Economics of Tourism Industry

In: Other Topics

Submitted By Dheeraj2901
Words 2463
Pages 10
This Project has been submitted by

Mr. Dheeraj K

Id No. 213031

On ECONOMICS I

During the MONSOON Semester 2014

The Economic Effects of Tourism Industry and Need for Sustainability

Dheeraj K
213031
II Year
Monsoon Semester (2014)
The West Bengal National University of Juridical Sciences
The Economic Effects of Tourism Industry and Need for Sustainability

The Tourism industry is one of the biggest contributors to the global economy. It is a fast growing and constantly expanding industry. The tourism industry has other associated industries it thrives on and this makes this one of the most important sectors of the economy. This paper seeks to examine the economic impacts of the tourism industry, track its growth and effect on the global scale and discuss the need for a sustainable growth.

Introduction

The Tourism industry encompasses all the firms, organizations and facilities which are intended to serve the specific needs and wants of the tourists. It is a booming and ever growing industry which currently constitutes 9.2 percent of the World’s Gross Domestic Product (GDP). In the post-world-war era, most of the developing countries had to turn to tourism to increase revenues and remedies for balance of payments deficits. The nature of demand and supply conditions of the tourism industry has also influenced its growth. The industry utilizes simple technology and resources like sunshine, existing scenery and manpower. The demand for tourism is ever rising; from 25 million international tourists in 1950 to 1.087 billion in 2013. The industry has been clocking nearly 5 percent increase every year. The UNWTO has forecasted a 1.8 billion international tourist forecast by the year 2030. As a result, the tourism industry has emerged as one of the biggest global industries. An industry of this magnitude has various economic impacts on the…...

Similar Documents

Tourism Industry

...1. Does the industry offer attractive opportunities for growth? Yes. Tourism is a sunrise industry. Many countries have substantial support it, because tourism can drive a lot of development of other industries such as restaurant and souvenirs business and hotel and so on. 2. What kinds of competitive forces are industry members facing, and how strong is each force? Rivalry among Competing Sellers: moderate to normal * Buyer demand is growing rapidly * Buyer costs to switch brands are low * Fixed and storage costs are low. * Competitors are roughly equal size and competitive strength. New Entrants: weak * Entry barriers are high * Significant experience- based cost advantage * High capital requirements Substitute: strong * Good substitutes are not readily available * Substitutes are attractively priced * Substitutes have comparable or better performance features * Buyers have low costs in switching to substitutes. Suppliers: weak * There is a surge in the availability of suppliers * Industry members’ switching costs to alternative suppliers are low. * Some of suppliers with large market shares. * Industry members accounts for a big part of suppliers’ sales * Buyers: moderate to normal * Buyer costs of switching to competing brands are low * Some of Buyers are well informed......

Words: 526 - Pages: 3

Overview of the Hospitality and Tourism Industry

...Overview of the Hospitality and Tourism Industry HTM100 05/28/13 Abstract The Hospitality and Tourism industry changes over the years like people of the world change clothes. Within this paper we are going to look at the overview of those changes and just exactly what makes this industry tic. We will discuss the challenges involved in managing restaurant operations that are specific to my state, as well as how I would address those challenges. Such challenges to the restaurant industry may include regulatory issues, social concerns, competitive issues, and / or demographic and geographic issues. I am also going to determine the impact of computerization on food service and lodging operations within my state, particularly in the areas of reservations, accounting, personnel management, and the recording of sales transactions, I’m also going to consider the quality of technology infrastructure in my state and the degree of technology usage by potential customers visiting or using these services within my state. I will be giving my opinion on all of these topics plus I will also analyze the interdependence of food service, lodging, and meeting segments of the hospitality industry and make two (2) recommendations for how the synergy between the three (3) could be improved, using examples from my state to illustrate my case. I will also explain how I believe these segments can improve their relationships between one another and how they can combine their services in order to......

