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Tourism PPP. The TURESPAÑA experience

Moscow, 15 March 2010 1

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Joan-Carles CambrilsCabinet Chief of the Spanish

General Directorate of Tourism

Moscow, 15 March 2010

An introduction to the Tourism PPP.

The Turespaña experience



CONTENTS

1. Characteristics of the public-private

partnerships

2. Reasons for public-private partnership

3. Examples of public-private partnership

4. Scope of public-private partnership at

Turespaña

5. Forms of public-private partnership at

Turespaña

6. Results of public-private partnership at

Turespaña

7. Pros and cons

8. Recommendations



CONTENTS

1.Characteristics of the public-private

partnerships



4. Scope of public-private partnership at Turespaña

5. Forms of public-private partnership at Turespaña

6. Results of public-private partnership at Turespaña

7. Pros and cons

8. Recommendations



Legal forms of cooperation between public

authorities and the world of business which aim to

ensure the funding, construction, renovation,

management or maintenance of an infrastructure or

the provision of a service.

(source: GREEN PAPER, European Commission).

1.1. DEFINITIONS OF PPP (1)



A cooperative venture between the public and private

sectors, built on the expertise of each partner, that best

meets clearly defined public needs through the

appropriate allocation of resources, risks and rewards.

It relates to the provision of public services or

public infrastructure.

Second, it necessitates the transfer of risk between

partners.

(Source: The Canadian Council for Public-Private Partnerships)




Forms of cooperation between

Public and Private Tourism

Agents in different levels of

commitment: low

participation, projects

cooperation or stable

partnership.





PUBLIC PRIVATE

An agreement between private and public sector agents to undertake a particular project in line with at least one of the two principles below:

Joint decision-making.

Joint risk/financing.



1.2. SCOPE OF TPPP

General issues about the tourism system.

Tourism marketing (mainly Communication, research and product development)

Tourism Quality policies.

Education and trainning



PPP in Tourism Decision/Management

SOFT IMPACT

STRONGIMPACT

100% PUBLIC 100% PRIVATE

AssociationFoundation

Agreements

NTO’s, Autonom. Organism, Institute, Tourist Boards

NTA’s, PublicAdministrations

1.3. FORMS OF TPPP

Societies, Corporations

Consortium

Advisory bodies

Public Incentives



CONTENTS

1. Characteristics of the public-private partnerships

2.Reasons for public-private

partnership





7. Pros and cons

8. Recommendations



1st reason: The best tourism experiences enjoy public and private goods and services.

2. REASONS FOR PUBLIC/PRIVATE PARTNERSHIP

Many environmental and cultural goods (that are tourism attractions) are public goods (non excludability, non rivality).

Particular TPPP can reduce or avoid the “parasitism” and the “lost of communal goods”

http://www.dominicana.com.do/fotos/playas/PALYA_MUCHAS-PALMAS.jpg

http://www.dominicana.com.do/fotos/baile-01.jpg



Private goods

Public goods



2nd reason: External effects (+ and -) caused by tourism activity.

“Upset somebody’s welfare without his consent”

¿Why the external effects happens? The general welfare balance the environmental

negative effects.

It’s difficult to quantify the negative/positive effects in money.

The property rights are not clearly defined.

http://noticias.ya.com/fotos/200104/1523.htm



A) Awareness of the problem with public campaigns: ethic change.

B) Negotiation by those involved, stipulating a price for welfare o discomfort.

C) Penalize or grant for the external effects.

(cont.) 2nd reason: External effects (+ and -) caused by tourism activity.

Private/Public agreements for solutions to the external effects:

Effect of a + externality

http://es.wikipedia.org/wiki/Archivo:PositiveExt_es.svg



Cambrige (Eng)



Number of tourists

Time

Exploration

Implication

Development

Consolidación

Stagnancy

Rejuvenation

Downhill

3rd reason: the economic - touristic cycle of destination: Long term medial costs are increasing.



