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Is Tourism good for Development?. Why have LEDC’s become popular?

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Presentation on theme: "Is Tourism good for Development?. Why have LEDC’s become popular?"— Presentation transcript:

1 Is Tourism good for Development?

2 Why have LEDC’s become popular?

3 How has this become possible?

4 Leakage In most all-inclusive package tours, about 80% of travellers' expenditures go to the airlines, hotels and other international companies, and not to local businesses or workers. In most all-inclusive package tours, about 80% of travellers' expenditures go to the airlines, hotels and other international companies, and not to local businesses or workers. Estimates for LEDW - 80% in the Caribbean, 70% in Thailand & 40% in India. Estimates for LEDW - 80% in the Caribbean, 70% in Thailand & 40% in India.

5 Leakage Import leakage LEDW - food and drinks often imported - local products often not up to the hotel's (i.e. tourist's) standards or the country simply doesn't have a supplying industry eg Scotch whiskey. LEDW - food and drinks often imported - local products often not up to the hotel's (i.e. tourist's) standards or the country simply doesn't have a supplying industry eg Scotch whiskey. Average import-related leakage % of gross tourism earnings for small economies and between 10% and 20% for most advanced and diversified economies. Average import-related leakage % of gross tourism earnings for small economies and between 10% and 20% for most advanced and diversified economies. Export leakage TNC's significant in export leakage. TNC's significant in export leakage. Have necessary capital to invest in the construction of tourism infrastructure and facilities. Have necessary capital to invest in the construction of tourism infrastructure and facilities.

6 "all-inclusive" All-inclusive - largest amount of revenue but smaller impact on economy per dollar of revenue than other accommodation types. All-inclusive - largest amount of revenue but smaller impact on economy per dollar of revenue than other accommodation types. All-inclusives also import more and employ fewer people per dollar of revenue than other hotels. All-inclusives also import more and employ fewer people per dollar of revenue than other hotels. Non-river cruises carried some 8.7 million international passengers in Non-river cruises carried some 8.7 million international passengers in Guests encouraged to spend most of their time and money on board, and opportunities to spend in some ports are closely managed and restricted. Guests encouraged to spend most of their time and money on board, and opportunities to spend in some ports are closely managed and restricted. Smaller trickle-down effect on local economies. Smaller trickle-down effect on local economies.

7 Dependence economies Diversification in an economy is a sign of health. Diversification in an economy is a sign of health. Gambia - 30% of the workforce depends directly or indirectly on tourism. Gambia - 30% of the workforce depends directly or indirectly on tourism. In small island developing states, percentages can range from 83% in the Maldives to 21% in the Seychelles and 34% in Jamaica. In small island developing states, percentages can range from 83% in the Maldives to 21% in the Seychelles and 34% in Jamaica. Over-reliance on tourism carries risks to tourism-dependent economies. Economic recession, the impacts of natural disasters such as tropical storms and changing tourism patterns can all have a devastating effect. Over-reliance on tourism carries risks to tourism-dependent economies. Economic recession, the impacts of natural disasters such as tropical storms and changing tourism patterns can all have a devastating effect.

8 Foreign exchange earnings An important indicator of the role of international tourism is its generation of foreign exchange earnings. An important indicator of the role of international tourism is its generation of foreign exchange earnings. Tourism can generate income for infrastructural improvements such as better water and sewage systems, roads, electricity, telephone and public transport networks Tourism can generate income for infrastructural improvements such as better water and sewage systems, roads, electricity, telephone and public transport networks Tourism is one of the top five export categories for as many as 83% of countries and is a main source of foreign exchange earnings for at least 38% of countries. Tourism is one of the top five export categories for as many as 83% of countries and is a main source of foreign exchange earnings for at least 38% of countries.

9 Contribution to government revenues Direct contributions - taxes on incomes from tourism employment & businesses and by direct levies on tourists such as departure taxes. Direct contributions - taxes on incomes from tourism employment & businesses and by direct levies on tourists such as departure taxes. Indirect contributions come from taxes and duties levied on goods and services supplied to tourists. Indirect contributions come from taxes and duties levied on goods and services supplied to tourists. The WTO estimate - worldwide contribution was over US$ 800 billion in a figure it expects to double by The WTO estimate - worldwide contribution was over US$ 800 billion in a figure it expects to double by 2010.

10 Employment generation The hotel accommodation sector alone provided around 11.3 million jobs worldwide in The hotel accommodation sector alone provided around 11.3 million jobs worldwide in Tourism can generate jobs directly through hotels, restaurants, nightclubs, taxis, and souvenir sales, and indirectly through the supply of goods and services needed by tourism-related businesses. Tourism can generate jobs directly through hotels, restaurants, nightclubs, taxis, and souvenir sales, and indirectly through the supply of goods and services needed by tourism-related businesses. Tourism supports some 7% of the world's workers. Tourism supports some 7% of the world's workers.

11 Antigua: a Caribbean case study

12 A sustainable future from tourism? Make note of the following:  Background of an LEDC.  Facts & figures about tourism.  How does the organisation of tourism (typical of an LEDC) result in costs outweighing benefits?  Economic (leakage, cruises, all inclusive, employment).  Social (cultural dilution, demonstration effect).  Environmental.  Political.


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