What is the SIFT Network about?
The SIFT network is an investment network meant to mainstream sustainability into tourism development investments and financing by:
- Stimulating the development and sharing of best practices in tourism investments for sustainability by creating an investor-driven network that will work to develop voluntary initiatives to encourage more sustainability in tourism investments.
- Matching the demand for sustainable tourism products in developing country destinations with available financial resources. The network is not intended to create a new fund but to facilitate information exchange and coordination between existing funds, donors, investors, and developing country destinations.
- Provide network members with practical research, capacity building, and action-oriented publications, as well as organizing workshops and events (such as business opportunity forums, or joint venture workshops) that bring together professionals from around the globe.
Why do we need the SIFT Network?
Today, investments in the tourism sector represent almost 10% of total investment value worldwide. In developing countries, such as in the Caribbean region, this figure could be as high as 50%. At the same time, there is a growing focus on tourism as a generator of foreign direct investment in developing countries. A recent United Nations Conference on Trade and Development (UNCTAD) study indicates that tourism is the number one priority and focus of Investment Promotion Agencies in developing countries.
When done correctly, tourism investment can be an effective tool for generating sustainable economic returns, conserving environmental biodiversity, and creating employment opportunities for local communities. But many investors and developers, particularly those with a long-term perspective, are grappling with just how to integrate sustainability in tourism investment decision-making.
This is not an issue that tourism investors alone are dealing with; investors around the world are becoming more conscientious about the environmental and social sustainability of their investment choices. This is fueled, in part, by a recognition of the significant impact that issues such as climate change, biodiversity conservation, and social development can have on investment value. As a result, addressing environmental and social issues are now considered critical to the proper management of projects, portfolio management, and reputation risks.
The Sustainable Investment in Financing for Tourism (SIFT) network will help private investors, multi-lateral and bilateral donors, and financing institutions identify strategies to address the sustainability aspects of the tourism development activities they support: What substantive, voluntary standards should investors apply to address sustainability? How should they implement them? And how do they assure compliance?
By establishing and cultivating a group of contacts within the investment community, SIFT will provide a network where these shared priorities can be addressed in support of sustainable tourism development.
What are the expectations from SIFT?
By bringing together the expectations of private investors, the leveraged strength of the financing and donor community, and the needs of developing destinations, SIFT will hopefully lead to better and more sustainable tourism development. Specific results from the establishment and operation of the SIFT network include:
- Establishment of voluntary initiatives (including standards) to encourage greater sustainability in tourism investments by public, private and multilateral investors;
- Intensified financing of sustainable tourism projects;
- Increase of sustainable investments in the tourism sector;
- Improved capacity of developing destinations; and
- Leveraging of the unique knowledge and reach of others.
How can investors get involved?
SIFT is looking for investors to express initial interest to participate in the establishment phase of the SIFT network and provide informal feedback on the SIFT concept, which will feed into the development of the working paper. They will then be invited to review documents prepared for the SIFT network and participate in expert meeting.