Transitioning to a green economy: the case of tourism in Bali, Indonesia

Authors Alexandra Law , Terry De Lacy , Geoffrey Lipman , Min Jiang 

Journal Of Cleaner Production

A study led by Victoria University, Melbourne, was just released today to look into Balis tourism development to 2050. Headed by Professor Geoffrey Lipman, presenting at a conference hosted by the Vice Minister of Tourism and Creative Industries for Indonesia, the six-month study unveils the long-term development of Bali, where tourism represents 40% of the resources.  Specific attention was paid to waste, water, and carbon impacts on the island.

Lipman said that the good news from the study was that the potential for growth, jobs, and investment for Bali’s tourism sector and the community at large was dramatic, particularly from the emerging markets of Asia and specifically from China. The more sombre realisation was that this growth was not being matched by essential investment in infrastructure, traffic control, waste, water, and energy management. The Roadmap (till 2050) contained dozens of recommendations that would support such a decision – environmental, commercial, operational, managerial, and social.   2014 Bali, Indonesia

This paper presents a framework for a green economy transition in tourism destinations. While the literature has suggested many models to guide sustainable tourism, very few studies have investigated the green economy in a tourism context. The main distinguishing factor between the green economy and sustainable development may be described as the acknowledgement of climate change as an existential threat to society and the aim to avoid policy, management and governance fragmentation (which has been common for environmental issues) by addressing greenhouse gas emissions, resource efficiency and social inclusiveness holistically at the economic level. This study frames the green economy concept from a tourism perspective and presents a model for translating the green economy concept into a tourism stakeholder engagement process. The model was tested in the case study of Bali, Indonesia, involving research methods such as visioning group techniques with tourism stakeholders, tourism economy and employment forecasting, resource efficiency estimates as well as resident and visitor surveys. This was followed by an analysis from a green economy stance to develop a Green Growth 2050 Roadmap for Bali tourism. The result is a framework which may be particularly relevant for tourism destinations experiencing rapid change


The green economy paradigm presents a new situation of change for tourism. Most energy use in tourism is still based on fossil fuels and the sector continues to emit increasing levels of greenhouse gas (GHG) emissions (Hall, 2013, Scott et al., 2008). Tourism is also showing strong growth patterns that are estimated to reach 1.8 billion international arrivals by 2030 as well as four times as many domestic trips (World Tourism Organization [UNWTO], 2011). Current trends in tourism, therefore, stand in contrast to a global policy momentum that aims for a long-term transformation of the economy to mitigate GHG emissions and increase resource efficiency as well as social inclusiveness (Lipman et al., 2012, UNEP, 2011). While sustainability in tourism has been researched extensively in the last few decades (e.g. Lane, 2009) and studies are increasingly focused on tourism and climate change (e.g. Becken and Hay, 2012, Scott et al., 2008), as yet, very few studies have researched the new concept of a green economy from a tourism perspective (e.g. Law et al., 2012, Lipman et al., 2012, UNEP, 2011). The aim of this paper is to develop a strategy development framework for a green economy transition at the tourism destination level.

Strategi Planning Framework

Strategic planning originates in conventional management theory and may be referred to as the development of “a coherent set of analysis, concepts, policies, arguments, and actions that respond to a high-stakes challenge” (Rumelt, 2012, p. 6). For many tourism destinations, this high-stakes challenge has become that of sustainable tourism development and strategies are built on a vision of becoming more ‘sustainable’. Sustainability, however, has a variety of meanings and interpretations (Schmalensee, 2012) and different schools of thought have emerged on sustainable development, with organizations being scattered across the spectrum of transformist views, reformist views and the status quo (Hopwood et al., 2005). This has resulted in a policy discourse that has become entangled in interrelated but different terminology, where terms such as sustainable development, green growth, low-carbon development and sustainable economy are being used subjectively and interchangeably (United Nations Department of Economic and Social Affairs 2012)

This has implications for strategic planning processes and implementing change in a social environment that involves a wide range of stakeholders and interests. Rumelt (2012) suggests that the success of a strategic plan rests on having: (1) a diagnosis that clearly defines the nature of the challenge and simplifies the often overwhelming complexity of the situation by identifying critical aspects; (2) a guiding policy for overcoming the problems identified in the diagnosis; and (3) a set of coherent actions to carry out the guiding policy. A strategy built on a poorly defined vision of sustainable tourism development consequently violates an essential part of strategic planning theory and is unlikely to produce any meaningful results. Furthermore, the enormous complexity of the sustainable tourism concept may not lend itself to easy strategic choices. Rumelt (2012) argues that ineffective strategy development often occurs because of an unwillingness or inability to choose. A clear theoretical framework for tourism sustainability consequently plays an important role for the diagnosis and ability to make choices in a strategic planning process.

The paper, therefore, begins with a review of the literature to clarify and frame the green economy concept from a tourism perspective. Based on the theoretical framework, a model for the stakeholder engagement process is presented and then tested in the form of a roadmapping approach in the case study destination of Bali, Indonesia. The paper finishes with an evaluation and discussion of the developed framework.

Section Highlights

The green economy as a theoretical framework for tourism strategy. Sometimes also referred to as green growth, the green economy refers to a globally evolving, long-term strategy framework, which aims to holistically transform the economy so that it can become “low-carbon, resource efficient and socially inclusive” (UNEP, 2011, p. 16). However, to understand its relationship with the notion of sustainable tourism development, it is important to look at the evolution of the latter.

A green economy model for tourism stakeholder engagement

Having reviewed the green economy concept, we shift the focus back to the question of how it can be applied in a tourism context. We have attempted to do this by developing a model which conceptualizes how the green economy approach may be applied in a tourism destination involving a stakeholder engagement process. To apply the green economy concept to tourism requires a number of assumptions as to what components of the broader green economy are relevant to the narrower

Application of the model in the case study destination of Bali

The developed green economy model for tourism stakeholder engagement was applied in the development of a strategic planning process in the case study of Bali, as part of a project commissioned by the Ministry of Tourism and Creative Economy (MTCE) to develop a green economy strategy. Bali has seen very rapid growth of tourism in recent years and is acutely aware of the complex and challenging relationships between tourism, culture and the environment (e.g. Picard, 1996,

Data and outcomes

The Bali case study produced a large volume of data and results, which have been published as a book chapter describing the Green Growth 2050 Roadmap for Bali tourism as a best-practice case study (De Lacy et al., 2014). The key findings are summarized here to show how the theoretical green economy framework was applied to the data collection, stakeholder engagement and strategy formulation.

Phase one of the project include visitor and employment forecasts, GHG emissions and water 


Although the outcomes of the Green Growth 2050 Roadmap are highly destination specific, the results of the case study can be integrated into the literature by evaluating and discussing the outcomes against existing evaluative instruments for strategy development. This paper has focused on how the green economy concept can be translated into a strategic planning process for tourism destinations and the results are first discussed against an evaluative instrument developed by Simpson

This paper has presented a framework for a green economy transformation in tourism destinations and has outlined how such strategies may be developed. First, the green economy concept was framed and a model presented for how it may be integrated into a tourism stakeholder engagement process. The model was then applied in the case study of Bali in a roadmapping approach to develop a holistic green economy strategy for the destination.

Journal of Cleaner Production