Tourism at the Crossroads

Challenges to Developing Countries

by the New World Trade Order

Authors:

Jorg Seifert-Granzin
Werkstatt Okonomie, Heidelberg/Germany

D. Samuel Jesupatham,
Indian Social Institute, Bangalore/lndia

Equations, Bangalore/lndia
Tourism Watch, Leinfelden-Echterdingen/Germany

epd-Entwicklungspolitik: Materialien VI/99

Frankfurt am Main/Germany, 1999

IMPRESSUM

Tourism at the Crossroads

Challenges to Developing Countries by the New World Trade Order

Published by: epd-Entwicklungspolitik, Equations, Tourism Watch (ZEB)

Written by: Jorg Seifert-Granzin (Werkstatt Okonomie, Heidelberg/Germany)
O. Samuel Jesupatham (Indian Social Institute, Bangalore/lndia)
English translation: Elaine Griffith
Edited by: Christina Kamp
Layout by: Christina Kamp, Jorg Seifert-Granzin
Cover image by: Ohanaraj Keezhara
Cover layout by: JOrgen Ravens

This study is published in the series 'epd-Entwicklungspolitik: Materialien' as No. VI/ 99.
Frankfurt/Main, 1 999

epd-Entwicklungspolitik
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2
 CONTENTS

Introduction ............................................................................................................................ 5

1. Tourism in a Global Economy: Forms, Significance and Contradictions ............. 6

1 . 1 Tou rism as a Service Mix: Sig nificance and I nterrelation with ot h e r Econ o mic Sectors
................................................................................................ ...................................... 6

1 . 2 Key P l aye rs in I nternation ally Traded To u rism Services ....... . ...................................... 8

1.3 To u rism and Develop m e nt - Facts, Myths and Cont radictio ns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2

1 .4 Conc l u sion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

2. Tourism in Developing Countries under the Regime of GATS ............................. 25

2. 1 T h e I nteg ration of I nternation al Trade in Services into a N ew Wo rld Trade Order ..... 25

2.2 Tourism R e l ated Services u n d e r t h e Verdict of Uberalisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

3. Disregard for Human Rights in Tourism - Challenges to the World Trade Order
45
................................................................................................................................•...

3 . 1 U g ly Backyards of Tou rism ......................................................................................... 45

3 . 2 " B lind Dates" in T rade R e g u l atio n: Level s and Means of I ntervention in I nternation a l
Trade .......................................................................................................................... 45

3 . 3 The P ros and Cons of I ntrod u cing Social C l a u ses: C rucial Points in t h e Field of
Tou rism ....................................................................................................................... 4 6

3 . 4 R eco m mendatio n s ...................................................................................................... 4 9

4. Ecological Impacts of Tourism as a Trade Issue ................................................... 52

4. 1 Shortcomings of the N ew World Trade O rder ............................................................. 52

4 . 2 Who's wrong? M arket Fail u re o r Trad e Liberalisatio n as a Cause of Enviro n m ental

Degradation? ..............................................................................................................52

4 . 3 Who's First? P ossib l e Conflicts B etween M u ltilateral E n viro n m ental Agree m e nts and
WTO-OMC in t h e Fie l d of Services ............................................................................ 55

4.4 Taking N at u re into Accou nt - a l l t h e M o re in Tou rism ................................................. 56

4.5 T h e Agenda of Sustainab l e Trade in To u rism Services ............................................. 6 0

Priorities o n the Way t o Sustainable Trade i n Tourism Services .................................... 62

Bibliography ............................................... . . ........................................................................ 64

Abbreviations ....................................................................................................................... 68

Appendix 1: Tourism Dependency ..................................................................................... 69

Appendix 2: WTOIGATS Member Countries ........ .............................................................. 70

The Publishers ...................................................................................................................... 71

3
4
INTRODUCTION
Freedom in international trade and freedom of travel is the idea of the moment. Yet some­
times the freedom of people in the tourism destinations in developing countries is trampled
underfoot. That is because costs and benefits from tourism are often unequally distributed.
While tourism arouses great business expectations, the ensuing benefit is in reality generally
far smaller. It is also often linked with negative socio-cultural and ecological repercussions.
For years, groups critical of tourism have been confronting the consequences of a mis­
conceived tourism policy with their vision of another, acceptable and sustainable kind of
tourism: As many local people as possible are to share in the economic benefit of such
tourism and participate democratically in its planning and implementation. This would be a
tourism that respects the culture of the host country, does not damage natural resources and
offers a stimulating experience to both hosts and guests.

The emerging world trade system under the World Trade Organization (WTO-OMC) provides
a challenge of unprecedented order to the tourism-critical groups and organisations. For the
first time, trade in services, including tourism, has been subjected to the policies of free trade
doctrine, alongside internationally traded goods through the adoption of the General
Agreement on Trade in Services (GATS). Tourism Watch and EQUATIONS have therefore
initiated this study aimed at analysing the consequences of this change for tourism in
developing countries. Such an analysis would help in evolving the strategies that need to be
adopted for a sustainable and self-determined development in tourism.

This study sheds light on the legal bases of the new world trade order, documents the
progress of liberalisation in this sector, identifies its risks and makes proposals for reforms. It
takes account of the sectoral problems in developing countries in general and the Indian
experience with tourism in particular.

Three problems play a prominent role here. In the first place, GATS intervenes deeply into
areas of national and sUb-national autonomy of the countries concerned. The effect of such
intrusion is accompanied with greater problems since the structures that are vital for the
participation of all concerned are also lacking in most developing countries. Secondly, human
rights violations in the field of tourism pose a fundamental question to the new world trade
order. Thirdly, the implementation of the commitments under GATS could lead to a
disregarding of the WTO-OMC's commitment to sustainable development and conservation
of natural rescues. Reform proposals have been drawn up for all three areas. In our view
their implementation is an important precondition for the development of sustainable forms of
tourism.

We thank the authors of the study, D. Samuel Jesupatham (Indian Social Institute,
Bangalore) and J6rg Seifert-Granzin (werkstatt 6konomie, Heidelberg) for this important
work. We also have much reason to thank Elaine Griffith for the English translation, the
Association of Protestant Churches and Missions (EMW) in Germany for their financial
support, Christina Kamp for her untiring editorial support, and last but not least the German
Protestant News Agency for publishing the study in their series 'epd-Entwicklungspolitik:
Materialien'.

Presenting this study for general public debate we are hopeful that it will facilitate the
discussions on the coming WTO-OMC Millennium Round, and will serve as a constructive
element in the ongoing international process on tourism within the framework of the UN
Commission on Sustainable Development (CSD).

Martin Stabler / Heinz Fuchs K.T.Suresh

Tourism Watch EQUATIONS

5
1. TOURISM IN A GLOBAL ECONOMY: FORMS, SIGNIFICANCE AND CONTRA­
DICTIONS

1.1 TOURISM AS A SERVICE MIx: SIGNIFICANCE AND INTERRELATION WITH OTHER

ECONOMIC SECTORS

THE SCOPE OF TOURISM-RELATED SERVICES

If relevant figures and forecasts are to be believed, the tourist industry has long become one
of the most important growth industries in the world. According to estimates of the World
Tourism Organisation (WTO-OMT), over a billion people will cross national borders in the
year 2010, income from tourist services will amount to over US$ 1.5 trillion (WTO-OMT
1996a). Other estimates go even further. The WEFA estimated a global turnover of US$ 3.5
trillion for the year 1987, which according to the World Travel and Tourism Council (WTTC) is
to rise to over US$ 7.1 trillion in the year 2006 ( Kirstges 1996, 46f.). While the forecasters of
global mobility are in agreement regarding the economic importance of tourism, they
disagree about the segments involved. Is building hotel complexes a way of adding value
through tourism? What grounds for travel (holidays, visits, business contacts, health,
pilgrimages, etc.) are to be included in tourism?

In India, for example, four types of tourism play a significant role:

• Businessmen and women travelling as part of the international corporate world with an
increasing presence of multinational corporations in India;

• foreign leisure tourists spending their holidays in India,

• domestic leisure tourists mainly stemming from the new middle class in India which has
an increased disposable income as an outcome of the liberalisation process. I

• the Indian pilgrim travel which might amount to the highest share according to number of
travellers2•

"Tourism - the biggest industry in the world?" Without a clear consensus regarding the forms
of tourism the significance of this sub-sector cannot be assessed, let alone the impact of
deregulating international trade in goods and services.

At the beginning of the 1990s the United Nations (UN) and WTO-OMT agreed on a joint,
broad definition of tourism: "Tourism comprises the activities of persons travelling to and
staying in places outside their usual environment for not more than one consecutive year for
leisure, business and other purposes" (UNIWTO-OMT 1994, 5). This consumer-related
3
approach includes business trips and international and domestic tourism . The orientation to

Domestic tourists have swelled from nearly 60 million in 1992 to over 100 million in 1995. With a
base of nearly 110 million, there is an in-built market of travelling Indians - says the Deputy Director
General of Domestic Tourism. The middle class was on the rise, particularly the upper middle and
high income groups in India, between 1989 and 1993. The lower and lower middle income
households have grown about 6 percent in number, and the middle and middle income group grew
nearly 26 percent. The Largest percentage increase was in the high income households which shot
up from 2.1 million to 3.6 million - a hike of 7 percent in the five-year period (ET 3.10.96).

The shrine of Lord Venketeshwara at Thirumala in Andhra earned a record income of Rs. 217.66
crores in 1995-96 during which it was visited by 20,518,152 pilgrims (Hindu 30.9.96).

In this context 'domestic' tourism refers to residents travelling within their own country. In the
context of national accounts it has a broader sense and refers to all activities of residents and non­
residents within a reference country.

6
the consumer, i.e. the traveller, conceals the close interweaving of the tourism sector with
other (backward) service areas and support activities. To what extent, for example, do
transportation, entertainment services, or food consumption contribute to profits from
tourism?
Deciding what activities are to be attributed individually to this definition is more than a
problem of definition or statistics. Generally the tourism sector is regarded as "... already
relatively Ilberalised, although characterised by a marked absence of developing countries'
suppliers in the distribution channels..." (Handszuh 1995, 17). Whether their weak position
can be improved at all does not only depend on the services offered in the core tourist areas
(hotels/restaurants, travel and tour operation, tourist guides' services). Support activities in
the fields of finance, technology and procurement of goods and services are gaining in
importance. In particular the access to modern distribution channels such as computer reser­
vation systems (CRS) and online advertising, and the range of on-site services (sporting
facilities, entertainment, etc.) will decide whether the tourism sector can make a higher con­
tribution to domestic value added and economic development (cf. 1.1.2).
Under Tourism and Travel-Related Services (TTRS) the service sectoral classification of
GATS covers hotels/restaurants, travel agencies/tour operators, tourist guide services and
others. Diagram 4 (cf. p. 30) shows,however, that there is hardly a single service area that is
not directly involved with tourism. The effects of the new World Trade Agreement on tourism
will thus be far greater than they appear if we look at the commitments to liberalise tourism
and travel-related services only.

INTERSECTORAL RELATIONS AND FORMS OF INTEGRATION

A key area of the interdependence of tourism-related sectors is the close connection

between transport services and tourism. Over 80 percent of international tourists reach their
destination by plane (Madeley 1996,8). The boom in long-haul travel came about when
charter flights where linked with package tours,which resulted in a high degree of interaction
between airlines and tour operators (cf.1.2). Furthermore, all other kinds of transport play a
vital role in the tourism business: without busses, trains, (hired) cars and ferries, it would be
difficult to achieve variety in (orchestrated) holiday worlds. All forms of recreational, cultural
and sporting services are factors relevant to the location which are also of considerable
importance.
At least as important as the core tourist activities are the wide range of business-supporting
activities: credit card suppliers and travel insurance companies have conquered lucrative
segments of the market. In the framework of strategic alliances, airlines are expanding their
information technology infrastructure in order to use it jOintly. Amadeus (Air France, Iberia,
Lufthansa) and Apollo (Air Canada, Alitalia, British Airways, KLM, Swissair, United Airlines
and USAIR) are only two of a good dozen CRS, which handle the bulk of all air bookings.
New holiday resorts - such as all-inclusive resorts and theme parks - are planned by
experienced consulting firms, financed through investment companies and marketed by
specialised agencies. Evident backward linkages exist to food production and the building
industry.

In view of the wide range of services it may be concluded that "activities related to the
manipulation and distribution of information lie at the heart of the (tourism) industry's wealth­
creating process" (Poon 1993,214). Through special expansion strategies,individual players
succeed in controlling activities in this process and taking a leading market position.

The strategies of vertical integration play a dominant role in individual segments of the
tourism industry. Tour operators have for years been buying into the backward and forward

7
areas of service or production. Their backward integration includes hotels and charter air­
lines. Via a far-reaching forward integration of retail distributors and travel agencies, these
operators also control all stages of distribution, marketing and sales of package tours.
Airlines, too, operate massive forward integration, extending far into the field of primary
tourism and travel-related services via their charter airlines which have interests in tour
operators, retailers and travel agencies. By contrast, hotels and hotel chains hardly pursue
strategies of vertical integration at all.

All stages of the tourist service chain are, on the one hand, marked by strong oligopolistic
concentration and, on the other hand, by increasing competition between the providers. Air­
lines, tour operators and travel agencies are subject to an increased process of horizontal
integration, which in the recent past has raised interest through spectacular take-overs like
that of Thomas Cook by the German LTU group in 1 993, or through joint ventures. The
consolidation among airlines has been in full swing since the 1 980s and is imminent for travel
agencies. Estimates suggest that of the approx. 16,000 German travel agencies, at most half
will survive this selection process (Scherer 1 996, 32).
The expansionist strategy of diagonal integration aims at a company becoming a provider in
as many tourism-related service markets as possible. "It is the process by which firms use
information technologies to logically combine services (e.g. financial services and travel
agencies) for best productivity and most profits" (Poon 1 993, 216). A broadening of the
service range offered is intended to cut costs ("economies of scope"), make the most of
synergies between the individual markets and achieve systems gains. This includes e.g. the
joint use of CRS by carriers and travel agencies under the roof of a holding, co-operation
between credit card suppliers and tour operators or travel agencies offering the special
insurance services of a holding partner.
Even though all forms of integration continue to play an important part in relevant tourism­
related markets, there is hardly any doubt that the strategy of diagonal integration will gain in
importance as information technology (IT) develops.

1.2 KEY PLAYERS IN INTERNATIONALLY TRADED TOURISM SERVICES

Eight core industry players in Europe dominate the supply side in tourism. In the broader
context, national and international trade associations, national government ministries
(transport, tourism) and multilateral organisations (IMF, World Bank Group, development
banks) are influential in this sector. Besides traditional providers (airlines, hotels, travel
agencies, tour operators and on-site service suppliers) companies gain in importance if they
cover a broad range of tourist services by creating and delivering holiday "events". The most
popular among the 'holiday-makers' are all-inclusive resorts (Club Mediterranee, Club
Robinson). Fantasy resorts and theme parks (Disneyland, Centerparcs) are also active on
the market of total holiday experience. Even cruise lines are losing their old-fashioned image
and offering the safety of orchestrated holiday worlds.
The importance of banks, insurance companies, credit card suppliers and investment fund
companies for tourism has already been pointed out. Financial service suppliers are
conquering the travel and tourism markets. At the same time, traditional players are
increasingly assuming financing functions in a process of diagonal integration and
4
diversification • By contrast, incoming agents have played a rather marginal role in tourism

4
In the literature terms like 'diversification' and 'integration' are defined differently. Poon understands
'diversification' as the expansion of a country in a field which has no relationship with previous
corporate activities and cites the participation of airlines and car rental firms (Poon 1993, 222)

8
market places. They ensure quality control in service networks and operate primarily as
intermediaries between the individual players in the destinations.

In view of the high degree of interrelations in the tourist industry, one might well conclude
that a few players dominate at least individual (national) tourist markets. The complex mesh
of interests, forms of co-operation and types of tourism-related services make it difficult to
identify "market-makers".

Box 1: The TUI case

Germany's biggest hotelier (Table 1) is also the tour operator with the biggest sales in
Europe. In 1997/98 the Touristik Union International in Central Europe achieved a turnover
of DM 7.4 billion (fvw Nr. 26/98), including all domestic and foreign interests in hotels, tour
operators and on-site agencies. At the same time it is one of the most important European
providers of long-haul trips, operating from Germany and elsewhere. Through its take­
over of the leading Dutch tour operator Holland International, planned co-operations with
Austrian travel agencies and Swiss tour operators, and expansion in Eastern Europe, TUI
will probably remain the leading European operator in the long term. Yet this tourism giant
has itself become a plaything of other group strategists.

The equity structure in this group highlights the integration of airlines, financial service
suppliers, tour operators, travel agencies and on-site service suppliers; it reads like a
Who's Who of the German tourist trade. The owner of this complex group (Hapag Touristik
Union 50.1 percent, Preussag AG 25 percent and WestLB 24.9 percent) are in their turn
affiliated with other leading German and American providers of tourist services. TUI itself
has a 50 percent share in Airtours International GmbH, which is a 50 percent subsidiary of
Lufthansa Commercial Holding GmbH (cf. Box 2). Among TUI subsidiaries (cf. Table 2),
Holland International, Seetours and Airconti are themselves among the 1000 biggest
European operators.

TUI has a three-level distribution system (Liedtke 1996): a few TUI agencies and the
franchise chain TUI UrlaubsCenter with its 255 outlets sell exclusively TUI travel services.
In addition, 9,160 independent travel agencies at home and abroad are licensed as TUI
ProfitCenters and grant the group offerings a special place in their sales offering. Originally
the company sought an exclusive distribution connection between travel agencies and
package tours of TUI operators. The travel agencies were to be required to sell package
tours of the most important German competitors. The dispute between TUI, travel
agencies, the Federal Cartel Authority and the courts lasted six years and ended in
1994/95 with TUI "voluntarily" lifting its exclusive representation requirement.
However powerful TUI may appear as a European tour operator it is itself only one
strategic component of a group that has a firm grip on other aspects of the tourist trade. In
1993 the major bank WestLB succeeded in getting into the group by the backdoor, via
subsidiaries and holdings. WestLB wanted to establish and control the biggest tourism
conglomerate in Europe, based on two pillars: TUI with all its European subsidiaries and
LTU International Airways GmbH & Co. KG. L TU, a 34 percent subsidiary of WestLB
would have contributed not only a powerful aircraft fleet to this mammoth merger but also
other subsidiaries in the form of leading operators Thomas Cook, Tjaereborg, Jahn Reisen
and Meiers Weltreisen. But WestLB exerts major influence on the European tourist
business via its 25 percent interest in TUI and LTU, but it is not the only shark in the sea.
Other German banks are also associated with Hapag-Uoyd and department stores via
minority interests.

9
 Supposedly self-employed tour operators
Table 1: Leading German Tour turn out to be 100 percent subsidiaries of
Operators: Turnovers 1997/98 larger tour operators; the influential
holdings themselves are not at all visible
Firm Market share Turnover
on the consumer markets.
[ %] [Mill. OM] Oligopolistic practices in sales and
booking of travel services link travel
TUI Germany 26.41 6,560.00
agencies and on-site service suppliers
C & N Touristic 22.26 5,528.60 with the tour operators (ct. Box 1: the TUI
case). Their investments and interest in
NUR Germany 17.05 4,234.30
hotels ensure the necessary quota of

LTU Touristic (LTI) 11.63 2,887.70 beds. "If you have the beds you have the
customers" (Scherer 1995, 83). This is
DER Tour 6.30 1,565.00 due to the decline in importance of
package tours and the rise of individual
HI 5.28 1,310.90
holiday offerings.
ITS 5.08 1,261.70
The destinations present a similar pic­
ture. Here there are many small compa­
Alltours 4.67 1,160.00
nies with regionalised service offerings
Oger Group 3.69 916.60 (boat trips, trekking tours, lodges, guided
tours, roundtrips, etc.) as well as the
Kreutzer Touristic 2.80 696.00
large, high-capital national tour operators
Source: FVW 28/98 and travel agencies. The latter are fre-
quently associated with or entirely owned
by foreign companies via capital interests, joint ventures or co-operation agreements. They
have their own transport facilities and distribution channels. Direct contacts with customers in
the tourist sending countries give them a stronger competitive position from the outset, as
they are familiar with their customers' needs and can even initiate broad trends. On the other
hand, smaller providers adapt flexibly to the special regional conditions and are not subject to
the constraints of a standardised service range.

The competitive position taken by individual companies from these two groups can be
identified only for a specific country or region. The only generalisation possible here is that
the tourist inflow from individual sending countries is focussed on certain destinations and
that certain foreign providers probably dominate these markets. For example, the Dominican
Republic was the most important Caribbean destination for German tour operators in 1994.
About 57 percent of all overnight capacity was in the hands of foreign (not only German)
companies, through ownership or co-operation agreements (Vorlaufer 1996, 25 . 87) . United
States citizens preferred Puerto Rico: two million, i.e. over two thirds of all incoming tourists,
came from the US (WTO-OMT 1995).

The importance of international hotel chains is easier to define, as they mainly operate under
standard international names. Madeley concludes that "... hotels have probably the biggest
impact on developing countries. The overwhelming majority of the largest hotels world wide
are owned, operated or managed by, or affiliated with transnational corporations (TNCs).
Such hotels account for a considerably higher percentage of the total number of rooms in
developing countries than in developed countries. In developing countries with tourism
potential, hotel chains are particularly prevalent" (Madeley 1995, 9.11).

Various pOints here require elaboration:

• Firstly, the number of hotels belonging to a chain in the sending country may be very
high, or the branches broadly scattered world wide. For example, over 80 percent of all

10
 Holiday Inn hotels are found in the United States. By contrast, the 262 Club Med centres
are scattered over all five continents. In both cases the number of company-owned
rooms says little about their market position.

• Secondly, co-operation between "smaller" (inter)national chains or individual hotels can

also lead to a prominent position in the hotel trade. As shown by the 1991 joint venture
between the Indian Oberoi chain and the French Accor group, some chains based in
developing countries also operate transnationally (Box 2: Key Players in India's Domestic
Hotel Industry - being about to globalise) . Oberoi and Accor agreed to set up the Novotel
chain in India, which runs 50 hotels in other developing countries.

Box 2: Key Players in India's Domestic Hotel Industry - being about to globalise

The Indian Hotels, part of the Tata Group operates 41 hotels and resorts in India as well as
14 abroad. It owns 14 hotels and has a minority stake in 20 others. Most of these hotels
operate under the Taj banner. Indian Hotels has a major presence in New Delhi and
Mumbai, where it operates three hotels in each of the two cities. The company has a major
presence in the flight catering business which contributes more than 10 percent to the total
turnover. The company proposes to build 19 hotels in the next five years. Indian Hotels is
the only company to add capacity during 1995, when 11 O-room Taj Mahal, Lucknow began
operations. Operating the largest hotel chain across the country has enabled the company
to diversify risks. While hotels in New Delhi and Mumbai cater primarily to the business
travellers, the others are centred on tourists. Being a leader in the segment, Indian Hotels
is the major beneficiary of the fortunes in the industry.

EIH (formerly known as East India Hotels): Apart from Indian Hotels, it is EIH which is
playing high in the stock market. EIH operates in Mumbai, and in New Delhi where the
Oberoi and Oberoi Maidens account for 80 percent of the company's total revenues. The
company also operates nine hotels in the country under the Oberoi, Trident and Novotel
banners. The company has a steady foreign exchange revenue of 60 percent of its total
revenues.

Asian Hotels: The company operates the 500 - room Hyatt Regency in New Delhi. The
hotel has a high occupancy rate and also has one of the highest operating profit margins in
the industry. The focus is on the business segment. The company has planned to expand
with projects coming up in Agra, Mumbai, Calcutta and Jaipur.

Hotel Leelaventue: The company operates the Leela Kempinksi in Mumbai and the Leela
Beach in Goa. The hotel is co-operating with Kempinski group Switzerland, which is part of
the Lufthansa Group. Its foreign exchange earnings constitute more than 70 percent. The
Goa resort has been voted the fifth best in the world. Additionally, the company is planning
an all-suite hotel in Goa along with Four Seasons Group, Canada.

Oriental Hotels operates the Taj coromandel (Chennai), the Taj Residency
(Visakapatnam), the Taj Malabar (Kochi) and Fishermans' Cove (near Chennai). In
addition, the company is investing abroad.

However, in many sending and receiving countries there are a broad range of small and
medium-sized tourist service suppliers that have to succeed in their respective market
segments. In Germany the market share of the five major tour operators (TUI, NU R, DER,
5
1ST, LTT group) has been under 40 percent since 1987, and that of the small ones has on
average been over 40 percent (Kirstges 1996, 357).

-,
For a definition of the individual provider segments see Kirstges 1996, 70f.

11
• Thirdly, through co-operation or sales agreements with many small hoteliers tour
operators can exercise a much stronger market power.

