD. (2018). OECD Tourism Trends and Policies 2018 . Paris: OECD Publishing.