Tourism is a significant contributor to the global economy. It accounts for approximately 10% of the world’s GDP and creates millions of jobs worldwide.
Tourism has an immense impact on various industries and economies, including transportation, hospitality, and service sectors. In this article, we will discuss how tourism affects the global economy.
Direct Contribution to GDP
Tourism directly contributes to the GDP of many countries. It includes spending by tourists on accommodation, food and beverage, transportation, entertainment, and shopping. According to the World Travel & Tourism Council (WTTC), in 2019, travel and tourism’s direct contribution to the global GDP was $2.9 trillion, which is about 3.3% of the total GDP.
Employment Opportunities
Tourism is a significant employer globally. According to the United Nations World Tourism Organization (UNWTO), in 2019, travel and tourism created 330 million jobs worldwide or one in ten jobs globally. The hospitality industry alone accounts for about 10% of all jobs globally.
Boosts Local Economies
Tourism can be a boon for local economies as it creates demand for various goods and services such as accommodation, transport, food and beverage industry, retail stores etc., which can lead to new businesses opening up in these regions. This can help increase economic growth in these areas.
Foreign Exchange Earnings
Tourism also contributes significantly to foreign exchange earnings for many countries by attracting international tourists who spend money on local goods and services. According to WTTC data from 2019, international tourist spending accounted for approximately 27% of all service exports worldwide.
Improved Infrastructure
To accommodate tourists’ influxes into a region or country, infrastructure development becomes necessary. This includes building new hotels or upgrading existing ones, improving transportation networks, and creating new tourist attractions. These developments can have a long-lasting impact on the local economy, making it more attractive to tourists and generating more revenue for the region.
Environmental Impact
While tourism can have positive effects on the global economy, it also has a significant environmental impact. The increased demand for accommodations and transportation has led to the development of new infrastructure that can harm natural habitats, leading to deforestation or pollution. This can have long-term effects on the environment and local communities.
Conclusion
In conclusion, tourism is a vital contributor to the global economy. It creates jobs, boosts local economies, generates foreign exchange earnings and improves infrastructure. However, it’s essential to balance economic growth with environmental sustainability to ensure that tourism doesn’t harm local environments and communities in the long run.