• Lastly, given the extremely hetero­

geneous spectrum of developing Table 2: Leading TUI Partners 1996
countries, the share of foreign hotel
TUI-equity
chains in total room capacity varies Firm
share [%]
considerably. In the cases of Kenya
and Sri Lanka, for example, it is Airtours International 100
estimated at 5-15 percent. In coun­
tries like Eritrea, which are now be­ Events 100

ginning to set up a tourist infra­

Take off Flugtouristik GmbH 100
structure (taz 29/30.12.96) this
share could well be much higher. TUI Nederland 91

Basically, there are four typical struc­

Wolters Reisen GmbH 100
tural features characterising the hotel
trade in developing countries (Vorlaufer TUI Austria 100

1996, 93f1.). In many countries, large

Dorfhotel 100
up-market hotel groups dominate the
tourism scene. Many hotels belong to Dr. Degener Reisen GmbH 100
transnational and national chains, via
equity participation, franchising TUI Service 85

accords, joint ventures or management

TUl lnfoTec 100
agreements. In many countries, state­
owned companies continue to play an TUI ReiseCenter 67
important role. Small and medium­
L'TUR 51
sized hotels run by local proprietors
are, however, increasing in importance.
Robinson Club 100

www.tui.com

1.3 TOURISM AND DEVELOPMENT - FACTS, MYTHS AND CONTRADICTIONS

In 1998, international tourism receipts world wide amounted to US$ 445 billion (WTO-OMT).
Developing countries accounted for about a quarter of this sum. According to estimates by
the World Tourism Organisation, in the year 2010 over a billion people will be travelling per
year and spending US$ 1.5 trillion. In the last 20 years, there has been a clear shift in the
market share of destinations. While the share of arrivals in European destinations continued
to drop (from 68.2 percent in 1970 to 59.6 percent in 1998), East Asian and Pacific tourist
areas clearly became more attractive, with their share in arrivals rising from 3.2 percent in
1970 to 13.9 percent in 1998 (despite a 1.2 percent decline in 1997 and 1998, due to the
financial crisis in the East Asian/Pacific region).

This being the case, it is understandable that individual developing countries, national and
multilateral development agencies and tourism planners hope for considerable growth
impetus from the establishment and expansion of the tourism sector. Whether these expec­
tations, centred around the hope that tourism will generate a significant share of the national
income, will be fulfilled, depends above all on the range of services which are actually being
supplied locally, under the guidance and to the benefit of the destination countries. Against
this background, the following expectations have to be reviewed:

12
(1) Tourism is to make a significant contribution to domestic value added. Given the close
relationship between tourism and other industries - food, building and transportation -
tourism-induced growth can stimulate other sectors.
(2) By promoting a high level of attractiveness of the destinations international tourism is to
be intensified and thereby foreign exchange earnings are expected to increase.

(3) It is also hoped that tourism will create additional employment and that the skill level of
local staff will be improved through technology transfer between domestic and foreign
companies.

(4) Furthermore, tourism is expected to be a pull factor to building and expanding the local
infrastructure to the benefit of communities.
(5) Regional customs and traditions are considered crucial factors when it comes to realising
tourism projects. Investors therefore like to point out that the planned projects could con­
tribute to the preservation of regional cultural goods. On the other hand, following ideas
of modernisation theory, there are hopes that the expansion of this sector can foster
social change in the societies concerned and break down traditional social structures that
are felt to be obstacles to development.
(6) There are also relatively recent but very popular hopes that nature-oriented tourist
activities can make a monetary or non-material contribution to the protection of nature
and the environment.
The extent to which these goals can be actually achieved depends on the conditions in the
individual countries, the kinds of tourism infrastructure and also on reciprocal developments
in the industry. Past experience gives cause for scepticism.

VALUE-ADDING EFFECTS OF TOURISM

Although all sub-sectors in the field of services are linked to the tourism industry, only a small
part of their production value can actually be expected to stay within developing countries. In
fact, a high percentage of the tourist expenditure is not leaving the tourists' countries of origin
in the first place. Long-haul air transport is mostly run by carriers based in the North.
Furthermore, in core areas of the tourism industry, i.e. hotels, catering, travel agencies, tour
operators and tourist guide services, as well as in the fields of on-site support services
(sports and recreation, facility leasing) "benefits" flow to a large extent into the same
direction. This is due to the fact that many services in the destinations are being supplied by
companies from the tourists' countries of origin or by their local partners.

The expected growth stimulus of upstream and downstream production areas have long
determined the development discussion. In the case of the tourist industry, there are
particular connections with other economic sectors. The food, building and entertainment
sectors can benefit from the expansion of tourism, as can transport companies. These
linkages, however, only benefit the local economy if local products and services contribute
significantly to the value added. In the case of certain forms of tourism for which there is
currently a growing demand, such as all-inclusive tourism ("A package deal- and low-cost!"),
club holidays or cruises, this hardly happens. These orchestrated holiday worlds are
generally largely isolated islands of affluence, supplied by the tour operators with products
and services from their countries of origin. Even souvenirs are being imported.

During the development of growth potential, with the transition from a growth to a consolida­
tion phase, individual upstream and downstream sectors gain in importance, while tile share
of value added in others tends to decline. Experience shows that the building industry, in
particular, is among these "losers" unless, in the growth phase, there are continuous growth
13
stimuli from other sectors that entail broad, stable diversification. The interrelation between
tourism and agriculture can also be an area of conflict in some countries, depending on the
conditions of agri-ecological production and the customary diet of local and tourist residents.
While in the 1 970s Kenya succeeded in producing all foodstuffs required in the tourism
sector (Vorlaufer 1 996, 163ft). other developing countries experienced a recession of agri­
cultural production as a consequence of growing tourist industries (German Federal Ministry
for Economic Co-operation and Development 1 993, 32). Competition for production areas in­
creases where necessary resources such as water and energy are scarce (cf. 1.3.6) or
where there is no overlap in the food requirements of locals and tourists.

The G OP of individual Caribbean states mainly depends on tourism (see diagram 1). And
even if - as in the case of Haiti - income simply amounts to three percent of G OP, it can
amount to 72 percent of the value of net exports.
The high dependence on tourism income involves risks. Countries in which tourism con­
tributes significantly to the G OP are particularly affected by global economic trends and
cyclical variations. The financial crisis has in 1 998 led to a decline in tourism receipts of 3. 8
percent over the previous year in the East Asia/Pacific region (WTO-OMT).
The negative trend is above all due to a drastic decrease in tourism within the Asian region
by about 10 percent which particularly affected individual countries such as Singapore, New
Zealand and Hong
Diagram 1: Tourism as an Export Mono-crop
Kong. The Asian
crisis also affected
tourism from Asia
to other parts of
the world, so that
WTO-OMT cor­
rected their global
growth forecasts to
the year 2001.
Furthermore,
many countries
with similar loca­
tional conditions
compete with one
another in the
world market.
Internal political
tensions, natural
disasters or eco­
nomic fluctuations
generally lead to a
diversion of tourist
flows to countries
with comparable
supply. A temporal
downturn, as in the case of the Indian state of Kashmir where tourism broke down due to
political conflicts, can lead to a regional or even national economic crisis.

Looking at India as a whole, international tourism is still concentrated in a few regions, but
about to take over several coastal areas, sacred sites and national parks. Especially the
states of Bihar, Madhya Pradesh, Punjab and Kerala have seen an increase in the number of
14
visitors. With under 0.4 percent of the world's tourist arrivals and one percent of tourist
spending, the country has barely tapped its so-called 'rich tourism potential'. India attracted
about 2.1 million foreigners in 1995, only 500,000 of which can be considered genuine
tourists. According to Pradeep Madhavji, Chairman of Thomas Cook, (TOI .22 Aug. 96), the
major part of international arrivals consists of businessmen and airline crew. Domestic
tourism (which includes traditional forms like pilgrimage journeys as well as leisure tourism
following western patterns) swelled from nearly 60 million in 1992 to over 100 million tourists
in 1995. With an expected 110 million travellers, Indian domestic tourism is becoming an
important market for tourism services.

FOREIGN EXCHANGE EFFECTS

Almost all developing countries have a positive balance in terms of net foreign exchange
6
earnings from the tourism sector . According to the Approach Paper to the Ninth Five Year
Plan (1997-2002), prepared by the Planning Commission of the Indian Government,
"Tourism is presently the third largest foreign exchange earning sector in India." Travel
account balance in South Asia has in 1997 been 1, 828 million US$ in surplus. All developing
regions experienced steadily widening travel surplus in the past decade. In 1997 their total
travel surplus was US$ 62.2 billion (WTO-OMT).

This balance, however, gives little information about the actual foreign exchange effects. It
only covers payments resulting from the consumption of the travellers at the end of the
tourist service chain.

Tourism was long regarded as an easily exploitable source of foreign exchange for develop­
ing economies. Increasingly it is being realised now that " ... tourism is not the dream dollar
cow that is easy to milk" (Khin Maung Kyi, Oase oder Fata Morgana? Frankfurter Rundschau
7.3.96). Indisputably the gross foreign exchange earnings in developing countries exceed
foreign exchange income from the export of agricultural and industrial goods. However, gross
foreign exchange figures give a one-sided picture, since most probably there are also foreign
exchange leakages due to profit transfers, tourism-related imports (luxury goods, vehicles,
advances etc.), payment of foreign experts or interest payments for foreign direct invest­
ments in tourist infrastructure.
In order to properly assess the effects of tourist foreign exchange one would need to con­
sider those foreign exchange receipts and expenditures that were transacted in the course of
the import and export of goods that, in their turn, flow indirectly or indirectly into the value
added by tourism. Besides the broad range of tourism-related services (diagram 4, p. 30)
there is the advance provision of e.g. building materials, foodstuffs, equipment and energy
which are essential to maintain the tourism infrastructure of a country.

Whether a country can obtain net foreign exchange earnings from tourism depends primarily
on the development phase of tourism, on its nature and on the level of development of the
respective economy (Leffler 1992). The high capital intensity of this industry - e.g. of hotel
and sporting facilities and the necessary infrastructure - plus unfavourable tourist con­
sumption patterns, particularly regarding food, can lead to considerable foreign exchange
leakages.

The balance for each country is the difference between international tourism receipts and
expenditure. International tourism receipts (expenditure) cover expenditure of international inbound
(outbound) visitors including their payments to national (foreign) carriers of international transport.
International fare receipts (expenditure) are recorded separately. The y cover all payments of sums
owed by non-resident visitors (persons resident in the compiling country) made to carriers
registered in the compiling country (UN/WTO-OMT 1994, 22).
15
The rate of foreign exchange leakage is hard to determine empirically - i.e. the share of
foreign exchange receipts flowing abroad to finance advance payments. For this, it would be
necessary to carefully compile and classify all foreign exchange transactions, and also all
input-output relations at all production levels of the tourism industry in the system of national
accounts. Most developing countries lack the administrative resources to do this. In addition,
a detailed accounting system covering all types of tourist services is still being developed. It
will take a while to implement the scheduled Standard International Classification System of
Tourism Activities (SICTA) in many countries. Without such a system it is very hard to come
up with consistent statements about the effects of tourism-induced foreign exchange in a
given country. Much numerical information about supposedly positive or negative net foreign
exchange effects in developing countries is based on thoroughly unreliable empirical
methods.
In general it can be said that the lower the tourism-induced import requirement of goods,
services and real, fixed and human capital in a country and the greater the local share in
production,the lower will be the foreign exchange leakages.

TRANSFER OF TECHNOLOGY - A BLACK Box

Given the fact that tourism is so closely linked with other industries, there are possibilities
that liberalisation of the tourism sector may intensify the transfer of technology and know­
how. Yet there is hardly evidence of the extent to which tourism has so far actually
contributed to this kind of transfer between industrialised and developing countries.
Tourism is one of the most information-intensive sectors (Poon 1993,156). Information tech­
nology (IT) is used in the production, management, distribution, sales and delivery of the
individual service components. It is not only important in linking the different service
providers, but also contributes at all levels of the service chain to a higher use of tourist
facilities and a greater degree of customer loyalty. The latter can be a critical barrier to
market entry for small and medium-size providers if they do not participate in such an infor­
mation network. The combined booking and handling of airline tickets, accommodations,
local means of transport, excursions and guided tours, plus payment for them, can give an
edge to providers belonging to highly integrated travel conglomerates. Insiders assume that it
is common practice for a CRS to give preference to its own airlines, for example, or for
restrictive commissions to be included in contracts with travel agencies (Poon 1993, 1 89f.)
This is disturbing since the twelve leading systems are in the hands of very few airlines,
almost all of which are based in industrialised countries and newly industrialised economies
(NIEs). In addition, these systems are being increasingly extended to further upstream,
downstream, and diagonally complementary service areas. Leonardo Costanzo, general
manager of Amadeus,sets out the goal of this development. He attaches great importance to
Amadeus not being a CRS but a global distribution system (GOS) - global in the sense that
"...it attempts to group all CRS data in one large container and, by definition, a GOS is
present throughout the world and not only in one country" (Costanzo 1995,91).
Another new medium is beginning to conquer the travel market: The internet and online
services are appearing as marketing instruments between customers and providers,covering
all players and destinations. Even if they cannot yet compete with catalogues as the
established medium (Mayer 1996), they are a promising platform for providers who depend
on direct marketing, due to their smaller capacities. For the providers in many developing
countries,in which the share of individual tourists is relatively high,such online services plus
the World Wide Web (www) constitute useful additions to the usual marketing channels,
provided that the technical infrastructure is available.

16
Box 3: Tourism Policy - the Role of India's Government

India's first Prime Minister Jawaharlal Nehru who was very keen on promoting tourism,
once gave a message to the people of India - "Welcome a Tourist - and send back a
friend." Actually, the history of promoting India's tourism reaches back beyond the founda­
tion of the state itself. In 1945 a Tourism Committee under the chairmanship of Sir John
Sargent, Educational Adviser to the Government of India, was formed for the first time. The
committee was to survey the potential for development of tourism in India.

The report stated that tourism would be to the interests of India and it recommended that a
separate organisation for promotion and development of tourism was needed. A Tourist
Traffic Branch was set up in 1949 and was elevated to the status of Department of
Tourism in 1958. Four Regional Tourist Offices in Bombay, Delhi, Madras and Calcutta
and two overseas tourist offices in London and New York were also started.

During 1963, another Committee under the Chairmanship of L.K. Jha was formed to study
the prospects of tourism in India. The Committee recommended that a separate ministry
looks after tourism and civil aviation. It also recommended that there was a need for a
Tourism Development Corporation directly under the charge of the central Government
which was established in 1966. During 1967 a separate Ministry of Tourism and Civil
Aviation under the charge of a cabinet minister was created.
The National Committee on Tourism (NCT) was founded in 1986. The most significant
recommendations of the NCT related to (i) development of Infrastructure; (ii) provision of
incentives; and (iii) development of human resources.
Tourism now has been given status of an 'export industry.' Along the same lines, the
Department of Tourism has been following a two-pronged strategy of strengthening the
economic infrastructure at home and improving the tourist image abroad:
• In his Union Budget '97-98 speech, the Minister of Finance proposed to give a 50 per­
cent tax reduction on profits for ten assessment years with respect to new hotels set up
in hilly or a rural areas, places of pilgrimage or of tourist importance. Additionally, these
hotels will also be exempted from the levy of expenditure tax. Furthermore, he pro­
posed to reduce the import duty on specified equipment required for hotels from 50
percent to 25 percent.
• The tourism development board is promoting India in the world market. The Indian
Tourism Development corporation is focusing on 32 countries as key countries of origin
including ten European countries, four African nations, the Commonwealth of
Independent States (CIS) and Gulf countries. The primary tourist generating markets of
India are west Europe and North America. These two regions taken together
accounted for more than 51 percent of the total arrivals during 1994.

The Department of Tourism cleared as many as 2,964 foreign investment proposals, for a
total of Rs.30,OOO crore, from August 1991 to February 1995. Though the investments in
Indian Trade and industries have increased from $ 150 million in 1991-92 to $ 5 billion in
1994-95. According to the Department of Tourism the priority investment areas continue to
be a wall writing - air seat capacity, international airports, domestic air seat capacity, tourist
centres, hotel rooms and highways. Therefore, the Government of India set up a Tourism
and Finance Corporation in 1989 to develop tourism related services.

The tourism sector offers considerable potential for technology transfer. This particularly
applies to sales, marketing and distribution in the fields of hotel and transport management
and to their respective relevant instruments (CRS, online marketing, etc.). Since the
17
d eve lopm ent costs of systems are h i g h - est i m ated at US$ 400-490 m i l l io n for G a l i leo and
A m adeus - and s i nce using them req u i res a rel iable tech nolog ical i nfrastruct u re and h i g h­
level trai n i n g , t h e gap between to u r i s m p rovid e rs i n i n d u strialised and d evelop i n g co u ntries i s
probably g reatest a t this poi nt.

As long as there is no i n stitutional i sed fram ewo rk fo r m e as u res to e n s u re tec h n o l ogy tran sfe r
o n a d ifferent b a s i s t h a n t h e p u rely co m m ercial o n e , t h e existi n g d ichoto my between a b road
less q ua l ified c l ass of (non-) e m p loyees working in tourism related i n d u stries on the o n e hand
and a few wel l-paid externally ed ucated staff m e m b e rs o n the oth e r hand will be perpetuated.

Tra n s n atio nal com pan i es could serve as a bridgehead in d eve l o p i n g the n ecessary h u man
capital and i m p l e m enting such a fra m ewo rk. They could use t h e i r infrastruct u re with its
branches , co-o peration agree m e nts and j o i nt ventu res. H owever, t h i s wo u l d req u i re a t rade
law fram ewo rk, tak i n g acco u nt of the special i nterests and weaker market position of
deve l o p i n g cou ntries i n terms of tec h n ology.

H owever, for many d evel o p i n g cou ntries t h e q u est i o n also is wh ich tec h n o lo g i es w i l l actu a l l y
ben efit to u ri s m and oth e r secto rs. T h e r e i s a d a n g e r o f com p l ex tec h nolog i es deve l o p i n g a
suction effect , ass i m i l at i n g t h e i r e n v i ro n ment and lead i n g t h e cou ntries i nto a n ew d e­
pendence on costly tec h n o logy t ransfer fro m t h e N o rth. T h i s fear is substantiated by t h e
d evelopm ent o f the a i rport operation m a rket. Am sterdam A i rpo rt Sc h i p h o l , f o r exam p l e ,
wants t o cap ita l i se its know-how a n d expertise gai n ed in airport operat i o n a n d is al ready
active t h ro u g h joi nt-ve ntu res and strategic a l l i a nces with a i rp o rt operato rs in N etherlands
Ant i l les, I ndonesia and C h i na. As l o n g as t h e appropriateness of such tech nologies i s n ot
b e i n g q u esti o n ed , a repeat perfo rmance of the m i stakes m ad e i n developm ent co-operation
back in t h e 1 970s becomes l i kely.

INFRASTRUCTURE DEVELOPMENT

At fi rst si ght, to u rism i n I nd i a seems to be stre n gt h e n ed through the p resence of M c Donalds,

Peps i , and Coca-Co l a - brand n a m es t h at h ave become synonymous with a h i g h l evel of
tourism development. Lei s u re and e ntertai n m e nt groups such as 'Thank God I t's Friday' and
'Warner I nternational' will soon take u p operations in I nd i a. Golf courses , ski res o rts and
a m u se m e nt pa rks are being set up, revived o r moderni s ed i n t h e cou nt ry.

The hopes that to u r i s m becomes a catalyst for the develop m e nt of i nfrastruct u re i n so-cal l ed
peripheral areas and helps red uce reg i o n a l d i s parities are closely related to those concern i n g
s o u n d tech n o logy transfer. They i n c l ud e t h e u s e of a l l k i n d s o f i nformation tec h nology, trans­
port capacity , water and en ergy s u pply syste m s and wast e treatme nt. The d i l e m m a is
evide nt: What m ight be u sefu l fo r a j ust- i n -t i m e tou rist t ransport ( h i g hway s , overs ized h i g h ­
end a i rports) m ay be f a r fro m n e e d s o f l o c a l com m u n ities w h o m ay want to participate i n the
be nefits of to u rism.

As I nd i a n experie nces are showi n g , tourism orie nted i nfrastruct u re developm ent tends to i n­
crease t h e gap betwee n the " haves" and the " h ave n ots". T h e sh acks , owners of s m a l l e r
restau rants and accom modat i o n fac i l it i es , orig i nally started w i t h tou rism s ervices a t Goa. B u t
n o w the orga n i sed tou r i s m i n d u st ry d i s e ngages them f r o m t h e s ites. The tax i drivers i n
Kovalam/Kerala w e r e d i s p l aced by t h e organised s ecto r o f t h e operato rs. I n areas m a rked f o r
tou r i s m development i n t h e s o u t h e r n state o f Tam i l N ad u , it h a s b eco m e o b v i o u s t h at the
Land Acq u i s ition Act is widely u sed to appropriate land from the poor and marg i n a l ised
farm e rs i n t h e n a m e of d u b io u s " p u b l ic i nterest".

18
Diagram 2: India's Share of Visitors from Abroad 1 994

The land thus forcefully

taken away from local peo­
ple at a pittance and some­
times without any compen­
sation is handed over to
hotel chains and other
tourism service suppliers at
a throwaway price.
To cite the Approach Paper
of the Indian Planning
Commission again, "the
1%
State will have to focus on
development of basic infra­
East A s i a!
Middle East 6% Pacific structure such as transport
1 3% facilities and amenities, and
to play a facilitating role in
the provision of accommo­
Europe 39% dation and other facilities
for all classes of tourists,
S o u r c e : WTO-OMC 1 996 d i a g r a m : w e r k s tatt o e k o n o m i e
both domestic and inter­
national." But obviously,
lopsided priorities exist in
the promotion of domestic
and international tourism.
On the one hand, the New Delhi - Jaipur road is being converted into a four lane highway
and expected to become India's first tourism highway with a string of hotels, motels, country
clubs, amusement parks and golf courses along the road. On the other hand, following a
recent judgement of the Chandigarh High Court, the Punjab Urban Planning and
Development Authority has ordered the removal of all "illegal structures and encroachments
on the side of scheduled roads in the state". This euphemistic formulation is aiming at local
eating places in between the informal economy which offers food and shelter and caters to
those who travel at low cost, e.g. pilgrims.

SPHERES OF WORK, SPHERES OF PAIN

There is little doubt that the tourism industry has positive effects on employment, reducing
unemployment in the destinations. Employment effects occur not only in the tourist industry
but also in other sectors closely linked to tourism. Studies show that a direct employment
effect (hotel, transport, travel agencies) can be generally assumed in a ratio of 0. 8 to 1.5 jobs
per hotel bed. The coefficient of indirect employment (other goods and services) is 1:2.75,
significantly higher than that of investment-related employment (building industry) (Leffler
1992, 10f.).
Of course, employment coefficients say nothing about the types of jobs and the working con­
ditions. Unskilled, insecure and poorly paid jobs are typical. In a study, the International
Labour Office (ILO) concluded that " .. .in many parts of the world, the remuneration of
employees in hotels and restaurants seems to be at the lower end of the salary spectrum"
(ILO 1990, quoted by Madeley 1996, 1 8). In many developing countries (i.e. Kenya,
Mauritius, Seychelles, Caribbean countries, Thailand) and individual regions, it may have
really been possible to compensate for seasonal fluctuations in employment (ibid.). In other

19
reg i o n s , c l i m atic conditions i n t h e d iffe rent seaso ns l ead to jobs i n tourism clearly b e i n g re­
st ricted to certai n seaso nal periods (Vorlaufer 1 99 6 , 3 0ff ; B M Z 1 993 , 3 1 f. ) . I n s o m e cou ntries
at l east , e m p loym ent in co re segments of tourism i s s u bj ect to considerab l e seasonal
fl uct u atio n .

Look i n g o n ly at d eve loping countries, o n e m i g ht negl ect t h e d ifferences i n em p l oy m e nt

effects i n t h e tourism i n d u stry as compared to t h e n o rthern cou ntries of origi n . It is q u ite re­
m arkabl e that several studies h ave been u n d e rtaken to m easu re e m p l oy m e nt effects i n
tou rist d est i n at i o n s ; b ut u p t o now evidence i s lacki n g w h et h e r these effects are s i m i l a r i n the
N o rth and i n t h e South .

It m u st also be considered that besides t h e fo rmal e m p loy m e nt contracts i n hotel complexes,

transport and travel agencies, a w i d e ra nge of service p roviders operate as "one m an/o n e
w o m a n com pan i es" i n the i nformal sector. The i r wo rki n g conditions a r e s o m et i m es m uch
worse that those of their cou nte rparts in the formal secto r. Accord i n g to est i m ates , i n
i n d i v i d u al cou ntries u p t o 5 0 percent o f t h e people e m p loyed i n tou rism actually work i n the
i nfo rmal sector (Vorlaufer 1 99 6 , 1 23) . Experience fro m I nd i a s hows that wo m e n , in particu lar,
but also m i n o rs are forced to seek small b u s i n ess act ivities in the i nformal tou rist i nd ustry ,
d u e t o t h e lack o f formal e m p l oy m e nt opport u n ities (Stock 1 996; B l ac k 1 995) .

Even if acc u rate d ata has been l ac k i n g so far, t h e I LO ass u m es a h igh s hare of c h i ld labo u r
i n hotel and cateri n g ( B l ack 1 995) . World w i d e t h e re are est i m ated t o be b etween 1 3 a n d 1 9
m i l l io n m i n o rs worki n g as sh oe-cleaners, flower-sel l ers, baggag e-carriers, room clerks,
kitc h e n workers o r s m a l l vendors in the tou ris m i n d u st ry - n ot cou nt i n g t h e tou rism-related
activities of c h i l d ren in the i nformal s ecto r ( P lOss 1 996) .

