Report on the Transformation of Phuket’s Tourism Sector Towards Sustainability

Executive Summary

This report details the strategic transition of Phuket, Thailand, into a model for sustainable tourism. The transformation is driven by a multi-stakeholder collaboration involving financial institutions, hotel operators, and government bodies. This initiative places significant emphasis on aligning with the United Nations Sustainable Development Goals (SDGs), particularly those concerning economic growth, responsible consumption, climate action, and partnerships. The report analyzes the key drivers, best practices, and outcomes of this green revolution, positioning Phuket as a leader in sustainable travel within the region.

The Strategic Imperative for Sustainable Tourism

In response to growing global demand for environmentally responsible travel, Thailand’s tourism industry is undergoing a fundamental shift. Sustainability has evolved from a niche concept to a critical business strategy, enhancing the nation’s competitive edge. Phuket is at the forefront of this movement, demonstrating how integrating eco-conscious practices can yield both environmental and economic benefits. This strategic pivot directly supports several SDGs.

• SDG 12 (Responsible Consumption and Production): The industry is moving towards sustainable patterns of consumption and production by minimizing waste, conserving resources, and reducing its overall environmental footprint.
• SDG 8 (Decent Work and Economic Growth): By attracting a growing segment of eco-conscious tourists, Phuket is ensuring long-term, inclusive, and sustainable economic growth for its tourism sector, which contributed over 2.6 trillion baht (14%) to Thailand’s GDP in 2023.

The Role of Sustainable Finance in Enabling Green Transformation

Financial institutions are critical enablers of Phuket’s green transition. Siam Commercial Bank (SCB) has been instrumental in providing the necessary capital for hospitality businesses to adopt sustainable technologies and practices. This partnership is a clear manifestation of SDG 17.

1. Financial Products: SCB offers tailored solutions such as sustainability-linked loans, green loans, and green bonds to facilitate investment in green infrastructure.
2. Investment Scale: Since 2023, SCB has issued 180 billion baht in sustainable finance, with 80 billion baht specifically allocated to the hospitality sector. In Phuket alone, SCB’s hotel loan portfolio is valued at approximately 20 billion baht.
3. SDG 17 (Partnerships for the Goals): The collaboration between SCB and hotel operators exemplifies a powerful public-private partnership model essential for achieving the SDGs.

Private Sector Leadership in Sustainable Operations

Hotel operators in Phuket are actively leading the implementation of sustainable practices, integrating environmental stewardship into their core business models. These efforts contribute directly to multiple SDGs.

Case Study: Kata Group Resorts

• Philosophy: Operates under the principle “Beyond a good place is a better planet,” earning Travelife Gold certification.
• SDG 7 (Affordable and Clean Energy): Implements energy-saving technologies including solar panels, LED lighting, and automation systems.
• SDG 6 (Clean Water and Sanitation): Focuses on comprehensive water conservation measures.
• SDG 12 (Responsible Consumption and Production): Manages waste through in-house recycling, food composting, and the reduction of single-use plastics. The Beyond Kata property saves over 1.1 million baht per month through these efficiencies.

Case Study: Jee Teng Hospitality (Four Points by Sheraton)

• Certifications: Awarded three leaves by the Green Leaf Foundation and pursuing EDGE certification for new developments.
• SDG 11 (Sustainable Cities and Communities): Prioritizes sourcing locally produced ingredients, strengthening the local economy and reducing transport emissions.
• SDG 8 (Decent Work and Economic Growth): Demonstrates the financial viability of sustainability, achieving over 90% occupancy and a gross operating profit margin exceeding 50%.

Government Support and Climate Action

Government initiatives are crucial for creating a supportive ecosystem for sustainable tourism and addressing broader environmental challenges. These actions are vital for achieving climate and community-focused SDGs.

• SDG 13 (Climate Action): The Thai government is advancing a climate change bill and, through its Department of Climate Change and Environment, aims to certify 600 hotels in Phuket with Green Hotel Plus certification.
• SDG 11 (Sustainable Cities and Communities): There is an urgent need for public sector investment to upgrade waste management, water facilities, and transportation infrastructure to support tourism growth sustainably and prevent the negative impacts of over-tourism.

Conclusion: A Replicable Model for a Sustainable Future

Phuket’s journey towards sustainable tourism, underpinned by strategic financial partnerships and dedicated private sector action, provides a robust and replicable blueprint for other destinations. The island’s commitment to the SDGs is transforming its tourism landscape, ensuring environmental preservation, social responsibility, and long-term economic prosperity. As Phuket prepares to host the Global Sustainable Tourism Council conference in 2026, it is solidifying its status as a world-class destination for sustainable travel, aligning its local success with global goals.

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 8: Decent Work and Economic Growth

  The article extensively discusses the economic aspects of sustainable tourism. It highlights how the tourism sector contributed “over 2.6 trillion baht to the country’s GDP” and how sustainable practices lead to financial success for hotels, such as one achieving a “gross operating profit margin exceeding 50%.” This directly connects to promoting sustained, inclusive, and sustainable economic growth.

• SDG 9: Industry, Innovation and Infrastructure

  The article points to the need for building resilient infrastructure and promoting sustainable industrialization. It mentions hotels “investing in solar panels, upgrading infrastructure to improve energy efficiency” and the development of a new resort featuring “EDGE certification, a globally recognized standard for green buildings.” It also calls for public sector improvements in “waste management, water facilities, and road infrastructure.”

