The growing impact of tourism in Palau


This morning we drove on a winding road to the state of Ngardmau to spend the day at Palau’s one and only Eco-Theme Park. The first attraction at this park was an open-air monorail that slowly chugs through the jungle allowing you to take in the towering trees, dangling vines, and singing birds without breaking a sweat.  We were all feeling young and strong and decided to take a pass on the monorail in favor of the cheaper, but slightly more strenuous, hiking option.  We climbed up and down the steep terrain and cautiously hopped across streams on slippery stones while the other tourists passed us by on the monorail with a wave and a smile. The second attraction awaited us at the end of this hike: a beautiful waterfall that was as tall as it was wide, pouring into a small, cool lagoon below. We waded and swam through the water and relaxed under the mist from the waterfall. The last and most exhilarating attraction was a treetop zip-line. After stepping into a harness and snapping closed the chin straps of our helmets, we were launched from a platform and sent soaring above the deep green valley.

Revenue generated by Palau’s Eco-Theme park and other tourism-related businesses such as dive shops, hotels, and restaurants, account for over 50% of Palau’s annual GDP. In 2011, Palau welcomed more than 100,000 visitors for the first time, and the number of annual visitors is still steadily increasing.  Surpassing the 100,000 tourist/year mark has led some Palauans to celebrate, while others have expressed concern. The question that many Palauans are starting to ask is whether or not the increasing number of visitors can be sustained without degrading the natural beauty that draws visitors to Palau in the first place.

The tourism industry has certainly had positive impacts on Palau’s environment, such as providing an added incentive and financial resources to preserve marine and terrestrial resources. Tourists must pay entry fees to visit the Rock Islands and Jellyfish Lake (top tourist destinations), and a “green fee” upon departure from the country that generated $1.8 million in FY2012 alone. This money is then devoted to improving protection and management of these natural areas as well as designating and maintaining new ones. Tourism also leads to increased employment and foreign investment, which can raise the standard of living for many Palauans and potentially decrease more extractive uses of the local environment.

However, the high volume of tourists has many detrimental environmental effects through increased fresh water use, energy use, sewage output, and eutrophication of coastal waters. These tourists all need a place to stay, and hotel construction along the coast has led to erosion and sedimentation that can settle on top of the coral reefs just off shore. Top dive sites are crowded with divers who often damage the coral with their hands and flippers. Jellyfish Lake is regularly visited by more than 500 visitors a day who leave behind a sheen of sunscreen on the surface of the water. During peak tourist seasons, locals aren’t even able to purchase fresh fruit and vegetables for their families because the hotels and tourist restaurants clear the markets of all available produce.  An employee of the Koror State government stated, “We are feeling the effects of just too many people at one time.”

Despite tourism’s high impact in Palau, the majority of locals involved in the industry are receiving a very small percentage of tourism revenues.  A large proportion of tourists visiting Palau, particularly those from Japan and Taiwan, purchase pre-packaged tours from operators in their home countries, so most of that money remains in the tourist’s country of origin and never actually touches ground in Palau. A local eco-tourism business owner described another way that foreigners are benefitting from Palau’s natural resources: “Despite the constitution having been written in such a way that transportation companies and tour companies were supposed to be wholly owned by Palauans, only a small handful in practicality are locally owned. Most of them are foreign investors…[who] are getting mega-rich off the resources while in many cases the stakeholders, the community, are getting left behind or the benefits they receive are not proportionate to the value of what’s here. From a tourism standpoint, I don’t think we are harvesting this crop sustainably.”

Most Palauans are receiving a very small percentage of the revenues generated by environmental tourism, if any. Many citizens have pointed out to me that Palau could make more money with less tourists and therefore less environmental damage if there were a government crackdown on the multiple ways that tourism revenues are leaving the country in foreign hands. At the same time, many Palauans suggested that it is unlikely that the government will ever actually place a cap on the annual number of visitors or impose other measures to limit tourist arrivals. Palau’s marine and terrestrial environments are still full of life and color, but how many more than 100,000 tourists per year can a country of 20,000 citizens accommodate before the environmental consequences become dire? The path towards creating a sustainable tourism industry in Palau remains unclear, but I am confident that a deep respect and appreciation among Palauans for their environment will ultimately lead to a solution.