G o i n g beyond the considerat ions of job c reation i n t h e formal and i nformal secto r, o n e has to
look at t h e even m o re serious boom of t h e sex i nd u stry and bonded labo u r , part i c u larly with
rega rd to c h i l d p rostitutio n , wh ich i s also g rowi n g due to i nc reased touris m . As recent stu d i es
have show n , 1 5 percent of t h e p rostitutes i n I nd i a are u n d e r t h e ag e of 1 5 , and 24,5 percent
between the ages of 1 6 and 1 8 . As the case of the d haba boys i l l u st rates , t h e re i s a close
co n n ect ion between poverty i n ru ral areas , the b reakd own of fam ily rel ations t h e re , m i g rati o n
to t h e cities and c h i ld l a b o u r i n touri s m . J u ven i l e m a l es , aged between e i g ht and twe lve, who
are rec ru ited from rura l areas , are worki n g i n c h eap h otels and resta u rants . As an I LO report
states , s o m e are " . . . e m ployed i n condition of g reat d e privation eq u iva l e nt to bondage . "
E m pl o y m e nt o f c h i l d ren is not l i m ited t o l ow standard acc o m m od at i o n s . O n t h e contrary ,
m ost of it takes p l ace i n hotels of t h e g rade I I and I I I category , o r i n u n g raded estab l ish­
m e nts.

The I LO report makes it clear that there i s a close con n ecti o n between m aterial hard s h i p -
particu larly pove rty i n ru ral areas - the breakdow n of fam i l y rel at i o n s , m ig rati o n to the cities,
c h i ld labo u r i n tourism and c h i ld p rost itution . There is also a n u ndefi ned area of partly fo rced ,
partly "vo l u ntary" occas ional p rostitution by y o u n g hotel e m p l oyees .

I n t h e u rban areas of t h e Nort h , d i fferent forms of sexual exploitation of c h i l d re n and y o u n g

peo p l e are equally widespread . I n N ew Y o r k there are s a i d to be a b o u t 3 0 , 000 c h i ld
p rostit utes , i n Paris 1 0 , 0 0 0 to 1 5, 0 0 0 ( L e M o n d e D i plomatiq u e , 1 6 .8 .96) .

TOU RISM AND CULTURE - AN AMBIGUOUS RELATIONSHIP

In the to u r i s m d i scussion there is n o s u bj ect more controversial than the effects of to urism o n
t h e s o c i a l st ruct u re, val ue system and cu ltural ident ity of t h e host pop u l at io n . W h i l e some
arg u e t h at - d espite t h e ad m itted i n c rease of (ch i ld) p rostit uti o n - t h e socio-cu ltu ral effects of
to u r i s m are s l i g ht ( Leff l e r 1 992 , 1 1 ) . Oth e rs note " . . . that the n egative i m pact of tourism o ut­
weighs t h e positive in t h e no n-econ o m ic f i e l d " ( B M Z 1 993, 34) . Both pos iti o n s can appeal to
20
a host of sociolog ical case st u d ies. They s h a re t h e d i l e m m a that i n th is co ntext t h e re is n ot
o n e ty p e of tourism i n d evelop i n g co u ntries .

T h e d i scussion of socio-c u lt u ral i m p acts concentrates on t h e fol l owi n g causes and effects
( B M Z 1 993; M ad e l ey 1 996 ; Vorl aufe r 1 99 6 ; Scherer 1 995) :

• To u r i s m contrib utes to soc ial change and triggers acc u lt u ration effects.

• As to u ri sts encou nter local res i d e nts, there can b e a " d e m o nstrat i o n " effect ; certa i n
p atterns of con s u m ption a r e f e l t to b e att ract ive by o n e g ro u p and consci o u s l y o r u n ­
consciously i m itated .

• Social and vertical m ob i l ity can b e triggered o r accelerated by t o u ri s m .

• Tourism developm ent can change t h e g e n d e r-specific b e h avi o u r of m e n and w o m e n i n

t h e d est i n ation reg i o n s .

• Tourism i n f l u ences esteem for m aterial goods and n o n- m aterial c u lt u ra l c o m m o d ities .

A l l t h ese co n n ect ions can be i l l u st rated by totally contrad ictory experie nces . It seems
p l a u s i b l e t h at i n one and the same co n n ect ion t h e assess m e nt of socio-cu ltu ral effects can ·
c h a n g e as t i m e passes. U lt i m ately, it w i l l n eed to be analysed w h ich of t h e d i m e n s i o n s l i sted
p l ays a role at the l evel of com m u n it i e s , reg i o n s and countries. P la n n ers of touris m p roj ects
s h o u l d take d u e accou nt of t h e (possibly oppos i n g) exp ectations of t h e people l iv i n g in t h e
dest i n at i o n s , and p a y attenti o n to t h e i r o p i n i o n a b o u t socio-c u lt u ra l i m pacts .

I n t h e case of I nd i a , som e negative i m p acts are q u ite obvio u s . At most of the I nd ian sacred
s ites, l e i s u re tourism has becom e a serious th reat to t rad itional pi lgri mage s . People's own
festivals and rituals n ow h ave been taken ove r and m a n ag ed by tourism p ro m otion . As t h e
cases of t h e B rah adeeswarar Tem p l e of R aj a R aja C h o l a and trad itional elephant m a rches
( G aj a m ela) s how, t h e i ntrinsic val u e of c u lt u ra l sy mbols for the com m u n ity is overlooked and
d e n i g rated to t h e level of s howpi eces . Fi rst declared as World H eritage M o n u m e nt by
U N ESCO, Tam i l N ad u tourism p l a n n e rs d ecided to i n stal l a s o u n d and l i g ht s how at the
temple. In p l aces l i ke Th riss u r, local peop l e who originally celebrat ed G ajamela o n their own
a re n ow forced to pay in order to catc h a g l i mpse of t h e i r own feast, as the eleph ant march is
h eld for a few fore i g n tourists exc l u s ively i n t h e M u n icipal ity Stad i u m . The s h ift fro m ritual arts
to modern t h eat rical ity does n ot al low peop l e to participate in t h e i r ow n c u l t u ral c e l eb rat i o n s
a n y m o re.

ECOLOGICAL MIRAGES?
N at u re to u ri s m d e n otes a special seg m e nt of demand c h a racterised by natu re-related
activities carried o ut in attract ive n at u ral s u rro u nd i ngs - p referab ly in n at u re reserves .
Beaut i f u l sce n e ry has been a popular reason fo r travel s i nce t h e fi rst reports o n p l easure
trips by t h e Roman p h i l osopher S e n eca (d i ed 65 A . D . ) . N at u re as a location factor has
d i rected the paths of trave l l e rs over the cent u ries. In t h e age of m ass to u r i s m th e to u r i s m i n­
d ustry itself th reatens t h e very p roduction facto r on w h i c h i n is espec i a l ly dependent.

Tourist centres and the h i g h n u m b e r of t ravellers th reaten frag i l e ecosyst e m s . In d eve l op i n g

countries, scarce res o u rces s u c h a s water o r e n e rgy a r e often overused i n tou rist cent res
and u s ually no su itab l e systems of waste m anag e m e nt exist. Natural areas are d eveloped ,
used i ntensively for tou r i s m and , f i n a l l y , "worn out." A l l t h i s is n ot n ew. It has been an i s s u e i n
t h e critical tourism debate s i n c e t h e 1 970s a n d has also contrib uted t o tourism p ro m otion
d i sappeari n g from t h e agenda of d eve lopment co-operation i n many cou ntries i n t h e N o rt h .
What is relatively n ew , h owever, i s t h at t h e play e rs i n t h e t o u r i s m i n d ust ry h ave d iscovered
the topic of enviro n m e ntal protecti o n and " ecotou ri s m as an i n stru m e nt of nat u re p rotect i o n " -
to q u ote the title of a research report of t h e German Fed eral M i n istry for Eco n o m i c Co-
21
operation and Development (Ecotourism Working Group 1 995). Tourism is sneaking in again
through the back door of development co-operation.

Box 4: Tourism and P rotection of Biological Diversity in I ndia

In India, the protected area network has increased more than five times in the last two
decades. In 1 970 there were 10 national parks and 127 sanctuaries in an area of 25,000
km2 • In 1 993 the protected area network increased to 1, 320,000 km2 . India has 500 pro­
tected areas including natural parks and sanctuaries, a lot of them being intensively used
by tourism: Safaris are offered in the state of Rajasthan, hang gliders in the state of
Himachal Pradesh, mountaineering in the Himalayas, trekking in Garwal and Kumaon,
river rafting in the Alakhananda, scuba diving in Lakhshwadeep, skiing in Gulmarg, heli­
skiing in Kashmir, sailing and surfing in Srinanagar and Goa.
The government plans to conserve biodiversity in seven protected areas with the help of
the World Bank. It is known as the Eco-Development Project. The plan is to be imple­
mented initially in seven protected areas. These are the Buxa Tiger Reserve in West
Bengal, the Palamau Tiger Reserve in Bihar, the Pench Tiger Reserve in Madhya
Pradesh, the Periyar Tiger Reserve in Kerala, the Ranthambore Tiger Reserve in
Rajasthan, the Nagarahole National Park in Karnataka and the Gir National Park in
Gujarat.
A case study about a hamlet was reported in Statesman. A tiny hamlet called Tabo is
situated in the Spiti Valley in the state of Himachal Pradesh. It has a population of 410
people. People here live in a close community culture of ancient origins. They are a self­
sufficient tribe, untouched by Western influences. A travel agent found out that a certain
Buddhist monastery in the village would be completing 1000 years. Hordes of tourists
descended on the place. It is not known whether the tourists were Buddhists or whether
they were interested in Buddhism and its teachings. The 410 natives were found lost in a
crowd of 25,000 tourists. The District administration failed miserably to provide even basic
necessities like sanitation, drinking water and wood for fuel. The desolate landscape lost
whatever little vegetative cover it had to the demands of the tourists, and signalled the end
for the precious livestock of the semi-nomadic population. Foreigners clogged the toilets
with toilet paper which eventually found its way to the Spiti river, a source of drinking water
for several villages downstream.

The Tobo disaster is just one of a series of tourism ventures that have backfired. Western
Nepal, parts of Himachal Pradesh, Jammu and Kashmir and Palamou - have witnessed
similar atrocities jeopardising a delicately balanced environment and throwing it into com­
plete disarray. Several remote areas become extremely popular with foreign tourists in
search of narcotic plants which grow in abundance and their derivatives, exposing the
vulnerable population to the dangers of addiction. There have also been instances where
people failed to recognise the imbalancing effect on the inflated market economy causing
upward pricing trends for commodities of daily necessity like food and fodder ( Kishore
Chauduri, Emerging Trends and Problems of Eco-tourism in Indian Context).

In other countries of the world, efforts have been undertaken to build up a database for
nation-wide site management to regulate the flow of tourists in order to have a check on
the fragility of the site. But in India it is imperative to have an advanced digital system to
monitor the ecological consequences and environmental costs. Priorities should be given
to implement new methods of measuring, evaluating and monitoring the changes in the
state of our natural and environmental resources.

22
International environmental associations such as the World Wildlife Fund for Nature (WWF),
the International Union for Conservation of Nature and Natural Resources (IUCN) and others
are striving towards a cautious tourist use of nature protection areas in Africa, Asia and Latin
America, to benefit local communities. To quote a definition of the Ecotourism Society
(Ecotourism Working Group 1 995 . quoted in Gustedt 1 996, 42 ;) , ecotourism covers "... all
forms of nature tourism that responsibly
• seek to minimise environmental effects and socio-cultural changes,
• contribute to financing protected areas,and
• create income opportunity for the local population".

Practical experiments in this direction testify to the difficulty of balancing ecological socio­
political goals at the level of the individual protection project. Beyond the eco-Iabel that tour
operators attach to themselves,the implementation of socially,ecologically and economically
sustainable forms of tourism has only just begun. While many catalogues of tour operators
are full of references to ecologically and socially sustainable tourism, in Germany TUI is the
only big operator so far to have employed a Director for Environment and become involved in
the discussion. As part of its environmental management system, TUI organises
environmental destination checks and the removal of inorganic waste (Liedtke 1 996;
Vorlaufer 1 996, 2 1 0) .
The bulk of (mass) tourism in developing countries,however,has so far remained untouched
by these kinds of efforts and the over-use of ecosystems and their resources continues.
Where there are conservation efforts in place for the sake of tourism,they are seldom to the
benefit and often at the cost of the local people affected.
Nagarahole National Park, located between Kodagu and Mysore in the south of India, can
serve as an example of the possible contradictions in ecotourism efforts. Having declared the
area a national park in 1 972 , the government shifted the local communities of Adivasis away
7
from their native places, as no human habitat is allowed to be situated inside the park •
Despite this regulation, the government built jungle lodges inside the park area to increase
wildlife tourism and leased them out to the Taj Group of Hotels which announced an eco­
friendly use of the resorts. The result is that communities who had cared for the forest for
hundreds of years have been displaced to open the stage for tourism supposed to generate
income in order to save a fragile ecosystem which is being threatened by the tourists'
presence itself.

1 .4 CONCLUSION

The extent of market concentration to which tourism is subject in the individual sending and
receiving countries is concealed through the host of tour operators and on-site service
suppliers. The expansion of (trans)national hotel chains is, of course, the visible sign of
globalisation of tourism services. Yet the formation of oligopolistic structures is disturbing,
particularly the mesh of interests between financial service suppliers, airlines, tour operators
and travel agencies. The extent of the actual influence of these integrated or diversified
groups in the individual service segments, and beyond, has only been seen hitherto on the
basis of individual areas of conflict. There should be no question that the biggest Northern

The fo l l ow i n g restrictions are i m posed on t h e com m u n ities: Cu ltivat i o n and kee p i n g l ivestock are
n ot a l l owed anymore ; h u nt i n g , d i g g i n g borewel l s and ren ovat i n g h o u ses a re all pro h i b ited ; a total
ban has been ordered on the col l ecti o n of m i nor forest prod uce l ike tubers, m u s h rooms and oth e r
wild vegetab l e s and f r u i t which a re staple foods; entry to t h e i r sacred s i t e s and b u rial g r o u n d s h as
been restricted and a ban on t h e i r trad itional m u sic and dance forms set i nto force.

23
tour operators have a defining influence on the development of tourism in some destinations.
What the consequences of such concentration will be is still an open question.
"Tourism is like a fire; you can use it to cook your soup, but it can also burn down your
house" (Scherer 1 995). Whether this is really an Asian proverb or only a platitude in the
critical tourism discussion, it in any event summarises the outcome of this stocktaking.
Whether tourism in developing countries really makes a substantial contribution to economic
development through multiplier effects in other industries, whether it contributes to
establishing a local provider structure, or generates noteworthy net foreign exchange
earnings, will largely depend on the conditions in the respective countries and on the con­
ditions in the international trade in services.
The partly concealed emergence of big tour operators may serve the dissemination and
implementation of ecological objectives. Yet it restricts the economic radius of smaller
service providers in the destinations. Transnational corporations could make a major
contribution to technology transfer. Yet whether they actually will is by no means certain.
Some countries already operate a pronounced tourist monoculture. Their economies depend
almost totally on the changeable tourism business. Even where this has not had serious con­
sequences, the other side of the tourism coin is clearly visible. The working conditions in core
service areas of the hotel and catering industry are unacceptable in many countries; the
exploitation of children is increasing along with sexual abuse, an area where there are no
exact statistics.
Hopes of positive ecological effects through tourism can be quickly scotched with reference
to the unbeatably negative ecological record of air traffic. Given that there is a considerable
and growing demand for long haul holiday trips, it is necessary to distinguish between
positive and negative environmental effects in order to achieve gradual improvements - with­
out taking a maximalist position. The increasing demand for natural tourist activities in a
delightful country atmosphere can certainly contribute to the preservation of protected areas
or the promotion of rural development. But whether it actually does, or whether other
environmental consequences of the most diverse forms of ecotourism negate those positive
effects again depends on the respective conditions. The ongoing enormous consumption of
land and water for tourist estates gives room for scepticism.
It would be misleading to assume that all of these complex problems can be solved with the
instruments of international trade policy alone. The instruments available in trade policy can­
not replace a coherent national policy of tourism or a social and environmental policy.
However, conditions can be created at this level, making it possible for tourism development
to comply with the goal of sustainable development to which the treaties of the new world
trade order are committed.

24
 2. TOU RISM IN D EVELOPING COUNT RIES UNDER THE REGIME OF GATS

2. 1 THE INTEG RATION OF I NTER NATIONAL TRADE IN SERVICES I NTO A N EW

WO RLD TRADE ORDER

INTRODUCTION

I n econom ics, trade in services was for a long time a neglected field . C l assical economists
regarded it as unprod uctive and stil l there are fewer statistics about trad e in services than
about trade i n com m od ities. A leadi n g German textbook o n i nternational trade and finance
d evotes as m uch as seven l i nes to trade i n services (Siebert 1 994, 86) . This side-stepping of
the service sector i n economic theory is in contrad iction w ith its outstanding i m portance fo r
the g rowt h of world trade. Wh ile i n industrial ised cou ntries two third s of G N P is p rod uced i n
the service sector i t 'on ly' accounts f o r a bare 30 percent o f the i nternational movement of
good s , worth approx. U S$ 3680 b i l l i o n (Wi ndfuhr 1 996) . This difference i n dicates a consider­
able g rowt h potential for i nternational trade. It contributed to the i n d u strialised cou ntries
p utt i n g "service trade" at the bottom of the agenda i n the U ruguay R o u n d . The U SA i nsisted
on including services as a cond ition for their remai n i n g in GATT mainly because of the hope
that a far-reaching l iberalisation of the service t rade wou ld l ead to considerabl e com petitive
advantages in this sector and ease the big trade balance d eficit of the USA.

D i a g ra m 3: The New World Trade Order

WTO S t r u c t u re

M i n i s t e r i a l C o n fe r e n ce

I I

---1 1
Trade Policy Review
Gen eral Council D i s p u t e S e tt l e m e n t B o d y Apellale Body
Body

I
I
l I I
1
C a m m il l e e o n T r a d e a n d
Dispute Settlement

I
I I I
Dev e l o p m e n t
Panels

�
I
C o u n c i l for Trade

�1
C a m m i l l e e on Regional
Trade Agreements C o u n c i l f o r T ra d e in C ou n c i l f o r T rade in R e l at e d As pects of

� J
P l u , , ' a e l r , 1 C a m m i ll e e o
Goods Se r v i c e s I n te l l e c t u a l Prope rty
TaXies I n CIVIl Aircraft

I
(GATT) (GATS) Rights
C a m m i ll e e on B a l a a n ce;

0;1
of· Pa y menl s�Restrictions (TRI Ps)

1 C a m m i ll e e e on
Finance and
Budgel, � f--
--
M arket Access
--
� Specific Comm ittments Y
Plurilaelral C o m m illee
Governmet Procurement

A d m i n i s t r a t i on

S a n it a ry & P h y t o s a n i t a ry
M e a s u res
f-- C o m m i t t e e on T ra d e i n
T ec h n i c a l B a r r i e rs t o F i n a n c i a l S e r v i c es
T ra d e -
Agriculture
A n t l - D u m plng- _ Working Parties o n :
Practices T r a d e - R e l a t ed
f-- I nv e s t m e n t M e a s u re s
f-- Profess ional Services

(T R I Ms)

�
Customs Valuation _

Working G roups o n : _ R u l es of O r i g i n '--- G A T S R u l e s

the relationship
S a f e g u a rd s _

between ,,,do ood

S"b;;d;,; ,"d
I n v e st m e n t ; - ..
C o u n t e r v a i l i n g M e a s u re s
t h e i n t e r a c t l o n b et �� e n Te'll l es
Monitoring
Trade a n d Co m pe t l t l o n Body . .
Policy; I m po rt L i c e n S i n g Grafik: werkstatt iikonomie
Transparency In
Governement
Procurement

25
GATS i s one of the t hree branches of the n ew world trade o rder under the aegi s of the WTO­
O M C . The origi nal GATT has beco m e part of the more comprehensive General Agreem ent
o n Tariffs and Trade 1 994 (GATT 1 994) which along with oth e r ag reem ents has becom e part
of the M u lt ilateral Ag reements o n Trade i n G oods ( M ATG) . These branches d iffer considera­
bly i n their functio n i n g and responsibi l ities. Wh i l e the dismant l i n g of tariffs and non-tariff
m easu res i n t h e field of trade i n goods i s al ready advanced , n o agreement was reached o n a
m u ltil ateral i nvestm ent ag reem ent ( M I A) . I nvest m ent-related arrangements are, however,
i ncl uded in GATS .

FU NCTIONING OF THE GATS SYSTEM

The f u ncti o n i n g of GATS is based on the i nterplay of fundamental standards in comm ercial
law, proced u ral regu lations for their i m p l e m e ntation and specific com m itme nts in which
8
mem ber states doc u m ent sector-specific l i m itations or concess ions •

PRI NCI PLES OF FREE TRADE

The most favoured nation ( M F N ) treatm ent has been at the heart of al l three branches of the
n ew world trade order (GATT 1 994 Art. 1 , GATS Art. 1 1 , T R I Ps Art. I V) . Fi rst app l i ed i n 1 860
as a basis of the Anglo-French free trade agreem ent, the M F N clause pledges each membe r
state, automatical ly and without d isti nct i o n , to g rant the parties t o t h e treaty all benefits and
favou rs that t h ey grant other countries. M FN is both the motor and the conveyor belt of a
p rogressive l iberalisation process u nder the WTO-O MC, w h i c h mem ber countries can no
longer escape . M FN treatm ent does , however, allow certain exceptions (see below) .
The second fundamental trade norm , national treatment, m eans that services and service
suppliers from other m ember states m ust not be treated wo rse in the signatory state than
national providers (GATS Art. XV I I ) . S i m i lar reg u lations apply for goods and i ntel l ectual
property rights (GATT 1 994 Art. I I I ; T R I Ps Art. I I I ) .
The com m itment to i m proving m arket access (cf. Box 5 , p . 27) by red ucing trade barriers is
closely related to the reciprocity pri nciple which entered GATT via U n ited States trade legis­
lation i n the 1 930s. I n the original version of the GATT treaty , the principle of political
reciprocity demanded that the resu lt of n egotiations should be solely equ ivalent and
balanced concessions, "without cal l i n g i nto q uestion the l evel of p rotection of a country"
(Senti 1 994a, 53) . In GATS, the contracting parties go one step fu rther. With the dem and for
an "overall balance of rig hts and obligations" i n t h e GATS P reamble (cf. Box 6 , p . 28) they
pursue a strategy of "agg ressive reciprocity" (Sent i 1 994b, 7f) which is patterned o n "super
3 0 1 " , Article 301 of the Am erican Trade Acts. In the past, this led to arbitrary trade meas u res
on the part of the U n ited States (Sen 1 994) .

PROCEDURAL STANDARDS

GATS is i ntended to l i beralise a l l i nternationally traded services, i n d ependently of how they

are performed and where they are con s u m ed (total coverage principle) . The agreem ent
therefore establ i shes fou r modes of s u pply. O ut of these, the principles of l iberal isation of
market access and national treatment (WTO-O MC 1 994, Vol. 28) are derived :

The GATS treaty and annexes are contai n ed in Vol u m e 28 of the Legal I n struments Embodying the
Resu lts of t h e U ruguay Round (WTO-OMC 1 995) . The specific com m itm ents are i n Volumes 28-
30.32. They can also be consu lted at the I nternational Trade Law Mon itor at the Law Facu lty of the
U n iversity of Tromso (http://ra. i rv. u it.n o/trade-Iaw/itlp. htm l ) .
26
• cross-border-supply: The poss i b i l ity fo r non-resident services s u p p l i e rs to supply services
cross-bo rd e r i nto the m e m ber's count ry : e . g . tou r operat i o n ;

• consumption abroad: The freedom fo r the mem ber's reside nts to p u rchase services i n the
territory of another m e m ber: e.g . i nternational visitors;

• commercial presence: The opport u n ities for foreign service suppl i e rs to estab l i s h , ope rate
or expand a co m m e rcial presence in the m e m ber's territo ry , such as a b ra nc h , agency , o r
subsid iary i n f u l l owners h i p : e . g . i nternational h otel chai n s ;

• presence of natural persons: The poss i b i l it i es offered to foreign i n d ivid uals to enter and
te m p o rarily stay i n the m e m b e r's territory i n o rder to supply a service : e.g. foreig n to u r
g uides o r h otel m anagers .

Box 5 : P RINCI PLES OF li BERALISATION I N G ATS

A rticle 1 1 . 1 : Most-Favo u red-Nat i o n Treatment

With respect to any meas u re covered by this Agreement, each Member s h a l l accord i m m ed i ately and

unconditionally to services and service suppliers of any oth e r Member, treat m e nt no less favou rab le than t h at

it accords to like services and service s u ppliers of any ot h e r cou ntry.

