Published on July 9, 2007
Biodiversity and Park Finance through Tourism: Biodiversity and Park Finance through Tourism Paul F. J. Eagles Professor, University of Waterloo Chair, Task Force on Tourism and Protected Areas, World Commission on Protected Areas Examples of Successful Tourism Finance of Park Management: Examples of Successful Tourism Finance of Park Management Each of the following have park management funded by tourism: Kenya Wildlife Service; Tanzania National Parks; South Africa National Parks; KwaZulu-Natal Provincial Parks; Ontario Provincial Parks; and, Niagara Parks Commission. Tanzania National Parks’ Budgets: Tanzania National Parks’ Budgets Niagara Parks Commission in Canada A Free Service that Earns a Profit: Niagara Parks Commission in Canada A Free Service that Earns a Profit Niagara Parks Commission: Niagara Parks Commission Created in 1885. Functions as a corporation owned by government. Board of Directors appointed by local municipalities and provincial government. Earned a profit on operations every year but one since 1945. Does not charge for primary activity – viewing Niagara Falls. Park Income: Park Income Parks have three major categories of income: Grants from government; Income from fees, charges, licenses, sales; and, Donations. The proportion of income from tourism compared to income from government varies from system to system. In this lecture, I will deal with income from tourism fees and charges. If properly done, park tourism is a financially sustainable option in the long term for biodiversity conservation funding. Park Tourism Finance in 13 park agencies in Canada in 1995: Park Tourism Finance in 13 park agencies in Canada in 1995 20,000,000 visitor days 10,000,000 visitor days 2,000,000 visitor days Ontario Parks’ Budget earned from Tourism Fees: Ontario Parks’ Budget earned from Tourism Fees Algonquin Provincial Park Visitor Expenditures: Algonquin Provincial Park Visitor Expenditures Capital and Operating Budgets in Ontario Parks: Capital and Operating Budgets in Ontario Parks Park Tourism Income Sources: Park Tourism Income Sources Entrance Fees Recreation Service Fees, Special Events and Services Accommodation Equipment Rental Food Sales (Restaurants and Stores) Parking Merchandise Sales (Equipment, Clothing, Souvenirs) Licensing of Intellectual Property Cross Product Marketing Park Tourism Income to Parks Canada: Park Tourism Income to Parks Canada Slide13: Economics of Australian World Heritage Sites: Economics of Australian World Heritage Sites $1.3 billon spent by tourists at Australian World Heritage Sites. Governments spent only $48.7 million on national park management at those sites. The parks earned $4.6 million from tourism fees. Therefore, the national parks at the core of the World Heritage Sites earned only .3% of the total tourist expenditures. Implications of Tourism Income - 1: Implications of Tourism Income - 1 Improvement of tourism facilities and programs. Increased staffing. Better contact between staff and public. More equitable distribution of benefits amongst users. Greater public appreciation of services and facilities utilized. Stimulus of local employment and local business operation. Implications of Tourism Income - 2: Implications of Tourism Income - 2 Business-based management. Increased profile of visitors in management. More emphasis on client satisfaction, length of stay, return rate, service needs, facility quality, and program quality. Service quality management enhanced. Higher profile for marketing. Independence from government. Implications of Tourism Income - 3: Implications of Tourism Income - 3 Management agency must function as a business. Park management can utilize a wide range of income sources. Business expertise needed in park agency. Park Tourism Finance: Park Tourism Finance However, even with all these benefits park funding through tourism is still relatively rare. What are the barriers? Resistance Factors to Tourism-based Park Income: Resistance Factors to Tourism-based Park Income Public expectation of free nature. History of pricing below production cost. Private sector resistance to public sector entrepreneurial behaviour. Private sector vultures. Lack of business expertise in agency. Public concern about commercial development of parks. Governance: Governance What is the most appropriate model for park tourism governance? Ownership of the Land and Resources: Ownership of the Land and Resources There are three alternatives for resource ownership for parks and protected areas: 1) government, 2) a non-profit institution, or 3) a for-profit corporation. Source