‘Creating and Managing Growth in Travel and Tourism’ TTRA European Conference,

Stockholm, Sweden, April 2001

INNOVATIVE PARTNERSHIPS FOR

SUSTAINABLE URBAN TOURISM
Framework Approach and the European Experience

Dr. Krassimira Paskaleva-Shapira1

Institute for Technology Assessment and System Analysis
Forschungszentrum Karlsruhe, Germany

Abstract
Europe’s cities and towns contain a rich cultural heritage. Yet, maintaining this
heritage presents many challenges, including dealing with the adverse environmental and
social impacts of mass tourism. Demands from urban tourism alike are high and growing,
hence the pressures and problems associated with the management of the sector have to
be systematically tackled by all parties concerned. Public-private partnerships are an
increasing aspect of the delivery of public policies and services across the world, yet with
a limited application in sustainable tourism development. This paper explores some of the
theoretical and policy issues concerning the reasons for development and operating
partnerships to promote urban sustainable tourism practices. A comparative evidence of
existing partnership cases in four European countries demonstrates the merits and the

1
The author wishes to acknowledge the contributions of the entire SUT-Governance research team (see
partners description at http://sut.itas.fzk.de) and Walter Kahlenborn and Jenny Atmanagara from Ecologic
GmbH (Berlin) who helped in generating some of the information on partnerships for sustainable (urban)
tourism in the four study countries – Germany, Austria, Greece and Bulgaria.
potentials of the approach, while emphasizing its, yet limited, utilization in public policy
and management of urban tourism in cities across Europe.

I. Research Context
Tourism figures among the industries with major growth in Europe contributing
with a 5 percent of GNP and generating 6 percent of all jobs in the European Union.
Urban tourism alone represents 30 percent of the journeys and 20 of overnight stays,
ranking respectively second and third among all tourist destinations (INTA 2001).
Another large number of European cities is potential tourist destinations. Increasing
investments in urban regeneration, heritage conservation and improving the quality of
urban life to adapt the city to the needs of visitors of attractive facilities, comfortable
transport, diverse events, and capitalisation of historical sites, among others, create new
prospects for the industry and the local communities. These developments, however,
create complex decision-making problems for the key stakeholders - city officials,
planners and economic leaders, industry and the public. Involving sustainability
considerations and long-term community advancement goals, poses even greater
challenges to urban policy makers and tourism developers.
Sustainable urban tourism requires attention to varied elements, including (a)
maintaining physical heritage in the context of living, developing cities; (b) allowing
maximum access to available infrastructure, tourist sites, parks, and other green spaces;
(c) strengthening the cultural and social viability of local community; (d) balancing
interests of residents and visitors; (e) economic viability (providing sound long-term
development and high quality employment opportunities); (f) minimizing adverse
ecological impacts on sites from transportation, and (9) unsustainable consumption
patterns. Achieving this involves advancing knowledge and practice about the types of
partnerships that can be formed to promote urban sustainable tourism; the roles of
government and other stakeholders; how local governments can apply such partnerships
to local tourism development; and the critical issues and challenges to local governments
seeking to create such partnerships. The paper addresses these complex multi-disciplinary
and multi-sectoral issues by contemplating a theoretical and policy framework supported
by evidence of existing national practices of private-public-community partnerships for
sustainable (urban) tourism in four European countries.
This research is part of a large international research and demonstration project
‘SUSTAINABLE URBAN TOURISM: Involving Local Agents and Partnerships for
New Forms of Governance’ (SUT-Governance) administered by Germany’s Karlsruhe
Research Center - Institute for Technology Assessment and Systems Analysis (ITAS) in
collaboration with the University of Economics and Business Administration and
Regional Consulting Ziviltechniker GmbH in Vienna (Austria), Aristotle University of
Thessaloniki (Greece), and the Veliko Turnovo University in Bulgaria.2 The project
presents an effort to work with public-private partnerships and urban governments in
Europe to develop, validate, and deploy a general framework for urban sustainable
2
This long-term project is a part of Key Action 4 “City of Tomorrow and Cultural Heritage” of the
“Energy, Environment and Sustainable Development” Program within the “Fifth Framework Program” of
the European Union.

2
tourism partnerships that is applicable to a variety of urban municipal and development
contexts. The national and case study field research is focused in Germany, Austria, Greece
and Bulgaria which present a mix of conditions for the analysis of urban sustainable
tourism partnerships, with a range of contexts in terms of such factors as levels of
economic, federal v. unified governmental structure, administrative capabilities, roles of
local government and other non-governmental groups, types of tourism, and
environmental policy frameworks. Within the four countries, case study efforts focus on
partnerships in selected cities: Heidelberg (DE), Graz (A), Thessaloniki (Gr), and Turnovo
(BG), all of which have been internationally recognized in their sustainable development
policy efforts and have developed tourism as a strategic economic sector.

II. Theoretical Setting

The study conceptual approach builds on, yet not fully developed, three theoretical
categories: (1) sustainable (urban) tourism development, (2) role of tourism in integrated
local community development, and (3) participatory governance as an innovative form of
achieving sustainable long-term solutions to existing local problems.
First, there is a fast growing – yet still not fully developed – body of work that
focuses on sustainable tourism development in a global context. This work draws on
detailed analyses of tourism growth, development trends, and economic, social, cultural,
and environmental impacts. Second, an emerging area of analysis and debate about the
role of tourism in local community (and urban) development, its benefits and costs to
localities, and its local environmental impacts. Third, a well developed general body of
literature on participation and governance. However, across all three areas, existing
theories and practice are weak on specific challenges of how to establish effective
decentralised decision-making and management for sustainable (urban) tourism. This
section describes the state of current knowledge in these three areas, highlights gaps, and
discusses the study approach to integrating these bodies of knowledge and advancing the
state of the art.
There is large body of literature on the tourist industry, focusing on the sector’s
principles, basic concepts, philosophies, practices, forms of tourism, and it’s marketing.
Opportunities and issues in the development of the sector and in its international
management are relatively well defined (see Boo 1990; Cooper et al 1993; Doswell 1997;
Gee, et al. 1997; Hetherington 1991; Kadt 1979; Kotler et al. 1993; Lea and Mointinhos
(ed.) 1998; McIntosh 1994; Middleton 1994; Pearce 1996; Rogers 1993; Smith 1995;
Smith and Eadington (ed.) 1992; WTO: various publications). Guidelines for the
development of the sector have been established at international, national, regional, local,
site-specific and architectural and engineering design levels (Gunn 1994; Inskeep 1991;
Lindberg et al. 1998; WTO 1994, 1998). Policy aspects and the responsibilities of the
state have also been in focus of recent scholarly debates (Hall and Jenkins 1995; Johnson
and Thomas (ed.) 1992).
However, the concept of sustainable tourism is relatively new. It is a concept that
has increasingly been the subject of study and activity over the last decade, as mass
tourism has expanded. In the 1990s and particularly after the adoption of Agenda 21, a
stronger connection was made between tourism and the environment and the sectors
potential for more sustainable development. To date, research and policy approaches

