News & Insights

Why climate change matters to tourism and hospitality: 5 impacts

Published 11 March 2019

Australia's natural environment, unique wildlife and world-famous beaches are the big draw cards in our tourism and hospitality industry. 

Australia's top five attractions for international visitors are 

  • beaches
  • wildlife
  • the Great Barrier Reef
  • wilderness areas
  • national parks.

Source: Climate Council

thumbnail climate change2But the Great Barrier Reef is dying, koalas and other native animals are losing their habitats and floods are obliterating the relics of our prehistory. And, let's face it, while visitors dream of a holiday in the sun, temperatures of 30+ Celsius are too challenging to be fun. The United Nations has identified Australia and New Zealand as one of five global tourism regions vulnerable to climate change.

The impacts of climate change for the future of the industry cover 5 key areas:

1. Economic effects

  • In 2015‒16 Great Barrier Reef Tourism was valued at $5.7 billion. A survey conducted by The Australia Institute after bleaching in 2016 found that if coral depredation continues, the reduction in visitor numbers to tourism areas adjacent to the Great Barrier Reef could result in a loss of more than $1 billion.

2. Weather events

  • Cyclone Yasi (2011) is estimated to have cost the tourism industry $600 million.
  • Flooding in the New South Wales Hunter Valley region in 2015 resulted in local tourism industry losses of $110 million.

Source: Icons at Risk: Climate Change Threatening Australian Tourism, Climate Council of Australia

3. Food chain impacts

Findings by the University of Melbourne for Earth Hour 2015 show that:

  • January ‒ April temperatures of 35⁰C = detrimental effect on produce quality
  • By 2050, 70% of wine growing regions will be less suitable for grapes
  • 20% reduction in rainfall = livestock weight gain reduced by 12%
  • Rising sea levels and salt tables threaten sugar cane crops.

4. Carbon emissions

5. Cost of insurance

  • Last year’s Insurance Council of Australia’s Catastrophe database estimated 2017 losses totaled $2,564,147,943, compared to $45,000,000 the year before.
  • Claims for international weather events added up to a global total of US$136 billion in insured losses from catastrophes.

Here at Gallagher, we are alert to the escalating risk climate change presents to our clients and the future of their businesses, as Taylor King explains.

Want to know more about how climate change is affecting the tourism and hospitality in Australia, and some suggested strategies for managing these impacts? Download Gallagher’s report in detail to access the latest insights.

Click here to download your FREE reportchevron-right


 

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