Words: 1884 - Pages: 8

Analysis of Hotel and Tourism Industry

...Investment Summary An Analysis of Hotel and Tourism Industry Tajamouat for Touristic Projects vs. Zara Investment Holding (ZARA)  Prepared By: Rasha Alazzeh Khaled Al-Shareef Marwa Jarkas Kamal Odeh May Hirzallah Nedal Khouri Valuation results   | Tajamouat for Touristic Projects | Zara Investment Holding (ZARA)  | Risk Characteristic |   |   | Beta | 0.7 | 0.02 | Jensen Alpha | -0.45% | -1.34% | R squared | 0.0873 | 0.0011 | Investment Performance |   |   | ROE – COE | -153.40% | -1.14% | ROC – WACC | -338.02% | -190.75% | EVA (Millions) | 91952595 | 166466611 | Capital Structure |   |   | Current Debt ratio | 48.07% | 38.62% | Optimal Debt Ratio | 92.57% | 62.91% | Change in WACC | N\A | N\A | Dividend Policy |   |   | Dividends (Millions) | 0 | 0 | FCFE (Millions) | -19678413.00 | -75373182.24 | Valuations |   |   | Value/share | 0.92 | 1.332 | Price/Share | 0.59 | 1.05 | Table of Contents Introduction: 3 Overview of Performance, Corporate Governance: 3 Tajamouat Business: 3 Zara Investment Business: 4 Corporate Governance: 5 Risk Profile: 6 Investment Return Analysis: 7 Investment Returns: 8 Dividends Policy: 11 Cash flow choice: 12 Growth pattern choice: 13 Valuation: 14 Weighted Average Cost of Capital – WACC: 14 Value......

Words: 4620 - Pages: 19

The Travel and Tourism Industry

...UNIT 1 The travel and tourism industry Introduction T he travel and tourism industry is one of the biggest and fastest growing industries in the UK. This unit will give you an introduction to the industry, providing a sound basis for further study. You will find out about the nature of the industry, its size and scale, and you will be introduced to the types of organisations that form its structure. In addition you will investigate the development of the industry and the factors which have affected the growth of travel and tourism. How you will be assessed This unit is assessed through an external assessment set by Edexcel. A variety of exercises and activities is provided in this unit to help you develop your understanding of the industry and prepare for the external assessment. After completing the unit you will achieve the following outcomes: ✱ Understand the nature and characteristics of travel and tourism and the travel and tourism industry ✱ Understand the development of the travel and tourism industry ✱ Explain the structure of the travel and tourism industry ✱ Explain the scale of the travel and tourism industry. UNIT 1: THE TRAVEL AND TOURISM INDUSTRY 1 1.1 The nature and characteristics of travel and tourism and the travel and tourism industry What is tourism? Defining tourism is not a simple matter, as it is a complex industry made up of many different businesses, the common theme being that they provide products and......

Words: 17515 - Pages: 71

The Value and the Relevance of Tourism Industry

...The World Tourism Organization defines tourism as “the activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes not related to the exercise of an activity remunerated from within the place visited”. This year, 1 035 billion people will go to discover another country. Europe remains the preferred destination for those tourists who need to be patient to be able to visit the Acropolis or climb to the top of the Eiffel Tower. This practice has become almost commonplace today for a privileged part of the Western world. “The past 20 years have witnessed enormous changes in the world, and tourism principles and practice have also changed in that time, reflecting the dynamics of the world in which we now live”. (Fletcher, Fyall, Gilbert and Wanhill 2013: preface). In fifty years, the number of tourists has increased from 25 million in 1950 to 702 million in 2000. Today, the tourism industry represents more than a third of the whole world trade of services. Indeed, tourism accounted for 9 % of GDP and 1 in 11 global jobs. Over the past decade, the rate of international tourism increased by 4% on average, per year. By 2019, the World Tourism Organization expects that the sector will account for 10% of GDP, 1 in 10 global jobs and will supply 296 million jobs at the world level. These figures make it clear that the tourism industry has now become a major economic sector in......

