Governments National, regional and local governments have a unique opportunity to set the stage to position the sector and facilitate sustainable tourism development through policies and initiatives. Properly designed incentives can accelerate tourist attraction and encourage adoption of technologies and sustainable business models that can drive economic growth. For example, Saudi Arabia’s Vision 2030 has been instrumental in diversifying the country’s dependence on oil, with tourism registering a 73% growth in the first month of 2024 compared to the same period in 2019.7 Similarly, Spain has implemented various tourism efforts and incentives that have contributed to a significant increase in tourist arrivals and spending. In 2023, Spain saw a record 85 million international tourists reaching over $110 billion in spending.8 Tourism is also recognized as a force for good in terms of driving economic growth (e.g. in Dubai),9 and contributing to poverty alleviation, as in some rural regions of China, where 10% of people were lifted out of poverty between 2010 and 2014.10 Governments can create enabling environments – both within and between economies – through modernized policies and regulations to help grow trade in travel and tourism services. Moreover, governments play a critical role in facilitating international cooperation and standardization to build a more resilient and seamless global T&T ecosystem. As governments develop their tourism strategies, it is important to embrace sustainability and inclusivity and create the right frameworks to encourage innovation through collaborations between the private and public sectors. At the same time, fostering international partnerships to address global challenges can support greater sustainability in the sector.Private sector Private-sector T&T actors are at the forefront of innovation. They have the opportunity to lead the adoption of sustainable practices and new technologies, such as AI-powered personalized itineraries or carbon-neutral accommodations. By creating personalized experiences that cater to evolving traveller preferences while prioritizing environmental and social commitments, the sector can contribute significantly to local and global economic development, strengthen its value propositions and drive future growth. Despite global volatility, the sector has shown resilience. During the past year, the BlueStar Travel and Vacation Index (BTOUR)11 has performed similarly to the Dow Jones with returns of over 20%, though showing higher volatility.12 Looking ahead, if companies successfully implement innovative and sustainable approaches, they may significantly surpass current performance levels, benefitting both the sector and its shareholders. Travel and tourism has always been interconnected with adjacent and supporting sectors, creating opportunities for cross-sector collaboration and innovation. From retail and entertainment to financial services, technology and real estate, related sectors can play a vital role in enhancing the travel experience and addressing challenges while creating significant revenue streams for their own businesses. For instance, social media or search engine results are the leading sources of travel inspiration.13 Also, international transactions represent up to a third of total revenue for leading payment processing companies. Additionally, tourists can be drivers for retail sales as seen in Dubai, where an estimated 25% of retail sales are driven by international visitors.14 Future of Travel and Tourism: Embracing Sustainable and Inclusive Growth 5

Future of Travel and Tourism 2025