Denmark's tourism industry as
 

-One may argue that there is no need to promote Denmark's tourism industry as its reputation as the Diamond of Northern Europe is enough to lure tourists to it.

The meaning of 'it', by speculation, should be Denmark; but the only possible referent of it in the sentence is Denmark's tourism industry, but this industry does not have the name of Diamond of Northern Europe. Do you think it is ungrammatical or that as long as the meaning is understood, there's no problem?

Re: Denmark's tourism industry as
 

It's not ungrammatical but stylistically could be improved. Firstly "to it" is redundant - and makes the end of the sentence sound clumsy. leave it out and the sentence is still fully grammatical and comprehensible. but if you wanted to use something "there" would sound much more natural than "to it". So either:

One may argue that there is no need to promote Denmark's tourism industry as its reputation as the Diamond of Northern Europe is enough to lure tourists.

or

One may argue that there is no need to promote Denmark's tourism industry as its reputation as the Diamond of Northern Europe is enough to lure tourists there.

Your point about "its" could be resolved by replacing the word with "the country's"

One may argue that there is no need to promote Denmark's tourism industry as the country's reputation as the Diamond of Northern Europe is enough to lure tourists there.

But that's being terribly picky - I doubt if anyone just reading the original would actually notice.

Re: Denmark's tourism industry as
 

Good answer. Thank you.