3
have focused on varied topics, including principles of sustainable tourism and policy
perspectives (Stabler (ed.) 1997), the European experience (Priestley et al. (ed.) 1996;
Montanary and Williams (ed.) 1995) consumer awareness and practices for responsible
tourism (Harrison and Husbands 1996), eco-tourism and protected areas (Ceballos-
Lascurain 1993), rural tourism development (Hetherington 1991), parks and green spaces
(Mertes and Hall 1995), the adverse ecological effects of nature tourism (Lindberg 1991),
and creating environmentally sound resorts (Rapaport ed. no date). Environmental
guidelines have been developed for large tourist corporations and eco-tour operators (The
Eco-tourism Society 1993), as well as for special categories such as marine tourism (The
Eco-tourism Society 1995), nature tourism (Whelan ed. 1991), the development of
national parks and protected areas for tourism (WTO and UNEP 1992), coastal areas
(WTO, UNEP and FEEE 1996), and tourism and food safety (WTO and WHO 1991).
However, there remains considerable debate about the processes and outcomes that
should or will result from certain sustainable development strategies. Also, much less
attention has been focused on sustainable tourism in a developed urban context, and there
are many underlying and unresolved questions about how best to promote sustainable
urban tourism practices.
Recently, debate has shifted from global perspectives to local issues about
tourism’s relationships with host communities (WTO, WTTC and The Earth Council
1995; WTO 1998) and on industry-community relations and interactions (Pearce et al
1996; Murphy 1985). Instruments for local governments to promote sustainability,
address legislative issues, adopt LA21 principles, and regulate land use have been
explored (UNCSD 1999). However, despite existing studies on local planning for tourism
development (see Harrison and Husbands 1996; Hawkins, et al. (eds.) 1995; WTO,
1994), few locality-based studies offer in-depth analyses in the context of principles of
sustainability. Stephen Page, for example, in his book “Urban Tourism” (1995), looks at
the impacts of tourism in the urban areas, but he fails to make a step further and address
the problems interactively from the perspectives of sustainability and its principles.
Just as there are gaps in global and local approaches to sustainable tourism, there
are also weaknesses in knowledge about how new forms of governance can support
sustainable urban tourism. Tourism raises many issues that are in the domain of city
government, including issues related to urban fabric and infrastructure, the conservation
of historic and cultural buildings and zones, controlling pressures for development,
overcrowding, pollution, the quality of jobs, and accommodating new technologies and
business forms. But local authorities alone cannot resolve such problems, requiring
instead involvement of all stakeholders, the development of consensus, and the
promotion of public-private-community partnerships. It has been argued that innovation
in participatory and governance systems is a critical issue in Europe, and that research of
the interactions society and the government must become an integral part of the process
of innovation itself (Paraskevas and Muldur 1997).
It is apparent that the sustainable management of urban tourism focuses attention
on the challenges that new decision making systems must overcome. Decision-making
processes are diffused, reflecting the multiple and diverse stakeholders, points of
responsibility, and gaps in authority that characterize the industry. To find solutions,
representative and responsible governance requires that sustainability initiatives foster

4
tighter relationships and partnerships as the foundation from which to attack and solve
these problems.
Various technologies and measures for sustainable development of the tourism
sector, such as heritage preservation requirements for site developments and building
designs, programs to exchange land and development rights from non-suitable to suitable
development areas, private heritage and green space stewardship programs, tourism taxes
and development fees to support construction and maintenance of required infrastructure
have been advanced. However, as the experiences of hundreds of local authorities
demonstrate, through their engagement in broad-based sustainable development planning
through Local Agenda 21, the appropriate application of these technologies and resources
requires effective and accountable partnerships (ICLEI 1999). If industry and
government are to protect and sustain the social, cultural and environmental wealth that
attracts tourists, they should build partnerships to plan, manage and invest in this wealth.
A growing number of books in recent years offer evaluations of public-private
partnerships in a broad range of theory and policy areas - education, health care and
health policy, welfare, environmental and energy policy, technology research and
development, and transportation (see Osborne (ed.) 2000; Bennet and Krebs 1991).
Partnerships are also articulated as key to improving urban life (Colman 1989; Davis
(ed.) no date). However, none of the literatures have explored the opportunities that
multi-stakeholders’ cooperation provides for development of sustainable tourism
practices in various settings.
Finally, participation, as a process through which stakeholders influence and share
control over development initiatives and the decision and the resources which affect them
(World Bank 1998), has been defined as a key principle of sustainability by all major
international organizations promoting sustainable development. In tourism, however, the
issue of participation and stakeholders involvement in development has been only
addressed to-date in the context of national tourism administrations (WTO 1996). Studies
on the local perspectives of participation are still missing. In-depth analysis of successful
complex urban tourist management involving sustainable principles is sparse. Examples
of urban cases that have explicitly sought to develop sustainable forms of tourism by
involving all principle actors in local decision-making are even more rare. It is difficult to
locate case studies of sustainable urban tourism which are detailed enough to assist
policy-makers in making decisions about the methods and the mechanisms to undertake
joint activities with other principle stakeholders. Many local community participants in
these efforts also lack convenient access to policy-oriented framework to reflect
commonalties and principles. Therefore, we assert that an integrated framework of
stakeholders’ participation is needed to assist future efforts in sustainable urban
management of tourism.

III. Theory and Policy of Urban Partnerships for

Sustainable Tourism: Concepts and Definitions
The concept of partnerships is at the core of the approach of innovative
participatory governance which “allows the mobilisation and co-operation of a great
number of actors in order to mould the necessary political and operational consensus to
affect directly the every day life of all members of society” (ISSC-UNISCO/MOST

5
1997). Fundamental to effective urban governance is considered the establishment of
public-private-citizen partnerships involving the principles of sustainability and Agenda
21. The creation of tangible, working local partnerships is also a key issue in the current
sustainable tourism debate, as argued earlier in this paper.
The term ‘partnerships’ covers greatly differing concepts and practices and is used
to describe a wide variety of relationships in a myriad of circumstances and locations (Mc
Quaid 2000). This section considers aspects and definitions of partnerships from the
perspectives of governance, policy, and public-private cooperation in the context of urban
sustainable tourism development.