of the Income: Source of the Income There are three broad categories of source of income for parks and protected areas: 1) societal taxes, 2) user fees, and 3) donations. Type of management body: Type of management body There are four alternatives for the management body: 1) a government agency, 2) a parastatal, a corporation owned by government, 3) a non-profit corporation, or 4) a for-profit corporation, either public or private. Combinations: Combinations There are potentially 36 different combinations of these factors. My research found 8 combinations in widespread use. Before park tourism management planning can be done, a decision must be made on which governance model is appropriate. Governance Principles: Governance Principles Summary: Summary Park tourism is a viable source of income for park management in some locales at some times. There must be sufficient numbers of park visitors who have the ability and willingness to pay for products and services. The park must be attractive to potential visitors. There must have sufficient levels of tourism facilities. The park operations must be designed for park tourism. Needs within a Park Agency: Needs within a Park Agency Appropriate financial and tourism policies of the park agency and government. The agency must be able to earn and retain income. Ability to set prices. Ability to retain income year over year. Appropriate purchasing procedures. Acceptable labour environment. Needs within a Park Agency: Needs within a Park Agency Sufficient number of staff members. Professional training in all aspects of tourism and business management. Ability to undertake, implement and monitor contracts. Robust financial procedures to guard against theft. Good combination of specialized expertise at central office and implementation ability in the field. Implementation of a Tourism Finance Program: Implementation of a Tourism Finance Program Startup funding. Park tourism plan, including governance. Guidelines on many subjects, including contracting policy. Consulting advice on tourism business management. Full review of legal and policy environment. Staff hiring and training, including graduate-level education. Minimum five-year horizon. On-going independent monitoring. Additional Readings: Additional Readings IUCN, 1998, Economic Values of Protected Areas - Guidelines for Protected Areas Managers. Available at: http://www.iucn.org/themes/wcpa/ pubs/pdfs/Economic_Values.pdf. Slide31: This book is written for park planners and managers. The book is available in English, Spanish, Russian, Chinese, Korean, Japanese and Indonesian. The information is global in scope. It is published by the IUCN, UNEP and the WTO as one contribution to the UN Year of Ecotourism. Slide32: This text book is designed for park tourism specialists training at advanced levels of university education. It is global in scope. Slide33: This 2007 book contains papers on specialized aspects of park tourism planning and management globally. The book is based on the most important work in park tourism presented at the World Parks Congress of 2003. References: References Chapter 11 entitled The Economics of Tourism in National Parks and Protected Areas, in Paul F. J. Eagles and Stephen F. McCool, 2002, Tourism in National Parks and Protected Areas: Planning and Management. Wallingford and New York: CABI. Chapter 12 entitled Park Tourism: Marketing and Finance, in Paul F. J. Eagles and Stephen F. McCool, 2002, Tourism in National Parks and Protected Areas: Planning and Management. Wallingford and New York: CABI. Chapter 9, Financial Aspects of Tourism in Protected Areas, in Eagles, Paul F. J., Stephen McCool and Christopher Haynes. 2002. Sustainable Tourism in Protected Areas: Guidelines for Planning and Management. United Nations Environment Programme, World Tourism Organization and World Conservation Union. Glover, T.D. andamp; Burton, T.L. 1998. A Model of Alternative Forms of Public Leisure Services Delivery. In: Collins, M.F. andamp; Cooper, I.S. (Eds.), Leisure Management: Issues and Applications (pp.139-155). CAB International. References: References Driml, Sally and Mick Common. 1995. Economic and Financial Benefits of Tourism in Major Protected Areas. Australian Journal of Environmental Management 2, no. 2: 19-39. Eagles, Paul F. J., Daniel McLean and Mike J. Stabler. 2000. Estimating the Tourism Volume and Value in Parks and Protected Areas in Canada and the USA. George Wright Forum 17(3): 62-76. Graham, J., Amos, B., Plumptre, T. 2003) Governance Principles for Protected Areas in the 21st Century. Ottawa, ON: Institute on Governance.