Opinion
- Editorial- Commentary
Mary
King: Peak
Oil - less tourism?
The
Government of T&T has chosen tourism as
one of the economic pillars for the country's diversification
away from energy. So much so that we are creating
in Trinidad waterfront hotels and a conference
centre with the hope also of attracting the business
tourist, and the more general kind to Tobago.
These plans are consistent with current annual
growth forecasts for tourism which, according to
the UN Tourism Organisation, are 3.8 per cent for
regional and 5.4 per cent for long haul traffic
- i.e. by 2020 some 1.6 billion people will be
involved in international travel. These figures
unfortunately do not take into consideration the
phenomenon of Peak Oil which is manifesting itself
in escalating fuel prices due in general to reducing
production and increasing demand for oil.
Present
consumption of petroleum is of the order of 30
billion barrels of oil per year, and of that,
84 per cent is converted to fuels, and jet fuel
alone consumes two billion barrels per year with
the attendant global warming. The UK, in planning
the expansion of its airports, is expecting passenger
volume to double by 2015 and triple by 2030. Airbus
(an aircraft manufacturer) is expecting an annual
growth rate of 4.5 per cent. However, with Peak
Oil it is now being estimated that by 2030 only
60 per cent of passenger and 45 per cent of freight
requirements will be met and these services will
be provided at exceedingly higher prices. Surely
then Peak Oil, as it is doing for food prices,
will have an alarming impact on the tourism industry
(particularly cruise ships that drag "hotels" along)
that is at present the life blood of the region
and one of the proposed pillars of our economic
transformation.
In some quarters there is hope that heavy oil
and bio-fuels will solve the shortage problem.
As a result we are seeing agricultural lands being
diverted to the production of corn for ethanol
and investments in the heavy oils of Canada. However,
neither of these will be available in the same
quantities as conventional petroleum, and, basic
scarcity economics tells us that both bio-fuels
and heavy oil derivatives will sell at prices comparable
to fossil fuels. Ethanol and even methanol-based
fuels will not be cheap substitutes for petroleum
unless subsidised by governments.
There are two obvious conclusions from the above
- with increasing costs of travel (due to increasing
fuel costs) potential tourists (except the very
rich) will re-consider travelling to distant
traditional and/or exotic destinations, and countries
will have to examine their tourist markets (sources
of tourists) to decide on which markets and kinds
of tourists to encourage.
It is fairly obvious that of the two kinds of
travel, business and leisure, the former is less
elastic, hence a tourist destination may wish to
concentrate more on business tourism. Further,
fossil fuels will be more readily available for
life-supporting industries and tourism travel is
not such a priority. Therefore, a country will
also have to tailor its choice of international
origin-markets so as to optimise the use of fuel.
Further, the parameters that govern this optimisation
(distance, airline competition) will be outside
the control of our regional tourist destinations.
In the extreme a country could lose its international
tourism and thus seek to increase domestic and
regional tourism and its local recreational facilities.
The days of the German tourist arriving for a holiday
in Tobago may indeed be numbered - the transition
to less oil-intensive tourism is inevitable.
When the tourist lands in T&T there will also
be demands for the further use of petroleum - accommodation,
local travel. Though fossil-based energy products
(gasoline, electricity) are at present subsidised
in T&T, we are not immune from the impact of
Peak Oil. In fact given the information we have
at present, our petroleum reserves (natural gas)
will not take us past 15 to 20 years. Such subsidies
are incompatible, if not incomprehensible, with
the pending scarcity.
In
T&T, we will be concerned with the kind
of tourist to attract. One measure being used is
eco-efficiency, the ratio of the money spent by
an individual tourist to the amount of energy she
utilised on-island. A study done for New Zealand
showed that tourists from China and Australia were
more eco-efficient than those from Germany, USA
and Japan, However, it was also found that the
greater part of Chinese tourists tended to stay
longer (students) and spent more money (fees) and
travelled less on island.
Surely then our Ministry of Tourism has to decide
which markets are viable in the longer term and
more generally whether international tourism is
as competitive relative to other industries, e.g.,
whether attracting E-Teck Industrial Park tenants
is preferable to tourism expansion with respect
to eco-efficiency.
Mary
King is
a regular columnist of ten Trinidad Express (maryking@tstt.net.tt)
. Petroleumworld
not necessarily share these views.
Editor's
Note: This article was first publish in Trinidad
Express, Monday, August 6th 2007. Petroleumworld
reprint this article in the interest of our readers.
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Petroleumworld
08/08/07
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