1. Urban Multi-Stakeholder Partnerships

The need for a greater partnership in policy-making and implementation is
considered a key principle of participatory Governance.

a. Governance
The concept of governance has been articulated widely in the last decade and can
generally be conceived as actions between actors to foster democracy and overall societal
and community prosperity (UNESCO 1995). The “Commission on Global Governance”
(1995) underlines three main aspects of the above definition. First, governance is not
only government. Governance as a concept involves recognition that power exists inside
and outside the formal authority of government. In many existing formulations,
governance includes government, the private sector and civil society. Second, governance
is a neutral concept. Governance can employ various forms: effective and incompetent,
oppressive or benevolent. Third, governance also emphasizes ‘process’. It recognizes
that decisions are made on the basis of complex relationships between many actors with
different and sometimes conflicting priorities (UNCHS 2000).
The city level adaptation of governance could be taken as the sum of the many
ways individuals and institutions, public and private, plan and manage the common
affairs of the city. The UN’s Habitat Program regards it as a “continuing process through
which conflicting or diverse interests may be accommodated and cooperative action can
be taken. It includes formal institutions as well as informal arrangements and the social
capital of citizens”. Furthermore, urban governance is inextricably linked to the welfare
of the citizenry. Generally, good urban governance can be characterized by
sustainability, decentralization, equity, efficiency, transparency and accountability, civic
engagement and citizenship, and security, and that these norms are interdependent and
mutually reinforcing (UNCHS 2000). The UNCHS “Draft Declaration on the Norms of
Good Urban Governance” argues “good urban governance, to deserve that qualification,
must ensure that everyone shares equally the benefits of urban life”. To attain a
maximum representation and benefits for all, partnerships between the stakeholders must
be developed and operated.

b. Delivering effective public policy: Why have partnerships?

A key recommendation of the 1992 Rio Earth Summit was to foster public-private
collaboration in the global and local search of sustainability. Public-private partnerships
(PPP) alone have been an increasing aspect of the delivery of public policies and services

6
since the 1970s developing first in the USA and than spreading at various rates in other
countries (Carrol and Steane 2000:38). The 1990s have seen the establishment of PPP as
a key tool of public policy across the world as part of the governments’ efforts to promote
employment and local economic development in partnership with business (Waltzer and
Jacobs 1998). Today, PPPs offer alternatives to full privatisation, the trend of the 1980s,
combining the advantages of both the public and the private sector. They represent the
second generation of efforts to bring competitive market discipline to bear on government
operations. Unlike the first generation of privatizing efforts, partnering today involves
sharing both responsibility and financial risk. In the best situations, the strengths of each
sector maximize the overall performance. In these cases, partnering institutionalizes
collaborative arrangements in which the differences between the sectors become blurred.
While this is still the case today, the role played by the non-profit sector is recently also
increasing with non-profit organizations entering partnerships for generally altruistic
reasons or political objectives (Carrol and Steane 2000: 50).
Overall, as Osborne (2000: 1) convincingly argues ‘not only have partnerships been
seen as a co-efficient and effective mechanisms for the implementation of public policy
across a range of policy agenda, they have also been perceived as bringing significant
benefits to the whole community’. In the UK, PPPs are a core stone of the development
of stakeholder society of the Labor Government enjoying a particular success in urban
regeneration and social inclusion (Falconer and Ross 1998). Within the European Union
policy development, PPPs are essential integrative mechanisms both to combat social
inclusion and to enhance local community development (Jones 1998). In the US and
Canada, PPPs have been central to state-government initiatives to regenerate urban
communities and promote local economic development (Aspen Institute 1997; Podziba
1998).
In tune with the sustainability debate of the 1990s, one can ask the question ‘why
forming partnerships for sustainable local development?’. Most of all, because in their
nature, partnerships seek to develop a consensual approach to the joint pursuit of a
medium- to long-term strategy, which advances both the individual and collective
interests of their various members. PPP also recognise that both the public sector and the
private sector have certain advantages relative to the other in the performance of the
specific tasks. Thus, by allowing each sector to do what it does best, public services,
infrastructure, and sectors’ performance can be provided in a more efficient manner
(Municipia 2001).
Furthermore, PPPs in their various forms are especially appropriate for securing
economic, social, and community development in the current period showing tendencies
towards expansion of governance (Irish National Economic and Social Council 2000).
Partnerships are viewed as effective forms of governance because thy can build collective
responsibility for planning, decision-making, problem solving, project implementation
and evaluation. They can also create network to share knowledge, resources, and
common goals. Participation, local ownership and shared responsibility are important
aspects of this innovative approach. This complementary approach with a flexible design
and a constant feedback mechanism contributes to the success of public-private
partnerships. Finally, PPPs can be catalysts of sustainable community dialogue,
integrated solutions, and long-term local change.

7
 c. What are public-private partnerships for the urban
environment?
Following the recommendations of the Rio Conference on Sustainable
Development, the United Nation’s Urban Program has been largely supporting the
development of innovative and sustainable partnerships in cities around the world
(UNDP 2001). Governments, businesses, non-governmental organizations, members of
the scientific and academic community, and other institutions have been encouraged to
promote sustainable models of public-private cooperation in urban areas to address
infrastructure and environmental problems, in the most part. Stakeholders involvement in
planning, action, and assessment and feedback of policies have been seen as a more
responsive and more effective method of urban governance in context of the Local
Agenda 21 principles by lead development organizations. Key to this innovative plural
model of service delivery have been broad participation, local ownership and shared
responsibility for urban problem solving among all partners and interests. The above
forms the core of the urban governance framework context of public-private partnerships
evolving community gains and benefits (Ross and Asborne 1999).
Why are partnerships essential for the long-term prosperity of our cities? Today, it
has become apparent that urban problems, environmental and social in particular, are
becoming more acute as available government services and resources are overwhelmed
by expanding populations, accelerating growth, and diverse management responsibilities.
Although limited government funds represent a key challenge, the need for promoting an
integrated long-term development of the European (and other) cities creates opportunities
to use partnerships to optimise the application of available public and private resources to
benefit all citizens and communities. In recent years, PPP is one of the most attractive
tool being used to help address the urban environmental crisis based on the recognition
that both the public and private sectors can benefit by pooling their resources of basic
services (UNDP PPP 2001).
Public-private partnerships are becoming increasingly important in the local
economic development efforts of many cities. Local partnerships are now a feature of
how public policies are implemented, and are particularly used as the mechanism for the
implementation of area-based regeneration and development actions under the Structural
Funds. Yet, there has not been sufficient learning from these experiences yet - some
partnerships have been more effective than others. Many have not been particularly
effective in promoting wider representation of interests in decision-making and are
considered to lack legitimacy. They have not fit well with structures and processes of
representative democracy and there have been inequalities in representation of interests
and influence. The conditions for effective partnership (organisation of interests, parity of
resources, cultural factors etc. – see further in text) are often not well developed. Ways
of achieving better balance along all of these lines needs to become part of the criteria
and the focus of capacity building support in urban policy.
Despite the difficulties, however, partnerships are continuing to receive widespread
support from across political spectrum including policy makers, officials and urban
communities. They are likely to remain high on the policy agenda on all levels. At the
local level a wide range of pragmatic factors such as resource constraints and ideological
factors (see Leach et al. 1994) justify continued or greater involvement in partnerships
approaches. Other factors include the move towards enabling local government to

