Tourism is a multifaceted and interconnected dynamic industry. It can generate an immeasurable contribution to a country or destination through socio-economic development, cultural enhancement and environment-friendly improvement. If the industry is properly guided. such contributions can be created, enhanced and distributed among different sectors and segments of people through its Backward and Forward Linkages together with its Direct, Indirect and Induced Effects. As a result, the industry has a great potential to be an economic stimulator or driving force in providing manifold income and revenue generation sources, employment opportunities, a reliable source for foreign exchange earnings and consequently direct such contributions for the economic growth and development of a country.
The rapidly growing tourism industry has evidently illustrated its strong economic linkages for regional and local economic development in many countries. The economic contribution of tourism to the peripheral rural and urban areas is stimulated through the integration of tourism development activities in the agricultural, industrial and service sectors of the economy.
Tourism: An Effective Tool for Reducing of Unemployment and Underemployment
Tourism development has shown its potential power of reducing the prevailing unemployment and underemployment of rural and urban sectors, more specifically with the agriculture and informal sector of the economy. A well-focused and prioritised tourism development effort in suitable /locations with specific activities and events in rural and urban economies can capitalise such unemployed and underemployed human and other resources to energise the local and regional economies.
Key Highlights of Growing Global Tourism:
· At present, global tourism has become the 3rd highest GDP contributor to the global economy, representing more than 10 per cent of the total world GDP. The , Travel and Tourism industry generates one in 10 jobs (319 million) worldwide and also generates 10.4 per cent of the world GDP.
· The Global travel and tourism industry has made a paradigm-shift. It has replaced the Wealthy-Friendly deiuxe travel in to a more democratic mass-friendly travel, and also from more westernised travels into globalised travels. This has been due to several reasons. Among these reasons, (1) reducing of travel barriers, (2) falling real travel costs, (3) rapid growth of disposal income and increase of the middle-income class in many countries, (4) positive changes in global political settings and travel attitudes have led to an era of flourishing travel and tourism industry at global level, despite having several terrorism activities and economic recessions. More specifically, booming rich and increasing middle income earners are identified as one of the major reasons for creating a rapid growing trend in travel and tourism demand in the globe.
· Furthermore, the recent forecasting on global tourism development clearly indicated that the most decisive regions of global tourism development in future will be Africa, the Middle East and Asia-Pacific while predicting a slow growth trend in tourism development in Europe and the Americas.
According to the UNWTO, more than 40 per cent of the world arrivals is represented by 10 top countries.
Sri Lanka Tourism: A Story of Untapped Potential
It has been clearly evident that the travel and tourism sector has been one of the successful industries in the post-war economy of Sri Lanka. The industry’s growth has significantly contributed to increase (1) level of employment, (2) foreign exchange earnings, (3) government revenue and subsequently (4) the economic growth of the country, through its direct, indirect and induced effects with a strong backward-forward linkages.
During past decade, from 2009 to 2018, tourist arrivals increased by nearly 475 per cent while foreign exchange earnings of tourism increased by nearly 1150 per cent. Similarly, levels of direct and indirect employment (total employment) increased by nearly 200 per cent while formal accommodation capacity increased by approximately 70 per cent.
As a result of this impressive performance, Sri Lanka Tourism has now become the 3rd highest foreign exchange earner of the country, leading to reduce the current burning deficit of the Trade Account in the Balance of Payment of the country.
However, reaching an unchecked conclusion that Sri Lanka Tourism is successfully performing by just looking at its current positive performance could surely be misreading the reality.