nature of tourism and its impact on economic activity

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ÞThe Nature of Tourism


Tourism can be defined as the temporary movement of people outside their normal place of work and residence, together with the activities undertaken during their stay at those destinations and the facilities created to cater for visiting tourists,


Tourism is distinguishable from travel undertaken in the past by its mass character, and is now not a luxury only for the upper classes.


Tourism is a luxury, with most people in the developed world and increasing numbers of people living in developing countries engaging in tourism at some time in their lives. Tourism is accepted and accustomed, and has become a good indicator of economic status and is considered necessary for good health and personal being.


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ÞDefining Tourism.


Tourism is a productive activity that encompasses human behaviour, use of resources, and interaction with other people, economies and environments. It involves physical movement of tourists to locations other than their normal place of living. It involves consumption of goods and services provided by organisations in the process, and generate a mass productive activity, employment and income.


Tourism is a highly complex productive activity. It involves the activities and interests not only of large transport undertakings, owners of tourist sites and attractions, and of various tourist services at the destination but also of all levels of government. Each of these serves the resident population and visitors. For countries delivering the tourist product it makes a significant contribution to GDP, employment, investment and FOREX earnings. It is a major catalyst for economic growth and structural change. It also diversifies employment prospects.


ÞTourism is dependant on a large number of economic activities supplying inputs to the industries that directly cater for tourists and producing consumer durables used for tourist activity.


Characteristics of tourism are


- Constantly operating industry, seasonal fluctuations


- Labour-intensive industry


- Lack of barriers to entry


- Small business predominates


- Important medium for educational and cultural exchange


- Sheer numbers


- Growing levels of consumer expenditure


- A few producers dominate


- New tourist attractions are regularly opening


- Mass tourists products have little differentiation.


- The impacts of tourism are broad ranging (economic, social, environmental)


ÞTwo forms of tourism


- International Tourism


Travel to country outside residence


- Domestic Tourism


Travel within tourist country.


ÞSpatial Pattern


Travel and tourism is the world largest industry. Western Europe and North America dominate global tourist flows. Total world tourism grew throughout the 180s and 10s at around 4% per annum. The range of destinations now encompasses virtually all countries in the developed world and many of those in the developing world. There has been spectacular growth in the Asia-Pacific region. Countries which are good destinations have sufficient environmental safeguards and a trained workforce.


Tourism has developed in many contexts. Modern mass tourism has origins in affluence of industrialised countries of West Europe, North America, and Japan. Tourism has also expanded significantly in East Europe, Asia, Africa and the Caribbean. It has developed in liberal and western societies and in a variety of physical environments.


Tourism has also developed in a wide variety of physical environments, with many different environments within a country becoming favourable tourist destinations. These environments may include


- Islands


- Alpine


- Coasts


- Countryside


ÞFactors affecting tourism


The tourism industry is multi faceted. Many components of tourism are inextricably bound to other economic sectors, and other forms of accommodation to commercial development. The spatial interaction that arises out of the tourist’s movement from origin to destination and factors affecting it lend themselves to analysis.


1. The biophysical and built environment


- A countries biophysical environment, cultural heritage and artistic life represent integral components of its tourist industry. Various types of tourism have differing requirements for favourable development and some countries will be more favourable for development than others.


- The industry is ultimately located according to the spatial distribution of attractions and access to them, which is largely determined by environmental factors. The tourist destination must offer tings the tourist seeks and needs.


- Tourist behaviour patterns are influenced by environment conditions, and they may place constraints on types of developments. Natural characteristics are highly desirable and should complement infrastructure and attractions.


- Climate is a special consideration, and favourable weather conditions are essential. For each tourist activity there is an optimal climate, and climate often determines the length and profitability of the holiday season at a resort.


. Technological change


- One of the most important variables affecting tourism is technological change. In the twentieth century, transport technology allowed the spread of mass tourism to a widespread array of destinations, which were previously not reachable by rail or ship.


- Manufacturers are constantly developing the capabilities of vehicles. Such developments influence places which can be reached, in terms of social and cost constraints.


- The development of wide-bodied long haul jets i.e. Boeing 747 was a major impetus to the growth of tourism.


. Sociocultural Influences


- Participation in tourism is affected by a number of demographic and social factors, such as age distribution, family life cycle, level of education, occupation structure, and population concentration. Demographic and social changes should profoundly affect the propensity of populations to indulge in tourism in the future.


- Increased life expectancy and changing workforce composition is also important. Increasing participation rates of women have provided a boost to tourism, because two income families have higher discretionary income. There is also a growing number of DINK’s who frequently travel.


4. Economic factors


- Tourism is among the strongest performing sectors of the global economy. Tourism is a major source of employment with the provision of accommodation, catering, transport, entertainment and other service industries important. There is also an enormous amount of productive activity generated indirectly by tourism. It is an important instrument for facilitating economic growth because of its wide multiplier effects.


- Tourism is Australia contributes 17.Bn in export earnings to the Australian economy.


- Changing economic circumstances largely determine the magnitude of the tourist industry. With higher levels of development, the employment structure changes, and a more affluent society creates a demand for tourists products.