8
implement sustainable policies, a recognition that anyone local actor does not have the
resources or competences to deal with the interconnected issue raised by multiple policy
areas of urban development, and a general agreement that urban regeneration and long-
term progress should involve a genuine participation of the local community.
Various multi-stakeholder partnerships form the bases of innovative urban
governance: between central governments and local authorities; between private and
public sector for the management and development of urban sectors, state organs and
citizens, and voluntary organizations to maintain social, cultural, and environmental
viability of cities. A special interest in the delivery of urban governance is to support
innovative forms of partnerships in the triangle of governments, businesses and civil
society (UNDP 2001). Within the context of the urban environment, PPPs in general
involve cooperation between the public and private sector for mutual benefits
contributing to the improving of the urban economy and the quality of life (Harding
1990). This approach incorporates a voluntary nature of the relationship, the need for an
agreed strategy, a long time scale, and agreed contributions of resources (presumably in a
variety of forms) to the process.
The MUNICIPIA International Consortium for Urban Decision Making (2001)
defines PPP for the urban environment as a “partnership between the public and private
sector for the purpose of delivering a project or service traditionally provided by the
public sector”. The United Nation’s development program considers PPP as innovative
partnerships at the local level, particularly well working in small and medium-sized
cities, where potential stakeholders are involved including investors, providers,
regulators, users, and experts to meet the challenge of providing various urban services
and promote integrated development. We can thus use the term “Public-Private
Partnership” (PPP) to describe a spectrum of possible relationships between public and
private actors for the co-operative provision of services and development3.
Using this innovation approach, PPP can support cities in meeting their urban
sustainable objectives by promoting a closer collaboration between the private and the
public sectors. Thus, a working definition of PPP for sustainable urban environment
could be taken as a the mobilization of coalition of interest drawn from more than one
sector in order to develop and implement an agreed strategy for various activities which
entails sustainable outcomes based on a broad local vision for the area and community.
PPPs obviously offer alternatives to joint ventures (through divestiture of government
assets) by combining the social responsibility, environmental awareness and public
accountability of the public sector, with the finance, technology, managerial efficiency
and entrepreneurial spirit of the private sector. The “right” relationship is thus the one
that best meets the needs and goals of the partners in the local urban context.
From a policy perspective, partnership can be viewed as a coalition in which risks,
resources and skills are shared in projects that benefit each partner as well as the
community (Stratton 1989). It is not enough, however, to just build partnership
structures; it is also important to build up a culture of partnership. This needs longer

3
In the context of public-private partnerships (PPP), we use a broad definition of the private sector,
including local, national and international businesses, as well as informal enterprises, non-governmental
organizations and communities.

9
timescales for development and is an important part of the wider capacity building
process of urban governance.

2. Urban Partnerships: Sustainable tourism

perspectives

The issue of urban tourism sets up the spatial framework of exploring partnership
formation.

a. Urban tourism: Opportunities for cooperation

Tourism is one of the fastest growing sectors of the European and global economy.
On our continent, as long as 1970, P. Hall (1970:445) predicted that ‘the age of mass
tourism is the biggest single factor for change in the great capitals of Europe - and in
many small historic cities – in the last 30 years of this century’. According to Law
(1993:1) ‘“large cities are arguably the most important type of tourist destinations across
the world’ and yet urban areas have been neglected in most academic tourism studies.
Major components of tourism and its wide-ranging effects on urban places remain
relatively unknown. The operation and the management of this process have been
generally poorly understood in theoretical and conceptual terms.
Cities as tourist destinations have multiple functions: they serve as gateways to
enter the country, as centers for accommodation, and base for excursions to rural areas
and destinations of there own right. Moreover, urban areas are not simply destinations
where populations concentrate together with economic activities, cultural life and the
control of political powers but they also have a great role as centers of tourism activities.
This suggests that research and practice should focus on urban tourism rather than
tourism in cities.
What constitutes urban tourism? These can be a number of activities and
motivations (tourism demand). Though varying by destinations and its attractions, these
could be visiting friends, business/convention, outdoor recreation, entertaining and
sightseeing, shopping, and education. The tourist city thus embraces all of the above
functions and their resources. However, tourist infrastructure, services and activities (the
supply of urban tourism) side has multiple users including the city residents, city-region
residents, and people working within the city.
Unfortunately, urban tourism, because the supply and demand side of tourism is
entwined with other urban functions, it has been viewed as ephemeral phenomenon
which is seasonable in character and transitory, as an adjunct to the way in which cities
operate. As a result, local planners have considered tourism as a managerial activity with
limited concerns over the effects of such a transitory activity rather than activity with
potentials towards sustainable urban development. Thus, with little research on urban
tourism, the public sector has not seen the necessity of detailed research to understand
urban tourism.
However, with tourism studies gaining a strong recognition in the last decade it is
appropriate for academics and practitioners to examine the wide-ranging effects of
tourism in localities in different social, cultural, and political environments. As it was
noted earlier, urban tourism constitutes a complex nature within the multifunctional
nature of cities as tourist destinations. Urban tourist functions are very rarely solely

