Tourism is one of the most important sectors of the global economy, generating massive revenue and providing millions of jobs worldwide. However, it is often difficult to classify tourism in terms of economic categories. In this article, we will explore the level of economy that tourism belongs to.
What is Tourism?
Tourism refers to the process of traveling for leisure, business or other purposes. It includes activities such as sightseeing, visiting cultural and historical sites, attending concerts and festivals, and engaging in adventure sports. Tourism also involves the use of various services such as accommodation, transportation, food, and shopping.
The Economic Impact of Tourism
Tourism is a major contributor to the global economy. According to the World Travel & Tourism Council (WTTC), the travel and tourism industry contributed 10.4% to global GDP in 2019 and supported 319 million jobs worldwide. The industry also generated US$8.9 trillion in revenue.
The economic impact of tourism can be seen at various levels – local, regional, national and international. At a local level, tourism generates employment opportunities and income for small businesses such as hotels, restaurants and souvenir shops. At a national level, tourism can contribute significantly to a country’s GDP and foreign exchange earnings.
The Classification of Tourism
Tourism can be classified into different types based on various factors such as purpose, duration, distance traveled etc. However, when it comes to its economic classification there are two categories:
Primary Industry: Primary industries are those that involve extracting natural resources from the environment such as agriculture or mining. While tourism does not fit entirely within this category since it does not involve extraction but rather consumption or enjoyment of natural resources but some economists argue that it should be classified under this category because it relies heavily on natural resources like beaches or wildlife reserves.
Tertiary Industry: Tertiary industries are those that provide services to consumers. This includes activities such as banking, healthcare, and tourism. In this sense, tourism is classified as a tertiary industry since it involves providing services to travelers.
The Role of Tourism in Economic Development
Tourism can play a significant role in the economic development of a country. It can create employment opportunities, generate foreign exchange earnings, and contribute to the growth of other industries such as transportation and construction.
However, the impact of tourism on economic development depends on various factors such as government policies, infrastructure development, and promotion of local culture and heritage. If these factors are not taken into consideration, tourism can have negative impacts such as environmental degradation and cultural commodification.
Conclusion
In conclusion, tourism is an important sector that contributes significantly to the global economy. While its classification within economic categories may be debatable, it is widely considered a tertiary industry that provides services to consumers. With proper planning and management, tourism can play a key role in economic development while also preserving natural resources and promoting local culture.