5. Cultural influences


- Features of historical or cultural interest exert a powerful attraction for tourists. Three major forms of culture attract visitors


- Forms of culture that are inanimate such as monuments


- Forms of culture reflected in the normal daily lives of a destination


- Forms of culture at are especially animated and may involve events such as festivals.


- Tourism is often accompanied by cultural exchanges and cultural enrichment. These contacts can have harmful effects where native cultures and traditional ways of life are weakened or destroyed.


6. Political influences


- Governments at all levels and of all persuasions have recognised that while tourism is basically private sector, its impact requires government involvement.


- Government profoundly affects the economic climate in which tourism operates. The government’s principal role is to foster the development of the industry that can best prosper consistent with broad economic, social and environmental objectives.


ÞThe relationship between production and consumption


Tourism as a productive activity consists of three major components the country of origin of tourists; destinations; and routes travelled between locations.


1. Tourism generating areas


Represent homes of tourists. These areas represent the main tourist markets in the world and major marketing functions of tourism are found here.


. Tourism destination areas


Attract tourists by offering what isn’t available at home.


Transit routes link these two areas of productive activity and are key elements. They are the main transport component of productive activity.


As tourists travel they acquire an experience made up of many different parts. These activities are extremely interdependent.


ÞThe changing nature of the production process.


The growth of tourism throughout the twentieth century was closely associated with rising living standards in the developed world. In the first half of the twentieth century the opportunity to travel remained largely the privilege of the wealthier people in society, but periods of rapid growth following WW enabled more people to travel. The car and aircraft became the main mode of transport. A number of important changes are associated with the development on the industry


- Internationalisation of tourism


Tourism has become globalised. The global transportation infrastructure is rapidly becoming an interconnected pathway all over the world. The level of globalisation has increased as more countries participate in international travel.


- Organisational developments


The organisation of tourism comes from two sources the government and private sectors.


Recognising the contribution tourism makes towards a countries economic and social well being nearly all governments have organisations to promote tourism. The extents of their responsibilities vary.


The opportunities which exist in tourism give rise to a mix of large and small scale operations catering for all the tourist needs from origin to destination. As with other productive activities there has been a significant growth of corporate involvement in tourism. Much of the growth in large tourism companies arises from the very competitive nature of many tourist markets and destinations and a drive for greater market share and economies of scale.


ÞSocial Impacts of tourism





Tourism is driven by individual consumer decisions.


The evolving tourism product


Package Tours


The package tour is sold for an all inclusive price, and this is usually cheaper bringing holidays in reach of a much larger section of the market. Consumers have a wise variety of choice. Contiki tours are a good example of a company catering for 18-5 year olds world wide. Contiki has an arrangement with Cathay Pacific.


Small group tours


Small group tours are a popular alternative. They utilise local resources and services wherever possible.


Individual travel


Many tourists are actively planning their own travel experience. They prefer to individualise their own itinerary rather than be locked into a group tour. Experienced travellers are seeking to fulfil specific desires. This reflects the desire of travellers for new and different experiences. More specialised demands has seen tourism as a productive activity respond.


Adventure travel


Cultural and environmental travel


Rural tourism


ÞEconomic impacts of tourism


Increasing the scale of production


The profit motive has encouraged development of large scale operations and an increase in the size of the companies involved. Increasing scale is especially evident in the accommodation sector. The scale of operations in the hotel sector continues to expand. While large hotel chains can exploit economies of scale, the small independents can compete on the basis of cost, and personalised service.


Horizontal and vertical integration


Growth in the scale of production and increases in the concentration of ownership and control have generally come about through horizontal and vertical integration. A business may expand or develop by itself or seek to combine with other businesses.


Transnationals operations


Integration in tourism has continued to point where operations become multinational or transnationals in nature. The pattern of multinational development varies. Clearly a global marketplace provides greater market potential and opportunities to secure a competitive advantage. Companies wishing to diversify their portfolio will expand activities overseas.


ÞTechnological impacts of tourism


Tourism receives substantial research funds to facilitate the development of new technology. They change every area of this productive activity.


Consumer choice


Tourist motivation and decision making are increasingly shaped by changing technology. The Internet has allowed a wealth of information to become available to tourists. Hotel facilities, reservations, and attractions to name a few.


Transport Technologies


Aircraft


Future developments in aircraft will favour larger capacity aircraft, but still subsonic speed. The amount of power to propel aeroplanes increases with speed. Therefore new aircraft are unlikely to travel any faster than existing, but they will have a greater range and more seating reducing the costs of travel.


Land Transport


Transport is now faster and more competitive over long trips. This has come hand in hand with infrastructure development.


Sea Transport


The cruise industry is growing particularly fast. The world’s cruise fleet has doubled in the last decade of the 0th century.


Keeping track of people and possessions


Computerisation allows transport operators to work more efficiently, and generates a wealth of data which can be used for planning marketing activities. Global satellite networks have provided powerful new marketing tools. Technology has transformed the distribution process.


ÞPolitical impacts of tourism


Most governments now actively seek to promote tourism to and within their countries and take steps to coordinate public and private tourism activities and to foster industry growth. Government support has been less forthcoming in some parts of the developed world. In many developing countries tourism is seen as a way of accelerating economic development. Some governments have also encouraged the development of international tourism to further their own political objectives.


