Can Tourism Deliver Real Development? Lessons from Ten Years of World Bank Projects

Tourism has long been promoted as a development success story: a sector that brings foreign exchange, creates jobs quickly, and turns culture and nature into economic opportunity. According to a new World Bank report, Tourism for Development: Lessons Learned from a Decade of World Bank Experience, that promise is real, but far from guaranteed. Drawing on research from institutions such as UN Tourism, the International Labour Organization, UNDP, and the World Travel & Tourism Council, the report examines what tourism has actually delivered across more than 80 low- and middle-income countries over the past decade. Its verdict is cautious but clear: tourism can drive development, but only when it is carefully managed.

A Trillion-Dollar Industry with Growing Influence

The scale of tourism explains why governments keep betting on it. By 2024, global tourism receipts reached around US$1.6 trillion, and tourism attracted over US$10 billion in foreign direct investment in 2023 alone. Over the past ten years, the World Bank mobilized more than US$10 billion to support tourism projects, with lending to the sector growing faster than overall Bank financing. Today, tourism projects are active in 47 countries, many of them small island states or economies where tourism is a major source of jobs and foreign exchange. After the shock of COVID-19, governments are again turning to tourism as a recovery engine, but with new questions about sustainability and resilience.

Jobs for Women and Youth, But Not Always Good Jobs

Tourism's strongest development case lies in employment. The sector employs a higher share of women and young people than most others, largely because entry barriers are low and opportunities exist across services, transport, and small businesses. More than half of the global tourism workforce is female, and youth employment is higher than the economy-wide average. However, the report stresses that these jobs often come with trade-offs. Tourism work is frequently seasonal, informal, and low-paid, leaving workers exposed during downturns. Inclusion, the report argues, is a potential benefit, not an automatic outcome, and depends on investment in skills, labor protections, and career pathways.

When Tourism Helps, and When It Hurts, Communities

Tourism can deliver real social and environmental benefits when revenues are reinvested locally. In places like Nepal, Uganda, and Cambodia, visitor fees have helped finance conservation, community services, and protected areas. But unmanaged tourism can also cause harm. The sector accounts for an estimated 8–10 percent of global carbon emissions, driven largely by aviation and cruise travel. Tourists often use far more water than local residents and generate disproportionate amounts of waste. When visitor numbers exceed local capacity, communities can push back, leading to protests, political tension, and damage to a destination's reputation. The report warns that growth without safeguards ultimately undermines tourism's own economic base.

What Actually Works on the Ground

Based on a review of 85 World Bank tourism projects, the report identifies clear patterns of success. Projects work best when they are focused on specific destinations rather than spread too thin, when they combine infrastructure with support for small businesses, and when they involve strong coordination across government ministries. Tourism projects that prioritize job creation, local enterprises, and market access consistently outperform those that focus only on building roads, airports, or hotels. Community-based tourism succeeds only when there is real demand, sustained training, and a clear financial plan; good intentions alone are not enough.

The Bottom Line: Manage Tourism, Don't Just Grow It

The report's message is ultimately a simple one. Tourism delivers development results when governments stop measuring success by visitor numbers alone and start managing impacts on people, places, and the environment. That means better data, stronger institutions, smarter investment, and clear rules that protect natural and cultural assets. In an era of climate change, rising travel demand, and growing resistance to overtourism, the destinations that thrive will not be those that grow fastest, but those that grow more thoughtfully, and share the benefits more fairly.