10
produced for, or consumed by, tourists but a whole range of users (Shaw and Willimas
1994: 201). This requires a system approach to understand the interrelated nature of
tourism activities within cities. This holistic view of urban tourism also helps considering
long-term community benefits.
Whether these are capital cities, or metropolitan centers, large historic cities or
inner-city areas, cultural cities, revitalized waterfront sides or industrial cities, the issues
of multifaceted relationships and complex impacts of tourism remain consistent. The
development, expansion, and operation of tourism in urban areas, despite the economic
merits4, have lead to a number of negative impacts for the cities and their population. Yet
the concern of the sector’s impacts is not confined to urban areas only – it’s a part of a
growing concern for the impact and long-term sustainability of both tourism and the host
community. These constitute the social and cultural impacts on changing value systems,
individual behaviors, family relations, collective lifestyles, safety levels, moral conduct,
creative expressions, traditional ceremonies and community organizations (Fox 1977).
Finally, the environmental dimensions and impacts of tourism in the cities are
assuming a growing significance with their number steadily increasing due to tourism
expansion: architectural ‘pollution’, urban sprawl in absence of planning, overloaded
infrastructure, traffic congestion, pollution of ecosystem from sewage, litter (Mathieson
and Wall 1982). Thus tourism may lead to changes in the urban environmental and
physical characteristics, visual impacts on the environment, requirements of urban
infrastructure, urban forms, and decline of quality of the urban environment (Green and
Hunter 1992) due to lack of planning.
On the other side, however, tourism can also assist the improvement of the urban
ecology. Shaw and Williams (1992), for example, report on not just the environmental
concerns in inner city areas, but also claim that tourism can actually enhance the
environmental quality particularly where the industry is used to regenerate entire inner
city districts, or, as Law (1993) argues too, redundant urban spaces. Evidence from
multiple cities indeed indicates, that tourism could be beneficial to the urban environment
in the restoration of specific features in the historical and cultural environment or
architecture of buildings and reuse of redundant buildings.
The impact phenomenon of tourism thus involves a wide range participation of
local actors. A wide range of agents of development become involved in either directly
meeting the needs of tourists or to facilitate control, planning and regulation, commonly
being the responsibility of the public sector. In the age of public-private partnerships this
is important to understand who is responsible for urban tourism and what organizations
can do to improve their experience. Other important questions are: What are the principal
partners for shaping and implementing policies? What is the organizational strength for
tourism development strategies – is there formal or informal urban organizing capacity
oriented specifically to further common interest and goals and to what extend are the
urban authorities involved in shaping the development of tourism and leisure activity in
the cities? In urban tourism, it is important to define the range of actors involved and the
power devolved. Because of the decentralized management of the sector, we argue, these

4
As Law (1933) argues, many urban governments are primarily viewing tourism as a mechanism to aid the
regeneration of ailing economies, a perception carrying their one problem since tourists are not noted for
their high level of customer loyalty to tourism destinations.

11
are the main stakeholders: local authorities, the private sector, the voluntary sector and
the local community.
Multiple opportunities for cooperation exist. Key is the stakeholders’
involvement in long-term strategic planning and development. Other areas include
innovations in management of urban tourism problems such as visitor managing in small
history sites, museums and galleries, theaters and concerts; development of (a) activity
places such as cultural concert halls, exhibitions, museums and art galleries or sport
facilities and organized events, or (b) leisure settings such as ancient buildings and
monuments, harbors, historical street pattern, parks and green areas, or ecclesiastical
buildings, and (c) socio-cultural features as folklore, friendliness, language, liveliness and
ambience of the place, local customs and security. Additional opportunities include
community markets, residents-friendly shopping areas, and secondary elements such as
site accessibility and parking areas, information offices and programs.

b. Urban Tourism: Issues of sustainability

Understanding the concepts of sustainable development in general and sustainable
tourism in particular requires that we consider several considerations (1) what should be
sustained (2) over what temporal and social organizational scale (3) for whom and (4)
why. Ideally, sustainable tourism combines and must seek a balance between (a) present
benefits with (b) the protection and enhancement of future opportunities (in context of
natural resources, natural and cultural heritage and socio-economic prosperity) for the
population of the host community while (3) maintaining its cultural, environmental, and
biological quality, diversity, integrity, and viability (Based on UN CSD and the WTO
approach to sustainable tourism and Lopez de Avila 1995). Furthermore, sustainable
tourism should benefit all citizens, regions, and tourism industries (OECD 1997). Far-
reaching views assert the importance of social participation, including the local
communities as well. Furthermore, on a large scale, sustainable tourism must serve broad
community goals, such as maintenance of the socio-economic welfare or a positive level
of residents’ attitude, for example. Moreover, it also has to reinforce the cultural integrity
and social, historic and cultural norms of the whole society. In the above context,
sustainable tourism implies too that the historic and cultural resources of tourism are
preserved and/or enhanced for continuous use for the future and the present while seeking
preservation and consolidation of its cultural values and traditions (OECD 1997).
Therefore, sustainable tourism means that tourist development does not generate
environmental and socio-cultural problems. In these complex relations, Local Agenda 21
can bring to light the links between tourism, local prosperity and sustainability.
Theoretical and empirical research, however, also indicates that the above goals
may be best achieved by cooperation of all groups at all levels with a view of facilitating
Local Agenda 21 principles of sustainable development so widely shared benefits among
community members and society as a whole can be accomplished. Thus three main gains
can be achieved: increased local social welfare; greater and more equitably distributed
local economic wealth, and enhanced integrity of local ecosystems. In this larger context,
one can claim that a proof of ‘sustainable tourism’ is the ‘sustainable development’ of
local communities that serve as tourist destinations (ICLEI 1999).

12
 c. Partnerships for sustainable urban tourism: Pros and Cons
The discussion so far suggests a number of factors, which may promote or hinder
partnerships for sustainable urban tourism. A range of merits was described in the
previous sections. In summary, for partners, PPPs allow several key advantages:
Resource availability: Pulling or leverage, or increasing the scale and level of
resources, in terms of finance, marketing, administration or production;
Increased effectiveness and efficiency of individual organizations through
improved coordination and decreased wasteful duplication therefore achieving a greater
output and cost savings5;
Building local capacity for action and control by the local community and other
stakeholders;
Allowing a greater legitimacy for policy involving actors directly rather than the
Representative democracy of local government (although this raises questions about the
form of participation where in tourism, we argue that a stakeholders participation is more
beneficial than a broad-based public participations).
Avoiding conflict, create confidence and trust and increase participation of
community members is another aspect of partnerships.
However, partnerships also present multiple problems, which may vary according
to the type of partnership. These revolve around resource costs, power distribution and
inequality (between bodies and over time), unclear goals, resource costs, unequal power,
impacts upon other mainstream services, differences in philosophy among partners, and
operational difficulties and organizational problems (Hastings 1996). In terms of
sustainability, key among them is the importance of the future relative to present. Short-
term profits versus long-term integrated objectives often pose challenges to the various
stakeholders. ‘Long-term relationship can overcome the dilemma and achieve the
optimum outcome’, says Kay (1993). Therefore stable cooperation is considered
necessary involving frequent interactions between individuals binded by in long-term
multi-level relationships between the organizations. An active private sector and
persistence of policies suggests greater potential for long-term co-operations. In order to
attract greater involvement of the sectors it is also important that the most appropriate
pay-offs for each actor individually are considered. Next, local characteristics, capacity
building networks and the potentials for participation of the local community are also
important in assisting PPPs.
Overall characteristics of effective development partnership, may include: clarity
of objectives; agreement on operation (structure, resources, responsibilities, management
longer term strategy); clear line of communication; clear exit routes (what happens when
and after objectives are met); supportive institutional structure; suitable system of
incentives to encourage change of behavior; and last, but not least, trust between
institutions
A successful partnership can lead to number of public-policy and community
gains: (I) To integrate sectors and utilize resources from public and private sectors of
local communities to combat inequality and exclusion; (ii) To reform services to become
more accessible and responsive to consumer’s needs; (ii) To use local networks for

5
For certain tourism policies partnerships are crucial for creating a positive external and community
perceptions (Kotler et al. 1993), or in the long-term, to increase economic effectiveness through creating
stability, building local confidence and minimizing risks for partners and investors.

