The Effect of Circular Economy Practices on Sustainable Tourism Development Among Tourism and Hospitality Enterprises Around Simien Mountains National Park in Ethiopia

Circular economy practices have become increasingly important for promoting sustainable tourism by reducing resource consumption, minimizing waste, strengthening local resource use, and encouraging innovative tourism products and services. However, tourism and hospitality enterprises in developing destinations often face challenges in adopting circular practices due to limited infrastructure, financial resources, technical capacity, and institutional support. This study examined the relationship between circular economy practices and sustainable tourism development among tourism and hospitality enterprises around Simien Mountains National Park, Ethiopia. A cross-sectional research design was employed, and data were collected from tourism and hospitality enterprises using a structured questionnaire. A total of 305 usable questionnaires were analyzed using descriptive statistics and multiple linear regression analysis. The study examined six dimensions of circular economy practices: resource reduction and efficiency, reuse practices, recycling and waste recovery, sustainable procurement, renewable energy and resource conservation, and circular product and service innovation. The findings revealed that the overall regression model was statistically significant, F(6, 298) = 68.236, p < .001, with the six circular economy practices jointly explaining 57.9% of the variation in sustainable tourism development. Circular product and service innovation (β = .552, p < .001), sustainable procurement (β = .303, p < .001), reuse practices (β = .261, p < .001), and resource reduction and efficiency (β = .102, p = .041) were positively and significantly associated with sustainable tourism development. In contrast, recycling and waste recovery (β = −.143, p = .032) and renewable energy and resource conservation (β = −.238, p = .001) showed statistically significant negative associations within the fitted model. These findings suggest that circular economy practices are important predictors of sustainable tourism development, although their relationships differ across dimensions and may reflect contextual implementation conditions. The study provides practical implications for tourism and hospitality enterprises, local government, park authorities, and other stakeholders to strengthen circular product and service innovation, sustainable procurement, resource efficiency, reuse systems, recycling infrastructure, and renewable-energy initiatives. The findings can contribute to the development of more resource-efficient, environmentally responsible, economically viable, and resilient tourism practices around Simien Mountains National Park..