A rticle XV I . 1 : Ma rket Access

With respect to market access throu g h the modes of s u pply identified in A rticle I, each Member s h a l l acco rd

services and service s u ppl iers of a n y other Member treatment no less favourable than t h at provided for u n d e r

the term s , l i m itations and conditions ag reed and specified i n i t s schedule.

A rticle XVI I . 1 : Nati onal Treatment

In the sectors i n scribed i n its sched u l e , and subject to any conditions and q u a lifications set out t h e rei n , each

Member shall acco rd to services and service s u ppliers of a n y ot h e r Member, i n respect of all measu res

affect i ng the s u pply of services, treat m e nt n o less favou rab le than that it accords to its own l i ke services a n d

service s u ppliers.

WTO-OMC 1 994

9
As under the co ntro l of tariff and no n-tariff barri e rs i n GAIT , the GATS s i g n atories (cf.
Appendix 2: WTO/GATS member co u ntries) are bound by existing trade-restricti n g
m easu res. These are specific com m itments w h i c h d efi ne, fo r a l l the fo u r modes o f every type
of service, trade-re l ated m easu res that e ither contradict the principles of free m a rket access
and n ational treatment or that req u i re respect in a certa i n field .

Add itionally, the com m itments spe l l o ut meas u res oppos i n g the principle of M F N treatm ent.
A l l trade-related reg u lations and l aws h ave to be doc u m e nted and a n y change h as to b e
reported to m e m ber cou ntries (GATS Art. 1 1 1 . 1 ) .

A l l meas u res covered b y sched u l es o f specific com m itments are subject t o t h e principle of
p rogressive l i beral isatio n . At the latest, five years after the WTO-O MC ag reem ent's e nteri n g
i nto force (Le. a t the latest i n the y e a r 2 00 1 ) , n ew negotiations for the g rad ual d i s mantl i n g of
trade-restricting m easu res h ave to b e cal led and co nd ucted reg u l arly (Art. XIX. 1 ) .

All WTO-OMC m embers are subject to GATS regu lations. In add ition , Congo, Algeria and C h i n a
h ave subm itted com m itments, even though they are o n l y observers.

27
 Box 6: THE PREAMBLE OF G ATS

M e m bers ,

Recognizing the g rowi n g i m po rtance of t rade i n s e rv ices for t h e g rowt h a n d development of t h e world

eco n o m y ;

Wishing to estab l i s h a m u lt i lateral fram ework of p r i n c i p l e s and rules for t rade i n s e rvices with a v i ew to t h e

expansion of s u c h t rade u nder conditions o f t ra n s parency and prog ressive l i b e ra l izat i o n and as a m e a n s of

promot i n g t h e eco n o m i c g rowt h of a l l t rad i n g part n e rs and t h e deve lopment of developing co untries;

Desiring t h e early achievement of prog ress ivel y higher levels of libera lization of t rade i n s e rv ices t h r o u g h

s uccessive ro unds of m u lt i l ateral n eg ot i at i o n s a i m e d a t promot i n g t h e i nte rests of all part ic ipants o n a m ut u a l l y

advantag eous bas is and a t secu ring a n ove ra l l b a l a n c e of rig hts and ob l i g ations, w h i l e g i v i n g d u e respect t o

n at i onal pol icy obj ectives ;

Recognizing t h e right of M e m bers to reg u l at e , and to i nt roduce new reg u l ations , on t h e s u pply of s e rvices

with i n their te rritories in order to m eet n at i o n a l policy objectives a n d , given asy m m etries exist i n g with respect

to t h e deg ree of development of s e rvices reg u l at i o n s in different countries, the particular need of developing

countries to exercise t h i s right ;

Desiring to fac i l itate the i ncreas i n g participat i o n of developing countries in t rade in s e rvices a n d t h e e xpan s i o n

o f t h e i r s e rvice exports i n c l u d i n g , i nter a l i a , t h ro u g h the st rengt h e n i n g o f t h e i r dom estic services capacity a n d

its efficiency and com petitive ness;

Taking part i c u l a r account of the serious d ifficulty of t h e least developed co u ntries i n view of their special

eco n o m ic s ituation a n d their development, trade and f i n ancial needs ;

WTO-OMC 1 994

THE SCOPE OF GATS

Cont rary to the original i ntention of d ea l i n g with all types of services u n d e r GATS , no ag ree­
m ent was reached in some service areas . For the t i m e b e i n g , o n ly negotiat i n g progra m m es
have been conc l u d ed for a i r and marit i m e transport services, (basic) telecom m u n ications ,
movement of nat u ral persons s u p p l y i n g services u nder the GATS agree ment and f i n ancial
services. In fact, l i b era l i sati o n i n t h e last m enti o n ed areas i s al ready m uch m o re advanced
than foreseen in the GATS prov i s i o n s . The A n nex on A i r Transport Services is of p a rticu l a r
i m p o rtance f o r the t o u r i s m i n d u st ry , as it exc l u d es t raffic rig hts , however g ra nted , and
services d i rectly re l ated to the exercise of traffic rights. GATS t h u s o n l y appl i es to ai rcraft
repa i r and m a i ntenance services , t h e s e l l i n g and m arketing of air transport services and C R S
services.

Besides temporary restrictions o n p r i n c i p l es of f ree t rade in i n d ividual s e rvices s et out i n the

sched u l es of specific com m it m ents , GATS provides for a restriction of the M FN treatm ent i n
fo u r a reas u nder certa i n cond iti o n s :

• when estab l i s h i n g economic i ntegration (usually as free trade zones or c u sto m s u n ions)
u n d e r A rt. V ,

• when the state p u rc h ases services for its own use (govern ment p roc u re m ent) u nd e r A rt.
XI I I ,

• with the b i l ateral recog n ition of fore ign trai n i n g courses , profess ional experience and
ad m i ssion regu l ations that , i n contrast to the M FN clause, d o not n eed to be extended to
other contract i n g parties (Art. V I I ) , and

28
• n on-d iscri m i n atory and non-arbitrary meas u res to protect public morals o r to mai ntain
public order i n case of serious th reat to a fundam ental i nterest of society , to protect
h uman , animal or plant l ife or healt h ; to secu re the prevention of deceptive and fraud u le nt
p ractices or of safety and other secu rity exceptions (Art. X I V , X I Vbis) .

DEVELOPING COU NTRI ES I N GATS' POI NT OF VIEW

I n keep ing with Art . 5 of the Preamble (cf. Box 6) Art. I V . 1 designates areas i n which greater
participation of d eveloping co u ntries in world trade is to be fac i litated . Key areas i nclude " . . .
t h e stren gthen i n g o f their domestic services capacity and its efficiency and competitiveness
i nter alia t h rough access to tech nology o n a co mmercial basis; the i m p rovement of their
access to d istribution channels and i nformation n etworks; (and) ... the liberalisation of market
access i n sectors and modes of supply of export i nterest to them". Furthermore , GATS calls
for i n d u strialised countries to establish i nformation and contact poi nts for service suppliers
from d eveloping cou ntries (Art. I V.2) and for special priority to be given to i m plementing the
provisions of Art. I V to the benefit of l east d eveloped countries ( LOCs) .
Flexible and more favou rable treatment (Art . V.3) i s granted the cou ntries i nvolved i n eco­
nomic i ntegration. They are also accorded a l i m ited choice of sectors and service types to be
liberalised and a selective market access l i n ked to their level of development, taking acco u nt
of the goals set out i n Art . I V (see above) (Art. X I X.2) .
Accord i n g to the objectives of Art. I V , developing countries are a lways considered to be
service supp l i ers wh ich m u st be g iven easier access to service markets in ind u strial ised
countries. This is the class ical perspective of trad i n g in goods between South and North , and
i s also j ustifiable.
G iven the p roblems of tourism i n d evelop i n g countries outl i n ed i n chapter 1 , the q u estion
arises as to how its conseq uences are to be handled i n terms of com m e rcial law. The GATS
treaty does not attempt to cove r this.

2.2 TOU RISM R E LATED S E RVICES UNDER TH E VE RDICT OF LI B E RA USATION

Accord i n g to the i ntention of GATS, the interaction between general principles and proce­
d u ral standards should lead to an ongoing process of prog ressive l i beralisation i n a l l
d i mensions a n d i n al l (sub-)sectors o f trade i n services. T h e critical factor i n between this i n ­
teraction is the concept o f specific comm itments, as the resu lt of this progressive m echanism
depends to a very large extent o n them. To u nderstand and evaluate the scope of l iberalisa­
t i o n , set up u nder GATS for a certai n sector, these comm itments n eed to be analysed i n
d etai l , which entails certai n d ifficu lties :
Sector-specific com m itments req u i re a common sectoral class ificatio n fra m ework to
d isti n g u ish each (sub-) sector in its scope. I n real ity , there m ight be q u ite a close i nterrelation
between different sectors , which is evide nt especially i n the case of tou rism-related services .
The GATS comm itments are based o n a special classification system d eveloped by the
G roup of N egotiations o n Services (GNS) . With regard to tou ri s m , the GNS system is very
restrictive. It i ncludes only fou r sub-sectors in Tou rism and Travel-Related Services (TT R S) :
( i ) hotel/restau rants , (ii) travel agencies/to u r operators ( i i i ) to u rist g u ides services and ( iv)
others . Therefore, for every sector-specific analysis it n eeds to be clarified i n advance to
w hich extent cross-sectoral rel ations h ave to be taken i nto consideration .

29
�

To u ri s m a n d Travel Rel ated S e rvices the Spectru m of GATS

Travel and Tourism- Travel and Tourism- C
Related Services Related Services iir
GATS Services Sectoral Classification CC
a
bookkeeping, auditing professional services -
- postal s e r v i c e s vacot,'on maijng services
facility management computer and related services -
- courier services
3
-
t ourism market research r e s e a r c h a n d d e 'V e l o p m e n t s e r v i c e s
business communication �
telecom m u n i cation services computer reserva/ioo systems, online seNlCes
feol estate ogencles for tou� properties real estate services - services services
- audiYiosual services training meoo
renting of transport equipment rental/leasing services without operator -
- other database management
business consultancy other

hotels, recreationol and other focilities

purification plant management sewage services
construction oJl tOUflsm facilities
garbage collection reluse disposal services
environmental a nd related
i n s t a l l a t i o n and a s s e m b l y w o r k all roorism foci/dies
beach cleaning sanitation and similar services services eng ineering
services ai/ tourism foci/dies
woler resources management, paiks other
other

inccming agents commission agents' services - - p r i m a ry e d u c a t i o n s e r v i c e s

trovel accessories, sports eqUIpment, souvenirs wholesale trade services - - secondary education services

- distribution educational -
Irovel occessories, sports equipment, souvenirs retailing services higher education services hotel schools
services services
theme and fantasy pores, hotels franchising - - adult education services tovnsm degree programmes

other - - other touriSt guides educatIOn

troveller old seNices h o s p i ta l s e r v i c e s - - h o t e l s and r e s t a u r a n t s as mentioned by GATS

filness clubs, cure services o t h e r h u m a n h e alth services - health-related tourism and - as mentioned by GATS
and social travel-related
speciat services for handicapped persons social services - - t o u r i s t gu i d e s s e r v i c e s os menllOlled by GATS
services services
other - - other

- m a r i l F m e transport s e r v i c e s cruising , diVing tours, yachting, ferries

travel insurancies a l l i n s u r a n c e a n d i n s u r a n c e - r e l ated services ferries

�
financial transport
CUfrrenc y management banking and other financial services air transport s e r v i c e s charter and related support services
services services
multilateral development funds other space transport

rail transport services special rail tour services

road t r a n s p o r t s e r v i c e s lourbu5es

celebrations, SI"lows entertainment services p i p e l i n e t r a n s port s e r v i c e s reslCiences water supply

event wendols, (Xomotion news agency services recreational, cotenng

cultural and
05 mentioned by GA TS other
sporting
os mentioned by GAlS sporting and other recreational services services
research and consuffCJ1cy by international tourism bodes
arts activities other
Another problem that further complicates comparative analysis is that some member
countries differentiated the GNS classification. Their specific commitments refer to a combi­
nation of the GNS system and the corresponding Central Product Classification (CPG) which
offers a far more detailed classification of sub-sectors. That is why in the field of tourism,
some countries treating hotel and restaurant services as separate categories made different
commitments, while other countries referred to both sub-sectors as one.

Finally, it has to be taken into account that the scope of trade measures bound by commit­
ments includes a vast range of different regulations, which, for the time being, are not
comparable to each other. Although GATS itself offers a kind of classification of these trade
10
measures , it has been proved in practice that a more differentiated system needs to be
11
used .

Although GATS mechanisms can be described precisely, it is quite debatable whether and
how they influence a certain sector. On the one hand, it has been stated, that " ... tourism is
indeed one of the most liberalised service sectors with commitments" (limam 1 995) . On the
other hand, other sectors such as information technology and financial services seem to be
far more affected by GATS than tourism. Furthermore, there is controversy over the role of
GATS in the process of liberalisation: Is it a landmark or a failure in terms of promoting
liberalisation?
The following chapter might seem to be very technical in content. However, it may assist the
reader in understanding the GATS mechanisms and their influence on a certain sector. First
of all, it will be explained using India's tourism commitments how specific commitments work.
Secondly, the focus will be on the tourism sector. Sub-sector-specific trends in commitments
of all signatory states will be identified in relation to certain types of trade measures, country
groupings and regions. Finally, it will be examined to which extent the tourism industry is
really affected by GATS.

FUNCTIONING OF SPECIFIC COMMITMENTS: INDIA'S TOURI SM- RELATED SERVICES

Sector-specific commitments contain all the trade measures affecting one of the three core
principles of liberalisation (Box 5, p. 27) which a signatory state is willing to make. The
country agrees not to step back behind this fixed limit in terms of liberalisation. First of all,
each country has to decide which sub-sectors will be ruled by the GATS principles of market
access and national treatment.
Next, it has to decide on those sector-related measures which shall remain in force even
though they violate these principles. The measures are listed along the four modes of supply
(ct. p. 26). For each sub-sector this procedure offers eight dimensions of restricted
liberalisation (four modes times two principles). Additionally, a country has to schedule all
measures separately which are violating the Most-Favoured Nation Treatment (MFN).

10
Art. XVI .2 takes the following restrictions into account: (i) limitations on the number of service
suppliers (numerical quotas, monopolies, exclusive service suppliers, requirements of an economic
needs test) ; (ii) limitations on the total value of service transactions; (iii) limitations on the total
number of service operations or on the total quantity of service ; (iv) limitations on the total number
of natural persons that may be employed in a particular service sector or that a service supplier
may employ ; (v) measures which restrict or require specific types of legal entity or joint venture
through which a service supplier may supply a service; and (vi) limitations on the participation of
foreign capital in terms of maximum percentage limit on foreign shareholding or the total value of
individual or aggregate foreign investment.
I I
The set of administrative requirements in trade regulation, as for example licensing procedures or
residence requirements, is not properly covered by the classification offered in Art. X V I . 2 .

31
 Ta ble 3: India's specific co mmitments to Tourism a n d Travel Re lated Servi ces

C o m m itment Mode of M a rket Access Nat i o n a l Treatment

supply

HOR IZONTAL C ross-border

COM M ITM E NTS supply

Cons u m ption
abroad

Com m e rcial In case of col laboration

presence with p ub l i c secto r enter-
pri ses or government
u n d e rtakings as joint part-
n e rs, preference i n access
w i l l be given to foreign
service s u p p l i ers/entities
wh ich offer the best terms
for transfer of tech nology

P resence of U n bo u n d except for measures U n bo u n d except for

natu ral per- affect i n g the entry and te m pora ry measures refe rred to u nd e r
sons stay of n at u ral p e rsons who fal l i n M a rket Access
any of the fol lowi ng categories:

Busi ness Visitors . . .

I ntra-co rporate tran sferees . . .

P rofessionals . . ,

9. TOU R I S M A N D TRAV E L- R E LATE D S E R V I C E S

H ote ls and oth e r C ross-border U nbou nd* U n bo u n d *

lod g i n g services supply

(CPC Ex. 64 1 ) Consu m ption U n bo u n d U n bound

abroad

C o m m e rcial O n l y through i n corporation with a None

presence fore i g n equ ity ce i l i ng of 51 percent

P resence of U nbound except as indicated i n U n bo u n d except as

natu ral per- the h o rizontal section i n d icated i n the h o rizontal
sons section

Travel Agency a n d C ross-bord e r Unbound U n bo u n d

Tou r Operator supply
service

(CPC 747) Consu m ption U nbound U nbou nd

abroad

Com m e rcial Only through i n corporation with a None

presence forei g n equ ity cei l i ng of 5 1 percent

P resence of U nbound except as ind icated i n U n bo u n d except a s i n d i -

natu ral per- t h e h o rizontal section cated i n the horizontal
sons section

34
A l l l i m itat i o n s w h ich m ight exist with regard to oth e r catego ries of b u s i n ess visitors m ig ht
change o r be i nt rod uced i n t h e future.

To u n d e rstand t h is approach of sc h ed u l i n g , one has to keep in m i nd that it is a 'hybrid' of a

positive and n egative l isti n g (ct . p. 32) : The I nd i a n gove rnm ent is not a l l owed to i nt rod uce
any oth e r d iscri m i native m easu res, for exa m p l e subsidies, i n favo u r of d o m estic hotel ow n ers
( n egative l i st i n g concern i n g m easu res) which would violate its co m m itm e nts to national
t reat m ent concern i n g 'co m m e rcial presence' . O n t h e oth e r hand , t h e I nd i a n governm ent is
f ree to i ntroduce such a m eas u re for tou rist g u id e services, as t h i s su b-sector has been l eft
aside (positive l isting co ncerning sectors) .

TRENDS I N TOURISM-RELATED SUBSECTORS

It has al ready been m ent i o n ed t h at it h as to be decided which rel ated s ub-secto rs beyond
TT RS s h o u l d be taken i nto consid eration i n analys i n g t h e i m pact of specific com m it m e nts . I n
t h e case of touris m , t h i s d ecision i s arbit rary , as n early every sub-sector i n services i s l i n ked
to the to urism secto r. I n the fo l lowing analys i s , any kind of a i r transport serv ices and sporting
and oth er recreational services h ave been incl uded as t h e i r relat i o n to TT R S i s evident.
Ot her sectors , for ex ample construction , p l ay an i m po rtant rol e but cannot exc l u s ively be
att rib uted to to u ri s m .

HOTELSIRESTA URANTS

It is worth mentio n i n g that only eight s ig­

n atories of GATS d id not make co m m it­
l6
m ents in this s Ubsecto r • D u e to the fact
that p rod uct i o n and d e l ivery a re t h e key
.� O N('
d i mensions in supplying 17 hotel and res­
tau rant services, 'cross-border supply'
(CBS) does n ot p l ay any rol e as a mode
of supp l y . Although it m ight be tec h n ically
feasi b l e to take 'consumption abroad'
(CA) i nto accou nt in these fields, t h i s
mode has b e e n considered as n eg l ig i b l e
by the s i g n atory states: N early a l l of t h e m
com m itted them selves t o "no rest rictions".

'Commercial presence' (CP) and

'presence of natural persons' (PNP) a re
CBS CA CP t h e key areas for co m m itments in this
su b-sector. Concern i n g
'co m m e rcial
'8
p resence' , diagram 5 above s hows that m ostly low and lower-middle-i nco m e eco n o m ies in
Africa and Lat i n America have l ibera l i sed m arket access for foreign i nvesto rs: 64 percent of
al l signatory states belonging to the group of LI Es

16
The g roup which d i d n ot present a n y com m itme nts i n DRS includes Mozam bique, Bru nei,
Bahrai n , Madagascar, Barbad os, Belize, Cyprus and Maldives. Sig n ificantl y , the last four cou ntries
belong to the grou p of so-called tourism countries: Their i nte rn ational touri s m recei pts exceed 5
percent of G O P or 10 percent of export reven ues.
17
By defi nition "supply of a service" i n cl udes n ••• the prod u ctio n , d i stributio n , marketi n g , sale and
del ivery of a service" (GATS Art. XXV I I I ) .
18
The classification fol lows t h e i n com e-orientated cou ntry classification i ntroduced i n t h e World
Development Report 1 996 ( I B R D 1 996):
35
 Diagram 6: Types and Number o f Comm itments t o Market Access :
Foreign Di rect Investment (CP) i n Hotels/Resta urants

40

35

30

25

20

15

10

GATS members
No restrictions
5 Other restrictions

U M I Es HIEs

and 75 percent of LMI Es committed themselves to "no restrictions" in this mode of supply.
Significantly, the group of high-income economies has not achieved such a high degree of
liberalisation of foreign direct investment. Only half of the group of H I Es (48 percent) has 'no
restrictions' in that mode. Eight member states of the European Union choose a very un­
common way by neither committing themselves 'unbound' nor specifying any trade measures
in that field. African countries seemed to have a preference for administrative measures
(licensing procedures and approval requirements).
As the hotel and restaurant industry is labour-intensive, it is not surprising that 'presence of
natural persons' (PNP) is the least liberalised mode of supply. 117 out of 119 countries
signing commitments in DRS restrict the movement of hotel staff. 68 countries refer directly
to their horizontal commitments ('unbound except as indicated in horizontal commitments')
which mostly offer only temporary stay for business visitors, intra-corporate transferees
(managers, specialists and executives) and professionals.

This indicates, that more than half of all signatory states restrict free movement of labour
across the scope of al l types of services.

Low-income economies (LIEs) : G N P p.c. .,:; 725 US-$

Lower-middle-income economies (LMIEs) : 726 .,:; G N P p.c . .,:; 2 . 895 US-$
Upper-middle-income economies (UMI Es) : 2 . 896 .,:; G N P p.c . .,:; 8.955 US-$
High-income economies ( H I Es) : G N P p.c. > 8.955 US-$ .

36
N early all E u ropean states (23 of 25 signatory states) choose to restrict this mode of supply
i n that way . 1 0 percent of all cou ntries belong i n g to the group of L I Es are offering an u n­
restricted movement of natu ral persons, compared to LM I Es (3 percent) , U M I Es (6 percent)
and H I Es (3 percent) . 2 1 cou ntries, none of wh ich belongs to t h e g roup of industrialised
19
cou ntries , l i m it market access with regard to the presence of nat u ral persons.
Apart from this l i m itatio n , they are the o n ly ones, however, who at the sam e time g rant
national treatment to both foreign and national qualified staff on their domestic markets.

Diagra m 7: Types and N u mber of Co m mitments to Market Access :

P resence of Natura l Persons (PNP) i n Hotels/Resta urants

GATS members

U M I Es H I Es

TRAVEL AGENCIES/ToU R OPERATORS (TA/TO)

Only 37 out of 92 co u ntries, mainly LI Es ( 1 9 cou nts) and LM I Es (9 counts) , are comm itting
themselves to restrict market access i n the mode of 'crossborder supply' of TAfTO , m ostly
with u nbound m eas u res. Especially those cou ntries i n which this service secto r generates a
m ajor part of G D P 20 l i m it market access for foreign TMO .

19
Ke nya, Cameroo n , Central African Republic, C h a d , N a m i b i a , Swaz i l a n d , Ben i n , G u i n ea , M al i ,
Anti g ua/Barbuda, Do m i n ica, G renada, Saint Lu cia, Sai nt V i n cent & G . , Tri n id ad/Tobag o ,
P h i l i p p i n e s , Thai lan d , Sri Lan k a , Ban g ladesh , Egypt, Malta.

20 To est i m ate the degree of dependence of i n d ividual countries on the tourism sector, fou r grou ps
h ave been d ifferentiated i n t h e an alysi s :
no dependence : tou rism receipts i n perce nt 0 G O P < 1 percent,
low d eg ree of dependence 1 <= tourism recei pts i n percent of GOP < 3 percent
tourism oriented cou ntries 3 < = tourism recei pts in p e rcent of GOP < 1 0 percent
cou ntries dependent on tourism tourism recei pts i n perce nt of G O P > 1 0 perce n t
37
 Chances for cons u m ers to use external travel agencies or tour operators are far more l iber­
alised , as 77 cou ntries present no restriction to 'cons u m ption abroad ' . Again , however,
'com m e rcial presence' and 'presence of natural persons' are the more decisive modes.
Only eig ht o ut of 27 high-inco m e eco nom ies
( H I Es) com m itting themselves to TAITO offer
TNTO co mpletely free m arket access concerning
commercial presence. Com pared to the
H I Es, developing co u ntries ( DCs) mad e
broader steps towards l iberalisation (cf. Dia­
g ram 7 ) : 36 (LI Es + LM I E s + U M I Es) of 68
co u ntries do not present any rest rictions.
Mainly developing countries restrict foreig n
d i rect investment ( F D I ) v i a l icensing re­

fJ�
co q u i rements (9 cou ntries) or capital restric­
E tions (6) . Eight mem ber cou ntries of the
� E u ropean U n io n ( E U ) , desp ite their co m m it­
C)
.� m ent to TAlTOs, d id not fi l l the form of
c
co m m itments related to restrictions of
'co m m e rcial presence', which m akes it
d ifficult to i nterpret their positi o n .
I t is remarkabl e that all H I Es regulate the
'presence of n atu ral persons' i n their horizontal com m itm ents, which results i n a high level of
protection agai nst free movement of labour. Eleven out of 68 d evelop i n g cou ntries d id n ot
make t h i s choice. They either d id not restrict this mode (5) o r they bound ad m i n i strative and
labo u r related m easu res.

