Tourism is the fastest growing industry in the world and plays a vital role in the economic development of a country. Many countries of the world stay alive upon the tourism sector. In this globalization era, third world countries in progress tourism to development their economy, keep contribution to world peace, reduce shortage level and develop human resource and culture.
Directly or indirectly, large account of people is involved in the tourism sector. It includes areas like transportation, somewhere to stay, food, ticketing, guide, boating, rafting, trekking, preservation of the tourist sites etc. Host provides all necessary services and facilities to the guests. The guest pays for all these services. Hence, the tourism generates considerable benefits for the people of the origin place of the tourist as well as people on destinations.
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By developing the infrastructure for various tourism related activities enables better movement services from one place to another for either incoming or outgoing tourists. One of the primary motives for developing a country like ours is to promote tourism destination for foreign tourists. It helps to get the foreign exchange.
A good amount of foreign reserve helps to maintain a country’s balance of trade. Apart from the balance of trade in the country, it also generates employment opportunity for the jobless youth. In this way they get their livelihood and the income is generated for their continued existence and well being.
General Impacts
- Generating Income and Employment: Tourism in India has emerged as an instrument of income and employment age group, poverty improvement and sustainable human development. It contributes 6.23% to the national GDP and 8.78% of the total service in India. Almost 20 million people are now functioning in the India’s tourism industry.
- Source of Foreign Exchange Earnings: Tourism is an important basis of foreign exchange salary in India. This has favorable impact on the stability of payment of the country. The tourism industry in India generated about US$100 billion in 2008 and that is expected to add to US$275.5 billion by 2018 at a 9.4% annual growth rate.
- Preservation of National Heritage and Environment: Tourism helps protect several places which are of historical importance by declaring them as heritage sites. For instance, the TajMahal, the QutabMinar, Ajanta and Ellora temples, etc., would have been decomposed and destroyed had it not been for the efforts taken by Tourism section to preserve them. Likewise, tourism also helps in conserving the natural habitats of many scarce species.
- Developing Infrastructure: Tourism tends to encourage the development of multiple-use infrastructure that benefits the host community, including various means of transports, health care facilities, and sports centers, in addition to the hotels and high-end restaurants that cater to foreign visitors. The development of infrastructure has in turn induced the development of other directly productive activities.
- Promoting Peace and Stability: Honey and Gilpin (2009) suggests that the tourism industry can also help promote peace as well as stability in increasing country like India by providing jobs, generating income, diversify the economy, shielding the environment and promoting cross-cultural awareness. However, key challenge like adoption of regulatory frameworks, mechanism to reduce crime and corruption, etc. must be address if peace-enhancing profit from this industry is to be realized.
Typology of Tourism Impacts
Understanding that tourism growth may result in many and complex impacts suggest those local elected officials, the tourism industry and community citizens need to work kindly and carefully to plan for its growth and development. Planning can help generate an industry that enhances a community with minimal costs and disruptions in other aspects of community life. Having broad community involvement and embracing different perspectives during planning helps recognize and resolve concern that would or else create problems later.
The impacts of tourism can be sorted into six general categories:
Economic Impact
Tourism increases employment opportunities. Other jobs, ranging from low-wage entry stage to high-paying professional positions in management and technical fields, generate income and raises usual of living. Particularly in rural areas, the diversification created by tourism helps community that is possibly dependent on only one industry. As tourism grows, extra opportunities are created for speculation, development and infrastructure spending
Tourism often induces improvement in public utilities such as water, sewer, sidewalks, lighting, parking, public restrooms, litter control and landscaping. Such improvement benefit tourists and residents the same. Likewise, tourism encourages improvements in transport communications resulting in upgraded roads, airports, public shipping and non-traditional transportation.
Tourism encourages new elements to join the retail mix, increasing opportunity for shopping and adding healthy competitiveness. It often increases a community’s tax revenues. Lodging and sales taxes most remarkably increase but additional tax revenues include air travel and other transportation taxes, business taxes and fuel taxes. New jobs generate more income tax revenues.
When considering the economic impacts of tourism, it is essential to understand that tourism business often include a significant number of low-paying jobs, often at minimum wage or less. These jobs are often regular causing under-employment or unemployment during off-seasons. Labour may be imported, rather than hired locally, especially if particular skills or expertise is required, or if local labor is unavailable.
Some tourism-related businesses are volatile and high-risk ventures that are weak. Greater demand for goods, services, land and housing may boost prices that in turn will increase the cost of living. Tourism businesses may claim land that could have higher- value or other uses.
Additionally, non-local owners and corporations may export profits out of the community. The community may have to generate money (possibly through increased taxes) to maintain roads and transportation systems that have become more seriously used. Similarly, if additional infrastructure (water, sewer, power, fuel, medical, etc.) is required, additional taxes may also be needed to pay for them.