• SDG 11: Sustainable Cities and Communities

  The focus on Phuket as a “pilot destination for sustainable tourism” and the need to manage the impacts of tourism to “prevent over-tourism” relate to making cities and human settlements inclusive, safe, resilient, and sustainable. The article mentions community-driven initiatives, such as distributing “surplus food to local communities,” which strengthens community resilience.

• SDG 12: Responsible Consumption and Production

  This is a central theme of the article. It describes the shift towards sustainable tourism where operators prioritize “reducing carbon emissions, conserving water, and minimizing waste.” Specific examples include “in-house recycling stations, food composting machines, and reducing single-use plastics,” which are all patterns of sustainable consumption and production.

• SDG 13: Climate Action

  The article links sustainable tourism directly to climate action, stating that Phuket’s goals align with “Thailand’s broader goals of combating climate change.” It also mentions the government’s work on a “climate change bill” and hotel efforts to reduce their carbon footprint through energy efficiency and renewable energy, which are urgent actions to combat climate change.

• SDG 17: Partnerships for the Goals

  The article emphasizes that the transformation is a “cooperative effort.” It details the “strong collaborations between financial institutions, hoteliers, and government agencies.” The role of Siam Commercial Bank (SCB) in providing “sustainable finance” to hotel operators is a prime example of a public-private partnership to achieve sustainable development goals.

2. What specific targets under those SDGs can be identified based on the article’s content?

• Target 8.9: Devise and implement policies to promote sustainable tourism that creates jobs and promotes local culture and products.

  The entire article is a case study of this target in action. Phuket is described as “spearheading Thailand’s transition to sustainable tourism” and becoming a “model for eco-friendly practices.” The government’s initiative to certify 600 hotels with “Green Hotel Plus certification” is a direct implementation of a policy to promote sustainable tourism.

• Target 12.b: Develop and implement tools to monitor sustainable development impacts for sustainable tourism.

  The article mentions several monitoring tools. Certifications such as “Green Hotel Plus,” “Travelife Gold,” “LEED,” “Green Globe,” and “EDGE certification” are used by hotels to measure and validate their commitment to eco-friendly practices and monitor their sustainability performance.

• Target 12.5: By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse.

  This target is addressed through the specific actions of hotel operators. The article cites examples like “waste management practices include in-house recycling stations, food composting machines, and reducing single-use plastics” at the Beyond Kata resort.

• Target 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies.

  The article describes hotels “upgrading infrastructure to improve energy efficiency” and adopting clean technologies like “solar panels, LED lighting, and automation systems.” The development of a new Sheraton resort designed to meet “EDGE certification” for green buildings also aligns with this target.

• Target 13.2: Integrate climate change measures into national policies, strategies and planning.

  The article mentions that the “government’s ongoing work to pass a climate change bill” and the “Department of Climate Change and Environment’s plans” are part of Thailand’s strategic approach to integrate climate action into its tourism development plans.

• Target 17.17: Encourage and promote effective public, public-private and civil society partnerships.

  The collaboration between the private sector (hotel operators like Kata Group), financial institutions (Siam Commercial Bank), and the public sector (Thai government and its departments) is the cornerstone of the initiative described in the article. SCB’s role in providing “sustainable finance” is a key element of this partnership.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Indicator for Target 8.9 (Tourism’s economic contribution):

  The article provides direct quantitative data: “Thailand’s tourism sector contributed over 2.6 trillion baht to the country’s GDP, approximately 14% of the nation’s total economic output.” It also notes an “8% year-on-year increase” in foreign tourists to Phuket, which measures the growth of the tourism sector.

• Indicator for Target 12.b (Number of businesses with sustainability certification):

  A clear indicator is the number of hotels achieving sustainability certifications. The article states a specific goal: “certifying 600 hotels in Phuket with Green Hotel Plus certification by next year.” The mention of other hotels earning “Travelife Gold” and “Green Leaf Foundation” awards serves as a qualitative indicator of progress.

• Indicator for Target 17.17 (Value of financial commitments to partnerships):

  The article provides specific financial figures that act as indicators for the scale of the partnership. It states that “SCB has issued sustainable loans and bonds worth a total of 180 billion baht,” with “80 billion baht allocated to the hospitality sector.” SCB’s hotel loan portfolio in Phuket alone is “valued at approximately 20 billion baht.”

• Indicator for Target 9.4 / 12.5 (Financial savings from resource efficiency):

  While not a formal SDG indicator, the article implies progress through financial metrics. The Beyond Kata resort “saving over 1.1 million baht per month” due to its sustainable practices is a powerful indicator of increased resource efficiency and successful waste/energy reduction.

• Indicator for Business Performance (Occupancy and Profitability):

  The article implies that sustainability is good for business, using hotel performance metrics as an indicator of success. The Four Points by Sheraton Phuket achieved an “occupancy rate of over 90% and a gross operating profit margin exceeding 50%,” linking eco-friendly practices to financial viability.

4. Create a table with three columns titled ‘SDGs, Targets and Indicators’ to present the findings from analyzing the article.

Source: travelandtourworld.com