13
implementation of PPP; (iv) To attain a more flexible and improved public-policy making
process by utilizing community and business links, and (v) To create basis of governance
and civil society.

3. Public Policy Context of Partnering: The city role in

catalyzing PPP for sustainable urban tourism

In view of the growing complexity of urban development, it is increasingly

necessary to make all active participants in the urban environment, the so-called urban
decision makers, face up to their responsibilities and let the citizens they represent have a
say in the running of cities. Urban decision makers are not usually individuals but
organizations, groups and businesses. This chapter considers some of the issues
concerning the role of urban authorities in promoting PPPs for sustainable tourism.
As it was discussed earlier, the social, economic and environmental impacts of
tourism are interrelated, overlapping and mutually reinforcing. Partnerships therefore are
essential in order to tackle problems of local tourism, their causes and the externalities.
This view apparently must underpin urban policy for sustainable tourism, as it has been
done in urban regeneration or employment and social inclusion programs in the 1980s
and more recent EU policies to generate partnerships in support of local and regional
development programs.
An important question is why should the public sector and other s seek forming a
partnership rather than carrying out the activity by itself. This section considered some of
the arguments in favor of forming and implementing partnerships as part of urban
governance policy-making. First, a number one point is that by cooperating the sum of
benefits may increase using a given level of resources. Moreover, partnerships are
considered to be an effective way of overcoming market imperfections caused by
externalities. Therefore the government should provide the Good and the services.
Thus the issue of the role of the local authorities in entering and enforcing
partnerships comes into play. Why should cities catalyze and sustain partnerships? A
strong incentive should be sustaining long-term community sustainable development, or
bringing in external resources (funding, expertise, links to other schemes), avoidance of
duplication, replication of good practices on other joint activities, and hence more
effective and efficient policy development and implementation. In summary, while the
private sector could be largely motivated by profit, the public sector, in contrast, may
become involve in tourism for a set of reasons, among which most important are: (i)
Economic (aid local economies, diversify the economy, increase employment, increase
revenues form taxes, generate new employment opportunities (Based on Pearce 1989);
(ii) Social and cultural (ensure well being and health of individuals is protected, promote
cultural awareness of an area and its people); (iii) Environmental (undertake the
stewardship of the environment and tourism resources that the agents of development do
not destroy the future basis for sustainable tourism development; (iv) Political reasons
(further political objectives and broaden political acceptance of the local administration
(Based on Page 1995).
However, despite the apparent core role, as Pierce (1989:44) rightfully
acknowledges, ‘the public sector is by no means a single entity with clear cut

14
responsibilities and single policies for tourism development’. Rather it becomes involved
in variety of forms at different levels and through many agencies and institutions.
A key factor in promoting successful partnerships is strong political leadership. City
authorities have a central role to play, as the structures of local democracy.

IV. Understanding and Analyzing Partnerships for

Sustainable Urban Tourism: Framework Approach

Efforts to implement partnerships at the local level, however, face many challenges.
A successful realization itself is a great challenge. A wealth of literature deliberates on
most important issue of partnerships6. All of these literatures are important on their own.
Missing, however, is a framework to link management and impact considerations of
partnerships across communities in various contexts. Understanding the nature and goals
of PPPs, the instructional characteristics, the components, the process and governing of
PPPs is key to understanding the role of partnerships. However, divergent of public-
policy contexts for PPPs need to understand such partnerships in terms of their national
and local context and impacts where the public sector assumes a leadership role.
To deal with the complexity and the relationships, which co-exist within urban
tourism, one needs to develop an analytical framework, which can synthesize the
multiplicity of factors, processes, and issues affecting the process of urban tourism in
different contexts. The objective of developing such framework is to encompass a range
of multidisciplinary perspectives, the total experience of urban tourism and its impacts on
the host community. To reduce the complexity of the holistic approach, a number of
main attributes and certain components will be defined which highlight the interrelated
nature of the different factors affecting the effectiveness and success of urban sustainable
tourism. In this section, we offer a framework for horizontal partnerships at the local
level (public-private-voluntary sector) in host communities involving the factors that are
useful in understanding partnerships in different circumstances but particularly for
sustainable tourism practices in urban contexts.
To operationalize the theoretical setting, we employ a conceptual model. We
hypothesis that, first, a system of urban community-specific factors determines the results
of an individual type of tourist partnership activity. Cities and towns are comprised of
systems that are economic, social, institutional, and environmental in nature. Without
accurate information on how these systems function together, decision-makers cannot
effectively analyze the systems in their care. Second, an instituted government decision-
making framework for partnerships and sustainable tourism development is needed to
ensure an effective partnership process and its implementation. In return, we argue that it
is important to view PPPs not as a describe phenomenon but rather within the broader

For example, (1) the nature of organization, structure, resource dependency of collaboration, and
institutional paradigm (Huxham and Vangen 1996, Benson 1975; DiMaggio and Powell 1988); (2) the
public management emphasizing on issues of relationships, management and costs (Osborn 1997); (3) a
public-governance perspective of PPPs emphasizing on the political and social context of relationships
within networks (Kooiman 1993; Kickert 1997); (4) community development perspectives of PPPs within
the context of needs of the local community (Oakley 1991); (5) empirical evidence describing the process
and the impact of PPPs upon provision of local services and the local community development (Taylor
1997).