Environmental Impact
Areas with high-value natural wealth like oceans, lakes, waterfalls, mountains, unique flora and fauna and great scenic beauty attract tourists and new residents (in-migrants) who seek emotional and spiritual connections with nature. Because these people value nature, selected natural environment are preserved, protected and kept from further natural decline.
Lands that could be residential can generate income by accommodating the recreational activities of visitors. Tourist income often makes it possible to protect and restore historic buildings and monuments. Improvements in the area’s appearance through cleanup or repairs and the addition of public art such as mural, water fountains and monuments (part of making a community ready for tourism) benefit visitors and residents alike. Tourism is generally considered a “fresh” industry, one that is based on hotels, restaurants, shops and attractions, instead of factories.
Socio-economic importance of tourism development
In 2013 foreign trade profits from the tourism business worldwide are 1.4 trillion US dollars, about 4 percent enhanced than in the former year. Tourism is the major business in the world nowadays. The tourism business share of the entire worldwide manufacture is about 5991.90 billion US dollars that is 9.1 percent of whole world manufacture. Roughly 2 per cent of the GDP arise from the tourism sector.
Moreover, tourism industry plays a vital role by forming the socio-cultural growth in the destination, education, progress, and peace. As a result, human values, behaviour, good lifestyle, etc. are established. For many developing countries the tourism industry works like “Life Blood”. Moreover, tourism activities are the supply of joy for people by bringing comfort and leisure opportunity. People know each other gather experience and make friends with people and harmony can produce through tourism. The government has to give special importance to the industry to continue its development.
Meanwhile, creating employment opportunities in the tourism industry has taken place as the biggest sector. Moreover, the activities of this industry run to every corner of the country create employment opportunities for rural people as well. As a result, the benefits of these industries also create equal opportunity of income between rural and urban people.
The rural people’s service prospects will be created by the development of tourism industry helping the low employment opportunities in Bangladesh. The quality of life is improved if tourism industry generates properly. The development of tourism industry and the development of tourism destination are helpful for local people by creating small business opportunity and forming many more options. Moreover, the ties and friendship between the people of the world rise by tourism.
Services
Tourism creates opportunities to develop new facilities and recreation amenities that would not otherwise be viable in a community. Tourist expectations can upgrade service by local shops, restaurants and other commerce operators. Tourist traffic in a community creates an opportunity for upgraded fire, police, and medical protection that also benefits residents.
Traditional services may be compulsory out or relocated due to competition with tourist interests. Supply shortage may occur temporarily, seasonally or chronically. Water, power, fuel, and other shortages may be experienced with increased pressure on the infrastructure.
Positive
- Increases accessibility of recreation services and opportunities.
- Better standard of armed forces by shops, restaurants and other commerce
- Improves quality of fire defense.
- Improves quality of police protection
Taxes
Increased retail activity from restaurants and tourist shopping will add state and local sales tax revenue. Lodging tax revenue to the city (or state) should increase since travelers account for virtually all lodging tax. Improved tax burdens to expand infrastructure and public services will be passed on to property owners through increased property taxes.
Positive
- Additional state and local sales tax revenue.
- Lodging tax revenue to city (or state)
Community Attitude
Visitor interest and satisfaction in the community is a source of local pride. Seeing visitor interest makes local residents more appreciative of local resources that are often taken for granted. As tourism develops, local residents will enjoy more facilities and a greater range of choices. Tourism activities and events tend to make living in a place more interesting and exciting.
However, sensitive tension and population divisiveness can occur over tourism development, pitting tourism supporters against non-supporters. Also, pressure between residents and tourists can occur. People will often feel stressed over the new, increasingly hectic community and personal pace of life. They may claim the result is no better than before or perhaps even worse. Where society is part of the tourist attractions, over-amplification of cultural traits and conception of “new” cultural traits to satisfy tourist tastes may create a phony culture.
Populace may experience a sense of exclusion and alienation over planning and development concerns. They may feel a loss of control over the community’s future as “outsiders” take over establishment and new development. Hotels built in monolithic cubes or restaurants with standardized franchise designs might clash with local standards and disrupt the aesthetic appearance of the community, damage unique community character, and spread sameness.
Positive
- Heightens satisfaction in community
- Greater gratitude of local resources.
- More facilities and variety of choices available.
Tourism and Its Impacts on the Livelihood
In the financial sense, tourism touches all the groups of people in a country. Over the last era, the conception of tourism development has become the increasing attention to the developing countries. Tourism focus on creating job opportunities, reducing poverty, investing in the deprived to build their own prospects, assisting their access to properties and developing the living style.
Tourism also creates non-economic impact related to business such as chances for training, education, ability constructing, rising self-importance and self-confidence, progresses in health and other sorts of well-being, enhanced socio cultural status.
Tourism includes the association of people to distinctive geological sites, and the creation of public relationships amongst people, exchanging cultures, civilization, belief, morals, existences, languages and points of wealth. Tourism can help as a helpful intensity for harmony, promote superiority in racial customs and support not moving to the city by generating local employment.
