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1 Kyiv National University of Technology and Design, Ukraine (corresponding author)
E-mail: pashbush@gmail.com
ORCID: https://orcid.org/0000-0001-5257-9104
ResearcherID: AAE-5238-2022

This is an Open Access article, distributed under the terms 
of the Creative Commons Attribution CC BY 4.0

DOI: https://doi.org/10.30525/2661-5150/2023-1-3

PECULIARITIES OF THE FUNCTIONING  
OF CROSS-BORDER TOURISM CLUSTERS IN UKRAINE

Pavlo Bushuiev1

Abstract. In the article the author highlights the essence and specifics of the functioning of cross-border tourist 
clusters. Accordingly, the purpose of the study was to determine the specifics of the functioning of cross-border 
tourist clusters in Ukraine in theoretical and applied aspects. Methodology. System analysis and especially  
scientific methods: systematization, generalization and verification of theoretical knowledge during the study, 
became the methodological basis of the study. Thus, in particular, the article systematizes and summarizes the 
issues of functioning of cross-border tourist clusters. The author notes that the formation and development  
of the tourist cluster will allow to use the potential of the regional scientific complex, recreational opportunities  
of the region, to solve the problem of the lack of investment resources and the development of innovative  
activities. The essence of cross-border cooperation in the field of tourism is identified, general European trends 
and experiences in the development of tourism clusters are given. The study emphasizes that the creation of 
tourism clusters makes economic sense, related to the coordination and extraction of additional benefits within 
the distribution network of services in the destination. As the tourism sector develops, the cluster model is 
increasingly used as a source of adaptive management solutions by individual economic entities. Among the 
main results and proposals it was established that joining efforts within the framework of the cluster strategy of 
interregional development is a useful and favorable action for expanding the geography of tourist trips for  
all types of tourism, which will form more promising alternative directions, will help not only to maintain, but  
also to increase the flow of tourists by increasing the availability and options of choosing a wider range of 
resources, Increase the length of stay of tourists in the territory of the region, reduce customs formalities and 
the impact of other barriers, which would allow to maximally reduce the time and costs for free movement of  
tourists and develop socio-cultural and economic-political relations between countries, which will be extremely 
necessary after the stabilization of the situation in Ukraine and the end of hostilities.

Key words: tourist claster, tourist destination, tourism product, service sector, cross-border tourist clusters.

JEL Classification: L83, E69

1. Introduction
The competitiveness of a tourist destination 

manifests itself first of all in the territorial and 
sectoral organization of the economic space,  
which is subject to detailed analysis by potential 
investors. Taking into account the international 
experience of territorial organization, the concept 
of clusters is, first of all, a modern approach to 
stimulate the increase of competitiveness of 
countries through the prism of their territories 
and, as a result, their economic rise. It should 
also be noted that the structural cluster policy  
should be aimed at creating favorable conditions 
for the formation of cluster associations.

When considering cross-border tourism  
projects, it is necessary to focus on the provision 
of a tourist product that is competitive for  
tourists from neighboring countries, in order to 
satisfy the needs that this structure is aimed at.

It should be noted that the theoretical 
foundations of cluster development include 
a number of stages, the most important of which  
are social and institutional approaches, the 
neoclassical school of economics and the concept 
of M. Porter. (Porter, 2003) The provisions of 
neoclassical economics formed the concept of 
network interfirm relations. It is necessary to  
note the industrial clusters of A. Marshall  



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(Marshall, 1922), "according to which he 
discovered the reasons for higher productivity 
of a group of enterprises of a certain industry 
located in a certain territory ". The development 
of the theory of the cluster approach is again 
noted in the works of M. Porter, who stated that 
"the most internationally competitive firms of the 
same industry are usually systematically present 
in different developed countries and tend to be 
concentrated in the same country and sometimes 
even in the same region of the country ". (Porter, 
2000) In the scientific literature, issues related 
to the theory of clusters with its application to 
tourism and cross-border regions in the field 
of tourism within Ukraine are highlighted, 
in particular, in the works of such domestic  
scientists as Z. Gerasimchuk and O. Lyutak 
(Gerasimchuk, Lyutak, 2010), at the same time, 
the question of the specifics of the functioning  
of cross-border tourism clusters in Ukraine in 
modern conditions remains extremely relevant.

The purpose of our research is to determine  
the specifics of the functioning of cross-border 
tourism clusters in Ukraine in theoretical and 
applied aspects.

