Economic Impact of Tourism
1. Foreign Exchange, Income, and Expenditure.
Our country earns foreign exchange when tourists buy goods and services while on holiday. We use the money to pay for imports (to maintain and improve our standard of living). It is also needed to repay foreign debt.
However, a large percentage of our earnings go back out of the country. This is called economic leakage. We struggle to finance the building and furnishing hotels, to train tourism workers, to provide food and other items used by tourists. Foreign owners will send home profits, which we lose out on.
Think about it
2. Direct Employment
Tourism is ‘labour-intensive’ and needs workers at all levels (e.g. manual, maintenance, supervisory, administrative) to serve the tourist directly.
However, employment is seasonal. The main peak is the winter season: mid-December to mid-March which employs the most people. Another peak runs from around June to early September. Therefore, in the off-season, some workers are laid off.
3. Indirect Employment (Linkages with other Sectors of the Economy)
Many industries help support tourism. If they work well together, these industries will grow, creating more employment for people working in those industries. Here are a few industries linked to tourism.
SECTORS LINK TO TOURISM
Agriculture: local produce for hotels and restaurants (e.g. tomatoes, lettuce)
Construction: building accommodation and other facilities
Services: transportation; delivering items to hotels/restaurants; advertising agencies; electrical/plumbing etc. maintenance.
Why might these linkages be weak? The product or service:
4. Government Revenue
Government earns money through taxation. Some tourism-related taxes are:
This money helps pay for social services (e.g. health, sanitation, welfare) and infrastructure projects (roads, ports, water supply) in the country. Money may also train tourism-related workers.
5. Spending on infrastructure in tourist areas compared to other places in the country.
Infrastructure (roads, utilities, etc) has to be in a good state to achieve a quality tourism product and a good general standard of living. However, it is usually better in resort areas but not so good in non-tourist areas, since these areas do not contribute as much to the local economy. The price of land will also go up near tourism facilities and land becomes too expensive for locals to buy.
6. Tourism's impact on land and labour being available for Agriculture
Think about it
Tourist Areas Vs Other Areas in a Country
How many ordinary Barbadian houses you still see along the west coast? Land is very expensive due to hotels and other development.
Our country earns foreign exchange when tourists buy goods and services while on holiday. We use the money to pay for imports (to maintain and improve our standard of living). It is also needed to repay foreign debt.
However, a large percentage of our earnings go back out of the country. This is called economic leakage. We struggle to finance the building and furnishing hotels, to train tourism workers, to provide food and other items used by tourists. Foreign owners will send home profits, which we lose out on.
Think about it
- Name some foreign owned tourist facilities in Barbados.
- Government may give tax-holidays to get foreign owners to set up here. Explain why we would lose out twice.
2. Direct Employment
Tourism is ‘labour-intensive’ and needs workers at all levels (e.g. manual, maintenance, supervisory, administrative) to serve the tourist directly.
However, employment is seasonal. The main peak is the winter season: mid-December to mid-March which employs the most people. Another peak runs from around June to early September. Therefore, in the off-season, some workers are laid off.
3. Indirect Employment (Linkages with other Sectors of the Economy)
Many industries help support tourism. If they work well together, these industries will grow, creating more employment for people working in those industries. Here are a few industries linked to tourism.
SECTORS LINK TO TOURISM
Agriculture: local produce for hotels and restaurants (e.g. tomatoes, lettuce)
Construction: building accommodation and other facilities
Services: transportation; delivering items to hotels/restaurants; advertising agencies; electrical/plumbing etc. maintenance.
Why might these linkages be weak? The product or service:
- is not of good quality
- it is not reliable
- is not available in large enough quantities
- is more expensive than importing from overseas.
- List 5 different types of jobs where workers get money directly from tourism.
- You work in agriculture or construction. Explain why you want the tourism industry to do well.
- Why might a hotel NOT use local produce in their menus? (About 3 reasons)
4. Government Revenue
Government earns money through taxation. Some tourism-related taxes are:
- Direct taxes: departure tax, head tax on each each cruise tourist, tax on airline tickets, aircraft landing fees, income tax on tourism workers, corporation tax (hoteliers)
- Indirect taxes: sales tax (VAT) on items purchased
This money helps pay for social services (e.g. health, sanitation, welfare) and infrastructure projects (roads, ports, water supply) in the country. Money may also train tourism-related workers.
5. Spending on infrastructure in tourist areas compared to other places in the country.
Infrastructure (roads, utilities, etc) has to be in a good state to achieve a quality tourism product and a good general standard of living. However, it is usually better in resort areas but not so good in non-tourist areas, since these areas do not contribute as much to the local economy. The price of land will also go up near tourism facilities and land becomes too expensive for locals to buy.
6. Tourism's impact on land and labour being available for Agriculture
- Prime agricultural land is sometimes used for construction of tourist facilities. For example, Sandy Lane and Westmoreland golf courses used to be plantations. We may not be producing enough food thus affecting our food security.
- Some farmers prefer to sell land for tourism development rather than continue to struggle with agriculture.
- People prefer to work in tourism since wages may be better.
- Both government and private investors tend to go to tourism and not agriculture.
Think about it
Tourist Areas Vs Other Areas in a Country
How many ordinary Barbadian houses you still see along the west coast? Land is very expensive due to hotels and other development.
