Tourism is Economic Development, What Government Leaders should know
June 2007
Many government leaders have come to understand the importance of tourism as an economic development tool. Yet despite the fact that the world’s largest peacetime industry is as major source of jobs, tax revenue and often, urban revitalization there is still a lack of understanding that tourism is more than merely a part of economic development, to a great extent tourism is economic development. This month’s edition of Tourism Tidbits addresses not only the direct impact that tourism has on a locale’s economy but also the secondary impact throughout an entire economic system.
- Tourism is the world’s largest peacetime industry. For those people who like facts and figures, according to the World Tourism Council, last year tourism produced over US$6 trillion. It provided around the world 221 million jobs, with an expectation that by 2015 it will be providing some 269 million jobs. Between 2006 and 2015, tourism’s growth rate is expected to average 4.6% per year.
- Tourism is a major source of revenue around the world. For example, according to the Travel Association of America, in the United States the tourism industry produces over $600 billion dollars in revenue and over $100 billion in taxes paid to local, state and federal governments.
- Tourism is a major source of revenue around the world. For example, according to the Travel Association of America, in the United States the tourism industry produces over $600 billion dollars in revenue and over $100 billion in taxes paid to local, state and federal governments.
- Tourism, on a national scale, not only generates employment but also may be a major renewable export source. Tourism attractions do not disappear; thousands/millions of people can see the same attraction. These people may also become a major source of foreign exchange, adding needed hard currencies to local economies. It must be noted however that for tourism to be a renewable resource it must be developed in a sustainable/responsible manner. That means that where ecologies are fragile, numbers and activities must be tightly controlled, pollution must be prevented, and local cultures protected.
- Tourism adds to the local economy in a variety of ways. Included are hotel and restaurant expenditures and taxes, conventions and meetings, taxes paid on transportation, attractions of foreign capital, especially in hotel construction, creation of additional jobs in such areas as public services and infrastructure renewal.
- Tourism and economic development go hand-in-hand. Think about what makes a place a good tourism center. What are the essential ingredients for tourism? How different are these from what a community requires for economic development? Here are a few of the essentials that tourism needs:
- Good environment. No one wants to visit a place that is clean or unhealthy. Tourism cannot survive without a clean and safe environment. In a like manner communities that do not provide pleasant surroundings and a clean environment have a very hard time attracting business.
- Tourism requires friendly people and good service. No matter what the attraction may be a tourism center that lacks good customer service and friendly people will fail. In the same way, communities that offer poor service not only do not attract new comers to their community, but in the end have a difficult time holding on to their local population, young people and businesses.
- Tourism requires a secure community. Often government officials and even police departments fail to recognize their economic impact. Police departments and other essential government agencies such as fire and first aid are major players in adding to the desirability of a community. First responders (police, fire, health) that take pro-active roles are also essential ingredients in a community’s economic development.
- Tourism requires good restaurants, hotels and things to do. Those are the same factors that are essential to any community seeking economic development.
- People who consider moving a business or industry to a community visit the community first as tourists/visitors. If they are not treated well when visiting the community there is very little chance that they will move their business and family to your location.
- Government and community leaders may also want to take into account that tourism adds prestige to a community. People like living in a place which others consider worthy of visiting. This increased national or community pride also can become an important economic generating tool. People sell their community best when there is a great deal to see and do in it, when it is safe and secure and when customer service is not merely a motto but a way of life. Community festivals, traditions, handicrafts, parks and natural settings all add to the desirability of a locale and its ability to sell itself to potential outside investors. Quality of life is also reflected in a community’s museums, concert halls, theatres, and uniqueness.
- Tourism is an important economic development tool for emerging and minority communities around the world. Because tourism is based on the appreciation of the other, tourism industries have been especially open to giving disadvantaged groups around the world opportunities that have often been denied to them by other economic sectors. In this respect tourism should not been viewed only at the surface level. Tourism requires a great deal of construction, provides large numbers of entry level jobs, and often means the difference between a smaller community’s business success and failure. For example, tourists may add additional money to the local economy by shopping yet place no additional demands on the local schools. In nations where there is a decline in manufacturing, the tourism industry can be an essential method to reinvigorate local economies. The bottom line is that tourism should not be seen as merely an economic development tool, but rather the basis upon which economic development can be built.