Words: 1801 - Pages: 8

Impacts of Internet on Tourism Industry

...IT and Internet’s Impact on Tourism and Hospitality Industry: Implementations of technologies for Hilton Hotels Group. Demonstrate critical and evaluative interpretation and application of theoretical IT/ e-business concepts to a current tourism and hospitality market situation in order to build sustainable competitive advantage. I Introduction Accompanying the technological revolution of the 1990s there are many new opportunities and challenges for the tourism and hospitality industries. Since tourism, global industry information is its life-blood and technology has become fundamental to the ability of the industry to operate effectively and competitively. Poon (1993) suggests that the whole system of information technologies is being rapidly diffused throughout the tourism industry and no player will escape information technologies impacts. The report below gives an insight into the importance of application of information technologies and the use of Internet in tourism and hospitality industries. Two given strategic frameworks provide the analysis of the Internet and its impact on these sectors. This paper also aims to show how technological innovations and information systems can be beneficial for the hotel companies, by using the example of Hilton Hotels Group. II IMPORTANCE OF TECHNOLOGY IN TOURISM AND HOSPITALITY SECTORS Market wisdom today suggests that hospitality companies must embrace technology to compete against traditional competitors, as well as......

Words: 3156 - Pages: 13

Tourism Industry Overview Paper

...In recent years, a few large national hotel chains such as Marriott, Best Western, and Hilton have dominated the hotel industry. Travelers are familiar with establishments that exemplify dependability and quality at reasonable rates. Many hotels recognize the importance of brand loyalty to guests. In doing so, they have expanded their lodging options that are under one corporate name which includes a variety of hotels from limited service, affordable type hotels, and luxury inns. To help understand the tourism industry and the impact it has on the economy, this paper will cover a brief history with an overview, a SWOTT analysis of the Marriott Hotel, defining and addressing the impact of the real GDP, unemployment rate, inflation rate, consumer confidence, foreign exchange rate, and oil and gas prices. Brief History & Industry Overview People travel for numerous of reasons such as for family vacations, business seminars, weddings, or just for a spontaneous getaway. A majority of them rely on hotels to accommodate them while their out of town. Hotels are considered more than just a place to stay, but a destination that offers a diverseness of activities to keep travelers occupied during their stay. Hotels differ as the many family and business travelers they accommodate. They range from 5-star hotels, bed and breakfast inn, to youth hostels. The main objective is simply providing a place to spend the night. However, if one chooses to stay longer a hotel can......

Words: 2164 - Pages: 9

Emerging Issues in the Tourism Industry

...Emerging Issues in the Tourism Industry (In case of Switzerland) Introduction According to the World Economic Forum's annual Travel & Tourism Competitiveness Report which was released at the Global Tourism Forum (GTF) in Andorra; Switzerland and some other countries were considered as the most beautiful environments for developing the tourism and travel industries. Tourism always plays a vital role in the economy of any country and it plays the same role in Switzerland. But, it has been struck by the economic condition in Switzerland, because of the world economic recession. Tourists come to Switzerland because of its natural beauty, but with the continuing strike in many areas of Switzerland; it results in the improvement of tourism in Switzerland in recent years. Tourism Growth "Our report measures different factors that make it beautiful to make the tourism and travel industry of one country," said Jennifer Blanke, Lead Director and Economist of the World Economic Forum's Centre for Global Performance and Competitiveness. "The top rankings countries Switzerland, France, Germany and Austria show the significance of regulatory frameworks and supportive business, matched with world-class tourism and transport infrastructure, and a focus on rising natural and human resources for increasing an environment that is beautiful for making the tourism and travel sector." This analysis of the cross-country of the drivers of competitiveness in tourism and travel offers......

Words: 5566 - Pages: 23

Tourism Industry

...Indian Tourism Industry Anurag Dugar* Competitiveness is a comparative concept, primarily applicable at the company or firm level (McFetridge, 1995) and indicates towards its willingness and ability to compete in a given market, but the contemporary usage of this term has extended its traditional meaning to new dimensions. However, for one school of thought, competitiveness is equally applicable to all business enterprises, levels of government and nonprofit agencies and workers of the postmodern nation state. (Hillman C. H. 1992), but for another the underlying premise for competitiveness is - ‘firms compete, and not nations’, for example, according to Krugman - "The world's leading nations are not, to any important degree, in economic competition with each other" (Wikipedia). Similarly, Porter holds that - diversified corporate do not compete; only their business units do. Thus, according to the second school of thought competition occurs at the business unit level and hence the ‘corporate strategy’ must reinforce and focus on nurturing the competitiveness of each (business) unit. From this perspective, Nations can be visualized as diversified conglomerates and its sectors, industries and firms as its diverse business units, and then the role, relevance, importance and impact of “Government Policies” (Corporate Strategy), on the competitiveness of its sectors, industries and firms (business units) is clearly elaborated and India (as a conglomerate) and its Tourism Industry......

