Rebuilding the Caribbean: a proposal for tourism with purpose

As another hurricane season begins, researchers have warned that this year may even be worse than 2017, when hurricanes Irma and Maria marched across the Caribbean leaving unprecedented devastation. Although climate change does not cause hurricanes, it likely "weaponizes" hurricanes by amplifying their intensity. From wiped-out Barbuda to near-demolished Tortola, the damage to many islands last year was historic — and with no guarantee that this was a once-in-a-lifetime event. Certainly not going by predictions for this year.

Much of the initial international relief efforts rightly focused on the basics such as providing food, shelter and drinking water, with electricity and cellular telephony not available widely months after the storms. In fact, power still has not been fully restored in Puerto Rico — and this is a U.S. territory.

But there is no question the affected islands need to rebuild their infrastructure and bring their businesses and economies back online. While there has been progress in the last few months, given the scale of the damage in many islands, it is unlikely that donations and foreign aid will be enough to help them get their primary industry — tourism — fully back on track as quickly as is desirable. At least not in the measure needed to get back to "normal."

In this case, what "normal" means is people coming from all over the world to spend their dollars, euros and pounds in the region — particularly in the hard-hit islands, which have a well-earned reputation for being slices of paradise.

What if 5 million potential visitors 'donated' $500 each and this pool of $2.5 billion was invested by a professional fund management team and directed into climate-resilient rebuilding?

From the vistas to the corals to the sunken ships prized by sailors, snorkelers and divers; to the sun, rum and lobsters that are among the myriad of reason to visit, the Caribbean attracted more than 30 million visitors in 2017. Together they spent more than $37 billion (with stay-over visitors spending an average of more than $1,200 per trip).

While the entire Caribbean was not equally affected by the storms, the hurricanes had a significant impact on many countries: Tourism decreased 7-18 percent in 2017 in affected countries — most of it in the high season. It could have been worse: The Economist noted that Grenada’s annual GDP dropped by 24 percent after Hurricane Ivan in 1994. Thus, while we can take heart in the relatively limited economic impact and signs of recovery after Irma and Maria, we need to prepare for future calamitous hurricanes.

A new way

Given the competing demands for financial resources in traditional donor countries, and the possibilities of donor fatigue with these events happening with increased frequency, there are well-founded worries by experts and the region’s leaders about the ability of affected countries to respond quickly to disasters.

Here's an idea to harness the spending power of potential tourists — some who might be repeat visitors to the region and many who may want to go for the first time —in a way that helps with the rebuilding.

What if 5 million potential visitors "donated" $500 each and this pool of $2.5 billion was invested by a professional fund management team and directed into climate-resilient rebuilding? This could include solar panels on hotels to generate renewable energy or adapting structures to better withstand hurricane force winds. It also could mean investing in supporting businesses such as sailing charters and marinas, along with the hundreds of local businesses supporting these operations and all the jobs that they would bring back.

In exchange, these retail "donors" would receive concessions at businesses in regions that benefited from the rebuild. For example, they might receive consideration in the form of discounted nights at resorts or sailing charters; those rewards might have a value equivalent to the amount they donated and perhaps even more. Think of it as an "advanced market commitment" for Caribbean hotel (or catamaran) nights or a "zero-interest development bond" for Caribbean redevelopment. The donations would not be tax-deductible, as they reap a benefit or return in some form, but those donating with this purpose and outcome in mind still would reap significant benefits.

In fact, such a mechanism could become increasingly relevant in a world beset with climate disruptions where resources other than the standard channels of donor aid may be required to help developing countries with rebuilding or even climate-proofing infrastructure development. This alternative funding idea also could help individuals become more than mere tourists in developing countries; instead, they would become partners in the country’s economic future — true citizens of the world.