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1、Unit2EconomicImpactofTourismUnit2EconomicImpactofTourismThetravelandtourismindustryisanindustryofrelativelyrecentdevelopmentinmanycountries.Manycountrieshavenowrecognizedtheimportanceofthisindustry.Itdefinitelyhasasignificantimpactonacountry’seconomy.Tourismprovidesb
2、enefitsforbothtouristsandhostcountrythroughtheeconomicbenefitsitcanbringtotheregion.Tourismcanprovidemanyeconomicincentivesfordevelopment.Thedevelopmentoftourism,especiallyinadevelopingcountry,requirestheexistenceofinfrastructureofroads,electricityandwatersupplies,co
3、mmunicationnetworks,andperhaps,airports,aswellashotelaccommodations,andotherfacilitiesspecifictotourism.Tourismgivessignificantcontributiontoacountry’sregionalandnationaleconomiesintermsofthecapacitytoattractinvestment,createemployment,generateforeignexchangeearnings
4、,improvebalanceofpayments,andcreatemultipliereffectsthroughouttheeconomy.Theeconomicbenefitsoftourismwillalwaysbringeconomicbenefits,asthereareeconomicproblemsandcosts.Thegreatertheoverallrelianceontourismasadominantindustry,thegreatertheoverallrelianceontourismasado
5、minantindustry,thegreatertherisksandcostsaretotheeconomyofacountry.Developingcountriesmaybemorevulnerabletotheboom-and-bustcharacteristicsofthetravelandtourismindustrythanlocalitymustundertakeitsownanalysisandassesswhetherornottourismwillhaveapositiveinfluenceontheir
6、economy.TheMultiplierEffectsofTourismTheeconomicimpactoftourismisbothdirectandindirect.Thedirecteffectcomesfromtheactualmoneyspentbytouristsatadestination.Itisobviousthatthereismarkedincreasesinrevenueinareaswheretourismispromoted,suchastheaccommodationsector,thetran
7、sportationsector,andthecateringsector.However,onemustrememberthatotherindustriesalsobeneficindirectlyfromtourism.Touristsspendmoneyonhotelsandotherformsofaccommodation.Theypatroniselocalshopsandrestaurants;theybuylocaltours;theypurchaselocalhandicraftsandsouvenirs;an
8、dtheyuselocaltransportationandotherservices.Theinflowofrevenuegeneratesadditionalturnover,householdincome,employmentandgovernmentre