Ways to bring private investment to the tourism industry for green growth

Abstract

Green economic growth is a crucial subject in environmental economics over the last half-century, emphasizing the need for different economic sectors to adapt their activities based on environmental concerns. This research explores the impacts of green growth, inflation rate, economic uncertainty, green finance, and financial development on the composite indicator of sustainable tourism in 10 ASEAN economies from 2000 to 2021, utilizing the PMG (Pooled Mean Group) technique. The findings reveal that, in the short run, financial development and green finance have insignificant coefficients, while green growth exhibits the most substantial positive coefficient. Economic uncertainty and inflation rate negatively affect sustainable tourism. In the long term, green financing has the most profound impact on sustainable tourism development, along with green growth and deepening financial markets, which accelerate sustainable tourism. Conversely, economic uncertainty and inflation rate have adverse effects on the green tourism industry. Primary practical policies to promote sustainable tourism include providing a comprehensive financial policy package, developing ICT-based tourism services, establishing an early warning system, and leveraging blockchain technology and cryptocurrency in green investments, enabling governments and stakeholders to foster sustainable tourism practices and advance environmental sustainability within the ASEAN region.