In this paper, there is going to be a discussion about tourism and economic development. Different sources of information are going to be considered. Several examples from different parts of the world about tourism and economic development are going to be presented.
The last paragraph of the paper will give a conclusion of the paper in which a summary of the main points in the discussion is going be presented.
The tourism sector is a very important sector in the world economy and serves as one of the significant sources of income for the developed as well as developing nations. This sector involves huge investment and great planning (Rahmatnia, Vejdan and Eskandarpour 139).
Tourism has been found to greatly contribute towards economic development. It is pointed out that this sector is the world’s largest sector and creates the largest number of jobs within the national as well as regional economies.
According to Aliqah, research undertaken in the recent past indicates that it was projected that by the year 2000, the tourism sector would generate both in a direct and in an indirect manner, 11.7 percent of the gross domestic product and about two hundred million jobs in the global economy (Aliqah 173).
In the same regard, the projected figures for the year 2010 stood at 11.7 percent of GDP and 255 million jobs respectively (Aliqah 173). It is reported that the jobs which are generated by the tourism sector “are spread across the economy in retail, construction, manufacturing and telecommunications as well as directly in travel and tourism companies” (Aliqah 173).
Job creation facilitated by the tourism sector through the direct means involve creating these opportunities within the sector itself and this includes such activities as tourists guidance, offering security to tourists, and transportation and travel among other similar activities.
Indirect creation of job opportunities involves job creation of jobs in other sectors which engages in supplying the tourism sector with the basic needs such as foods and health care.
Studies conducted indicate that the average of having creation of direct jobs in the hotel industry “was between 0.5 – 1 job opportunities for every room in the hotels’ rooms and the average increased in low incomes countries was about 1.5 or more” (Aliqah 178).
According to Aliqah, who undertook a study about tourism in Jordan, considering the ratio of costs for job creation in the tourism sector to other economic activities, there is no comprehensive data that is available about the countries in the Arab World; however, some of the studies in other parts of the world give assurance that the cost incurred in the creation of a job in the tourism sector is less than the cost of creating a job in any of the traditional sectors (Aliqah 178).
In Aliqah study, which was concerned with tourism in Jordan, it was found out that the government of this country looks for ways of developing employment in this sector by coming up with development plans as well as having international cooperation with “the International Funds” or IF and “international organizations to invest in the tourism sector, specifically in the tourism locations like Aqaba and Dead Sea” (Aliqah 178).
In such places, the investors can get to take joy in “wide free taxes”, in the ability to engage in exchanging their entire capitals, and “the foreign ownership one hundred percent in the tourism sector” (Aliqah 178).
It is pointed out that, in the present day, a large number of countries depend on the tourism sector for economic development since this sector is currently among the world’s largest sectors and also among the sectors that are realizing rapid growth (“Tourism, instrument of economic development” 1).
It is reported that in the publications presented recently by the “United Nation World Tourism Organization” – UNWTO, it was revealed that “International tourism grew by almost 5% in the first half of 2011, totaling to a new record of 440 million arrivals” (“Tourism, instrument of economic development” 1).
The results give a confirmation that, despite many challenges, the international tourism goes on “to consolidate the return to growth initiated in 2010” (“Tourism, instrument of economic development” 1).
In the course of the last decade of the twentieth century, the African continent witnessed an increase in the number of tourist arrivals to about 10.6 million from 8.4 million “and receipts growth from 2.3 billion to 3.7 billion” (“Tourism, instrument of economic development” 1).
For a large number of nations that have high arrivals of tourists, their governments had come to a realization of the role that can be played by tourism in the nation’s economic development, but still there were other nations that could not realize this role 9“Tourism, instrument of economic development” 1).
Some of the countries in Africa still tend to consider tourism as an entertainment tool and not as an instrument that can be used in realizing economic development. This is the reason why such countries have sidelined tourism in their development plans (“Tourism, instrument of economic development” 1).
Perhaps one on the good examples of the countries where tourism has contributed to economic development to a great level is South Africa. This country is among the holiday destinations that at are growing at the fastest rate.
South Africa is known for “its scenic beauty, magnificent outdoors, sunny climate and cultural diversity” (“Trade, Exports and Investment” 1). It has been found out that tourism plays a major role in South Africa’s economic development (“Trade, Exports and Investment” 1).