The changing political and economic environment


- Collapse of the soviet union and opening up Eastern Europe


- Switch from centralised economies to free market economies in China and India


- Creation of NAFTA


The nature of government involvement


Tourism promotion


Primary contribution of governments is to promote tourism both to and within their country. The most direct means is to establish tourism organisations to influence the path of tourism development. Australia’s ministry of tourism carries out this role, and its goals include


- Provide government with a clear statement for future development of industry


- Enhance community awareness of economic, environmental and cultural significance of tourism.


Facilitating visitor entry


Ease of access to a country is a key factor in attracting tourists. If visitor entry formalities are complicated tourism will suffer. Some countries now have visa free arrangements with certain countries.


Transport policy


The availability, pricing and ease of transport dictates the flow of tourists both within and between countries. The distribution of transport also influences the level of dispersal of tourists. Governments are generally responsible for the provision of transportation infrastructure and equipment. Many airlines have entered into alliances that enable them to reduce costs and increase passenger load. Governments are under pressure to deregulate international airlines further.


General economic policy


Government policies have direct and indirect implications. For example policies imposes when governments are grappling with high levels of inflation can reduce disposable incomes thereby limiting spending on tourism. Government taxes, chares and levies increase costs to tourists.


ÞEnvironmental and social impacts of tourism


Two major issues threaten the long term survival of tourism environmental degradation; and undesirable social impacts, which often accompany the growth of tourism.


Tourism and the environment


Tourist developments tend to be located near attractive or unique features of the biophysical environment. Exploitation for tourism often places a heavy strain on such natural resources. The greatest threat is to those which are most vulnerable to natural and human-induced stress.


Tourism can contribute to


- A deterioration of air and water supplies


- Destruction of natural landscape


- Damage to vegetation


- Threats to wildlife


The challenge is to develop procedures to assess the potential environmental impacts of tourism related developments. Other mechanisms available to address the impact of tourism are regulations, the establishment and management of national parks, preservation of significant heritage sites, and enactment of legislation that helps conserve our cultural and natural resources.


The link between tourism development and environmental protection is critical for the future success of this productive activity. Uncontrolled development could well destroy attraction to visitors. With adequate planning by government the threat that environmental degradation poses to global tourism can be overcome.


Social impacts of tourism


Social contact between tourists and residents can be mutually beneficial


1. Resident population can gain a greater understanding of the visitor’s culture as well as demand for traditional activities thereby preserving parts of the national heritage.


. Tourist patronage brings revenue and maintains these facilities for local use as well. The tourists may go home with a better understanding of the host country and its culture and traditions.


Tourism development may promote mutual misunderstanding, hostility and social tension as residents lifestyles are affected by tourists. This can include prostitution, crime and gambling.


Social policy and provision of community services must become an integral part of tourism planning, by tourist operators and the host government. If this is not done hostility towards visitors may emerge, which could reduce tourist flows and viability.


ÞFuture Directions


Tourism is the world largest productive activity. It is embraced by governments as a result of its potential source of income and employment. The future pace and directions of tourisms explosive growth will be determined by


- Affordability


Propensity to travel will remain closely aligned to prevailing economic conditions.


- Accessibility


As transport technology makes long hauls more affordable, more people will be able to participate in international travel. Destinations chosen will reflect perceived security.


- Accommodation


Tourists will be drawn to destinations which best meets their needs. The tourism industry is attempting to provide travel experiences to meet every budget and situation.


- Attractions


Technology will continue to develop and enhance the tourism experience. Market research will lead operators to promote new tourist products.


- It is likely there will be few barriers to international travel. Tourists will be courted by both the developed and developing countries, for the economic developments.


- Those involved in tourism will have to assume greater responsibility. Both the tourist experience and host population should be considered as does environmental quality.


- A basic strategy in tourism development is to retain and preserve the aspects that set a destination apart. Environmental codes of ethics and development guidelines should be implemented to keep tourism sustainable and viable in the coming century.


- As national boarders open up, the population ages and becomes more affluent, and tourism is promoted increasing numbers of people will travel.


- As a productive activity, tourisms importance within the global economy will continue to grow.


ÞThe advantages and disadvantages of tourism


Advantages


- Tourism earns foreign income which can be used to pay for imports


- Unique environments are often protected


- Tourism creates jobs and is labour intensive


- Local produce can be sold to hotels and resorts


- There is foreign investment in airports etc


- Profits can be used to improve housing, schools etc


- Local customs and heritage are preserved


- Increased cultural understanding


Disadvantages


- 10-0% of income received stays in the country; most hotels are foreign owned.


- Lack of planning results in facilities being built in the wrong places, spoiling scenic sites


- Much of employment is seasonal and poorly paid


- Agricultural systems break down as land is sold to developers; much food eaten by tourists is imported


- Locals discouraged from using hotel facilities; few can afford


- Borrowed money can increase the countries debt


- Local customs are destroyed through prostitution, crime and drugs.


- Lack of respect for local customs and religious beliefs.








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