Tourism is a major economic sector in many small island states. Table 17-5, which expresses tourist arrivals in terms of the populations of small island states for which data were available, shows that in most small island states, the numbers of visitors substantially exceed the number of inhabitants. Table 17-5 also expresses tourism receipts in terms of gross national product (GNP) and in terms of foreign exchange inflows from exports of goods and services. Again, the ratios tend to be relatively high in most small island states; the Maldives, Antigua and Barbuda, and the Bahamas exhibit the highest ratios. In many countries, tourism also makes a significant contribution to employment. For example, the industry provides jobs for 70% of the labor force in the Bahamas, 40% in Malta, and 20% in Seychelles (Waters, 1998).

It is widely acknowledged that the effects of climate change on tourism will be both direct and indirect. For instance, sea-level rise would disrupt the sector through loss of beaches, inundation, degradation of coastal ecosystems, saline intrusion, and damage to critical infrastructure (Nicholls and Hoozemans, 1996; Teh, 1997; Perez et al., 1999). Because many small islands are so heavily dependent on the tourism sector for their economic survival, adverse impacts on the industry, from climate change or other causes, would be of great concern in these countries. In many small islands, the industry also would be sensitive to other climate-related impacts, such as loss of attractiveness of coral reefs as a result of bleaching.

A high proportion of tourism in small island states is motivated by the desire of visitors from developed countries of the north (their largest market) to escape cold winters. Small island states are becoming increasingly concerned that projected milder winters in these markets could reduce the appeal of these islands as tourist destinations (Martin and Bruce, 1999). It is projected that tourism could be further harmed by increased airline fares if GHG mitigation measures (e.g., levies and emission charges) were to result in higher costs to airlines servicing routes between the main markets and small island states (Wall, 1996).

To ensure the sustainability of the tourist industry in Cyprus, it has been recommended that a strategy of protection of infrastructure combined with planned retreat would be effective and appropriate to local circumstances. The overall goal would be to maintain the limited beach area to sustain the vital tourist industry, specifically by erecting hard structures, enforcing building set-backs, and use of artificial nourishment, although the latter measure may require external sources of sand (Nicholls and Hoozemans, 1996). Although not all these strategies may be applicable to the atoll states, many other island nations—such as Barbados, Jamaica, Grenada, St. Lucia, and Singapore—already have begun to implement similar approaches as part of the ICM process.