Sustainable Destination Management
Strategies in the OIC Member Countries
45
revenue of around $300,000 for the conservation of the Lake District National Park by collecting
voluntary contributions from guests.145
1.2.4. Challenges for Sustainable Tourism Funding
According to the UNCTAD’s World Investment Report, the developing countries’ annual
investment gap in sustainable development sectors over 2015-2030 amounts to $2.5 trillion.
Even with current levels of government funding, the private sector role is deemed essential in
achieving Sustainable Development Goals whether through the adoption of good practices or
investing in sustainable development.146 Funding sustainable tourism faces a number of
challenges including the “maturity mismatch” between the needs of sustainable tourismprojects
and the available financial instruments, lack of information on green investment impact in
tourism, and the lack of support for green business practices. With regards to the available
financial instruments, in most cases there is “maturity mismatch” caused by the fact that many
sustainability activities and projects, especially infrastructure investments, are typically short-
term while investors usually look for projects where assets can be liquidated quickly.
Additionally, tourism SMEs may be unable to provide the collateral needed for securing external
financing especially since they are service providers dealing mainly in “intangibles” which are
difficult to quantify and use as collateral. Information on green investment in tourism is very
limited, thus far most green financing has focused on energy efficiency and ignores other
sustainability areas. Policy support for green businesses has also been limited; governments
need to play a more proactive role to encourage financing and investments in sustainable
tourism, from the provision of grants and subsidized loans, to businesses which integrate
sustainable tourism strategies in their operations, to promoting green financing to businesses
working in the tourism sector, to providing public credit guarantees to small tourism businesses
to enable them to pursue sustainable tourism strategies. Furthermore, governments need to
increase awareness of the benefits of adopting sustainability strategies and encourage the
adoption of such strategies through the provision of incentives.147 Governments can provide
support to local entrepreneurs to improve tourism product offerings enhancing sustainable
tourism, such in the case of Italy, where a tax credit system was introduced to incentivize the
renovation and upgrading of hotels and other tourism accommodation establishments. The tax
credit covers between 30% and 65% of the cost and focuses on energy efficiency and anti-
seismic measures. Since 2018, this tax also benefits renovation projects in green tourism, such
as campsites and agritourism. Alongside this measure, another tax credit was introduced to
support digital technology in tourism.148
145 UNWTO. (2018). Tourism and The Sustainable Development Goals – Journey to 2030.
146 UNCTAD Website.
147 OECD. (2018). OECD Tourism Trends and Policies 2018 . Paris: OECD Publishing.
148 OECD. (2018). Tourism trends and policies 2018. Retrieved from
en.pdf?expires=1540143519&id=id&accname=guest&checksum=89293B789E485F9A785A8768B7ED5241.