Words: 5376 - Pages: 22

Environmental Sustainability in the Tourism Industry

...abundance of studies that show how tourism greatly impacts environmental sustainability in various ways. The purpose of this report is to explore and analyze the activities that occur in the tourism industry as a whole, which cause a negative impact on the environment. Tourism and the environment are interrelated in a complex way, with many variables. This report will address three main issues. This first issue is how the tourism industry faces a conflict of interest between investors wanting short-term return on investment and environmentally sustainable management. Second, environmental issues are often times limited to only natural environment, with a major focus on pollution, global climate change, resources consumption, and habitat/ecosystems. These issues remain very important, however, in order for effective environmentally sustainable management to take place, a broader topic of sustainability must be covered which includes dimensions of economics, equity and environment. This report will explain how ecotourism aims to address these issues. The third issue is “greenwashing.” A lack of standardization in ecotourism allows for some companies to deceive customers into thinking they have implement environmentally sustainable practices, when in reality they are simply taking advantage of the rising popularity of ecotourism to boost revenues. This paper will explore what has been done so far to address sustainability issues and what practices tourism operators need to adopt......

Words: 2788 - Pages: 12

Tourism Industry in China

...Between 1949 and 1976, China was closed-off to foreigners with the exception of a selected few. During that time, travel and tourism was for all intents and purposes considered a political activity. Domestic tourism hardly existed and outbound travel was limited almost exclusively to government officials. To Chairman Mao Zedong, leisure travel was considered a capitalistic bourgeois activity and therefore forbidden under Marxian principles. Turning point: Shortly after the Chairman's death, China's most famous economic reformist, Deng Xiaoping, opened up the Middle Kingdom to outsiders. Foreign visitors quickly flocked to this once forbidden destination. Contrary to Maoist ideology, Deng saw the monetary potential in tourism and began to promote it intensely. China quickly developed its own travel industry. Major hospitality and transportation facilities were constructed or renovated. New jobs such as service personnel and professional guides were created, and a National Tourism Association was established. Inbound: - In 1978, an estimated 1.8 million tourists entered the country, with the majority coming from neighboring British Hong Kong, Portuguese Macau, and Taiwan. - By 2000, China welcomed over 10 million new oversea visitors, excluding the aforementioned three locations. Tourists from Japan, South Korea, Russia, and the United States comprised the largest share of that inbound population. - In 2010, China became the third most visited country in the world...

Words: 362 - Pages: 2

Service Products and Economic Tourism

...Exam: Service Product and Economic Tourism (All sources are a part of Bibliography) "The media is going to be in town and they're going to stick microphones in front of a whole bunch of visitors to get their opinions on their experience in London. Their answers are going to be critical in supporting the reputation of London and the UK in the future," said Greg Klassen, Senior-Vice President of the Canadian Tourism Commission. This statement came just before the 2012 Olympics. In a nutshell, his comment hits the nail on the head in terms of the impact hosting the Olympics can have on future tourism after hosting the Olympics. It goes without saying, then, that hotels and restaurants should price cautiously. "Resist the urge to price for the Olympics and con-sider pricing for the next 10 years instead. You don't want these to become known as the rip-off Olympics," advises Klassen. By hosting a successful major event, a city is able to demonstrate technical and organizational abilities, and even winning the opportunity to act as the host city signals success. However, by taking on that responsibility, in an event such as the Olympics, you run into the possibility that the event may not go the way you planned it. Either way, hosting the Olympics is an opportunity that many tourist destinations will not let pass them by. The Australian Tourist Commission received US $6.7 million from the Australian Government over four years, to maximize the tourism opportunities presented......