TOUR IST GUIDES SERVICES (TGS)

Only 22 H I Es and 31 DCs presented com m itm ents in the sub-sector of tou rist g u ides
services. Even though theoretically app licable, 'crossborder supply' and 'consumption
abroad' do not p lay a sign ificant role i n this context. Furthermore, the m ajority of countri es do
not consider 'co m m ercial p resence' as a main play i n g g ro u nd for tou rist g u ides services , as
1 9 H I Es and 2 1 DCs did not restrict market access . Most restrictions occ u r in the mode of
'presence of natu ral persons': A l l 22 H I Es restrict this mode by bindi ng it via horizontal com­
m itments in the well known way. In DCs the situation is not u n iform : 1 9 co u ntries choose the
way along horizontal com m it m ents, fou r com m itted them selves in a s i m i lar way i n their
specific com m itments, three bou nd so m e restrictive measures and signed the mode as u n­
bou nd. This l eads to the resu lt t h at TGS is the most p rotected sub-sector of TTR S .

SPORTING AND OTHER RECREATIONAL SERVICES (SRS)

Beyond TTR S , the sub-sector of sporting and other recreational services shows the hig hest
degree of p rotection from the side of i nd u strialised cou ntries, especial ly in the mode of
'presence of nat u ral persons'. 1 9 o ut of 22 H I Es used horizontal co m m itments to restrict the
movement of l abour. In the gro u p of DCs 1 1 out of 21 co u ntries followed this way , fo u r coun­
tries signed 'no restrictions', fou r bound the demand for worki ng perm its . Foreign d irect i n­
vestm ent ( F D I ) is not seen as an i mportant domain i n this sub-sector, as most of the
cou ntries com m itted them selves to ' n o restrictions'.

Appe n d i x 1 g ives an overv i ew about which cou nt ry b e l o n g s t o w h i c h g roup.

38
Diagra m 9 : Types a n d Cou nts o f Comm itments t o Market Access :
Com mercial Presence (C P) of Travel Agencies/To u r Operato rs

40

35

30

25

20

15

10

T AfTO-s ig ners
No restrictions
5

o .

U M I Es H I Es

A I R T R A N SPORT

21
Although com m itme nts in air transport do not i n c l u d e the key sector of passenger tran spo rt ,
key seg m ents of to u ri sm -re l ated transport a re touched u p o n by t h e m , espec i a l l y m a i nte­
n a nce/repa i r of ai rc raft services , C R S and sal es/ma rket i n g . I t is w o rth n ot i n g t h at fre i g ht and
rental of a i rc raft , which are - besides pass e n g e r transport - ot h e r i m po rtant s u b-secto rs in
terms of t u rnover, have also been l eft as ide (ct. tab l e 4, p . 40: R e g i o n a l trends i n air transport
c o m m itm ents) .

M ostly American (7) and E u ropean cou ntries (2 1 ) i nt rod u ced com m itm ents i n t h e field of
C R S . These restrictions ( m ost of them by E u ropean cou ntries) do n ot relate to ma rket
access but to national t reatm ent in the mode of 'crossbord e r s u p p l y ' . T h ey foc u s espec i a l l y
o n C R S s contro l l ed by an a i r carrier o f o n e o r m o re c o u ntries, i n w h ich c a s e n o co m m it m ent,
i . e . ' u n b o u n d ' , has been entered . ' C o m m e rc i a l p resence' s h ows a co rrespo n d i n g p ict u re ,
altho u g h t h e l evel of p rotection i n DCs seems to be very h i g h , too .

I n t h e field of m a i ntenance and rep a i r of a i rc raft , t h e p res ence of n at u ra l perso n s is of key

i m po rtance for serv ices to be d e l ivered . Except fo r Tu rkey , w h ich has a l m ost c o m p l etely
l i bera l i sed this type of service, all 42 co u ntries h ave m a rked this m od e as ' u n bo u n d ' .

L i m itat i o n s t o l i b eral i sation i n t h e service area of sales a n d m a rket i n g o f a i r transport a re

m a i n ly focuss i n g on m arket access and national treatm ent with rega rd to t h e p resence of
n at u ra l perso n s , as wel l as n at i o n a l t reatm ent of c ross bord e r s u p ply and c o m m ercial

21
A t t h e e n d o f t h e U r u g u ay- R o u n d negot i at i n g parties d i d n o t reach t h e p o i n t o f g e ne ral agreement
on i ntrod uci n g this sector i nto GATS . It i s p l a n n ed to i n c l u d e it i n t h e n ext rou n d of n egotiati ons.

39
 presence. E u ropean cou ntries, above a l l those belonging to the E u ropean U n io n , l i m it sales
and marketing through reservation systems, the key i n stru ment of d i stri b utio n .

Restrictions f o r services i n the field o f C R S are separately documented i n the com m itments .
F u rth ermore, the restrictions which Singapore, Thai land , Poland , Switzerland and Liec hten­
stei n entered u nder exemptions to the most favou red nation principle need to be considered .
It becomes clear that despite the fact that most cou ntries (32 out of 40) allow for free market
access, o n ly 1 5 cou ntries grant eq ual treatment to foreign and d o mestic suppl iers i n the
sense of n ational treatment in cross border supply. There i s an analogous d evelopment in
the restriction of com mercial presence. 30 co u ntries allow for free market access; national
treat ment, however, is granted by o n ly 1 5 cou ntries among which there is no single E u ro­
pean one. The p resence of natural persons is co mpletely l i m ited . Apart from Tu rkey, no other
co u ntry allows for free market access . Equal treatment of foreign and dom estic suppl i ers is
only g ranted by I celand , F i n land and Romania.

Ta ble 4: Reg i o n a l t rends i n a i r tra nsport commitments

Sector Africa A merica/Car. Europe East Asia IPac. Tota l

CRS 2 7 23 2 40

Frei g h t 1 1 0 0 2

M a i ntena ncel 2 11 23 6 42
Repai r
I

Rental of 2 2 1 0 5
a i rcrafts I
Salesl 1 4 20 5 30
Ma rket i n g

Su pport i n g 2 2 0 1 5
services

GATS : O BSTACLE OR MOTOR OF F R E E TRADE IN TOU R I SM-RELATED S E RVICES?

It is noteworthy that o ut of 1 27 GATS signatory states 1 1 9 cou ntries presented com m itments
in Tou rism and Travel-Related Services . No other service sector shows such a h ig h percent­
age of participation.

Com m itments i n Tou rism and Travel-Related Services have been used as a ticket to enter
the World Trade Organizatio n . When looki ng fo r an answer to the controversial question
posed i n the h ead i n g , GATS has to be i nterpreted i n two different ways: Firstly, we have to
look on the actual res ults of the U ruguay- R o u n d , i . e . the state of bou nd trade measu res .
Seco ndly, we h ave to i nterpret the scope of com m itments as the fo u ndation for futu re nego­
tiations. Keepi n g i n m i nd the ' hybrid '-approach of the com m itments m echani s m (cf. p . 32) , it
is obvious that 'co m m ercial presence' i n the field of h otel and restaurant industries offers the
greatest potential fo r a far reaching process of l iberalisation .

' P resence of natu ral persons' as a mode of supply has the highest degree of restriction i n all
tourist services . At the sam e time, however, this m ode is therefore the key starting point for
future steps toward s l iberalisatio n , as t h e p roblem no more consists i n defin i n g ind ividual re­
strictive m easu res , but i n removing restrictions. This development will equally take place i n
t h e area o f 'hotels/restaurants' and i n t h e sub-sector 'travel agencies/tou r operators'.

40
The two s ub-sectors 'tou ri st g u id es services' and 'sporting and other recreational services'
have in the past negotiations hard ly been l iberal ised . However, they rank second to the other
sectors i n terms of their econ o m ic i mportance . What is more i mportant is the whole spectrum
of air transport services. In this area, too, there were o n ly first steps toward s liberalisation
taken i n the U rug uay Rou n d . In the future, the focus is l i kely to be on passenger transport.

In a n utshel l , it can be said that the cu rrent co m m itments po i nt the way for the f u rther l i berali­
sation of services i n the areas of h otels/restau rants and trave l agencies/tou r operators . In the
com i n g rou n d of n egotiations, the sti l l ex isting restrictions will be d ismantled and the bas is for
the l i beralisation of other t ravel and tourism related services broadened.

2.3 BRAVE N EW WORLD? - FORESEEABLE EFFECTS OF PROGR ESSIVE LI BERALISATION

In practice the negotiations of the U ruguay Round fol l owed the 'ch i ef supplier ru le' . In each
negotiating group the most important sector-specific suppliers ag reed on certain l iberalisation
m eas u res , to be extended to all members . This p roced u re - claimed to fac i l itate negotiations
- actually m eans that the d o m i n ant cou ntries and interest g ro u ps can effectively d ictate l iber­
al isation measu res to t h e weaker suppliers . I f fut u re rou nds p roceed in the same way , o n ly a
few countries of the Sout h , such as I ndia, Thai land and South Africa w i l l be able to exert
d i rect influence on negotiations i n the case of tou rism . The interests of a large n u m ber of
destination countries, wh ich despite their h ig h tou rist flows are not able to provide a substan­
tial sh are of tourist services , wil l probably h ard ly count.

The p resent situation regard i n g trade-relevant measu res does not i nd icate wh ich of these
measu res will be dism antled in the next few years, or whether f u rther areas, such as
passenger transport, are going to be i ncluded . The effects outl i n ed here can therefore only
be gen eral i n nature. The u ncertainties con n ected with such an appraisal can be i l l ustrated
by the prom ises to liberal ise C R S usage.
1. P roviders of travel and tourism-related services (TTRS) w i l l expand their busi ness i n h o l i­
day destinations and i ncreasingly compete with local providers. I f the latter do not
succeed in closing the techno logy gap between them and the big i ntegrated tour opera­
tors , particu larly i n the field of IT, the share of local services in this sector w i l l conti n u e to
decline.
2. The red uction of the few local equ ity req u i rem ents will promote f u rther concentration and
i nteg ration. The anticipated g rowth sti m u l u s and positive effects on foreign exchange
balances will be slight and tourist n u m bers will g row.

3. Treating dom estic and fo reign suppl iers eq ually (same national treatment) means that
developing cou ntries will lose the instru ments of selective promotion of domestic i ndus­
tries (subsid ies, tax rel i ef) , s i nce foreign supp l iers w i l l be granted the same claim to
i n vest ment i ncentives .

4 . Through t h e red uction o f existing restrictions regard i n g cross-border payments, cou ntries
are l i kely to completely lose control over concealed profit transfers . This also puts i nto
perspect ive hopes that tourism could trigger major development processes via i ncreased
tax revenues.
5 . Commitments so far i nd icate that the free movement of qual ified tec h n ical staff and
m iddle and top ma nagers will i ncrease i n all areas of travel and to u rism-related services.
This is l i n ked with the expectation that these gro u ps can make a crucial contribution to
tec h nology transfer in the destinations. As long as this transfer is not i nstitutionally safe­
guarded by further m easu res, th ere are few i ncentives fo r compan ies to bear the cost of
this techno logy transfer and to contribute to the developm ent of h u man capita l .

41
 Ta ble 5: L i be ra l isation Effects - two C R S·Scena rios

Tec h n ical con d it i o n s , the relative com petitive position of i n d ividual s u p p l iers and t h e macro-econ o m i c
co ntext m ay compen sate f o r the expected positive effects o f l i beralisation . The o pt i m i stic esti m ate of
the World Tou ri s m Org a n i sati o n , ap peari n g h e re in ital ics (WTO-OMT 1 995c , 1 8f) , has o n l y l i m ited
val id ity agai n st the backg ro u n d of eco n o m i c co nditions in developing cou ntries:

A de veloping country may restrict the establishment of CRS, because it is perceived as putting its
national airline at a disadvantage. Under GA TS, Country A where a CRS is based will be able to
approach Country B where it is restricted and ask that the restriction (e.g. commercial presence) be
lifted. Country B will then decide what market liberalising measure it wants in return from Country A or
from other countries in which CRSs are based and which may equally be interested in accessing its
market. In addition to fair access terms, the compensating measures sought by Country B could be in
the tourism sector or in another sector. Countries involved will then negotiate.

If the talks succeed in lifting the limitations and allowing the CRS into the new market, this market
opening will be a vailable to CRSs from all countries and the following advantages could result:

I n vestment: The CRS that is seeking to establish itself The techn ical i nfrast ruct u re and necessary com-

in Country B will have to invest in Country ponents are not ava i l able in country B. The local

B. This will ha ve a positive result on the agency of CRS s u p p l i e rs i n country B i m po rts t h e

latter's balance of payments a n d econ- necessary co mponents on a franch ise bas i s .

omy. There is a g ross outflow of fore i g n exchange.

Access: Country B will be granted fair access Very few maj o r local s u ppliers in t h e cities can

terms in the CRS for its tourism services partici pate in t h e distribut ion of t o u rist s e rv i ces

suppliers. v i a C R S as t h e i nfrast ruct u re is not yet ava ilable

for nat io n-wide com m u n icat i o n .

Tra i n i n g Local Staff will have t o be trained and The system is set u p as a c l i e nt system of a n in-

and employed because bringing in a full ex- ternat i o n a l server. O n ly a s m a l l n u m be r of exter-

E m p l oy­ patriate staff may be prohibitively expen- n a l special ists is req u i red to m a i nt a i n it, w h o can

ment: sive. This will attract know-how and tech- t ravel to t h e s pot or g ive external ass ist ance v i a a

nology and will create new jobs. h e lp-desk system . T h e techno logical d ic h otomy

between s u pp l i e r and user re m a i n s .

Payments: Local telecommunication costs ha ve t o be External sat e l l ite syste ms are used t h at are n ot

paid, thus increasing country 's revenues. c h a rged for by local s u pp l i e rs .

Ta xes : Payment of local taxes boosts revenues Concea led profit t ra nsfer takes place t h rough

for national treasuries. price-fixing for external s e rv ices to m a i ntai n t h e

syste m . T a x reve nues stag n ate .

Prices: Declining prices for consumers and in- Scope for sett i n g prices is not passed onto t h e

creasing commissions for travel agents customers w h e n t h e m a rket is d o m i nated by

may result because of new competition. t ravel agencies which are part of a h o l d i n g with

CRS prov iders.

Benefits i n The negotiated compensations vary and Cou ntry B has no service a reas i n wh ich it is

other could include, for example, increased com petitive in t h e m a rkets of i n d u strialised coun-

service business services opportunities for pro- tries .

sectors: fessionals of Country B in all other GA TS

countries

42
I t has been stressed several t i m es that the actual effects of l iberalisation w i l l largely depend
o n sector-specific conditions in the ind ivid ual cou ntries. Concentration on the part of m u lti­
n ational travel cong lom erates has al ready beco m e a major factor. A com parison of two
scenarios in the field of global d istribution via C R S shows (Tabl e 5) that opti m istic scenarios
tend to overlook this facto r. A m o re differentiated approach to l iberalisation of travel and
tourism-related services is t herefore n ecessary .

2.4 SUSTAINABLE TOU RISM OPTIONS IN TH E FI ELD OF GATS

U PG R A D I N G R EPORTING SYSTEMS

As shown in chapter o n e , no rel i ab l e est i m ates have yet been made of the m acro econ o m ic
effects of i nternatio nal tou ri s m i n developing countries, d u e to a lack of appropriate s u rvey
p roced u res and a systematic assessm ent sch e m e . S I CTA is an i m portant step in the right
d i rectio n , b ut it is i ncom p l ete as it does n ot take accou nt of the social and ecological costs of
t h e tourism i nd u stry - i nsofar as they can be record ed at a l l . When it comes to assessing
service t rade i n this sector, the WTO-OMC's t rade pol icy review m echanism l acks e m p irical
fou ndations as does the revival of m u lti l ateral tourism promotion by the World Ban k and
regional development banks.

R ecent approaches , e.g. to m easuring gender-specific d isparities to supplement the h u m an

d evelopment i n d ex ( H O I ) , o r t rade-related natu re consu m ption as part of ecological n ational
p rod uct accou nt i n g , will have to be considered i n the assessm ent of t rad e effects and will
n eed to be d eveloped .

I MP L E M E NTI N G FLEX I B LE P ROCEDU R E S

As long as there i s u ncertai nty in this sector about the soc i o-econ o m i c , eco logical and
c u lt u ral effects of p rogressive l iberalisat i o n , th e convening of a new liberal isation rou nd w i l l
h ave t o be postponed . Keep i n g i n m i n d t h e d ifficu lties i n and opposition t o i m p lem ent i ng
reformed welfare m easurement and resou rce assessment, five years w i l l hard ly suffice to put
n ew approaches i nto p ractice. O n ly o n the basis of appropriate m u ltid i mensio nal evaluation
i n stru m ents and a reform ed environ mental and natu ral resou rce acco unting can we j udge
whether further steps towards freer trade w i l l really l ead to "sustainable growth and d evelop­
m e nt for the com m o n good" as declared i n the D raft Singapore M i n i sterial Declaration (WTO­
O M C 1 996: d raft Si ngapore m i n isterial declaration) . So far this has n ot been shown to be the
case.

C H A N G I N G P E R S P ECTIVES TOWA R DS PARTICI PATION

GATS is geared exclusively at service supp l i ers and national govern ments . The tou rism
i n d u st ry i l l u strates, however, that there are popu lation g roups i n the cou ntries concerned who
are not themselves players but are all the m o re affected by the reperc u ssions of expandi n g
i nternational trade. One ex ample i s the forced relocation o f local com m u n ities for the sake of
tourism development. The i nterests of such com m u n ities are frequ ently ignored by n ational
governm ents and o n ly taken u p by N GOs. As several N GOs have a l ready been accepted as
participants i n negotiations i n the framework of the U N -Syste m , WTO-O MC should estab l i s h
m echanisms ensuring that the representatives of the i nterests of such com m u n it i es are
h eard .
A rt. X I X .2 GATS concedes , that t h e " . . . process o f l iberalisation shall take place with d u e
respect for natio nal pol icy objectives and t h e level o f developm ent o f ind ividual m e m bers,
43
 both overa l l and i n individ ual sectors. There shall be appropriate flexibility fo r ind ividual
developi ng co u ntries fo r opening fewer sectors , liberalising fewer types of transactions, pro­
g ress ively exte nding market access in l i n e with their developm ent situatio n . " The decision on
how and to w h ic h extent these concess ions s h o u ld be used l ies with national govern ments.
As GATS itself refers to "measu res of central , reg ional or local governments and authorities,
as well as measu res of non-govern mental bod ies in the exercise of powers delegated by
centra l , reg ional or local govern ments or authorities" (Art 1 . 3) , the resu lt is q u ite u n balanced :
On the one hand , t rade- related measu res of all ad m i n istrative levels are placed u nder GATS ;
o n the other hand , m ost corporate bod ies have no c hance to participate o r rights to intervene
i n negotiations at a l l .
Therefo re, A rt . XI X.2 s h o u l d accord i ngly be amended t o take accou nt o f the general and
special needs of local com m u n ities and regions i n the l iberalisation process as wel l as of the
natio nal political goals and level of deve lopment of the ind ividual m e m ber states. Only under
this condit i o n , if at all, may a broad reach of GATS be acceptable.

TOWARDS A NEW FAI R NESS IN COMPETITION

Experience in the field of info rmation tec h no logy to date gives cau se for concern that exte n­
sively integrated service providers co u l d ass ume a domi nant market position by using
information systems i n an envi ron ment with a low level of technological developm ent. It w i l l
b e h ard t o strengthen domestic service capacities i n t h e econom icall y d isadvantaged cou n­
tri es if access to tec hno logy rem ains o n ly on a co m m e rcial basis. This is all the more so, as
the b u l k of research and developm ent i n industrialised n ations is conducted by state-run
institution s , and parts of the tec h n ical i nfrastructu re of new com m u n ication systems enjoy
gove rn ment s u bsidies. U nder these conditions a one-sided o rientation to technology transfer
on a com m ercial basis is l i ke a prom ise to reach or even overtake a train on a single track.
Contrary to the intention of GATS , it may be necessary from a developm ent point of view to
temporarily close markets i n order to leave room for appropriate technological development
accord i ng to the specific req u i rements of the country concerned .
I n o rder to avert t h e possible expansion of a strategic trad e pol icy widen ing the technology
gap, co mpetition regu lation m u st be i ntrod uced m u lti l ateral ly, ensuring t ransparency of
gove rnm ent pol icy on com petition and ind ustry , and allowing fai rer conditions fo r com petition
between industrial i sed and developi n g countries. Originally, the principle of reciprocity
dem anded that the res u lt of n egotiations should be solely eq u ivalent and balanced conces­
sions. With the demand for an "overa l l balance of rights and obligations" in the GATS
Preamble; contracting parties purs u e a strategy of "aggressive reciprocity" that is patterned
on "super 30 1 " , Article 30 1 of the American Trade Acts . In the past this led to arbitrary trade
meas u res on the part of the Un ited States. The trend towards aggressive rec ip rocity i n the
field of com m itments m ust therefore yield to a more selective hand l i n g of trade-ex pansive
and t rade- restrictive meas u res.

BALANCI NG PRINCI PLES AND PRACTICE

I n its charter WTO-OM C is pledged to the goal of sustainable development in harmony with
g rowth and em ployment . In the ongoing n egotiating p rocess itself these goals have no
corrective fu nction . Solely the overrid ing idea of progressive trade liberalisation is l i n ked with
operative proced u res l i ke Most Favou red Nation and N ational Treatment. Since the
fu nctioning and l i beral isation th rust of WTO-OM C are based on legal standard s , n ew
proced ural standard s have to be d eveloped to ens u re that t h e stated goals are being m et .

44
3. DISREGARD FOR HUMAN RIGHTS IN TOU RISM - CHALLE N G ES TO T H E
WOR LD TRA D E O R D E R

3.1 UG LY BACKYA RDS OF TOU RISM

There are various fields i n tou rism where a d i s regard for fu ndamental h uman rig hts can be
observed . It occu rs
• i n violation of basic labou r rights as a conseq uence of working conditions i n travel and
tourism-related i nd ustries , e.g. with respect to worki ng hou rs , working conditions, o r
deprivation of employees' rights ;
• i n disregard for the rights of local i n habitants especially i ndigenous com m u n it i es to
c u ltura l self-determ i n ation in a self-chosen enviro n ment, e.g. when peop le are being d is­
p l aced from thei r homes for the land to be used for tourism projects;
• w here women are being discri m i nated agai n st and sexually exploited ;
• i n child sex ual exploitatio n , rang i n g from sexual harassment to forced prostitution;
• i n child labo u r and c h i ld bonded labou r i n touris m , cateri ng and entertai n m ent i n d u stries
as i n related service areas.

It is clear that these problems do not accompany tourism development only i n develop i n g
countries . They are a l s o t o be fou n d i n t h e N o rt h , albeit t o a lesser extent a n d m aybe with
another focus. In any case, their close con necti o n with i nternational tourism p rec l udes any
moral ising stance towards the cou ntries affected by these abuses.

3.2 "BLIND DATES" IN TRA DE R EG U LATION : LEVELS A N D M EANS OF I NTER­

VENTION IN I NT ERNATI ONA L TRADE

The causes of h u man rights violations i n tourism are com p l ex and can not g enerally be
attributed to a single s ector or to a m i sl ed trade pol icy. Nor can we expect to solve t h ese
p roblems by trad e regu lation alone. U nder certain conditions, however, such measures m ay
p lay a supportive rol e i n the enforcement of social standards and h u man rights .
M i n i m u m social standards can be incl uded at different l eve l s . They have long been part of
i m po rtant I LO conventions (ct. Box 9 , p . 50) . Discussion about i mplem enti ng codes of con­
d uct i n transnational corporations (TNCs) has also revealed e m p i rical evidence. For
exam ple, worki ng conditions i n the South African p lants of i nternational companies were i m­
p roved under Apartheid, and these levels mai ntai ned. I ncluding m i n i m u m social standards i n
t h e E u ropean U nion's general system o f p references i s now being d iscussed a s wel l .

T h e issue o f m i n i m u m social standard s i s not entirely foreign t o the WTO-OM C agreement

either. Taking up Art. XX of the former General Agreement on Tariffs and Trade (GATT) ,
GATS and WTO-OM C foresee exceptions to t h e principle of most favou red nation treatment
( M FN) in order to p rotect public moral ity and order, and also h u m an l ife and h ealth . Beyond
this, GATT Art . XX also i nc l udes the very concrete poss i b i l ity of rejecting goods produced by
prison labou r and of protecting national treasu res of artistic, h i storic or a rchaeological valu e .
Even t h o u g h the i mportance of such exceptions is evident especially i n t h e tou ris m sector,
trade law practice h as not taken up these poss i b i l ities, b ut has rather more or less passed
them over them when d rafting the new world trad e order. While Art. X I V GATS , l i ke Art. XX
GATT, does mention exceptions to the principle of M FN treatment, it does not - interestingly
enough - take u p the concrete cases referred to i n Art. XX GATT.

