Sophia Tibon
The tourism benefits that slip away from destinations
Sophia Tibon
The tourism benefits that slip away from destinations
Sophia Tibon
The tourism benefits that slip away from destinations
The narrative of record-breaking tourism is often celebrated with arrival and spending figures, but across much of the Caribbean—from the Dominican Republic to Jamaica, from the Bahamas to Saint Lucia, and including Aruba, Puerto Rico, and Barbados—an uncomfortable paradox persists: millions come in, and a substantial share of the value generated flows out through invisible channels without taking root in the local economy. This “leakage” takes multiple forms: packages sold at origin by foreign tour operators; integrated resorts that import a large share of their supplies; intermediation platforms with tax domiciles outside the destination; and global chains that repatriate profits to their parent companies. When this occurs systematically, each dollar spent by a visitor makes only a few stops in local businesses, payrolls, and suppliers before leaving the island, reducing income multipliers and leaving only a faint trace in the productive fabric.
The all-inclusive model has been particularly influential in my Caribbean. Its promise of predictability and cost control appeals to source markets and to families seeking “hassle-free vacations,” but that convenience has side effects. If guests eat breakfast, lunch, and dinner, are entertained, and shop within the resort, proximity commerce—corner shops, restaurants, independent guides, taxis, artisans—receives only crumbs of the tourist flow. Logistics add to this: from meats and wines to amenities and construction materials are often purchased abroad due to corporate economies of scale, while advertising, technology, and insurance contracts are signed with external providers. The result is a destination full of visitors but with short value chains, compressed wages, and low local business density.
The cruise segment reproduces the logic of concentration, with nuances. Large cruise lines control the onboard experience and set port-of-call agreements that maximize time spent on the ship. Many passengers disembark for only a few hours and spend relatively little on shore, since they have prepaid dining, entertainment, and duty-free shopping. Ports compete with fee reductions, public investment in terminals, and regulatory facilitation, but if clear give-backs are not negotiated—such as quotas for local guides, curated community excursions, purchases from local producers, or longer calls—the fiscal and economic balance may be modest compared with the pressure on infrastructure, waste systems, and coastal ecosystems.
The “more is better” paradox is not exclusive to the Caribbean. In Bali and Phuket, mass tourism strains housing prices and water access; in the Maldives or Seychelles, the economy benefits from high rates but imports much of its supplies; in heritage cities like Dubrovnik or Venice, surges of visitors crammed into a few hours suppress dispersed spending and displace traditional commerce. In Mexico, the Riviera Maya combines integrated resorts and theme parks that leverage industrial scale, while Maya communities demand a larger share in the value chain. The cross-cutting lesson is clear: without rules to accompany growth, tourism wealth tends to concentrate in corporate nodes and become detached from the territory.
Environmental costs amplify the problem. Coral reefs stressed by anchoring, discharges, or sedimentation; aquifers over-exploited by complexes that consume in days what a neighborhood uses in weeks; solid waste that exceeds municipal management capacity; a high energy footprint on islands still dependent on fossil fuels. When balance sheets are drawn behind closed doors—occupancy, RevPAR, average spend—those bills fall out of frame. But destinations that fail to internalize these costs end up paying with lost appeal: eroded beaches, degraded reefs, congestion, neighborhood conflicts, and tarnished reputations.
What can be done to keep tourism value in place and make it pay off? The first lever is contractual and fiscal: condition incentives, licenses, and exemptions on measurable commitments to local purchasing, quality employment, training, and linkages with local SMEs. Publishing leakage audits by property and destination, using comparable methodologies, would help reward those who anchor value and correct laggards. The second lever is market-based: promote products that lengthen average stays and blend beach with culture, nature, and gastronomy, integrating routes for farmers, fishing cooperatives, artisans, and creative enterprises. The third is urban and social: regulate accommodation to avoid displacing residents, ensure housing for sector workers, and capture part of the tourism windfall through earmarked levies dedicated to infrastructure, sanitation, waste management, and marine conservation.
The Caribbean has the assets for such a shift. In the Dominican Republic, more purchasing agreements with local producers can turn resort menus into a lever for agriculture; in Jamaica, music, sports, and Rastafari culture offer high value-added experiences beyond hotel perimeters; in Barbados or Antigua and Barbuda, yachting and coral-science tourism can attract visitors willing to contribute to conservation projects; in Puerto Rico, the creative economy and culinary innovation can turn neighborhoods into vibrant gastronomic circuits; in Saint Lucia or Grenada, cocoa, spices, and agroforestry provide origin stories with premium potential. The key is to curate the experience and ensure visitors have real reasons to spend in the community, not just on the wristband.
Policies must also look to the sea. Agreements with cruise lines that set minimum on-shore spending, longer calls, and quotas for local operators; regulated mooring zones and artificial reefs to ease pressure on sensitive areas; transparent green fees reinvested in conservation; and stringent water- and energy-efficiency standards for hotels and ports to reduce diesel dependence. When nature is the main draw, protecting it isn’t philanthropy—it’s safeguarding the business base.
Tourism can be a powerful development tool if value doesn’t leak away. Measuring leakage, redesigning incentives, agreeing on rules with major players, and multiplying the gateways for spending are concrete steps to ensure prosperity leaves a mark. Caribbean or Mediterranean, Indian Ocean or Pacific: the issue isn’t just how many arrive, but how much stays, where it stays, and who benefits. Switching the scoreboard from “visitors” to “anchored value” is the first act of honesty in any tourism strategy that aims to endure.
Author: Sophia Tibon
Sophia Tibon, born in Jamaica, is an analyst and journalist specializing in tourism policy and sustainability in island destinations. Educated in the United States (undergraduate and graduate studies in economics and development), she researches value chains, revenue leakage, and marine conservation. She has published reports and features on employment, housing, and the green transition across the Caribbean and the Americas. She currently advises projects on responsible tourism and the creative economy.
The authors are responsible for the choice and presentation of the facts contained in this document and for the opinions expressed therein, which are not necessarily those of Tourism and Society Think Tank and do not commit the Organization, and should not be attributed to TSTT or its members.
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