The group of people can take the respected characteristics of another community’s culture and tradition throughout tourism. Tourism has positive penalty on the ecosystem by paying attention to environmental protection and maintenance. Tourism increases the consciousness of ecological prices and can work as a tool to funding the protection of environmental zones. Natural sites are demanded for sustainable tourism and government and tourism power give special attention to developing these spots. When the environment is preserved better then people’s life style will be better.
Positive Economic Impacts of Tourism
There are many positive impacts on the economy of the local area of target of the tourist particularly in the fewer economically developed countries or developing countries due to tourism. Some of them are:
- Expenditure incurred for the purpose of encouraging tourism generates Income in the host countries. This in turn increases the growth in the other allied economic sectors.
- As mentioned above, attracting foreign tourists to a host country fetches foreign currency. This is a very good sign of having good international trading capacity.
- Government of a host country generates the revenue as taxes on the income from tourism employment, business, and entry fee at various tourist sites/monuments also through toll taxes etc.
- Many items needed by the tourists are imported from other countries. When Government levies import duty it gets financial benefits.
- It has piloted better economic status of the people involved in tourism, directly or indirectly through hotels, restaurants, guides, nightclubs, taxies, local crafts, paintings, local cultural products etc. Tourism motivates the government to invest more on many types of infrastructures leading to better facilities for tourists as well as for the local people.
Negative Economic Impacts of Tourism
There are many negative impacts on the economy of destination of the tourist particularly in the less cheaply developed countries (LEDC) or developing Countries due to tourism. Some of them are:
- There are many hidden costs of tourism which have adverse effects on Economy on the destination countries. Most of the time, wealthier countries are better profited than the poor countries. Many fragile products like food and drinks have to be imported by host countries which are poor or developing. This is because local products are of lower quality. Thus, the profits go to the developed countries from where they are imported.
- In all-inclusive package tours, almost two-third of the expenses goes to the airline, hotels and other international company and not to local businesses or workers.
- In all-inclusive package tours, tourists generally remain for their entire stay at the same cruise ship or option, which provides everything they need. There is no option left for making profit to the local economy.
- In poor and developing destination, the money is used to develop the infrastructures for tourism by government. But the profit is exported to other developed countries when overseas investors finance resorts and hotels. More and more demand for basic services and goods by the tourists lead to the price hike in the destination nation. It negatively affects local people whose income does not increase in that proportion.
- Development of tourism in target nation increases the value of services and land. Thus, basic needs of the people of that place become very tricky to meet.
- Many countries do not carry tourism because of the seasonality or harsh climatic conditions. During the tourist season, the local people get some employment opportunity, but there is no guarantee that they would get the same in the next season. Therefore, they are insecure in getting their livelihood.
- People are displace to construct airports, resorts, hotels, nature reserves, historical and other hold sites and other tourism development projects.
Tourism Economic Concerns
There are a number of economic concerns about tourism.
- Inflation and land values: As noted above, tourism growth raises both the price of land and the prices of other goods and services. Even if a local resident does not sell, his or her costs increase as property taxes rise. In the five years next the acquisition of land in the US state of Florida for Disney World, land values surrounding the attraction increased significantly. The land was originally purchased under assumed names for USD 350 an acre (0.4 hectares). Five years later the surrounding land brought upwards of USD 150,000 an acre!
- Seasonality: Most tourism destinations are seasonal; many hospitality facilities close down during the off season. However, large amounts of capital are necessary to build these facilities. Interest costs are high on the capital needed for construction. Interest costs are also fixed; they must be paid irrespective of the amount of business generated. As a result of high fixed costs and seasonal demand, there is constant pressure to produce a profit in what some call “the hundred-day season”. As a result of underutilization of the asset on a year-round basis, the return on investment is often less than that generated in other industries.
Often financial incentives from the public sector are necessary to get tourist facilities built. - Public services: Tourism is touted as a “smokeless industry” that require few public services. Schools do not have to be built for the children of tourists, whereas they must be constructed for the children of workers brought in to work full time in other industries. However, an increase in tourism tends to increase the costs for residents in such areas as garbage collection, police and fire protection.
- Over-dependence on tourism: It is generally agreed that it is foolish to base an economy on tourism. Tourism growth is affected by change both internal (price increases and changes in fashion) and external (political problems, power availability and currency fluctuations). Just as an individual property can rely too heavily on one segment of the market, so too a destination can rely too heavily on tourism. The key is to develop a balanced economy.
In a “usual” development, a country’s economy shifts from the primary sector (farming, mining, fishing, etc.) to the manufacturing or secondary sector to the service sector. For destinations that have only agriculture and tourism, the economy “misses” the middle stage of development. It is as if there is the lack of a basis on which to build a strong service sector. This is the danger of an over-dependence on tourism.