Tourism's Economic Impact - Tourism: Principles, Practices, Philosophies - page 300

INTRODUCTION

T ourism is a powerful economic force providing employment, foreign exchange, income, and tax

revenue. The generators of economic impact for a city, a state, a province, a country, or a
destination area are visitors, their expenditures, and the multiplier effect. The economic impact of
tourism spending is a function of the numbers of domestic and international visitors and their
expenditures (see Chapter 1). Because of the economic importance of tourism, the United Nations
World Tourism Organization (UNWTO) maintains statistics by region and country on tourism arrivals
(visitors) and both tourism expenditures (what a country spends) and receipts (what a country receives
from visitor expenditures). Tourism destinations are becoming increasingly competitive as more and
more destinations look at tourism to become the new economic generator replacing declining activity
in agriculture, mining, and manufacturing.
As noted by the members of the International Academy for the Study of Tourism (IAST) who
recently, with a special issue of the Journal of Travel Research, presented their insights on '' The Global
Economic Crisis and Tourism. '' IAST noted speci cally, '' The Global Financial Crisis (GFC) has seen
financial, business, and consumer con dence sink to almost record low levels. Tourism spending has
experienced greater falls than other consumer spending, affecting outbound, inbound, and domestic
tourism flows and with that, the economic contribution of tourism to destinations worldwide.
Declining asset prices and wealth have affected the ability of firms to fund debt and invest. Credit
availability and the derisking of bank balance sheets have also sti ed tourism investments with
consequent impacts on employment in the industry. '' 1 The detailed nature of the decline in tourism
arrivals and receipts in 2009 throughout the world is shown in Tables 14.1 and 14.2, respectively.

TOURISM'S ECONOMIC IMPACT:
AN INTERNATIONAL PERSPECTIVE

Re ecting the impacts of the global financial crisis of 2008 and 2009, international tourist arrivals declined
by 4.2 percent in 2009 to $880 million (Table 14.1). International tourism receipts reached US$852 billion
(611 billion euros) in 2009, corresponding to a decrease in real terms of 5.7 percent on 2008 (Table 14.2),
which shows that receipts were not very much more affected by the crisis than arrivals. 2
In 2009, there were only slight changes in the ranking of the first ten destinations by international
tourist arrivals and receipts. France continues to lead the ranking of the world ' s major tourism
destinations in terms of arrivals and ranks third in receipts. The United States ranks first in receipts and

TABLE 14.1 International Tourist Arrivals

Arrivals (million) Change Rate (%) Market Share (%)

2009 a /2008 2008 2009 2009

World 919.0 880.0 -4.2 100.0

Africa 44.3 45.6 2.9 5.6

Americas 140.9 140.1 -4.6 15.9

Asia and the Paci c 184.0 181.6 -1.3 20.6

Europe 482.6 460.0 - 5.7 52.2

Middle East 56.0 453.2 - 4.9 6.0

a Data as collected in UNWTO database, June 2010.
Source: UNWTO World Tourism Barometer, United Nations World Tourism Organization, June 2010.