15
institutional framework within which they operate. When the latter is explored then the
strength and weakness of the government and other stakeholders within it become
apparent. Third, key to its success is the establishment and operation of an effective
partnership process using the appropriate methods and approaches. And finally, the
employment of effective implementation methods, including high technical skills and up-
to-date technologies followed by assessments of the impacts and feedback for use in
other relevant projects and activities is critical for success. In this context, we argue that a
vital issue of the evolution of PPPs is the complex impacts on community development,
capacity building and civil society, and finally the contribution, which PPPs can make on
public-policy-making. In this line of analysis, in order to be able to identify, among other
factors, those that lead to the project’s success, all factors need to be analyzed in a
holistic way.
Our conceptual model thus builds on three classes of attributes and the interfaces
between and among them. The three attributes are context, activity, and resolution. The
interfaces between and among these attributes are public involvement and multi-
stakeholder partnerships.
Context Attributes include (1) specific activity-related factors pertaining to the
context in which tourism development issue exists, including: (a) demographic
characteristics of the community affected by tourism development such as income and
education; (b) economic development issue such as ownership, growth rates, employment
opportunities and unemployment; (c) environment and land-use considerations including
such as energy and resource utilization, location of site/activity within the urban space, :
accessibility, environmental issues, and zoning restrictions; (d) cultural and historic
preservation issues and (e) and community organizational structure including whether the
community has a formalized structure with defined leadership roles and responsibilities
and the capacity to delegate responsibilities, workers associations, and the availability of
consumer and other interest groups; (2) Specific characteristics of the established process
of decision-making for tourism management, including considerations of the Local
Agenda 21 principles, commitment to partnerships, training, dissemination and awareness
raising, and networking locally, regionally, and beyond; (3) The level of commitment of
the local government to Local Agenda 21, creating partnerships and sustainable tourism
development (Local Agenda 21 Action plan and the link to tourist industry,
institutionalized decision-making for sustainable development, action to involve directly
and indirectly affected partners including the non-joiners, and commitment to openness,
transparency, and awareness-raising).
Activity/Program Attributes include features of the activity being proposed or
pursued: Understanding the capabilities and limitations of the technology (methodology)
selected for the activity; costs, the time necessary to establish and conduct the activity
and possibilities of affect on future development opportunities; the socio-political,
regulatory, and legal implications of the proposed activity; and the sustainability of the
proposed activity including the ability of the design team to account for the externalities,
including environmental, social, economic, and cultural impacts.
Project Resolution Attributes comprise he union of all other classes of attributes.
This class includes features describing the design and the implementation of the activity
including effectiveness, efficiency, evaluation and feedback, communication, applicable
statutes and regulations, and principles of urban sustainability.

16
 Public Involvement Attributes present the first interface class of attributes, defining
the overlap between context attributes and resolution attributes. This class of attributes
includes features such as general awareness of problems and the level of community
concern, commitment by the community to support the proposed activity to successful
completion, and specificity of goals, public perceptions of risk including the degree of
risk, and assurance that all parties are working to minimize risk; degree of community
empowerment to resist adverse impacts, providing the community with ownership,
maintenance, and a financial stake in the outcome of the action. Other attributes include
the establishment of relationships between the public and the technical providers through
free flow of information, the development of trust in each of the parties, clearly defining
roles and responsibilities through memoranda of agreements or similar methods with the
objective being the creation of openness and integrity among parties; and, the
understanding of the community’s long-term interests, facilitated by the efforts necessary
to get to know the community and the willingness to listen to the community .
Establishing Effective Partnerships is the second and key to the issue of effective
governance of local sustainable tourism, the focus of this project, which includes features
such as establishing an institutionalized (government) approach to involving partnerships
in the decision-making process for tourism development, including (a) identification of
areas of concerns and the “right” partners for funding the best solutions, (b) involving the
stakeholders in participatory planning and decision-making, (c) collaborative evaluation
of impacts, (d) effective implementation and monitoring, (e) assessing feedback for
considerations in future projects. The methods by which partnerships are constituted (e.g.
time limited agreements, focus on specific issues) and structures and ways of working in
order to manage a process of wide participation (e.g. through sub-structures of
partnerships, working groups on specific themes) need further attention.
While extensive knowledge exists about the subsets of the attributes, to date no
integrated framework has been established to reflect the relationships between all these
attribute classes to show their relative and/or collective influence on the success of a
tourism-focused urban project. The larger SUT-Governance project seeks to create and
establish such a unified framework based on empirical review and evaluation of existing
success cases. The framework can assist evaluation of SUT PPPs’ success.

V. Partnerships for Sustainable Urban Tourism in

European Perspective: Context & Development
In this chapter we discuss some of the key findings of the first phase of the SUT-
Governance project examining (1) Framework development: Influences on decision-
making for PPP for SUT and (2) Country context assessment in Germany, Austria,
Greece, and Bulgaria. A range of cases from the four countries is brought in highlighting
their nature, goals and links with sustainability. A detailed investigation on the
application of PPPs in promoting urban sustainable tourism in Europe will be the focus of
the next phase of the SUT-Governance project.
The initial findings of the detailed country framework analysis, empirical review
and the evaluation of existing projects in the selected four countries, indicate that, though
a number of PPPs for (sustainable) tourism have been established on all levels of both
government and industry policy and action efforts, they are mostly in the area of

17
marketing. The cases come from a number of tourism activity fields. On local urban level
specifically, some partnership projects deal with traffic related problems in tourist areas
(Heidelberg, Germany) or seek improvement of the industry performance towards
sustainability (ECO-LABEL in Vienna and Graz, Austria). In Bulgaria, the newly
established local and regional tourism associations have practically opened the door to
various stakeholders allowing a greater participation in promoting more sustainable local
forms of tourism. The cultural basis for PPPs is differently established in the selected
countries. However, while each partnership is a function of particular historical,
economic, social, and political context, there are many common natures and trends.
Apparently, while many urban pressures are encouraging PPPs, the local political and
sectoral cultures are generally far less open to this model of service delivery. Greece
represents an exception since tourism is high on all policy agendas nationwide.
As a result, the role of partnerships in promoting urban sustainable tourism, by and
large, has been insignificant in all four countries. Moreover, the impact of the existing
programs on urban decision-making and management of tourism in the direction of
participatory governance and sustainable community development has been minimum.
Germany, for example, represents one unambiguous case demonstrating the general lack
of interest and action in catalyzing partnerships for sustainable urban tourism, on part of
all sectors, including public authorities, industry, tourism associations, and non-
governmental interest groups and organizations due to its generally rigid administrative
system. Moreover, the institutionalization of this innovative approach by local authorities
is usually not a priority on their policy agendas. However, some successful cases
demonstrate that partnerships maintain strong potentials for improving tourism practices
towards a more sustainable future. Here are some examples:

In Munich (GE) the local tourist board and some private companies have set up a
programme to provide tourists with the opportunity to visit the city either walking
or by bicycle, bus, tram or coach. A special brochure promotes the program.

Also in Munich, hotel booking via the “Munich Key” (Münchener Schlüssel)
includes automatically a ticket for public transport services.

Freiburg (GE) has stipulated an agreement with local hotels and restaurants to
exclude of packaging waste tax those hotels and restaurants, which do not use
disposal packaging and serving utile.

Baden-Baden (GE) operates a biodegradable facility and a number of restaurants
and hotels now participate in the established treatment scheme.

The city of Worbis (GE) runs a project aimed to revive local traditions and arts
through exhibitions and other events attempting to increase the attractiveness of
the city for the tourists.

