Impact Of Tourism On The Economy Positive Impacts
- Slides: 7
Impact Of Tourism On The Economy
Positive Impacts • One of the main reasons for the huge growth in tourism is the positive effect it can have on the economy of an area. • The nature of the industry means that it provides many jobs and generates substantial revenue. • This can be particularly important for less developing countries as it provides a valuable source of foreign revenue.
Positive Impacts • To evaluate the success of tourism you need to look at where the money generated goes. • If it is invested locally on new services such as infrastructure, schools and local projects, then any money generated by tourism is having a positive effect on the local economy and society. • The jobs generated should also go to the locals so that the economy will benefit from the multiplier effect.
Negative Impacts • The negative effects of tourism for an economy are determined by the distribution of the money generated and the allocation of jobs. • We use the term 'leakage' to help explain this. • Leakage is the amount of money that escapes (whether directly or indirectly) from the local economy.
British Tour Company Owns An Overseas Hotel • The management of the resort are British so a percentage of their wages will be leakage especially if they are on a fixed contract for maybe a year or two. • British staff are employed to run the hotel on a seasonal basis. • Therefore a large percentage of their income will eventually be spent in the British economy. • Some tour operators export food to their hotels so suppliers in the UK benefit instead of the local suppliers.
Goa • There is a situation in Goa where one company owns the hotel, coach and airline. • So the holiday is booked in Germany (travel agent takes a cut), the tourists fly on a German airline, are met by that company's employee, taken on the company's bus to the company's hotel. • It is clear to see how little of the money spent by the tourists will get into the Goan economy!
Activity 1. Create 2 spider diagrams on both the positive and negative impacts that tourism has on the ECONOMY of a place. 2. For each of your points, explain reasons for them. 3. Is tourism all about strengthening a country’s economy? Explain both sides of this argument.