Global medial cost

Q= trips or inclusive tours

New destination

Medium size destination

Mass destination

Global medial cost = explicit costs + opportunity costs

Long term global medial cost of tourism production, consequence of the law of decreasing marginal productivity

(short term)

(long term)

N.B. the economic downturn accelerates this commitment: more efficient choice of public/private investments and mk actions



In order to correct this problem, Turespaña has promoted the consortiums for requalifying a few mature destinations

http://noticias.ya.com/fotos/200104/1523.htm



4th reason: sustainability.

Next generation should be able to use the same

amount of natural capital.

People and NGOs are endogenous resources taking

important economic decisions.

New culture/new governance of tourism that

supports Turespaña: shared Leadership with all the

actors.

Spanish Tourism Council

Mesa de la calidad (Quality Advisory

Council)



CONTENTS



3.Examples of public-private

partnership




7. Pros and cons

8. Recommendations



SPAIN (national level)

Turespaña: autonomical body for marketing: 100% public. Segittur: a 100% public national company for research and new

technologies. Paradores: a 100% public national hotel company, with nearly a

100 establishments, most of them monumental buildings, located in strategic places.

Advisory bodies and consortiums: TPPP

21

3. EXAMPLES OF PUBLIC-PRIVATE

PARTNERSHIP



SPAIN

(local level)

Convention Bureau: non-profit making associations.

More than a 100 local constituted or in process TPPP (with a Turespaña grant).

1


PARTNERSHIP



Visit London: Public Limited Company, P-P shareholders

Berlin Tourismus Marketing Gmbh: 85% private capital, 15% public capital (land of Berlin)

Amsterdam Tourism & Convention Board (ATCB): Private non-profit association set up with public and private capital. Depended on by five private companies with legal personality (marketing, bookings, congresses, information and advisory).

Wonderful Copenhagen (WOCO): private non-profit entity (business foundation) with public/private capital.

Marketing Manchester: commercial company with 50% public/private capital

23


PARTNERSHIP

(source: FEMP)



CONTENTS




4.Scope of public-private partnership at

Turespaña



7. Pros and cons

8. Recommendations



4.1. The 2020 Spanish Tourism Plan is a PPP outcome

All public administrations and all agents in the industry are committed to making the Spanish Tourism System more competitive and sustainable by 2020 for the wellbeing of the wider

community.

WHAT'S THE PLAN?

HOW WAS IT DONE? Through an open debate between the public and private sector to examine

Spain's position and tackle the challenges posed by new trends.

WHO TOOK PART?

Over 35,000 touristsOver 100 industry experts

Over 2,000 industry representativesAll public administrations

4. SCOPE OF PUBLIC/PRIVATE PARTNERSHIP AT TURESPAÑA



4.2. Spanish Council of Tourism

• A TPPP, the Spanish Council of Tourism approved the 2020 Plan. It was officially supported by the Autonomous Community Conference and the National Government.

54 MEMBERS (19 from Autonomous Communities, 4 from

Spanish Federation of Municipalities and Provinces (FEMP), 4 from the State Tourist Board, 6 from the Spanish Confederation of Business Organisations (CEOE), 6 Chambers, 4 Syndicates, 9 of repute)

It has advisory functions Frequency: It meets usually twice a year.

26




4.3. Spanish Tourism Strategies 2020

1. New Tourism Economy

Knowledge Innovation Capturing talent

4. Shared leadership

Deseasonalisation and redressing regional balance

Regeneration of mature tourist destinations

Tourist destination planning and management

Cooperative culture

Legal framework and simplification

Competitive Industry-wide Plans

Accessibility of tourism

4. Competitive environment

Tourism, the environment and society

3.Sustainability

2020 positioning

Experimental Spain

Helping to sell

Perceived quality

2. Value for customers




a. Knowledge / Innovation (e.g.)

Agreement with the National Council of Chambers (INTELITUR)

MK research

Agreements with the Instituto Tecnológico Hotelero - CEHAT training

Boosting PP innovation clusters (THINKTUR)

innovation


4.3. Spanish Tourism Strategies 2020



b. Building a more sustainable / more

competitive model of tourism (e.g.)