45
 Box 8: A RT. XX GATT 1 947 G E N E R A L EXCEPTIONS

Subject to t h e req u i rement that s u c h measures are n o t applied i n a m a n n e r w h i c h would constitute a m e a n s of

arbit rary or u nj u stifiable d iscri m i n ation betwe e n count ries where t h e same conditions preva i l , or a disgu ised re­

strict i o n on i nternational trad e , not h ing in this Ag ree ment shall be construed to prevent t h e adopt i o n or

enforcement by any contract ing party of meas u res : . . .

(e) relat i n g t o t h e products o f prison labou r;

(f) i m posed for the protection of nat ional treasu res of art istic, h istoric or archaeolog ical val u e ;

(g) relating to the conservation o f exh aust ible nat u ral resou rces if such measures a r e m ade effective i n

conj u nct i o n w i t h rest rict ions on domestic prod uction or consu mption.

It is a 'blind date' that takes place between early attem pts to b i nd free trade to certain m i n i­
m u m standards on the one hand and the actual problems of h u man rig hts violations. There­
fore, t here is a need for sound reg u l ations ens u ri n g the protection of these rig hts i n the
sphere of trad e. The world has been observing with concern the i nc rease i n child and
enfo rced labou r. This has i ntensified the d iscussion abo ut introd ucing a 'social clause' i nto
existing trad e agreements. Th i s means . . . "special provisions i n serted i nto i nternational trade
agreements setting out a n u m ber of m i n i m u m social standards . . . In the case of a n egat ive
clause the no n-observance of the ag reed standards in man ufacturing a p rod uct m eans that
the i m porting cou ntry s hal l hinder o r totally pro h ibit market access of this prod uct. I n the case
of a positive clause the i m porting cou ntry shall g rant favo u rab le market access co nditions to
p rod ucts manufactu red in cou ntries observing the ag reed standards" (Gsanger 1 994, 1 6) .
I n the case of negative clauses there are three forms of trade restrictions which could be
considered by the i m porting cou ntry ( K u l essa 1 995 , 60f ) : .

• product-related social clauses restricting the i mport of goods manufactu red u nder condi­
tions violating official standard s ;
• sector-related social clauses restricting i mports of goods from a whole sector;

• trade sanctions restricting the i mport of goods from a country i n wh ich certain standards
are not being met.
The meas u res cover penalty tariffs (or custo ms p references in the case of positive clauses)
o r a quantitative l i m itation of i m po rt quotas , up to the poss i b i lity of i m posing an i mport ban .

3.3 TH E PROS A N D CONS OF I NTRODUCING SOCIAL CLAUSES : C RUCIA L POI NTS

IN THE FIELD OF TOURISM

In October 1 996, B u rma's m i l itary j u nta p roclai m ed the "Visit Myanmar Year" . The i nter­
national P R campaign was expected to attract half a m i l lion tourists i nto the South-Asian
cou ntry . With the creation of national parks for eco-tou ri s m and of biosphere reserves ,
members o f t h e Karen popu lation were expelled from their homes, many were even exe­
cuted (Tourism Co ncern 3/97) . M i l itary u n its of the State Law and O rder Restoration Council
(SLO RC) forced thousands of m e n , women and c h i ld ren to work wit hout being paid wages to
b u i ld tourism infrastruct u re such as the rai lway between Rangun and Mandalay. Those who
refused to work were put i n chains; prisoners were forced to work ( E i n e Welt 2/96) .

Forced labour, c h i ld labou r and sexual abuse of c h i ld ren need to be combated at the legisla­
tive and executive levels as well as at the judicial . Co-operation with the various players i n
the tourism i n dustry (hotel a n d t o u r operators, carriers , tourist g u ides) , relevant authorities
and particu larly with the to u rists themselves i s i n d ispensable. I n the fight against com mercial
sexual explo itation of ch i ld re n , WTO-OMT is promot i n g i nternatio nal police co-operation ,
46
tou rist ed ucat io n , the creation of cri m e reporting system s and self-regu l ation in the tourism
i n d u stry (codes of cond uct, good pract ices , trai n i n g p rogram m es) and even t h e creation of an
i n d ustry-wide C h i ld Protection Task Force (Stabler 1 996) . With respect to the world trade
order, the q u estion is whether, i n add ition to the m easu res al ready i n itiated , laws and reg u la­
tions should be i ntrod uced with i n WTO-OMT.

As the case of Burma shows, even national authorities can use c h i ld labo u r and prison
labour and thus defy the relevant I LO conventi o n s . Only a few to u r operators fol l owed the
B u rm ese opposition's call s for boycott. Trad e sanctions co u ld not be i mposed on the WTO­
O M C member B u rma because GATS lacks both appl icabl e standards and possi b i l ities for
their i m plementation .
One of the most controversial iss ues regard ing the world trade order is whether social m i ni­
mum labo u r standards or ecological standards s h o u ld be i ntroduced. In the Sin gapore
M i n i sterial Declaration of WTO-O M C all WTO-OMC members pledge to co mply with the "ob­
servance of i nternationally recog nised core labou r standards", b ut pass on its m o n itoring to
the I LO:
,,4 . We renew our com m itment to the observance of i nternationally recogn ised core labour
standards. The I nternational Labou r Organ ization ( I LO) is the co mpetent body to set and
d eal with these standards, and we affirm our su pport for its work i n promoting them . We
believe that economic g rowth and development foste red by i ncreased trad e and f u rther trade
l i beral i sation contribute to the promotion of these standard s . We reject the use of labou r
standards for protectionist purposes , a n d ag ree that t h e co m parative advantage o f cou ntries ,
particu larly low-wage developing cou ntries, m ust i n no way be put i nto question . I n this re­
gard , we note that the WTO and I LO Secretariats w i l l cont i n u e their existing collaboration."
(WTO Focus 1 5 , January 1 997)
Over a long period of time, participants in the debate on the i ntrod uction of social and eco­
logical m i n i m u m standards in the world trad e o rder seemed to be clearly d ivided i nto two
parties : those in favo ur, i . e. several NGOs, trade u n ions, and representatives of several
govern ments and political parties fro m industrial nations, seemed to be opposed by a large
n u mber of N GOs , govern ments and trade u n ions in the South .
R ecent stud i es i n d icate that this seem i n g ly u n ited opposition of the South , wh ich govern­
mental representatives like to refer to, as did the m i n ister of trade in Malaysia, h as long been
replaced by a more differentiated debate ( P i epel 1 995; Hensman 1 996) . There are mai n ly six
arg u ments agai nst the i ntroduction of social m i n i m u m standards in WTO-OM C agreements
( H ess 1 995 ; Hensman 1 996) .

(1) The new WTO-OMC order gives unilateral preference to industrial nations ' interests and
is part of an exploitative international order. If ecological or social minimum standards are in­
troduced industrial nations are given additional opportunities of intervention against third
world countries and divert attention from the real problems raised by the global economic
framework.

I t is indisputable that ind ustrial nations played a dom i nant ro l e i n the G ATT negotiations and
in WTO-OMC . The new d ispute settlement m echanis m , however, marked a turning point
from principle of co nsensus of the U ruguay- R o u n d . Experience with this mechan ism , e.g. i n
22
the tu na-dolphi n-confl ict , s how that the pane l is ready t o take decisions wh ich are against

22
I n 1 990 the U SA i m p osed an e m bargo on tuna e x p o rted from M ex ico. M e x ican tuna usually h as
been harvested with nets lacking sufficient dol p h i n p rotection measures, a p ractice violating the
U . S .- Marine M a m m al P rotection Act which asks for i m p ort restrictions. The U SA was forced by
GAn to give u p the ban as it violates national treatm ent: Accord i n g to the p anel , d iffere nt
h arvesting p ractices are not a sufficient reason for d i scri m i natin g good s . In WTO-OMC p ers p ective
47
 t h e i nterests of the m ost i m po rtant tradi n g n at i o n s . I nt rod u ct i o n of ecological or social m i n i­
m u m standard s also provides developi n g cou ntries with opport u n ities to d emand that these
standard s b e com p l i ed with i n i n d u strial n ations as wel l . As the extent of child p rostitution in
the large cities of t h e North i n d i cates , t h e re i s a s ubstantial need for i nterventi o n . H owever
legit i m ate the general criticism aga i n st the international eco n o m i c (d i s-)ord e r , it s h o u ld not
l ead to p lay one p roblem agai n st another. C h i l d (bonded) labo u r and com m e rcial exploitation
of c h i ld r e n and wom e n , for exam p l e , are closely l i n ked to t h e g l obal eco n o m i c fra m ework, at
l east i n t h e export i n d u stries.

(2) When social minimum standards are included into trade agreements they can - at best -
bring about change within the export industries of a specific country. They have no impact on
violations of these standards by other non export oriented industries of the same country, or
by countries with only loose foreign trade relations.

I nd e ed , rel evant t rade restrict i n g m easu res s h o u l d in the fi rst p l ace be prod uct and i nd u stry
focu ssed , i . e . efficient o n l y in a l i m ited area. However, experience with the fig ht aga i n st c h i l d
labo u r i n I nd i a s h ows that the debate o n potential t rade restrict i n g measu res t o be adopted
with i n the relevant export oriented i n d ustri e s , e . g . in the carpet i n d u stry , raises p u b l ic aware­
n ess about the probl e m of c h i ld labo u r. Even i n d u stries that mostly p roduce goods and
serv i ces for the d o m e stic market are i n t h i s way forced to co nform to new req u i re m e nts.
Trad e sanct i o n s as ultima ratio would also have a n i m p act on cou ntries seeki ng o n ly sel ec­
tive world m arket i ntegrat i o n .

(3) The introduction o f trade sanctions under WTO-OMC rule would undermine implementa­
tion and further development of ILO standards and of the ILO monitoring system. De veloping
countries would necessarily refrain from ratifying additional ILO standards, fearing automatic
sanctions whenever implementation of s tandards proves insufficient.

Whether a trade-off w i l l take place between t h e i ntrod uct i o n of sanct i o n s a n d ratification of

t h e relevant standards w i l l m a i n l y depend on w h at t h e standard s , t h e m o n itoring system and
t h e future division of tasks b etween I LO and WTO-OMC will be. Trade sanct i o n s can o n ly be
ultima ratio. Both o rganisations n eed to set u p a p roced u re that woul d , as a f irst ste p , allow
for i nd e p e n d e nt reports on violat i o n s of I LO standard s by m e m b e r or non-member states.
N egative sanct i o n s w o u l d not n ecessari ly have to be appl i ed w h enever a confl ict arises. As
an alternative positive i nce ntives could be granted for the i m p l e me ntat i o n of standard s
acco rd i n g to i nternational l aw .

(4) I n the past, trade sanctions ha ve been imposed o r lifted mostly for strategic reasons or
motives relating either to defence policy or economic policy. A homogenous application of
sanctions is also being prevented by WTO-OMC agreements themselves, as the GA IT 1994
only pro vides for the possibility not the obligation of introducing trade measures protecting
health and environment.

The confl i ct between t h e U SA and the EU on "Th e C u ban Liberty and Democratic Solidarity
Act" (" H e l m s- B u rton Act") shows that trad e sanct i o n s - l i ke in t h i s case i mposed by the U SA
on companies with d i rect i n vestm e nts i n Cuba - are com m o n practice a m o n gst tradi n g
n at i o n s , w h ich does n ot j u stify t h e i r arbitrary u s e . What i s t h e refore n eeded i s a set o f ru l es
govern i n g the respon s i ble appl icat i o n of t rade sanct i o n s . There i s an u rgent need fo r a more
d etai l ed d efi n ition of standards , w h ich s h o u ld be as b i n d i n g as possi b l e with respect to i nter­
n at i o n al law.

signatories are n ot allowed to extend trade restrictions extraterritorially for the sake of
environ mental and resource protection.
48
(5) Trade sanctions are at least partially destructive, in the sense that they affect those
whose living and working conditions are to be improved by compliance with specific
standards.

As n egative effects can not be excl uded for these groups of perso n s , they s h o u ld be g ranted
a hearing and t h e rig ht to participate in the decision making p rocess on potential sanctions.

(6) The introduction of sanctions in order t o impose social and ecological minimum standards
lea ves the door open to protectionist abuse of all kinds. These standards could, above all, be
used to eliminate comparative cost advantages that developing countries have due to lower
wages.

The th reat of protectionism and the loss of com parative cost advantages are the arg u ments
m ost often brought forward against the i ntrod uction of social and eco log i cal m i n i m u m
standard s . Apart from the fact that t h e theorem o f com parative cost advantages is subject to
very restrictive p rereq u isites t h at hardly correspond to the real ity of the world economy and
that com parative cost advantages o n ly have a l i m ited i nfluence on fo reign trade relations,
recent OECD studi es i nd icated clear l i n ks between social and eco logical standards on the
one hand and the dynam ics of trade and its structure wit h i n a specific cou ntry on the other
hand . Thorough checks i n t h e dispute settlement mechanism can ensure that social
standards cannot be abused fo r protectionism .

3.4 R ECOMMEN DATIONS

TAKING DIFFERENCES SERIOUSLY

It may seem u norig i nal to demand that differing positions of N GOs and N o rthern and
Southern govern ments be recog n ised. This bears repeat i n g , however, in view of the
coverage of the WTO-OM C conference i n Singapore i n late 1 996. Otherwise the voices of
N GOs critical of social clauses w i l l be instrum ental ised by govern m ents with l ittle i nterest i n
i m p roving the situation o f t hose w h o have t o work u nder i n h u m ane cond itions .
Social clauses are not the one and only way to enforce m i n i m u m social standards. I n the
best case t h ey support the efforts of social groups to create h u mane wo rki ng conditions. The
d i fferent views on p rio rities and d i fferent approaches concern i n g s u itab le i n stru m ents i n the
fight against child labo u r s h o u ld be taken seriously. In c u rrent controversies abo ut the i ntro­
d uction of social standards, N GOs critical of tourism are cal l ed upon to reach a consensus
o n the problems where the use of trade policy instru ments m ay i m p rove the situation for
people standing outside of formal eco nom ies.

A BO LISHING CHILD PROSTITUTION AND BONDED LA BOU R BY R EG U LATI N G TRADE

To be realistic, there will probably be no consensus for a social clause covering all basic I LO
standards i n the foreseeable fut u re (cf. Core I LO Conventions concern ing M i n i m u m Labou r
Standards, p. 50). Moreover, a b road ly defi n ed standard c o u l d p lace u nd u e strai n on t h e
abil ity of some developing cou ntries t o observe adaptation dead l i nes. T h i s is w h y we p ro­
pose to beg i n by focussing demands on the narrow field i n which the worst h u man rights
v iolations occur and which see ms best su ited to obtain the critical s u p port of sceptics. Once
N GO s have reach ed s u fficient agreement on this proposal, the first step wou ld be to i ntro­
duce a sectoral negative clause i m posing su itable sanctions on c h i ld bonded labo ur in con­
n ection with c h i ld p rostitut io n . Such a vol untary arrangement wou ld i n itially p revent objec­
tions that i ntrod u c i ng a case-specific social clause m eant t h e level l i n g down of comparative
cost advantages of developing cou ntries by industrial ised nations. This objection wou ld be

49
 unfou nded for the very reaso n that i n the case of sexual exploitation of children and bo nded
labo u r, the econom ic way of thinking has reached its l i m its. To exceed these l i m its would
mean to accept that h u man beings have beco m e a tradable good . Therefo re , eco n o m ic
theory and politics are not only challenged to recognise l i m its to growt h , but certain l i m its to
the appl ication of trade theo ry as wel l .

Si nce c h i ld p rostitution in many co untries is su bstantially sti m u l ated by t h e development of

touri s m , it wo uld be helpf u l to extend GATS Art. X I V along the l i n es of original GATT Art. XX.
However, t h i s can not be a matter of a prod uct-related social clause, s i nce there is rarely a
d i rect co n n ection between i nternational to urism service suppliers and the operators of c h i ld
prostitution networks. A sector-specific clause would req u i re governments to oppose the
violation of children's rig hts and to provide s ufficient legislation and law enfo rce ment
capacities .

Box 9: CORE I LO CONVENTIONS CON C E R N I N G M I N I M U M LABOUR STA N DA R DS

No. 29 and 1 05 : CONVENTION CONC E R N I N G FO RCED LA BOUR and A BOLITION OF FORCED LA BOUR

E a c h M e m b e r u nd e rtakes to su ppress and n o t to m ake u s e of any f o r m of fo rced or compu lsory l a b o u r and

secu res t h e i m mediate and complete abolit i o n of fo rced o r compulsory labour.

No. 1 38 : CONVENTION CONC E R N I N G M I N I M U M AGE

Each M e m b e r for w h i c h this Convent ion is i n fo rce u ndertakes t o p u rs u e a nat i o n a l policy designed t o e n s u re

t h e effect ive abolition of c h i l d l a b o u r a nd to raise prog ress ively t h e m i n i m u m age for ad mission to e m ployment

or work to a level consistent with t h e f u l l est physical and mental development of y o u n g persons (Art. 1 ) .

No. 111: CONVENTION CONCE R N I N G DISC R I M IN ATION

A l l h u m a n b e i n g s , i rres pect ive of race, creed o r sex, have t h e right t o p u rsue bot h t h e i r material wel l-be i n g a n d

t h e i r s p i rit u a l development i n cond itions of freedom and d i g n ity, of eco n o m i c secu rity a n d eq u a l opport u nity.

Each Member decla res to p u rs u e a n at ional pol icy desig ned to promote equality of opport u n ity and t reat ment

in respect of e m ployment and occupat i o n , with a v i ew to e l i m inating a n y d iscri m in a t i o n , distinct i o n , excl u s i o n o r

prefe rence m a d e on t h e basis of race, colour, s e x , re l i g i o n , pol itical o p i n i o n , n a t i o n a l ext ract ion or social

origiany d iscri m i n at i o n i n respect t h e reof.

No. 98: CONVENTION CONCE R N I N G THE A P P LICATION OF THE P R I N C I PLES OF THE R I GHT TO
ORGAN IZE A N D TO BARGAIN COLLECTIVELY

Wo rkers s h a l l enjoy adequate protect ion a g a i nst acts of a n t i- u n i o n discrim i n at i o n in respect of t h e i r e m p l oy­

ment (Art. 1 ) .

No. 87: CONVENTION CONCERNING FREEDOM OF ASSOCIATION A N D P R OTECTION OF TH E RIGHT

TO O R GANIZE

Workers a n d e m ployers, without d istinction whatsoever, s h a l l h a v e t h e rig ht to estab l i s h and , s u bj ect o n ly t o

t h e r u l e s o f t h e o rg a n izat i o n concerned, to j o i n organizat i o n s of t h e i r o w n choosing wit hout p rev i o u s a u t h o riza­

t i o n ( A rt . 2).

No. 1 00 : CONVENTION CON C E R N I N G EQUAL R E M U N E RATION

... sec u res t h e principle of equal o rd i n ary, basic o r m i n i m u m wage o r s a l a ry and any addit i o n a l e m o l u ments for

men and women workers for work of equal v a l u e .

Besides a sector-specific social clause, appropriate i nter-linked reporting systems s h o u l d be

set up both by WTO-OM C and I LO to ensure the participation of t h e chi ldren affected by
sexual exploitation and forced labour, along with representatives of their i nterests and other
players . Consideration should be given to i ntrod ucing cou ntry-specific adaptation d ead l i nes
as well as assi stance, and to the demand for customs preferences as positive i n centives for

50
change. Such a ' soft' system is p referable to an auto m atic sanctio n i n g p roced u re. It wou ld
i n st itutionalise co-operation between I LO and WTO-OM C w h i l e ensu ring t h e i r i ndependent
operations. I n add ition, it will p rovide a basis fo r cou ntry-specific s u p port i n i mplementing t h e
n ew trade standard .

Such a vol untary arrangem ent m ight be criticised for i n itially ignoring th e b roader scope of
m i n i m u m social standards. Experience based on t h i s n arrower approac h , however, co uld
promote the discussion of trade-relevant issues i n t h e other areas of m i n i m u m social
standard s . These spread effects should be used in d evelopment pol icy in o rder to ach i eve a
breakthrough i n other areas of h u man rig hts' violat i o n .

51
 4. ECOLOG I CA L I M PACTS OF TOU RISM AS A TRADE ISS U E

4. 1 SHORTCOMINGS O F THE N EW WORLD TRADE ORDER

Exam ples are legion t h at enviro n mental damage h as beco me a tou rist's co m panion. The
to u ri s m i n d u stry actually is i n the d i le m m a of overusing the resou rces on wh ich it depends,
as t h ey are one of its key locational facto rs. Efforts wh ich a re being made to appear m o re
sustainable by i ntrod ucing eco-tou rism concepts are sti l l i n their i n fancy and have not yet
developed beyond a n ic h e existence.

A lthough the WTO-O M C is com m itted to the goal of s u stai nable develop ment and use of
reso u rces (cf. Agreement Estab l i s h i ng t h e World Trade O rga nization) , and GATS al lows
exceptions to t h e principle of most favou red nation treatm ent, t h e world trade order clearly
fal l s sho rt i n this field in th ree ways:

1. Despite the fact that at the UN level the con nection between trad e and enviro n m ental
costs has long been taken i nto consideration when reform i n g environmental and nat u ral
resou rce accounting, it does not play any particu lar rol e in t h e assessm ent of welfare
benefits t h rough l i bera l i sation u nder WTO-OMC and the reform of calculating a cross­
sectoral tou rist val u e added . Were it to be consistently taken i nto account, the positivist
eq uation of free trade with welfare benefits wou l d no longer be tenable.

2. I ndividual WTO-O M C agreements have so far merely considered the protection of territo­
rial enviro n m ental goods. It is not yet clear what such protection m ight be l i ke , what
t rade-relevant m easures would cause lasting vio lations and how the observance of t h i s
standard could be m o nitored . I m portant extraterritorial goods , such a s the atmosphere
and seas , which are permanently damaged by tou rism , are not taken into account.
3. I n t h e case o f violation o f standards, other i nternational environm ental agreements p ro­
vide for trade-restrictive m easu res that confl ict with , or are not covered by WTO-OM C
agreements . Fut u re conflicts m ight occur especially i n relation t o the Convention on
I nternational Trade i n Endangered Species of Wild Fau na and Flora (C ITES 1 973) , the
Base l Co nvention on t h e Contro l of Transboundary Movements of H azardous Wastes
and Their D isposal ( 1 989) and t h e Montreal Protocol on S ubstances that Dep l ete the
Ozone Layer ( 1 990/92 ) .

4.2 WHO'S WRONG? M A R KET FAI L U R E O R TRA D E LIBERA LISATION A S A CAUSE

OF ENVI RONM E NTA L D EGRADATI O N ?

T h e joint declaration of the first m i n isterial conference of t h e WTO-OMC m e m ber states i n

S i ngapore (9- 1 3 . 1 2 .96) g losses over the potential conflicts between trade l i be ralisat io n ,
d evelopm ent and enviro n m ental protection, turning them upside down :

"The Comm ittee (on Trade and Environment) has been exam i n i ng and w i l l conti nue to
exam ine, inter alia, t h e scope of complem entarities between trade l i beral isatio n , econom ic
developm ent and enviro n mental protection. Full im plem entation of t h e WTO-OMC Agree­
ments w i l l make an i m portant contribution to ach i evi ng t h e obj ective of sustainable develop­
ment" (Singapore M i n isterial Declaration 1 3 . 1 2 .96) . H owever, in contrast to all diplomatic
opt i m ism and b l i n ke red theory , no clear positive co n n ection can be observed between free
trade and developm ent or between free trade and envi ro n m e ntal protection .

52
 Box 1 0: R i ca rdo's theorem of compa rative cost adva ntages

D evelopm ent theories on foreign trade are all based on the theorem of comparative costs,
establ ished i n 1 8 1 7 by David Ricard o . In essence, this theorem says that each of two
cou ntries should special ise in the prod uction of those good s in the prod uction of wh ich it
has com parative cost advantages, i . e . the g reatest relative efficiency or the relatively better
conditions compared to the other cou ntry . This can be i l l u strated by a s i m p l e exam ple.
Suppose that Braz il and G ermany are in a position to p rod uce two eq ual co m m od ities,
mac h i nes and co mputers. With the sam e l i m ited resou rces , Germany can prod uce either
20 mach i n es o r 1 2 comp uters and Braz il 1 0 mach i n es or 9 computers. In this situation
Brazi l has an absol ute p rod uction d isadvantage regard ing both prod ucts. In the case of
computer prod uction this is relatively smaller than i n the case of mac h i n es ( 1 2/9 vs. 20/ 1 0)
and co nstitutes a com parative prod uction advantage. This would become effective if the
two cou ntries l i m ited themselves to prod ucing the com modity i n the production of wh ich
they had comparative prod uction advantages and if they traded amongst themselves.
Domestic exchange relations for the prod uct would improve i n both cou ntries and they
wou ld ach i eve an i m p rovement of their i ncome situation i n terms of supply of goods.
Before enteri ng i nto trad e, either 20 mac h i nes or 1 2 comp uters are p rod uced i n G e rmany,
the exchange ratio amo u nting to one mac h i ne per 0 .6 computers . In B razi l this ratio is one
machine to 0.9 co mputers , as the prod uction of the latter seems to be relatively cheaper.
Assu ming that having started trad i n g , the world market price m u st lie between these two
exchange ratios - otherwise t rade would not make sense - e . g . arou nd 0.75, B razi l wo uld
receive 1 .2 mach i n es on the world market i n stead of one m achi n e on the dom estic market ,
forgoing 0 . 9 computers . I n this case, Germany would receive 0.75 instead of 0.6
com p uters, forgoing one mac h i ne.
The theorem of com parative costs serves to explain and j u stify the classical and n ew
i nternational d ivision of labou r fro m an econom ic perspective, s ince it shows that i n the
case of free price fixing o n the world market, i.e. free trad e , cou ntries with absol ute p ro­
d uction d isadvantages but comparative cost advantages can achieve welfare gains in the
fo rm of a higher supply of good s . This theorem has entered GA n and WTO-OMC i n the
form of the l iberal isation principle and p rovides the theo retical fo u ndation fo r world wide
effo rts to liberalise trade.