Basing on the “World Travel and Tourism Council” report, the contribution that tourism makes to the economy of South Africa increased by abpuitR17 billion in the period between year 2008 and2009 and this led to an increase in the gross domestic product (WTTC 10).
The statistics based on the tourism sector give an indication of an increase in revenue of up to six percent from the “foreign air markets” (“Trade, Exports and Investment” 1). Moreover, beginning form the year 2007, there has been an increase in the total employment of about six percent (“Trade, Exports and Investment” 1).
Having over two hundred nations across the world and resources that are limited, “South Africa Tourism” has made a decision to put focus on those markets from where there is a high likelihood to receive returns within the medium to short term (“Trade, Exports and Investment” 1).
This nation’s latest portfolio review of 2008 – 2010 gives an indication of “the U.S, the U.K, Australia, India, France, Germany, the Netherlands, Botswana, Nigeria, Kenya, and the domestic markets as the core markets” (“Trade, Exports and Investment” 1).
It is reported that in the year 2008, “the nine core markets accounted for 55 percent of air arrivals and 6.1 percent of foreign direct spend…most of the other regions fall under either investment, tactical or watch-list markets” (“Trade, Exports and Investment” 1). It can actually be seen that tourism in South Africa is doing well as compared to the rest of priority sectors.
This sector is normally referred to as “the new gold of the South African economy” (“Trade, Exports and Investment” 1) because of what has been discussed above and also due to the fact that the “total direct spend of the tourists has overtaken gold foreign exchange earnings” (“Trade, Exports and Investment” 1).
The situation is different when such a country as Nigeria is considered. It is reported that the government of Nigeria is among the African nations’ governments that still consider tourism as an entertainment instrument and not as a means by which economic development can be realized (Tourism, instrument of economic development 1).
The people charged with the responsibility of setting up the economic policies in this country did not consider any potentials that tourism has and no pronouncements have been made in regard to what positive impacts tourism can have to the economy of this country (“Tourism, instrument of economic development” 1).
In an interview conducted last year (2011) with Nigeria’s Minister of “Culture and Tourism”, the minister pointed out that the greatest economy in Sub-Saharan Africa “is driven by tourism which is the greatest contributor to GDP in South Africa, not the solid minerals sector” (“Tourism, instrument of economic development” 1).
And Nigeria, the second largest economy in the region is “a mono-product economy” (“Tourism, instrument of economic development” 1). The minister also pointed out that in case this country can make addition of the benefits of culture as well as tourism to the benefits obtained from the energy sector, then definitely this country will be in a position to get ahead of South Africa.
The country has the population as well as a ready market (“Tourism, instrument of economic development” 1).
In conclusion, it has been found out that tourism makes a big contribution towards realization of economic development in a nation. It plays a big role in creating jobs, both in a direct and in an indirect manner.
It has been found out that the cost of creating a job opportunity in the tourism sector is far much lower than the cost involved in creating a job in the traditional sectors. This sector also assists in increasing a country’s gross domestic product through the high revenues received.
This sector has been found to be growing at the fastest rate across the world and the countries that have recognized its importance and developed it have actually experienced economic development. A good example of a country that is benefiting from this sector is South Africa.
A country like Nigeria has not gained much from the sector since it has been among those countries that have not seen the great potentials that the sector has.
It is important that countries, especially in the developing ones, realize the importance of this sector in regard to economic development, in order for them to capitalize on it for economic prosperity. They will be able to deal with such a problem as unemployment effectively.
Works Cited
Aliqah, Khaled Mohammad Abu. “The role of tourism sector on economic development in Jordan during the period 1990 – 2008. European Journal of Economics, Finance and administrative Sciences. 1.18 (2010): 173 – 180. Print.
This is a trade journal that talks about tourism and economic development in Jordan.
Rahmatnia, Sasan, Vejdan, Rahim, and Eskandarpour, Behrooz. “Cultural tourism and its role in society’s economic development”. American Journal of scientific Research, 1.58 (2012): 138 – 147.
This is a scholarly article that presents a research report on cultural tourism and economic development.
Tourism, instrument of economic development. 2011. Web.
This is a news article that presents information on tourism and economic development and specifically talks about Nigeria.
Trade, Exports and Investment 2010. Web.
This is popular information center that provides information about tourism in South Africa.
WTTC. (2010). The Economic Impact of Travel and Tourism: Mali. London: World Travel and Tourism Council.
This is a book that talks about the economic impact of tourism, specifically on Mali.