Boosting quality, quality incentives (Q

label, Instituto de la Calidad Turística

Española)

Plans for re-qualifying mature

destinations with local PP partners

4. SCOPE OF PUBLIC/PRIVATE PARTNERSHIP AT TURESPAÑA4.3. Spanish Tourism Strategies 2020



c. Building value for customers / Helping to sell (e.g.)

Agreements with companies to jointly fund product

campaigns.

Joint destinations promotion with PP tourist

destinations/brands

Agreements with PP partners for press trips.

4. SCOPE OF PUBLIC/PRIVATE PARTNERSHIP AT TURESPAÑA4.3. Spanish Tourism Strategies 2020



CONTENTS





5.Forms of public-private partnership at

Turespaña


7. Pros and cons

8. Recommendations



(i) PP signed Agreements

- Agreements, arrangements for dissemination, raising awareness

- Agreement with TT.OO. to recommend Q qualified establishments

- Agreements, arrangements for Promotion/helping to sell.- CoMK with Air Europe, Monarch, TUI, REWE, ABTA,…

32

5. FORMS OF PUBLIC-PRIVATE PARTNERSHIP AT

TURESPAÑA



(i) PP signed Agreements

- Agreements, arrangements for Training/quality- Co finance the biggest Tourism postgraduate

university network- SICTUR

- Agreements, arrangements for Sponsorship- Eurobasket 2014, Madrid Tennis Open, Pan European

Golf, Liverpool F.C., Spanish Basketball and Football Federations and Moto GP.

33


TURESPAÑA



(ii) Advisory entities Creation and participation in the Spanish Council

of Tourism (for advisory purposes) Quality Advisory Council Group of MK experts asses over the new Spain creativity

1


TURESPAÑA



(ii) Incentives to the private participation in public programs

Co-finance Q label

Support European Charter for Sustainable Tourism in Protected Areas (ECST)

Support to innovation tourism clusters (25 Agrupaciones Empresariales Innovadoras)

Cofinance IT trainnig (Plan Avanza) Support to the creation on Local TPPP

35


TURESPAÑA



(iv) Participation in legal institutions, sharing responsibilities to all levels, like consortiums

Mallorca, Costa del Sol, Gran Canaria

1


TURESPAÑA



CONTENTS






6.Results of public-private partnership at

Turespaña

7. Pros and cons

8. Recommendations



6. RESULTS OF PUBLIC/PRIVATE PARTNERSHIP AT TURESPAÑA (2009)

i. 260 agreements with private companies and associations to carry out

joint activities

ii. Total investments of €63 million (43% Turespaña-40% private sector-

17% other public administrations) in co-MK. Induced private/other

public investments: €31 million.

iii. Over 2,500 firms hold the Q quality label

iv. 30 innovation clusters set up (€3.8 million in funding)

v. 38 Projects of the Avanza training plan (€4 million in funding)

vi. 17 competiveness plans and 3 destination requalifying plans



CONTENTS







7.Observed pros and cons

8. Recommendations



7. OBSERVED PROS AND CONS

CONSPROS Need of an strategy results

oriented: P&P have different

goals.

Lack of experience in PP

cooperation

Lack of institutional support

Need of market incomes

Disproportionate Government

role

Powerful tool for

implementing policies more

effectively: MK, quality,

awareness, innovation.

Share of information,

resources, risks and

rewards.

Move actors to a new

cooperation culture .



CONTENTS







7. Pros and cons

8.Recommendations



8. RECOMMENDATIONS

Understand why a TPPP.

Share vision and objectives

Adapt national/regional laws

Share risks

Professional management

Team work

Mesuared results.

Believe on your partnership: a PP effective cooperation requires a

decided and positive attitude



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THANK YOU VERY MUCH FOR YOUR ATTENTION

www.spain.info

www.tourspain.es

joancarles.cambrils@tourspain.es

http://www.spain.info/

http://www.tourspain.es/

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