2. A general approach  
to understanding clusters

The cluster concept goes beyond "simple" 
horizontal networks in which firms operating 
in a common market for finished products and 
belonging to an industrial group cooperate in areas 
such as research and development, demonstration 

programmes, joint marketing or purchasing 
activities. Clusters largely function as networked 
(vertical and/or horizontal) structures of  
combined industries, composed of heterogeneous 
firms specialised in the production of a specific 
product, service or database required by the 
network.

By establishing rigid boundaries for industries  
and economic sectors (often based on some 
statistical parameters), the traditional research 
approach does not take into account the  
importance of establishing relationships and  
sharing knowledge in the production process, 
within the network structure. In contrast to the 
traditional sectoral approach, which focuses on 
strategic groups of similar firms with a similar 
position in the network structure, the cluster 
concept offers such a perspective on economic 
problems, which is more in line with the  
modern view, based on taking into account the 
interaction of innovation theory with the nature  
of market relations.

The cluster concept can be seen as an alternative 
to the traditional sectoral approach in economic 
market research. (Cuhna, 2005) While the  
sectoral approach focuses on horizontal 
relationships and competitive interdependence, 
i.e., relationships between direct competitors  
with similar activities, the cluster approach 
emphasises the consideration of vertical 
relationships between heterogeneous firms and 
their symbiotic interdependence. The main 
differences between the cluster approach and the 
traditional sectoral approach are shown in Table 1.

Table 1
Key differences between cluster and sectoral approaches

Cluster approach Sectoral approach
Considers strategic groups of companies in network 
structures with complementary heterogeneous companies

Considers groups of companies with similar network 
structures

Attracts suppliers, consumers, producers of goods and 
services, specialised institutes

Focuses on finished goods manufacturers

Brings together a number of related industries that share 
common technologies, expertise, information, resources, 
channels and customers

Focuses on direct and indirect competitors

Most participants are not direct competitors, but share 
common problems and needs

Indecision in organising cooperation with competitors

A wide range of improvements in areas of common interest 
that will boost productivity and competition

Narrow branch approach

A forum for more constructive and effective dialogue between 
government and business

Dialogue with the government is usually aimed at obtaining 
subsidies, protectionism and limiting competition.

Looking for synergies between new associations
Searching for the direction of strengthening the diversification 
of companies under the existing conditions



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It is worth noting that the cluster is described as 
"a sustainable territorial and sectoral partnership 
based on an innovative programme for the 
introduction of advanced innovative production, 
management and engineering technologies to 
increase the competitiveness of its participants". 
(Alexandrova, 2007)

According to M. Porter's theory, a cluster  
is "a group of geographically contiguous, 
interdependent firms and related organisations 
that are active in a particular field and are 
characterised by a commonality of activities and 
complementarities". (Porter, 2000) Companies 
in a particular cluster can act as suppliers of  
products, components or specialised services, 
infrastructure companies, research institutes and 
other companies that complement each other  
in order to strengthen the competitive advantages 
of each of them and of the cluster as a whole.

The academic literature identifies three ways in 
which clusters affect competition:
– by increasing the number of firms and industries 
included in the cluster;
– by increasing innovative activity and, as a result, 
the productivity of firms;
– by stimulating the development of new  
businesses that support innovation and extend  
the boundaries of the cluster.

In the course of his research, M. Porter came 
to the conclusion that clusters play a leading role  
in the world market, which is explained by the 
fact that when one of the cluster participants 
succeeds, the successful outcome spreads to 
its other participants and even to consumers, 
suppliers and competitors. (Porter, 2003) 
Thus, the cluster approach contributes to the 
development of individual territories, industries 
and enterprises, and the state stimulation of the 
formation of clusters in the regions will allow to 
achieve a significant effect on their socio-econo- 
mic development, increase the innovative  
potential, as well as the competitiveness of enter-
prises. The cluster approach as a tool of economic 
structuring allows to ensure an optimal combi-
nation of interests, territories and enterprises, as 
a result of which regional specialisation is formed.

The presence of clusters is therefore one of the 
most important factors in creating competitive 
advantages for regions. It is cluster structures 
that determine competitive success in certain  
industries and thus contribute to the development 
of regions.

3. Differences in tourism clusters
Current trends in the sphere and sphere of 

services in Ukraine allow us to note the presence 
of centres of formation of potential opportunities 
for development of recreational activities, among 
which should be considered the potential of  
natural resources, growth of demand for these 
services, expansion of the sales market, the 
possibility of changing the specialisation of  
services depending on demand, development of 
new market segments; creation of high-quality 
services. In particular, the regions of Western 
Ukraine – Volhynia, Prykarpattia, Carpathians, 
Zakarpattia – can become such centres.