Words: 1558 - Pages: 7

Economics of Kerala Tourism

...[pic] Tourism sector analysis-Kerala Content 1. Content 2 2. Scope 3 3. Tourism market in India 3 3.1 Kerala Tourism 5 4. Market Structure 9 5. Conclusion 11 6. References 12 Scope Indian tourism industry is growing at a rapid rate with foreign visitor arrivals reaching a record 0.5 million in 2010, resulting in international tourism receipts of USD 3.8 billion. Tourism is a great foreign exchange earner for India accounting around 3-4 % of GDP. It also makes a direct contribution to economy with significant linkages with agriculture, horticulture, handicrafts, food, transportation, medicine and construction. India’s culture and the slogan “Atithi Devo Bhavah” targeted at the inbound foreign tourists in the country, is paying huge dividends. This assignment aims at analyzing the market structure in tourism industry and the specialties of Kerala tourism. This also analyses the competition and the market potential available in Tourism sector, Medical tourism, spiritual tourism and Adventure tourism are not considered here. Tourism market in India The foreign tourist arrivals in India has seen tremendous growth from 90’s to 2010, it has increased to six hundred thousand visitors in 2010, Main reason for this increase has been following fundamental factors: ❖ India’s economic growth and newly found image. ❖ Opening of tourism sector to private sector/ foreign......

Words: 1625 - Pages: 7

Brazil Tourism Industry

...1.0 Introduction to Brazil Tourism Industry In Brazil, tourism is a key to the economy development of several regions of the country. This statement was further supported by Slob B. & Wilde J. (2006), in their published journal entitled ‘Tourism and Sustainability in Brazil’, regardless of anywhere in the world, tourism, indeed; is the fastest growing industry and it contributes the world economy with a gross output of over US$7 trillion, employing 11% of globe’s workforce, forming 11.5% of global GDP. While in Brazil, White (2006) found that the industry contributes 3.2% of the total country revenue in year 2005. According to World Tourism Organization (WTO), due to the devaluation of American Dollar against the Brazilian Real has made a favorable trend in International tourist arrival to Brazil to grow dramatically in 2007 and in early 2008. In spite of this, statistic in Table 1 shows that revenue had risen from USD 4.3 billion in 2006 to USD 5.7 billion in 2008. Table 1 Brazil International Tourism Arrivals 1995-2011 Year | International tourist arrivals (x1000) | Annual growth (%) | Total revenue (millions USD) | Annual growth (%) | 1995 | 1,991 | - | 972 | - | 2000 | 5,313 | - | 1,810 | - | 2003 | 4,133 | - | 2,479 | - | 2004 | 4,794 | 16.0 | 3,222 | 30.0 | 2005 | 5,358 | 11.8 | 3,861 | 19.8 | 2006 | 5,019 | -6.3 | 4,316 | 1.1 | 2007 | 5,025 | 0.1 | 4,953 | 14.8 | 2008 | 5,050 | 0.5 | 5,780 | 16.7 | 2009 | 4,802 | -4.9 | 5,305 | -8...

Words: 5336 - Pages: 22

Business Tourism as Industry Driver

...Business Tourism as an Industry Driver Lilla Széplaki DISSERTATION FOR BA (HONS) IN TRAVEL AND TOURISM MANAGEMENT OXFORD BROOKS UNIVERSITY AND INTERNATIONAL BUSINESS SCHOOL – BUDAPEST 2007/2012 1 Acknowledgements Hereby, I would like to express my deepest appreciation to the Sales team of the Budapest Marriott Hotel, who gave their assistance informing me about all the needed data. I would like to thank to the people with whom I have had interview and also for my former colleagues from the Kempinski Hotel Corvinus. They supported me in my research work. I am deeply indebted to my supervisor Mr Alan Godsave. His suggestions helped me to write this thesis. 2 Table of Content 1. 2. Introduction......................................................................................................... 4 Literature review ................................................................................................ 7 2.1. 2.2. 2.3. What is Tourism? ........................................................................................ 7 The World Tourism Organization (UNWTO) .......................................... 8 Current situation of business tourism ....................................................... 9 Globalisation ......................................................................................... 9 International Trends .......................................................................... 10 The affecting factors of Business Tourism......

Words: 14443 - Pages: 58

Telefoonkaarten | RULES OF SURVIVAL | Bandicam 4.1.3 Multilingual Terbaru !