The city of Leutenberg (GE) strives to become a model city for "tourism and
environment" in Thuringia. A key initiative involves strengthening of the co-
operation between local restaurants and local organic farms.
Noticeably, partnerships are being used more and more often in tourism across the
study countries. Most of them have economic pursuits. Partnerships, aimed at improving
the environmental performance of the sector are few and involve primarily the private
and public sectors where the main actors are local authorities and local businesses.
Community-partnerships, i.e. partnerships involving NGOs are less frequent. In
Germany, for example, they are typically not relevant to the administrative tradition,

18
therefore have been generally less welcome. Furthermore, the partnerships at the local
level are more common in the area of implementing tourism policies than in the phase of
formulation and planning, and have not been generally used as instruments in the
decision-making process.
Despite the slow progress and considering current trends, it appears likely,
however, that partnerships will more and more be regarded as an important policy
implementation instrument. With respect to sustainable tourism, multi-stakeholder
partnerships will likely be of growing importance, since tourism-related environmental
objectives cannot be achieved through the implementation of hard instruments alone.
Pressures for improving the quality of jobs in the sector will place social concerns on the
spotlight as well.
It is also important to acknowledge the different types of partnerships which exist
- some focus on building agendas for cooperation, and agreement on strategy only and
have no role in execution while others have been created with more comprehensive
implementation roles. On the other side, some seek to introduce the PPP idea into
ongoing local governance programmers in the countries building on established
relationships. Other uses the Local Agenda 21 frameworks to facilitate a sustainable
tourism joint venture. Such example is the City of Lübeck’s (GE) ‘Conception for
Tourism’, which incorporates the concept for sustainable local tourism with the view to
optimize the number and quality of jobs in the local tourism industry, promote biking and
pedestrian areas across the city and offer diverse opportunities for families with children.
Generally, such schemes have functioned well. Their main liability, however, is the
one-sided orientation towards economic growth. Environmental and social aspects are
less considered. Partnerships promoting explicitly sustainability are less common. The
focus in the future should be obviously on these other important aspect.
PPP appear particularly beneficial especially in the less developed countries, such
as Bulgaria and Greece where the private sector participation can contribute substantially
to the reforms of basic public services. High-level political commitment of the central
government to support multistakeholder participation in tourism development has been
critical. A strong decentralization policy in place that gives local governments sufficient
autonomy for PPP development is also central. Potentials for domestic and international
private sector investments in city infrastructure and tourism services, such as in Vienna
and Thessaloniki, appear key to success. Local institutions with the capacity to execute
the partnership policies and programs with a high standard of managerial and substantial
know-how are important too. Finally, potentials for cost-sharing arrangements with bi-
lateral and multi-lateral agencies, governments, private sector or other funds on the local
city country level are essential as well.

VI. Concluding Remarks

The previous sections have suggested that there is a need to form a framework to
allow a meaningful analysis of partnerships aiming sustainability goals, to distinguish
between different types of PPPs and to increase their effectiveness. We have also
underlined that despite the diversity, there are general dimensions, which allow the
development of a more general framework for analyzing and improving partnerships.
This would allow linking individual studies and polices in general circumstances.

19
Investigating individual cases using this framework provides evidence of the real benefits
that partnerships bring or do not bring, considering if and how the costs and benefits of
cooperation can be reconciled. This would improve our understanding of policy
development and implementation, provide models useful to practitioners and researchers,
help us learn what types of partnerships are helpful for sustainable tourism, clarify
advantages and disadvantages and how these can be dealt with.
An apparent paradox was set out, that single institutions like local authorities have
to deal with multifunctional nature of policies resulting in the need of a partnership form
of strategy development and implementation involving participation of the non-public
sector key actors. We also underlined some factors likely to assist the development of
effective partnerships. Certainly success must be viewed in terms of what partnerships
bring, how legitimate their legitimacy is, the resources used, the issues that are dealt with,
the time span of the impacts, the management and evaluation.
The local government may craft the approach that best fits their local needs,
drawing from the lessons learned in partnership arrangements elsewhere. Lessons can be
learnt from practical experience that is generated through a detailed case studies carrying
out public-private partnerships.
Efforts to implement these partnerships at the local level, however, face many
challenges. For governments, the challenge is to find ways to fulfill their responsibility
for ensuring that tourism development benefits all citizens and the community in the long
run while meeting the needs of the private inventors and entrepreneurs. This implies a
new and often difficult transition for many governments, from provider and manager of
basic services, to enabler, regulator, and collaborator. An examination of the present
legal, structural, financial, and political underpinnings of those policy areas of domestic
urban government appear most critical. It is also important to understand the current and
emerging agenda of state and local governments and the growing number of private profit
and not-for-profit organizations that are assuming increasing responsibility for leadership
and performance in state and local tourism affairs.
Government offices have to facilitate an effective co-ordination with other
bilateral and multilateral actors to ensure harmonization of policies and action with and
the pooling of resources through joint programming and cost sharing. PPPs must not
more be used solely a policy implementation tool, rather they have to assume an
important role in the design of policy initiatives. At the end, PPPs must impact the
policy-making process towards participatory urban governance.
For private tourist firms, the challenge is to be convinced that investing in any
particular project offers more attractive returns than other available investment
opportunities. Most importantly, entrepreneurs must be encouraged by the long-term
benefits that sustainability considerations will bring into their businesses and the
community. Drawing that conclusion depends on the firm's comparison of the potential
returns against the potential risks, considering not just economic but social, cultural, and
environmental outcomes.
Overcoming these challenges could be complicated, however, by a range of gaps
in the capacity of both public and private actors. Major gaps may include: (a) the
reciprocal mistrust and lack of understanding of each other’s interests and needs across
the public and private sectors; (b) the absence of locally available information on, and
experience with, arranging sustainable partnerships; and (c) the underlying legal,

20
political, and institutional obstacles to forming effective public-private relationships.
These gaps may lead to lengthy negotiations and increased transaction costs making such
partnership projects less attractive to potential interest parties.
The challenge for solutions is to tackle these bottlenecks and lay the groundwork
for more effective collaboration at the local level. Local governments must implement the
necessary sector reforms and develop integrated strategies for multistakeholder
participation. We can specify four sets of strategic dilemmas to be addressed: (1) Trust
building (2) Effective structure building (3) Policy development (remove legal and
political bottlenecks which hinder PPP development at the local level and, if necessary,
carry out policy or legislative reform) (4) Capacity building for local governments, local
business and community organizations aimed at overcoming misunderstanding and
mistrust between public and private actors, and building the minimum capacities to
design and negotiate effectively sustainable partnerships.
Next in the SUT-Governance project, we will merge our experiential and research
findings to examine how successful partnerships perform, to identify the conditions in
which they work best, and to determine the factors that define their long-term success.

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