Economists just ify the necessity for free trad e with R icardo's theorem of com parative cost
2
advantages 1 (cf. Box 1 0) . The World Trade Organization i l l u strates its i mportance with an
24
anecdote :
' N obel lau reate Pau l Sam uelson ( 1 969) was once challenged by the mathematician
Stanis law Ulam to "name m e one p roposition in all of the social sci ences which is both true
and non-triviaL" It was several years l ater that he thought of the correct response: compara­
tive advantage. "That it is logically true n eed not be arg u ed before a m athematician; that it i s

21
R i cardo's th eorem was elaborated u p o n i n t h i s ce ntury. The development l i n e exten d s via
H eckscher-O h l i n ' s variable-proportions facto r e ndowment theory to t h e n e o-factor endowment
t heory. The weaknesses in R icardo's t heorem set out below also apply to its t h eoretical
successors.
24
Th i s an ecdote was p u b l i s h ed by the WTO-OM C i n the I n ternet ( h ttp://www . u n icc.org/wto) . T h e
quote is from P . A . S a m u e l son ( 1 969) , "Th e Way o f an Eco n o m i st" , i n P . A . Sam uelson , ed . ,
I nternation al Eco n o m i c Relatio n s : P roceed i ng s of t h e Th i rd Congress of t h e I nternat i o n a l Econ o m i c
Associatio n , Macm i l l a n : Lo nd o n , pp . 1 - 1 1 .

53
 not trivial is attested by the tho usands of i m portant and i ntell igent men who have never
been ab le to g rasp the doctri ne for themselves or to believe it after it was explained to them."
The theorem is really true and no n-trivia l . Yet, the assu m ptions on w h ich it is based are so
restrictive that it was on ly of l i m ited appl icab i lity at the time of R icardo ( 1 772- 1 823) . The
weaknesses of this theory are well known (Todaro 1 994, 426ff; Eki ns/Fol ke/Co nstanza 1 994 ,
4f) . I n view of the i nteraction between trade, environ ment and d evelopment, the fol lowing
fou r weaknesses of the theorem are of particu lar i m portance:
( 1 ) In R icardo's world , p roduction tec hnology is u nchanging and avai lable to all nations.
(2) There i s no i nternatio nal mobility of prod uction factors . Labo u r and capital remain i n the
countries engaged i n trade and are mobile merely wit h i n these cou ntries .
(3) Prices remain stable and are not subject to the market power of the players i n trad e.
2S
(4) There are no externalities , prices do not properly reflect the real costs of p roductio n .
T h e real ity o f many d evelop ing cou ntries is i n conrJict with t h e fi rst three points . R i cardo's
theorem leaves no room fo r fo reign d i rect i nvestments, ol igopo lies and technology parks.
There is a cl ear connection between international trade and the damaging of environm ental
good s : i nternational t rade is respo nsible for about an eig hth of g lobal o i l cons u m ption
(Ekins/Fol ke/Constanza 1 994, 7f) . Yet, this con n ection is a matter of d ispute. In the spirit of
R icardo's fourth weak point, economists point to the fact that the " . . . primary cause of
envi ro n m e ntal degradation is market fai l u re , not trade l i beral isation" (Wilson 1 994 , 1 ) . P ropo­
nents of this arg u m ent consequently expect an i nternal ising of these enviro n m ental costs,
e.g. through an appropriate fiscal po l icy, eco-balance sheets (life-cycle assessm e nt) and
contribution systems (French 1 994; Diere n 1 995) .
An effective environmental p rotection pol icy w i l l never win the day without i nternalising
environmental user costs . These efforts meet with i n h erent l i m its, however. The use of
enviro n m e ntal goods i n prod uction and trade can o n ly be considered i n pricing when this use
can be quantified i n monetary u n its , i.e. when the val u e of these goods can be d eterm i ned .
That t h is is virtually i m possible may be i l l u strated by the q u estion about the "worth of a song­
b i rd" (Fu ntowicz/Ravetz 1 994) , to w h ic h no satisfactory answer can be give n .
There is another l i m it t o t h e id ea o f i nternal ising externalities. P rices f o r t h e u s e o f environ­
mental goods suggest that nat u ral capital can be replaced by (produced) capita l , which is
only possible to a l i m ited degree. Damag i ng biological d iversity by bu i l d i ng a hotel i n a natu re
reserve m ay (certainly only i n adequately) be assessed in monetary u n its . As a ru le, this
d iversity can n ot be restored even with the aid of compensation pay ments. Starting from a
detailed g rid of the enviro n m e ntal fu nctions that ecosystems fulfil for h u man beings alone
(Groot 1 992) , it tu rns o ut that very few of them , such as ind ividual productive or regu l ative
functions, are the subject of a market-based assessment i n monetary u n its. The external
effects of extens ive use of these fu nctions are not considered i n pricing at a l l .
T h e w idespread idea that t h e primary cause o f enviro n m ental degradation is market fail u re,
not trade l i beralisation, is based o n the e rroneous idea that all use of the enviro n ment can
somehow be compensated for i n monetary terms and can then be considered i n i nternational
pricin g . Fro m this perspective, the price of environmental use including enviro n m e ntal
damage would possibly be so h i g h that the latter wou ld not take place at a l l . H owever, no
market w i l l ever develop for m ost trade-related enviro n mental damage, such as the loss of
biological d iversity or habitats for t h e sake of c u lt u ral enjoyment, as thei r valu e can not be

25
A n egative external ity , also cal l ed external effect or spil l-ove r, occurs in a situ at i o n of m arket
fai l u re . Then prices no longer refl ect a l l costs of prod u ct i o n ; private and social costs of prod u ction
d iverge . A n exam ple of a n externa l ity i s when rivers are pol l uted by companies without t h i s
pollution bei n g considered i n cost calcu l ation and p roduct prices.

54
m easu red i n monetary terms. I nternalising external effects is a n ecessary b ut i n sufficient
cond ition for d efusing the conflict between the expansion of i nternational trade and the pro­
tection of the enviro n m ent. Supplementary m u lti lateral p rotective m echan isms are req u i red i n
o rder t o protect those enviro n mental goods for which it i s i m possible t o i nternalise their use.

4.3 WHO'S FI RST? POSSI B LE CONFLICTS B ETWEEN M U LTI LATERAL ENVI RON­
M ENTAL A G R E E M ENTS AND WTO-OMC I N THE FI ELD OF SERVICES

Although t here have so far been no conflicts of standard s b etween the WTO-OMC regi m e
a n d the m u lti lateral environm ental ag reements ( M EAs) , potential confl icts d o exist between
the two. The arrangements of individual agreements relating to trade, such as the U N
Fram ework Convention o n C l i m ate Change ( FCCC, 1 992) , t h e Convention on I nternational
Trad e i n Endangered Spec i es (CITES, 1 992) or t h e Convention o n the P revention of Mari n e
Poll ution b y D u m p i n g o f Wastes a n d Other M atter (London Conventio n , 1 972) are not
n ecessari ly compatible with the WTO-OM C treaty (Goldberg et al. 1 995) . H owever, t h ese
conflicts primarily relate to trade in services . Merely fro m appl y i n g the London Convention,
26
confl icts with GATS regulations could arise with regard to the trade i n waste •
The WTO-OM C Com mittee on Trade and Envi ro n m ent (CT E) was aware of the n eed for
clarification with regard to the relationship of GATS and different M EAs (CTE 1 99 6 , item 9) .
I n the d iscussions the demand was form u lated " . . . to identify the environmental i m pact of the
l iberalisation of trade i n services (e.g. transport and tourism) and the i mpact that certain envi­
ron m e ntal leg i slation m ig ht have o n trade liberalisation ( e . g . conditions appl icabl e to services
suppli ers in the field of waste management) " (CTE 1 996 , item 9) .
Furthermore, Art. X I V (b) GATS was seen as a possi b l e source of problems. The appl ication
of this article could s u bsequently force individ ual providers out of service markets. In v i ew of
this danger it s eems all the more d isturbing that the Com mittee was n ot able to agree o n a
practical program m e of work for the field of ' E nviro n m ent and Services' , regard i ng the scope
of A rt. X I V (b) as sufficiently broad .
F uture confl ict cou ld also arise from the i mplementation of the Berl i n Declaration o n Biologi­
cal D iversity and S ustai nable Tourism ( 1 997) , which is i ntended as a basis for a future
convention (or p rotocol to a convention) o n sustai nable touris m . It states :
" 1 5 . Tourism s h o u ld be developed i n a way that benefits the local co m m u n ities, strengthens
the local economy, employs local workforce and wherever ecological ly sustai nable, uses
local material , local agricultural products and trad itional skills. Mechanisms i ncluding pol icies
and legislation should be i ntrod uced to ensure the flow of benefits to local com m u n it i es . "

W h i l e GATS foresees i n Art. XV a flexible hand l i n g o f subsid i es i n t h e case o f developing

27
countries , it i s ultimately the specific comm itments of each country which should d eter m i n e
whether i t c a n really pursue a pol icy o f specific promotion o f d o m estic providers. The far­
reac h i ng concessi o n s i n the h otel sector, i n particular, l eave l ittle room for the meas u res
foreseen in the Berl i n Declaration.

26
1t is stil l u nclear whether the Convention relates to trade in waste as a product or trade in waste
removal as a service (Goldberg 1 995, 60) .
27
l t says: "Members recogn i se that , i n certain circu mstances , subsidies m ay h ave distorting effects on
trade in services. Members shall enter i nto n egotiations with a view to developing the necessary
multi lateral d i scipl ines to avoid such trade distorting effects. The negotiation s shall also address the
appropriaten ess of cou ntervailing procedu res. Such negotiations shall recognise the rol e of
subsidies i n relation to the development programmes of developing countries and take i nto account
the needs of Members, particularly developing cou ntry Mem bers , for flex ibil ity in this area . "
55
 d e m a n d for each sector be adeq uately measu red , com pared and doc u m e nted i n t h e
nat i o n al acco u n t i n g system? - T h e s e a r e t h e q u est i o n s wh ich cu rrent l y determ i n e the
d iscussion of tourism stat i stics .

I n bot h t h e reco m m e ndations on tourism statistics j O i nt l y p u b l ished by WTO-OMT and t h e

U n ited N ations statistics office a n d i n the Stan dard I nternational C l assificat i o n System of
Tourism Activities (SI CTA) the economic effects caused by tou rism-related con s u m pt i o n of
nat u ra l assets are l eft out of considerat i o n . T h i s led to the d raft of a sate l l ite accou nt system
(2 n d d raft of WTO-O MT's Tourism Sate l l ite Accou nt) to be used for meas u ring t h e eco n o m i c
effects o f t h e tou rism sector w h i c h does n o t c o n s i d e r tourism-i nd uced changes i n t h e va l u e
o f natu ral assets.

A test of the f i rst d raft of the accou nt system (1 st d raft of WTO-OMT' s Tou rism Sate l l ite
Acco u nt) came to t h e con c l u s i o n " . . . that t r u e contri b ut i o n of to u rism to the Dom i nican
1 99 1 was 1 8 .7 percent of G O P [in stead of 4.5 percent convent ionally m easu red] "
eco n o m y i n
(WTO news M ay 1 997) . This res ult, h owever, is m is l ead i n g . From a compre h e n s ive p o i nt of
view , t h e actual ("true") contribution of tourism can be d eterm i n ed o n ly if the tou ri s m-ind uced
physical changes of nat u ral assets are bei ng considered and val u ed , and if the secto r
specific contribution to the G O P or N D P is correspo n d i n g l y corrected .

The conseque nces of the o n e-sided WTO-O MT approach are obvious. O n the o n e h a n d , the
val u e add ed of the to u rism sector wou ld i n t h e futu re b e accou nted for in a more compreh en­
sive way . On the othe r hand, the envi ro n m e ntal costs associated with this val u e added wo uld
cont i n u e to be l eft out of considerat i o n . T h i s l eads to wro n g decision making and could not
be c o m p e nsated eve n if envi ro n m ental i n d icators were defined in some dest i n at i o n s in order
to determ i n e carry i n g capacity . These i n d i cators are fi rst of all far less binding than a u n iver­
sal , i nternationally recogn ised sate l l ite accou n t syste m . Seco n d l y , the proposed i n d icators
(Manning 1 996 i n WTO N ews M ay-J u n e 1 996) are of a p u rely descriptive nature. For
exa m p l e , a "use i ntensity i n d i cator" has been p roposed as one of t h e core i nd icators of s u s­
tai n a b l e to u rism . It would be m easu red as " i nt e n s ity of use - peak pe riod (person/h ectares ) " .
F u rt h e rm o re , there c o u l d be specific "ecosystem i n d icators" , for i n stance for coastal areas
("deg radation (% of beach degraded , erod ed ) " ) . These types of i n d i cators , however, m erely
present t h e actual situat i o n and do not g ive any i nformat i o n o n critical th res h o l d val ues.
T h i rd l y , they g ive no i n dicat i o n o n how to val u e t h e con s u m pt i o n of natural assets .

... A N D THEREFOR E N EEDS TO B E ADJUSTED TO TAKE ACCOU NT OF ENVIRONMENTA L

ASPECTS

I n order to apply sustai n ab i l ity criteria in tourism plan n i n g , the sector specific val u e add ed
and t h e co n s u m pt i o n of n at u ral assets have to b e l i nked . The contribution of the tou rism
sector to t h e GOP or N D P as c u rrently measu red i s not a sufficient i n dicator for econom ic
prog ress.

The p l a n n ed o n e-s ided expansion of t h e statist ical d oc u m e ntat i o n of the enviro n m e ntal ly
relevant tourism sector i s u n acceptabl e , especi a l l y as t h e U n ited N ations revision of t h e
Syst e m of N ational Accou nts ( U N-SNA 1 994) a l ready conta i n s fi rst starting poi nts for a
valuation of natural assets. What is m o re i m p o rtant, however, is that al ready i n 1 993 a hand­
book on the i nteg rated U n ited N ations System of E nvironm ental and Econom ic Accou nt i n g
( S E EA) had been s u b m itted . S E EA is t h e c o n ceptual fram ework o n t h e bas is of w h i c h
nat i o n a l statistics authorities c a n devise t h e i r e n v i ro n m ental repo rt i n g systems. The p u rpose
of S E EA is to b u i l d u p an i ntegrated report i n g system , u s i n g sate l l ite systems to com b i n e the
d iverse m ethods of enviro n m e ntal and resou rce accou n t i n g with t h e accounting system of
the revised System of N ational Acco u nt s .

58
T h ree important areas of reporti ng exe m p l ify the way i n which t h e i nterrelation b etween
enviro n m ent and economy expands the conventional System of N ational Accou nts (Stah mer
1 993; D i eren 1 995) :
At reporting l evel A , enviro n mental protection related defensive activities (e.g . water treat­
m ent plants, waste d isposal) w i l l not be accou nted for in t h e conventional S N A , but are
separately being represented as monetary agg regates. This mai n ly appl ies to the envi ron­
m ent related d efensive costs actually incu rred in t h e national eco n o m y .

Reporting level A+B contains add itional q uantitative information on the w ithdrawal of raw
m aterials d u e to econ o m ic activities , on land use and on the p o l l utant refl ux caused .

R eporting level A+B+C shows the actual costs of meas u res taken (or the p otential costs of
avoid i n g poll ution i n order to mai ntain a g iven enviro n mental standard) i n o rder to avoid t h e
enviro n m ental i mpact of the consu m ption o f reso u rces a n d nat u ral assets accou nted f o r at
l evel A+B.
S E EA offers different val uation methods for these d ifferent levels. The m ethods are partly
compet i ng and partly exc l u d i ng each other. T h e challenge in the i m p l e m e ntation of S E EA
first consists i n fi nding an app roach s u itable for a sectoral structure ( i mpact related vers u s
pol l uter related costs of enviro n mental u s e ) a n d i n identify i ng m ethodolog ical elem ents.
Secondly, possi b i l ities for the i m plementation with i n the framework of satel l ite accou nts need
to be wo rked out.

D eterm i n i ng the physical and monetary resource use of touri s m was id entified i n S E EA as a
p riority for both developing and i nd ustrialised co u ntries ( U N 1 993, 1 33) . This prio rity , how­
ever, was neither dealt with by WTO-OMT nor by t h e U N Department for Economic and
Social I nformation and Pol icy Analysi s . Fo r the reform of tourism statistics this means that
t h e i m m i nent i ntrod uction of a b road sate l l ite acco unt system for reco rd i ng t h e value added i n
tourism n eeds t o be co mplem e nted - o n t h e basis o f S I CTA - by an enviro n m e ntal report i ng
system i n l i n e with this accou nt system . I f t h i s can not be ach ieved , the reform of tourism
statist ics wo u ld l ead to a bookkeep i ng i n w h ic h balance forgery by obsc u ring costs becom es
a method .

STEPS TOWA RDS AN ENVIRONM ENTA LLY SENSITIVE REFORM OF TO U RISM STATISTICS

The i m m i nent changes in t h e statistical documentation system have so far h ard ly been taken
u p i n the critical tourism debate. S E EA got attention by the C l u b of Rome i n its 1 995 report.
The authors of the report u rged for a fast i m p l e m e ntation of S E EA to be supported by i nter­
n ational o rgan isations ( D ieren 1 995, 2 8 1 ) . Up to now , neither t h e World To urism Organ i za­
tion nor t h e U n ited Nations statistical department fol l owed this reco m m endation.

It would be fatal if the reform of the doc u m entation system of such an environmentally
relevant sector would take p lace witho ut using this i m portant instrum ent of envi ronm ental
politics . Therefore, the I nternational Conference o n Tourism Econom ic Statistics 1 998 s h o u l d
consider co m b i n i n g S E EA a n d the To urism Satel l ite Account Syste m . This req u i res the
fo l lowi ng steps:

D EVELOPI NG G U I D E L I N ES FO R TO U R I S M STATISTICS T H A T I N C L U D E ENVI RONMENTA L A S P ECTS

I n the process of developing an i ntegrated acco u nt system which takes accou nt of both the
d ifferent tou rism activities and their enviro n me ntal effects, the principles w h ich g u ide
envi ro n m ental cost accou nting first need to be identified . The selection of su itable principles
d etermi n es the choice of the accou nting methods. For exam p l e , it would have to be decided
whether to apply the principle of i mpact related o r of p o l l uter related costs of environm ental

59
 use. I m pact related costs consider the i mpact on the nat u ral enviro n ment to be born by
domestic economic agents (fo r example, i ndividuals, h ouseholds or firms) . They fol l ow
spatial criteria. Poll uter related enviro n m ental costs are attributed to the econom ic age nts
wh ich caused them. I n the case of international tou rism , the question therefore arises
whether the environ mental costs i ncu rred have to be accou nted for i n the country of origin
(polluter related) or the destination ( i mpact related) . S E EA offers su itable m ethods for both
approaches, without, however, com b i n i n g the two .

F u rth ermore, considerations must be made with regard to the completeness and scope of
the enviro n mental i m pacts that are to be i ncluded . Th ere ex ists a trade-off between the
principle of co mprehensive i nteg ration on the one hand and that of p racticabi l ity on the other.

I DENTIFY I N G THE ENVI RONMENTA L I M PACTS OF KEY ACTIVITIES I N TOU RISM AND SE LECTI N G
S U ITABLE BALANCING METHODS

S I CTA in its present form ( U N -WTO 1 994) al ready contains a first approach of evaluating
economic activities with regard to their i m portance for tourism supply and demand. Comple­
menting this, a framework of possible enviro n mental i m pacts needs to be developed in order
to reco rd the respective environ mental impacts of tou rism activities. The selection of
environmental i mpacts to be considered and of su itab le acco u nting systems as outl i n ed in
S E EA would then be based on the princip les identified above.

P RESENTING EXA M P L ES O F A LTERNATIVE R EPORTI NG SYSTEMS

The effect of alternative val uation approaches could m ost convinci n g ly be i l l u strated by using
a suitable case study. Provided that su itable data records derived from an eval uation of
enviro n m e ntal functions are available for a chosen geograp h ic area (nature park, reg ion or
cou ntry) , this case study could refe r to the real world. I f th ere are no such data available, the
effects of the d ifferent val uation approaches could also be i l l u strated i n different scenarios ,
using a hypothetical exam ple.

I D E NTIFY I N G P R I ORITIES F O R I MPROV I N G TOU R ISM STATISTICS

On the basis of these scenarios , priorities can be identified for adapting tou rism statistics to
include env i ronmental aspects . These priorities would need to find entry , for example, i nto
the process of i nformation exchange on sustainable tourism i ntroduced by the Conference of
the Parties to the Convention on Biological D ivers ity ( C B D/COP I V , Bratislava, M ay 1 998) .
Th i s process m i g ht eventually lead to global g u id e l i n es or even a legally binding protocol on
sustainable tou rism and biological diversity. It i s , therefore , u rgent to push a l l p reparato ry
efforts toward s enviro n m entally 'sensitive' tourism statistics i n order to increase the chance of
including operational standards wit h i n th is framework.

4.5 THE A G E N DA OF SUSTA I N A B L E TRA DE IN TO U RISM S E RVICES

R ECOGNISING USER'S RIGHTS

The restriction of f u rther developm ent of land for tourism may , i n borderl i n e cases, violate
free market access and national treatment. Authorities could al low local com m u n ities, e.g.
i nd igenous groups , a l i m ited exploitation for tourism and refuse it to others . I n terms of trade
law , such exclusive (also non-tourist) usage rig hts ought to be considered as not in confor­
m ity with GATS, and abol ished . This confl ict could be solved by referri ng to GATT Art. XX.
60
o n t h e p rotection of n ational cultu ral goods. Any effective protection nat u rally req u i res
appro priate p rocess standards and m o n itoring i nstrum ents.

INDICATI NG ECOLOGICAL COSTS

T h e c u rrent efforts i n adj usting tourism statistics to i n c l ude enviro n m ental aspects m ust not
be h i ndered by the possible objection t hat one m ig ht fi rst have to conce ntrate on the reform
of na rrow econom ic reporting. It is most u n l ikely t h at once a revised tou rism satel l ite account
system i s adopted , an env i ro n m e nt-related reform wou l d soon fol l ow. The d ata to be re­
corded would need to be re-adapted . Therefore , an i ntegrated solution s h o u ld be sought,
rat h e r than a two-stage implementation. Only by considering carry i n g capacity and environ­
m ent-related costs w it h i n the framework of an i ntegrated reporting system can the objective
of s u stainabil ity in the context of tou rism be ach ieved.

As long as the prices of tou rist services do n ot p roperly reflect enviro n m ental user and
damage costs, there will be no re l iab le basis at all fo r opti m i s m regard i ng the eco nomic
effects of cont i n u i ng l iberalisation . E stab l is h i n g su itable accounting system s takes p rece­
dence over further negotiations o n dismant l i n g ex isting trade barriers i n t h i s sector. The
Standard I nternational Classification of To u rism ( S I CTA) p roposed by the WTO-OMT and the
UN covers the val ue added of almost a l l backward and forward l i n kages of the tou ri s m
i n d ust ry , b u t not their envi ro n m e ntal a n d resou rce u s e , not t o m ention t h e i r harmfu l effects.
S I CTA m ust therefore be con n ected with accou nting and assessm e nt sch e m es as al ready
foreseen by the UN System of E nv i ro n mental and Economic Acco u nt i ng ( S E E A) .

Box 1 1 : MAASTRICHT Treaty A rticle 1 30r (2)

2. Co m m u n ity pol icy on the e nv i ron m e nt s h a l l aim at a h i g h level of protection taking into accou n t the divers ity
of s i t u ations i n the various reg ions of the Co m m u n ity. It s h a l l b e based o n the precaution a ry principle and o n

the p r i n c i p l e s that preve ntative act i o n s h o u l d be take n , t hat e nv i ro n m ental d a m a g e s h o u l d as a priority b e

rectified a t s o u rce a n d t h at t h e pol l uter s h o u l d pay.

E n v i r o n m e ntal protecti o n requ irements m ust be integ rated i nt o the definition and i m p l e m e ntat i o n of ot h e r

Com m u nity policies. I n t h is context , harmon izat ion meas u res a nswe ring t h e s e req u i re m e nts s h a l l i n c l u d e ,

w h e re appropriat e , a safeg uard c l a us e a l l owing M e m b e r States to take prov i s i o n a l m e as u re s , f o r non­

eco n o m i c environmental reason s , s u bject to a Com m u n ity i n s pection procedure.