Participants of the tourism cluster can be 
tour operators, passenger and cargo transport  
companies, tourist accommodation facilities, 
producers of food products, souvenirs, medical 
cosmetics and others. At the same time, the 
formation and development of a tourism cluster  
will allow to use the potential of the regional 
scientific complex, recreational opportunities  
of the region to solve the problem of lack of 
investment resources and development of 
innovative activities, because as the world 
experience shows, clusters attract new  
investments, especially foreign ones.

It is also necessary to take into account the 
peculiarities of the creation of tourism clusters, 
which distinguish them from industrial clusters:
– the specificity of the production of tourist 
products;
– the need to take into account the geographical 
characteristics of the region where tourism  
services are provided;
– availability of the necessary amount of unique 
natural resources;
– sufficient level of development of small and 
medium-sized enterprises in the region of cluster 
formation as the main participants of the tourism 
cluster.

In the structure of the tourism cluster, it is 
common to distinguish four main sectors:
1) production of tourism services;
2) service sector;
3) auxiliary sector;
4) the tourism cluster livelihood sector.  
(Liu, Yang, 2013)

The first sector (production of tourism services) 
comprises enterprises that directly produce 
a tourism product. These are primarily tour 
operators and travel agents. They include hotels  



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and restaurants (hotels and restaurants),  
companies that transport tourists (railways,  
airlines, etc.), companies that organise 
tourists' leisure time (museums, theatres, etc.), 
entertainment facilities, and nature conservation 
facilities (protected areas, national parks, etc.).

The second (service) sector includes tourist 
educational institutions, insurance companies, 
financial institutions, etc.

The third (auxiliary) sector comprises three main 
elements: enterprises producing tourist goods, 
souvenirs, etc.; polygraphic and cartographic 
organisations, television and radio companies; 
state authorities, regional tourism institutions.

The fourth sector links the different sectors, 
ensuring their interaction and joint action.

The following advantages of the tourism cluster 
are usually emphasised:
– mutually beneficial cooperation develops in the 
cluster, involving the exchange of information, 
technologies and experience; employee 
qualifications increase;
– more efficient use of resources;
– the attractiveness of the investment area increases;
– the range and quality of tourist services is 
increased;
– cluster members have more opportunities and 
higher incomes;
– new jobs are created by involving workers from 
different types of economic activity in the service 
of tourists. (Carrie, 1999)

At the same time, the implementation of cluster 
initiatives, especially in the field of tourism, attracts 
investment funds and, as a result, the development 
of innovative technologies and approaches directly  
in the recreation and tourism complex.

In general, the main advantage of the cluster 
approach for an enterprise is the reduction of 
production costs due to the effectiveness of the 
implementation of joint investment projects, the 
improvement of personnel qualifications due to 
joint programmes, and the possibility of using 
the results of scientific research. As a result, it is 
possible to speak of an increase in the financial 
stability of leisure enterprises and their investment 
attractiveness.

4. European experience and main prospects  
for the creation and functioning of cross-
border tourism clusters in Ukraine

Cross-border clusters can be defined as groups 
of independent enterprises and related institutions 

that are geographically concentrated in a cross-
border region. At the same time, they specialise 
in different fields but are linked by common 
technologies and skills, cooperate, compete 
and complement each other, and join together 
to implement joint projects or produce joint  
products. Ultimately, this allows for synergy 
and network effects, diffusion of knowledge and  
skills. (Solvel, Lindqvist, Ketels, 2006)

The European experience shows that cross- 
border partnership creates noticeable advantages 
for cross-border regions and allows to actively 
involve public, private and third sector organi-
sations from both sides of the border, especially 
in the field of tourism. As a rule, cross-border  
clusters are formed in conditions of already 
established cross-border relations between  
business entities of border territories of 
neighbouring countries and their effective activity 
is based on mutually beneficial cooperation of 
business entities, authorities, non-profit and public 
organisations of these territories. When initiating 
the creation of cross-border tourism clusters, it is 
necessary to carry out a diagnosis of the priority 
of tourism in each of the participating countries.  
In addition, the diagnosis should include 
a favourable geographical location and positive 
dynamics of tourist flows in recent years.

