This appendix provides details about the construction of the 2015 edition of the Travel & Tourism Competitiveness Index (TTCI).

The TTCI structure (detailed below) is based on 14 pillars organized into four subindexes: A) Enabling Environment, composed of five pillars: 1. Business Environment, 2. Safety and Security, 3. Health and Hygiene, 4.Human Resources and Labour Market, 5. ICT Readiness; B) T&T Policy and Enabling Conditions, composed of four pillars: 6. Prioritization of Travel & Tourism, 7. International Openness, 8. Price Competitiveness, 9. Environmental sustainability; C) Infrastructure, composed of three pillars: 10. Air Transport Infrastructure, 11. Ground and Port Infrastructure, 12. Tourist Service Infrastructure; and D) Natural and Cultural Resources (2 pillars): 13. Natural Resources and 14. Cultural Resources and Business Travel.

These 14 pillars are calculated on the basis of data derived from the Executive Opinion Survey (Survey) and quantitative data from other sources.

The Survey data is derived from responses to the World Economic Forum’s Executive Opinion Survey and range in value from 1 to 7. Hard data were collected from various sources, which are described in the Technical Notes and Sources section at the end of the Report. All of the data used in the calculation of the TTCI can be found in the Data Tables section of the Report.

Hard data indicators used in the TTCI are normalized to a 1-to-7 scale in order to align them with the Executive Opinion Survey’s results.¹

Each of the pillars has been calculated as an un-weighted average of the individual component variables.

The subindexes are then calculated as un-weighted averages of the included pillars. In the case of the Human Resources and Labour Market pillar, which is, itself, composed of two subpillars (Qualification of the labour force and Labour market), the overall pillar is the un-weighted average of the two subpillars.

The overall TTCI is then the un-weighted average of the three subindexes. The indicators that make up each pillar and subpillar are described below.

Indicators not derived from the Survey are identified by an asterisk on the following pages.

Subindex A: Enabling Environment

Pillar 1: Business Environment
1.01 Property rights
1.02 Impact of rules on FDI
1.03 Efficiency of legal framework in settling disputes²
1.04 Efficiency of legal framework in challenging regulations²
1.05 Time required to deal with construction permits*²
1.06 Cost to deal with construction permits*²
1.07 Extent of market dominance
1.08 Time required to start a business*²
1.09 Cost to start a business*²
1.10 Extent and effect of taxation on incentives to work²
1.11 Extent and effect of taxation on incentives to invest²
1.12 Total tax rate*

Pillar 2: Safety and Security
2.01 Business costs of crime and violence
2.02 Reliability of police services
2.03 Business costs of terrorism
2.04 Index of terrorism incidence*
2.05 Homicide rate*

Pillar 3: Health and Hygiene
3.01 Physician density*
3.02 Access to improved sanitation*²
3.03 Access to improved drinking water*²
3.04 Hospital beds*
3.05 HIV prevalence*
3.06 Malaria incidence*

Pillar 4: Human Resources and Labour Market
Qualification of the labour force
4.01 Primary education enrolment rate*
4.02 Secondary education enrolment rate*
4.03 Extent of staff training
4.04 Treatment of customers
Labour market
4.05 Hiring and firing practices
4.06 Ease of finding skilled employees
4.07 Ease of hiring foreign labour
4.08 Pay and productivity
4.09 Female labour force participation*

Pillar 5: ICT Readiness
5.01 ICT use for business-to-business transactions²
5.02 Internet use for business-to-consumer transactions²
5.03 Individuals using the internet*
5.04 Broadband internet subscribers*
5.05 Mobile telephone subscriptions*
5.06 Mobile broadband subscriptions*
5.07 Mobile network coverage*
5.08 Quality of electricity supply

Subindex B: T&T Policy and Enabling Conditions

Pillar 6: Prioritization of Travel & Tourism
6.01 Government prioritization of the T&T industry
6.02 T&T government expenditure*
6.03 Effectiveness of marketing to attract tourists
6.04 Comprehensiveness of annual T&T data*²
6.05 Timeliness of providing monthly/quarterly T&T data*²
6.06 Country Brand Strategy rating*

Pillar 7: International Openness
7.01 Visa requirements*
7.02 Openness of bilateral Air Service Agreements*
7.03 Number of regional trade agreements in force*

Pillar 8: Price Competitiveness
8.01 Ticket taxes and airport charges*
8.02 Hotel price index*
8.03 Purchasing power parity*
8.04 Fuel price levels*

Pillar 9: Environmental Sustainability
9.01 Stringency of environmental regulations²
9.02 Enforcement of environmental regulations²
9.03 Sustainability of travel and tourism industry development
9.04 Particulate matter (2.5) concentration*
9.05 Number of environmental treaty ratifications*
9.06 Baseline water stress*
9.07 Threatened species*
9.08 Forest cover change*
9.09 Wastewater treatment*
9.10 Coastal shelf fishing pressure*

Subindex C: Infrastructure

Pillar 10: Air Transport Infrastructure
10.01 Quality of air transport infrastructure
10.02 Available seat kilometres, domestic*³
10.03 Available seat kilometres, international*³
10.04 Aircraft departures*
10.05 Airport density*
10.06 Number of operating airlines*

Pillar 11: Ground and Port Infrastructure
11.01 Quality of roads
11.02 Quality of railroad infrastructure
11.03 Quality of port infrastructure
11.04 Quality of ground transport network
11.05 Railroad density*
11.06 Road density*²
11.07 Paved road density*²

Pillar 12: Tourist Service Infrastructure
12.01 Hotel rooms*
12.02 Extension of business trips recommended
12.03 Presence of major car rental companies*
12.04 ATMs accepting Visa cards*

Subindex D: Natural and Cultural Resources

Pillar 13: Natural Resources
13.01 Number of World Heritage natural sites*
13.02 Total known species*
13.03 Total protected areas*
13.04 Natural tourism digital demand*
13.05 Quality of the natural environment

Pillar 14: Cultural Resources and Business Travel
14.01 Number of World Heritage cultural sites*³
14.02 Number of oral and intangible cultural heritage expressions*³
14.03 Number of sports stadiums*
14.04 Number of international association meetings*
14.05 Cultural and entertainment tourism digital demand*

Notes

1. The standard formula for converting each hard data indicator to the 1-to-7 scale is

The sample minimum and sample maximum are the lowest and highest scores of the overall sample, respectively. For those hard data indicators for which a higher value indicates a worse outcome (e.g. fuel price levels), we rely on a normalization formula that, in addition to converting the series to a 1-to-7 scale, reverses it, so that 1 and 7 still correspond to the worst and best, respectively:

In some instances, adjustments were made to account for extreme outliers in the data.

2. These indicators are combined applying a simple average aggregation to form one single indicator. Consequently, they are implicitly weighted by a factor of 0.5.

3. Indicators 10.02, Available seat kilometers, domestic, and 10.03, Available seat kilometers, international, are summed to form a single indicator, which is then averaged with indicators 10.01, 10.04, 10.05 and 10.06 to calculate the pillar average. Similarly, indicators 14.01, Number of World Heritage cultural sites, and 14.02, Number of oral and intangible cultural heritage expressions, are summed to form a single indicator, which is then averaged with indicators 14.03, 14.04 and 14.05 to calculate the pillar average.

Note that countries with zero reported incidences receive a 7, regardless of their scores on the related Survey question.