R ECOGNISING MULTILATERAL PROTECTIVE STANDARDS

Exist i n g i nternational enviro n m e ntal standard s , e . g . the Convention on Biolog ical Diversity,
s h o u ld n ot be u nderm i n ed by the WTO-OM C agreem ent. The com m itment of WTO-O MC to
enviro n mental and resou rce protection s h o u ld be supplemented by process standards with
the same status as market access and national t reatment . By analogy with A rt . 1 30r (2) of t h e
M aastricht Treaty t h i s c a n happen thro u g h add ing another trade standard i n connection with
a f u rther exception to the M FN principle i n accordance with A rt. XX GATT. It s h o u ld be
g uaranteed t hat these changes take effect in all t h ree areas of negotiation (goods, services,
i ntel l ectual property rights) .

Add itional ly , standard s have to be developed safeg uard i n g extraterrito rial goods adversely
affected by cross border trade. Experiences with recent co nfl icts between t rade and
enviro n m ent managed by the dispute settlement m echanism show t hat the i m p lementation of
trade related env i ro n mental standard s m ay fail o n ly for the reason that there was not
s ufficient proof that these standards w i l l work in a non-d iscri m i native m a n n er. To secu re
efficient environmental p rotection i n the sphere of trade t h e b u rden of p roof t h e refore has to
be reversed .
61
 WI DENING PARTICI PATION

Environ m e ntal and resou rce protection affects particu l arly the n eeds , rig hts and i nterests of
peopl e in t h e destination areas. As cal led for in connection with m i n i m u m soc ial standards,
and i n line with Agenda 2 1 , participatory struct u res and m ec hanisms also n eed to be set u p
i n t h i s field , ensuring the transfer of i nformation and a say f o r groups whose i nterests are
d i rectly or i n d i rectly affected .

PRIORITIES ON THE WAY TO SUSTAINA BLE TRADE I N TOU RISM SE RVICES

The need for fair t rade i n goods and services is justified by the increase in consumer welfare
that a b road er range of goods at lower prices represents. I n the case of the i nternational
tou rism ind ustry , t h i ngs are somewhat different. Services i n the tourism industry are being
offered cross border. Consu mption of these services i s then also cross border. In places
where a s ubstantial n u mber of tou rist arrivals in develop i n g countries are i nternational
tourists, national consum ers wo u ld have no reaso n to l i beralise tourism services, as the
gai ns of liberalisation would be expected to benefit foreign consum ers i n the fi rst place. Con­
s u m ption of key services of a particular destinatio n , i . e . the natural , c u ltural or 'exotic'
s u rro u n d i n g s , i s usually not at all or insufficiently paid for. Those who promote the develop­
m ent of tou rism i n these cou ntries therefore poi nt to the positive effects of expandi n g this
indu stry . In t h e fi rst part of this study, som e of the expectations are being viewed with scepti­
cism with regard to the ex isting com petitive fra m ework in the tourism market. I n no other
industry has a s i m i lar degree of liberalisation been ach ieved . This is mainly d u e to the fact
that govern m ent expectations towards the tourism industry remain u nchanged and that im­
portant steps for liberalisation had al ready been u ndertaken - particularly i n t h e h otel industry
- before GATS came i nto force. N u m erous cou nt ries are bou n d to sti l l existin g trade restric­
tions in t h e tourism ind ustry , w h ich they have u sed as a vehicle for f u l l WTO-O M C member­
ship.
Some critics regard l iberal isation of t rade i n services as ach i eved u nder GATS as i nsufficient.
They see the agreement as mainly re-enforcing existi ng trade regimes and n ot promoting
prog ressive l iberalisation for the future. Those who s hare t h i s opinion u nderesti mate the
potential i mpact of industry specific regu l ations, which provide the ' raw material' for future,
more extensive l ibera l isation efforts. Th e n ext round of n egotiations wil l be marked by three
orientations:
• Firstly , future delegations participating i n the n egotiations w i l l try to include industries i n
the agreement that have been l eft o u t so far. Efforts w i l l concentrate on i ntegrating cargo
and passenger a i r traffic.
• Secondly , attempts will be made at red ucing existi ng trade restrictions. This m ig ht easiest
be ach ieved through industry specific com m itments . N egoti ations on horizontal comm it­
ments are expected to be difficult, as these comm itm ents apply to all the services of a
country . They m ostly refer to the free movement of nat u ral person s , a mode of supply
mainly s u bject to horizontal com m it ments. I n the catering i nd ustry , liberalisation of d i rect
i nvestm ents m ig ht p recede l i beral isation of movement of natu ral persons.
• Finally, efforts w i l l be u ndertaken to convince more governments to p rom ise l iberalisation
i n specific i nd ustries. In tourism-related services this w i l l be the case especially for tour
operators and to urist g u ides services as wel l as complem entary services i n sports and
culture.
For many governm ents the very first areas of negotiations will b e challenging. Decisions on
the priorities in air traffic plan n i ng have to be taken now. I f this does not happen , far reaching
liberalisation of air traffic co u ld resu lt i n foreign carriers covering mainly l ucrative d estina­
tions, whereas domestic carriers wou ld be l i m ited to l ess attractive d o m estic routes.

62
At the i nternational leve l , N GOs worki ng o n tourism w i l l have to agree on a com mon agenda
for reform ing GATS. The first q u estion w i l l be w h ether (and which) trade pol icy meas u res
should be taken to enforce m i n i m u m labour stand ards and h u m an rig hts and how such
m easu res cou ld be i nteg rated i nto the WTO-OMC. The d ebate rel ated to the subord i n ation of
the WTO-O M C reg i m e under existing m u lt i lateral enviro n m e ntal agreements should not be
too m uch of a prob lem . H owever, shap i n g futu re ag reem ents which would help i n specifying
t h e Agenda 2 1 for tourism and would be of legally b i nd i n g c haracter (such as a convention or
a protocol to a convention ) , m i g ht prove considerably m o re d ifficult. The danger is that - in
anticipation of al ready existing WTO-OM C ru les co m i n g i nto effect - regu lations to p romote
socially and eco logically sustai n able tourism m ight not be consid ered at al l .
More than ever befo re , t h e doctrine o f free trade is cu rrently i n a weak positio n . Analysis
t rying to meas u re welfare costs of protectionism i n the service sector will be a waste as long
as prices for these services do not reflect the social and eco logical cost of their avai lab i l ity
and their consu m pti o n . The essential challenge for NGOs w i l l be to take a new position that
would replace t h e one d i m ensional opposition of liberalisation and p rotectionism and would
lead to the creation of new proced u res and m o n itori ng i n stru m e nts fo r shaping world trade.
This should happen at various levels:
Fi rst of al l , N GOs would have to exercise stronger influence o n developing s u itab l e systems
of indicato rs . As long as the actual social and eco logical costs of the to u rism secto r remain
unaccou nted for, the opti m i stic assu mption that prog ressive l iberal isation leads to an i n­
crease i n welfare i n the dest i nation cou ntries re mai ns without fou ndatio n . Cu rrently there is a
danger that existing systems of i ndicators to m easu re t h e eco nomic i m portance of tourism
will be improved only i n a one sided way . Suggestions which t h e World Tourism Organ ization
cu rrently presents fo r d iscussion do provide a better basis for assessi n g the contribution of
tourism to national i ncom e . However, they do not assess the costs incu rred by the n egative
i mpacts of to u rism . The challenge for N GOs consists i n lobby i n g for t h e f u rther i m p rovement
of ex isti n g systems of measurement, which w i l l have to adeq u ately reflect the complex
causes and effects. Another major challenge for N GOs consists i n exercising d irect influence
on the upco m i n g WTO-OM C n egotiations wh ich are expected to be opened with the 3rd
M i n isterial Conference i n November 1 999. Conditions are favou rab le, si nce in itial "official"
worki n g contacts between N GOs and WTO-OMC already exist. F u rthermore, a consensus
about the priorities from a civil society perspective has to be ag reed upo n . GATS will play an
i m portant ro le. After the negotiations on the M u ltilate ral Agreem ent on I nvestment (MAl ) , with
O EC D in charge fai l ed , GATS is the only agreement which al ready includes regu lations
about the protection of investments. These are l i kely to be expanded. Therefore, t h e co ming
negotiations req u i re the special attention of N GOs, even m o re so si nce GATS has i n their
focus so far been rather neglected .
I t has repeated ly been i n d icated that those who would be d i rectly affected by u ncontrolled
l iberal isation of the tou rism ind ustry have no opport u n ity to participate i n the debate.
Especially the broad defi n ition of trade-related m easu res i n article 1 . 3 GATS n eeds to be
amended to allow for com m u n ities, regions and federal states to have their ow n independent
tourism policies. Such an amendment could be g u ided by the p rinciple of subsidiarity w h ich
the E u ropean U n ion refers to i n its charter. Originally, this principle was m eant to safeg uard
the autonomy of com m u n ities in a h ierarchy. It safeguards responsibilities of co m m u n ities or
groups in a legal system against erosion t h rough co rporate bod ies on a h igher level . This
principle could be d eveloped to apply to g roups affected by the decisions taken wit h i n the
WTO-OM C who would then be al lowed to participate in the process. This wo uld help devel­
oping p roced u res that would take i nto accou nt the right of com m u n ities to self-determ inatio n .

63
 M adeley , J o h n 1 996: Foreign exploits: Transnationals and Tou ri s m . U K-Lond o n : Catholic
I nstitute fo r I nternational Relati o n .
Malik, Satyender S i n g h 1 997 , "Eth ical, Legal a n d Regu latory Aspects o f Tou rism Business,
R a h u l P u b l i s h i n g House, D e l h i , I ndia.
Marti n , W i l l and W i nters , L. Alan 1 996: For Services, R ules but Few Red uctions i n P rotec­
tion, D E C notes Research Findi ngs N o . 1 1 , M ay 1 996.
Mayer, Rainer 1 996: Der E i n satz von I nternet und O n l in e-Diensten im Tou ris m u s , i n :
K i rstges 1 996 , 229-246.
Pac i , Enzo 1 998: What i s a Tou rism Sate l l ite Accou nt? WTO[-OMT] N ews Septernber­
October-November 1 998.
Piepe l , Klaus Ed . 1 995: Sozialklausel n i m Welthandel - ein I nstrument zur Fbrd e ru n g der
M ensch e n rechte? Dokumentation eines Studientages und Stell u ngnahmen aus der
D ritten Welt, D-Aachen: M isereor-Berichte u nd Dokum ente 1 D.
Pluss, Ch rist i n e 1 996: Wenn e i ner eine Reise tut . . . haben andere viel zu tun. Die
Tou ri s m s usforsc h u ng entdeckt Frauen und Kinder, in: blatter des iz3w, N r. 2 1 4 ,
J u n i/J u l i 1 996, 26f.
Poo n , A u l iana 1 993: Tou rism , Technology, and Com petitive Strategies , U K-Wa l l i ngford : CAB
I nternational.
Prasad , Ashok Chandra. H , and Rajendar Kapoor, (ed ) , 1 996, "Trade i n I nvisibles: The I nd ian
Perspective", Co m m o n Wealth Publishers, Del h i , I ndia.
Ratandeep Singh, 1 996 : " I nfrastructure of Tourism i n I nd ia" , To u rism Today Series - 2,
Kan ishka P ub l is hers , Del h i , I nd ia.
Ratandeep S i ng h , 1 996: "Tou rist I ndia, Hospital ity Services", Kanishka P u b lishers , Delh i ,
I nd ia.
Scherer, Bri gitte 1 995: rororo special : Tou rism u s , D- R e i n beck.
Schi rmer, U l rich 1 995 : D i s kussionsstand zur Frage der Sozialklausen im Bundesm i ni sterium
f O r W i rtschaft, i n der Welthand elsorgan isation (WTO) und i n der Organisation fUr
w i rtsch aftliche Zusam menarbeit u nd E ntwick l u ng (O ECD) , in: P i epel Ed . 1 995, 36-
45.
Sen , S . R. 1 994 : GATT & TNCs, in: Economic and Political Weekly, 22 . 1 0. 1 994, in: Contours
1 995 .
Sent i , R ic hard 1 994a: GA TI-WTO. D i e neue Welthandelsord n ung nach der U ruguay- R u nde,
C H-Z u rich : I nstitut fUr Wirtschaftsforsch u ng der ETH Z u ric h .
Sent i , R ic hard 1 994b: D i e n e u e Welthandelsord n u ng f O r D i enstleistungen , Materialien 94/2 ,
C H-Zu ric h : I nstitut fOr Wirtschaftsforsch u ng der ETH Zu rich .
Siebert, H o rst 1 994: A u B enwirtschaft, 6 . completely revised edition , D-Stuttgart: G . Fischer.
Stabler, Martin 1 996: Tou rism and C h i ld ren in P rostitutio n , Paper subm itted by EC PAT for
the World Congress against Com mercial Sexual Exploitation of C h i ld re n , Stockhol m ,
Sweden 27-3 1 Aug ust 1 99 6 .
Stock, Ch ristian 1 996: Tropical Techno. Klei n u nternehmerinnen i m sudind ischen Kovalam ,
i n : blatter des iz3w, N r. 2 1 4 , J u n i/J u l i 1 99 6 , 28f.
Surend ra, J Patel 1 99 1 , "Th e South and the G ATT negotiations o n Services Secto r" Eco­
nomic and Political Weekly, Vol . xxvi N o . 48, Nov.3D, 1 99 1 , p. 2732 .
Todaro, M ichael P . 1 994 : Economic Developm ent 5th Ed . , U S-New-York: Longman.

66
U NIWTO-O M T U n ited Nations a n d World To u ri s m O rga n i zati o n 1 994 : Reco m m e nd at i o n s
o n To u ri s m Stat istics , Stat i st i ca l Papers Seri es M N o . 8 3 , U SA-N ew Y o rk : U n ited
N at i o n s .

U N D P 1 996 : Beri cht Ober d i e m en s c h l iche E ntwickl u n g , ed . D e utsche Gesellschaft f U r d i e

Vereinten N atio n e n e . V . , D-Bo n n : U N O-Verlag .

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n ac h h a lti gen E ntwickl u n g d u rc h Fre m d e nverkehr, D-Darm stadt: W isse nschaft l iche
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Books, Del h i , I nd i a .

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R u n d b r i ef 4/ 1 996 , 4f.

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E m body i n g the R e s u lts of the U r u g u ay- R o u nd of M u lt i l ateral T rade N eg ot i at i o n s
d o n e a t M arrakech o n 1 5 A p r i l 1 994 , Vo l . 2 8-30 . 3 2 , C H- G e n eva: WTO-O M C .

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Stat i stics . R eco m m endat i o n s o n T o u r i s m Statistics WTO/ U n ited N at i o n s S e r i e s M
N o . 83- 1 994 Fo l l ow- u p series, E-Mad ri d : WTO/O M T .

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Ag ree ment on Trad e in Services and To u ri s m . Se m i nar on GATS I m p l icat i o n s for
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WTO-O MT.

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6/ 1 /9 6 .

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1 + 1 1 , E-Mad rid : WTO- O M T .

67
 A B B R EVIATIONS
CRS Com p uter Reservation Systems

FCCC Fra m ework Convention o n C l i m ate Change

GATS General Ag reement on Trade i n Services

GATT Genera l Ag ree m e nt on Tariffs an d Trade 1 947 as amended t h rough 1 966

G ATT 1 994 General Agreement o n Tariffs and Trade 1 994

GOP G ross Dom estic P rod u ct

GDS G lobal Distribution System

GNP G ross N ational P roduct

HIR Hotels and Resta u rants

HIE H ig h - I nco m e Econom ies

I BRD I nternational Bank for Reconst ruction and Developm ent

I LO I nternational Labou r Office; I nternational Labou r Organ ization

I U CN I nternational U n io n for Conservation of N at u re and N at u ral Reso u rces

LDCs Least- Developed Cou ntries

LI E Low- I nco m e Econom i es

LM I E Lower-Midd l e- I ncome Econom ies

MATG M u lti lateral Agree m ents o n Trade in Goods
M EAs M u lt i l ateral E nviro n m e ntal Ag ree ments
MIA M u lt i lateral I nvest ment Ag reeme nt

N I Es N ewly I nd u strialized Eco n o m i es

OECD Organ ization for Econ o m ic Cooperation an Development

p. c. per capit u m

SIR Sporting a n d other Recreational Services

TAITO Travel Agenci eslTou r Operato rs

TGS Tou rist G u ides Services

T R I Ps Trade related Aspects of I ntellectual Property R ig hts

TT RS Tou ri s m and Travel- R elated Services

UMIE U pper-Middle- I ncome Econom ies

UN U n ited Nations

WTO-OMC World Trad e Organization

WTO-OMT World Tou rism Organ i zation

WTTC World Travel and Tourism Council

WWF World Wide Fund for N at u re

WWW World Wide Web

68
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70
THE PU B LISHERS

IN GERMANY:

EPD-ENTWICKLUNGSPO LITI K
epd-Entwicklu ngspol itik is a specialised German language i nformation reso u rce of the
German P rotestant N ews Agency (epd ) . It m o n itors g l obal trends and g ives a voice to the
'Sout h ' . Central topics of analysis i nclude not only poi nts of confl ict i n N o rth-South re lations
and poss ible solutions, b ut also how far the North can cope with developmental change.
The b iweekly m agazine o n development issues 'epd-Entwicklu ngspolitik' co ntai ns approx.
60 pages of cu rrent i nformation , backgrou n d repo rts , analysis and com mentary, pol itical
cartoons, as well as a detailed docu m e ntation sect i o n . Special ised journal ists and exp e rts
in the fields of developm ent aid, politics , science, culture and education contribute to this
magaz i n e . Authors from the South also have their say .

epd-EntwickJungspolitik
Emil-von-8ehring-Str. 3
0-60394 Frankfurt/Main
Germany
Phone +49 / 69 / 5 80 98- 1 38
Fax: +49 / 69 / 5 80 98- 1 39
E-mail: epdep@epd.de

TO U RISM WATCH
Tou rism Watch is a special d esk of the Developm ent Service of the Protestant c h u rc h i n
Germany. It was fou nded i n 1 975 agai n st t h e backd rop o f negative experiences with
tou rism in developing countries. Questioning the eq uation that tourism m eans develop­
ment, To urism Watc h is engaged i n information and education on the i m pacts of tourism i n
Germ any. The Ecumen ical Coalition on T h i rd World Tou rism i s an i mportant partner in
international co-operatio n . Tou rism Watch participates in cam paigns such as E C PAT ( E nd
C h i ld Prostituti o n , C h i ld Pornog raphy and the Trafficking of C h i ldren for Sex ual P u rposes) .
I t is the co-ord i nati n g office of the T h i rd World Tourism E u ropean Ecum e n ical N et (TEN ) .
Tourism Watch p romotes alternatives which max i m ise t h e positive aspects o f to urism and
m i n i m ise its adverse effects. Examples are the ecu m e n ical study tou rs supported by the
P rotestant C h u rch in Germany and the To Do! Contest for Socially Respo nsible Tourism
organised by the Study G ro u p o n Tourism and Developm ent wh ich is supported by
Tou rism Watc h . The office publishes a q uarterly 'To u rismWatch ' i nformation service.

Tourism Watch
NikoJaus-Otto-Str. 13
0-70771 L einfelden-Echterdingen
Germany
Phone +49-7 1 1 -79 89 -28 1
Fax +49- 7 1 1 -79 89-283
E-mail: tourism-watch@due. org
Internet: www. tourism-watch. org

71
IN INDIA:

EQUATIONS
Equations is a non-profit organisation established for researc h , trai n i ng and promotion of
h o listic touris m . It works towards transfo rming the i n herently explo itative nature of mass
com mercial tourism by q u estion i ng t h e real benefits of tourism to the h ost co m m u n ities as
well as its social-cu ltu ral and economic i m pacts. Eq uations activities i nclude documenta­
tion, publicatio n , research, sem i nars , and the i nvestigation of alternative tourism policies
and structures.

Equations
1 98, lind Cross Church Road
New Thippasandra
Bangalore 560 075
India
Phone +9 1 / 80 / 528-23 13, -2905
Fax +9 1 / 80 / 528-23 1 3
E-mail: AOMIN@equations. ilban. erneUn

I N CO-OPERATION WITH

WER KSTAIT OKONOMIE (WO R KSHOP ECONOMY)

The Werkstatt O kon o m i e cond ucts research and advises on action i n the field of economic
and d evelopment policy. It i s com m itted to more justice i n the global economy and i n the
field of labour. It usually works on temporary projects , either on demand or o n its own
i n itiative .
To the Werkstatt O konom ie consultancy means empowering people for action . I t advises
organ isations and groups, develops materials for educatio nal and med ia work, plans cam­
paigns, engages in lobbying and h elps others build a l l iances . Studies affected by the
Werkstatt O konomie are closely l i n ked to subseq uent action . The Werkstatt O konom ie
researches backg ro u nd information and then makes it avai lable pointing out t h e connected
social and economic prob lems plac i n g them i nto their context and offering political
sol utions.

Werkstatt Okonomie
Obere Seegasse 18
0-69 124 Heidelberg
Germany
Phone +49 / 62 2 1 / 72 02 96
Fax +49 / 62 2 1 / 78 1 1 83
E-mail: werkstatLoekonomie@t-online. de

72
epd-Entwicklungspolitik:Materialienausgaben 1997-99

IJ97 Norman Paech, Land gegen Frieden - Das verlorene Territorium des PaHistinensischen
Staates. Zur israelischen Siedlungspolitik nach den Oslo-Abkommen.
( 1 6 S., DM 4,-)

II197 Spannende Herausforderung? Zunehmende Uihmung? Entwicklungspolitik als

Querschnittsaufgabe . (vergriffen )

IIIJ97 Pflanzenschutz und nachhaltige Landwirtschaft. Wieweit ist die Agenda 2 1 in der
landwirtschaftlichen Entwicklungshilfe umgesetzt worden ? Ergebnisse einer Tagung und eine
Studie zur deutschen Entwicklungszusammenarbeit. ( 1 02 S . , DM 1 2,-)

IV/97 K. Friedrich Schade (Hrsg.) Wie global sollte entwicklungspolitische Bildung sein?
( vergriffen)

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IJ98 Stand der Umsetzung der Empfehlung der Kultusministe rkonferenz "Eine Weltl
Dritte Welt in Unterricht und Schule " . Eine Urnfrage der Redaktion bei den B undesHindern
und der Standigen Konferenz der Kultusrninister der Lander (76 S . , D M 1 0,-)

II198 epd-Entwicklungspolitik, CAP/Agenda-Transfer, Zentrum fUr kommunale Entwick­

lungszusammenarbeit (Hg . ) , Kommunen in der Einen Welt. ( 1 2 8 S eiten, DM 1 2 , -)

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IJ99 Rudolf B untzel-Cano, Tobias Reichert, Rashid Kaukab, Agrarpolitik und Ernah­
rungssi cherheit am Vorabend der Millennium- Runde der WTO. Nach welchen Regeln
handeln? (57 Seiten, DM 1 0,-)

II199 Arbeitsgemeinsc haft Kirchlicher Entwicklungsdienst, AG KED ; Prom zeigen und

kooperieren. Orientierungen fUr die Inl andsarbeit ( 3 2 Seiten, DM 5 ,-)

IIIJ99 Zur " R e int e gr a ti on entwicklungsbezogener Bildung". (92 Seiten, DM 1 7 , -)

IV/99 Cl e me nt ine Herzog , RUdiger S arei ka, K. Fri ed ric h Schade (Hg . ) , Kunst wird die W elt mehr
verandern als Politik. Texte einer Tagung 1 999 in der Evangelischen Akademi e fserlohn.
( 1 0 9 Se iten , DM 1 9 ,- )

V/99 Schatzinseln in der Stids e e - B ergbau im Stidpazifik. Modernisierungskonfl ikte i n j ungen ..

Staaten und Perspektiven na c h hal t iger Entwicklung. Dokume ntation einer Tagung vom 23. -� .

25 Oktober 1 99 8 in der E v a n g e l i s c h e n Akadernie Tutzing. In Ko op erati o n mi t dem

Missions werk der Evang. -Luth. K i r c h e in B ayem. dem Ki rc hli c h e n Entwi c klungsdienst
B ayern (KED). dem Pazifik Netzwerk e . V . und dem European Centre on Pacific Issues
(ECSIEP). (88 Seiten, DM 1 3 . -)

VIJ99 Tourism at the Crossroads. Challenges to Developing Cou ntrie s by the New vVorld Trade
Order (72 S e ite n , DM 1 9 ,-)

Zusatzangcbot zum 1 4tag l i c h ersc heinenden Informationsdienst

epd-Entw ic k l un g s po l i t i k : Materi a l i e n s i nd e i n
epd-Ent w i c k l un g s pn l i t i k . Sie konnen nur einzeln bestellt werden. Die an ge ge benen Preise v e r s t e h e n sich i n k ! .
M W S t . , zzg l . Ver�and kuste n . B e z u g : epd- V e rtri e b , P()stfac h 5 0 05 5 0 , 60394 Frankfurt/wI .