From the European experience, it is possible to 
mention the following countries that apply the 
cluster model of tourism organisation Italy, France 
and Norway. For example, in Norway, clusters 
are developing in the field of marine economy.  
In France, the tourist cluster "Nice" is visited 
annually by several million tourists, which is 
almost 1% of the world trade turnover in the 
field of tourism. Similar models operate at a high  
level in Greece, Scotland, Belgium, Spain and 
Ireland. In Italy, the cluster organisation of  
tourism has the highest level of scientific 
justification. For example, in some regions of the 
country, specific conditions have been identified 
that form the basis for their creation: conditions 
for the development of several types of tourism, 
significant tourist resources, the importance of 
the tourist zone, etc. Examples of clusters in Italy: 
the tourist system "Lake Trasimeno" (Umbria), 
"Salinuntina Baths" (Sicily), "Adriatic Sea and 
Coast", "Cities of Art, Culture and Business". 
(Emilia-Romagna)

The development of cross-border tourism  
makes it possible to activate tourism enterprises 



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located near the borders and to ensure a higher  
level of capacity utilisation of accommodation 
facilities in the cross-border region thanks 
to the creation of a complex tourist product. 
(Gerasimchuk, Lyutak, 2010)

Cross-border tourism clusters, in contrast to 
the tourism and recreation system, include not 
only interacting entities (economic entities, 
mana-gement bodies) and their mutual links, but 
also all resource potentials used in interaction  
(natural, labour, production and social 
infrastructure). At the same time, the formation  
of cross-border tourism clusters is closely linked  
to the specifics of the territorial recreation system,  
the structure of which is shown in Figure 1.

The figure shows the main elements and 
relationships of the territorial recreation system.  
It distinguishes a part of the population 
directly related to the territorial recreation 
system – recreationists, i.e., holidaymakers who 
directly participate in recreational activities. The 
recreational environment includes resources 
(natural, cultural, economic) that ensure the 
functioning of the territorial recreational system. 
The main elements of the interaction of the 
territorial recreation system are: recreational 
activities, population and infrastructure (Solvel, 
Lindqvist and Ketels, 2006). At the same time,  
the internal connections between these  
components are the closest, and their intensity 
determines the level of system development.

To a certain extent, this structure is the basis  
for the formation of a cross-border tourism  
cluster. It is connected with the possibility of  
using the unique recreational base of different 
regions, a network of multi-specialised local 
specialised clusters, various regional ethno- 
cultural and historical resources. In our opinion, 
a cross-border cluster can be considered as 

a geographically concentrated network of 
enterprises cooperating in complementary  
sectors and supporting organisations in the  
cross-border regions of Ukraine.

Territories where clusters are formed become 
leaders of national economies and their foreign 
economic relations. For the real development of 
the cluster, it is necessary to create communication 
platforms (information centres) for those 
potentially interested in participating in the 
business of the respective cluster. In addition, as 
mentioned above, cluster initiatives stimulate the  
inflow of foreign investments and large inter-
national companies to the region, which usually 
prefer to invest in those regions and countries  
where clusters have already been formed in 
the necessary industries, or at least there are 
prerequisites for their formation. Domestic and 
foreign investors interested in investing in the  
cluster region can get information about the 
region in the Tourism Cluster Information 
Centre and receive feedback without barriers 
based on low information loss with high quality 
of its transmission, and as a result the investor 
can become a participant of the tourism cluster. 
Clusters will promote the creation and growth 
of incubated innovative companies. Thanks to 
clustering, the region's investment and innovation 
opportunities grow.

4. Conclusions
To sum up, after the end of the war on the  

territory of Ukraine caused by the Russian military 
invasion and the stabilisation of the security 
situation, large-scale reconstruction works and 
serious economic reforms will be necessary to 
ensure sustainable development and the formation  
of a new image of the country in the future.

People Recreational activity

Use of recreational 
resources

Positive recreational 
effect

Infrastructure of the 
recreational region

Recreational environment

Figure 1. Structure of the Territorial Recreation System



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International practice shows that tourism can 
recover quickly after the end of hostilities and  
that new initiatives can lead to post-conflict  
recovery, especially when infrastructure 
improvement projects are developed. At the  
same time, it is necessary to open a critical space 
for interaction and development, create the most 
favourable conditions for business, effectively 

involve and expand the rights and opportunities 
of the population, provide entrepreneurial 
opportunities for the poor, in order to avoid the 
emergence of social causes of conflict. It is quite 
possible that tourism in Ukraine will eventually play 
not only an economic, but also a socio-political, 
foreign economic and peaceful role in the post-
conflict reimaging and branding of the territory.

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Received on: 24th of February, 2023
Accepted on: 29th of March, 2023
Published on: 28th of April, 2023