The economic impacts of tourism

Travel and tourism, if utilized effectively, can be a force for positive growth and economic success for both developed and developing countries. Markets have the potential to enhance lives in a sustainable framework through providing wealth creation, choice, innovation and competition.[1] The travel and tourism industry contains these four elements that enable it to be a dynamic market force for sustainability in the future. It has the capacity to generate jobs throughout the economy, both in companies directly involved in the business and in related supplier industries such as retail, construction, manufacturing and telecommunications; to increase exports, bring in capital investment, boost an economy’s GDP and create employment.

In order to achieve sustainable economic growth, the travel and tourism sector needs to reduce social, economic, environmental and cultural barriers. Some of the major obstacles to this growth are the lack of infrastructure, environmental degradation and fragile linkages that weaken a country’s tourism potential.[2]

One way to address these barriers is for the sector to foster tourism investment through public-private sector partnerships that not only enable a country to grow economically, but retain the essential social, cultural and environmental assets that make each country a unique product. Public-private sector co-operation and planning are also essential to creating sustainable employment in the tourism industry, and to this end the private sector has fought for recognition of its true contribution to job growth and economic development. Hitherto, the industry had been disadvantaged by a lack of data reflecting its full economic impact.

One of the catalysts creating the urgency for trained, skilled workers within the industry is the increasing use of information technology. Travel and tourism is reliant on a human service, yet is increasingly using technology to facilitate the sector in competitive pricing. The growth in tourism forecast for the next ten years, will lead to a greater dependency on information technology, which will become more important in the future as the industry copes with rapid expansion and sophistication of the tourism and hospitality supply[3].

 

Reference

[1] Holiday, C., & Pepper, J.; Sustainability Through the Markets – 7 Keys to Success, World Business Council for Sustainable Development, p. 9. www.wbcsd.org/projects/pr_market.htm[2] Hawkins, D.E., Finucane, E., Sharp M. (forthcoming). “Reducing Barriers to Tourism Investment in Developing Countries”. International Institute of Tourism Studies. The George Washington University. USA.

[3] Buhalis, D.; 1994: Information and telecommunications technologies as a strategic tool for small and medium tourism enterprises in the contemporary business environment” In Tourism: The State of the Art. Ed Seaton, A. V., et al.; John Wiley & Sons. Chichester  p. 254.

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