Impact on Physical Environment
Some tourism activities misuse or overuse the natural environment. However, some other tourism activities help to preserve it.
1. Resort development and the local environment
2. Changes in ecology, tidal patterns, reefs etc.
3. Conservation of plants and animals, historical sites, national parks. [Positive Impacts]
Think about it
We want more and more visitors, but more people mean more food, water, and services are needed; more waste is created.
What could hotels do to minimise environmental damage?
Get about 4 ideas from these web pages
Some tourism activities misuse or overuse the natural environment. However, some other tourism activities help to preserve it.
1. Resort development and the local environment
- May have to clear away trees and other vegetation to build. [Where in Barbados was this in the news recently?]
- Facilities are built to have a nice view (e.g. along the coast). But other people may no longer be able to see this view. Sometimes we cannot get to the location anymore.
- Beautification and landscaping of beaches and other areas. E.g. planting trees,grasses, flowering plants; clean-ups.
- Draining swamps and wetlands. [Do you think this is good or bad?]
- Golf courses need lots of water. Also they use fertilisers and pesticides which can affect our water quality.
2. Changes in ecology, tidal patterns, reefs etc.
- Depletion of species (flora and fauna on land and in the sea are collected as souvenirs) Pieces of coral [What else?]
- Construction of jetties, groynes, and coastal roads may interfere with sand formation and cause erosion of beaches.
- Sewage disposal and pollution of bodies of water/ environment. Sewage may be dumped or leak into the sea. It may wash ashore, affect marine life, cause excessive weed growth.
- Construction dust: kills marine life. Destroy the environment. Anchors destroy reefs.
- Kitchen wastes, grease and detergents.
- More people means more waste to get rid of - plastics, garbage dumped in/ on beach
3. Conservation of plants and animals, historical sites, national parks. [Positive Impacts]
- Preservation of species, sites etc: We protect them to increase our tourist attractions. Sometimes, we only recognise we should preserve things when outsiders find them interesting. Developing zoos, botanical gardens etc.
- Development of coastal areas: marinas, docks etc. increased use of the area; Instead of destroying swamps, we might now stop dumping there and allow tourist to explore their natural beauty.
- Under Features, put the following elements of the environment: Forests; Land; Beaches; Sea; Landscapes.
- Then, identify ways they are used in tourism, give examples of abuse/misuse.
- Try to find possible solutions. Landscape is done as an example
Think about it
We want more and more visitors, but more people mean more food, water, and services are needed; more waste is created.
What could hotels do to minimise environmental damage?
Get about 4 ideas from these web pages
Impact on the Social and Cultural Environment
Tourism brings together people of different cultures. This is an opportunity to interact and learn about each other. Sometimes, these cultures may clash.
1. Effect on land ownership, land use, beauty, use of beaches.
- Tourism leads to changes in land ownership and use. E.g. West Coast of Barbados has few low-income owners now. Mainly high-income and tourist related facilities. Price of land increases.
- Citizens often avoid “tourist” beaches. There may be the development of the ‘beach bum’ culture.
2. Visitor perceptions of Caribbean Societies.
It is easier now for both Caribbean people and visitors to have a clear idea about each other since we can find information online, or from being in contact with each other. However, sometimes both locals and visitors misunderstand or resent each other.
3. Opportunities for visitors and Caribbean people to meet.
Tourists and citizens meet at public beaches; festivals and shows; sporting events; entertainment centres; hotels, and shopping areas. Visitors in all-inclusive resorts may have less chance to interact.
4. Relationships between citizens and visitors; citizens and returning nationals
Can be positive or negative.
- Two way cultural exchange: Citizens and tourists are exposed to the culture of the other side (food, music, dance etc.). Each may end up with better appreciation for each other.
- Lack of appreciation and respect for local culture.
- Visitors perceived to be wealthy and are robbed or exploited.
- Influence of lifestyles, language, dress, values
- While most interactions are positive (warm and welcoming), sometimes they are negative (hostile and resentful).
5. Attitudes of citizens to tourism
- Indifference. Citizens not directly involved in tourism sometimes don’t see it as beneficial and are indifferent to it. Or else they think tourism is owned by foreigners and for foreigners.
- Enthusiasm. Tourists are welcomed to the island/store etc. Industry has brought benefits to country.
6. Effects on Arts and traditional Culture.
- As tourists buy local arts and crafts, it encourages people to create more and earn a living. This also includes other forms of culture e.g. drama and music performances.
- Sometimes, selling an item becomes more important and it is not true local craft on display. (Made in China "Bajan" products) The quality can be very poor too.
7. Government policies.
Since tourism is so important for our development, governments need to be sure certain issues don't become problems. Here are some.
- Beach control: Should beaches be patrolled for the protection of tourists? Should vendors be allowed to trade? Why are vendors sometimes seen as nuisances? Can citizens be prevented from going to certain beaches? Should private beaches be allowed?
- Hotel ownership/ Employment of non-nationals. We encourage foreign ownership because we lack financial resources locally. Should government allow foreign companies to operate without restrictions? What are reasonable conditions? Should work permits be given whenever a hotel wants? Should citizens fill vacancies first? Are they qualified?
- Should government allow foreign ownership of property? How serious a problem might it be if foreigners control this very important section of our economy?
Think about it
1. Tourists Boards advertise special features of the region to influence how visitors see a destination. Suggest 2 other ways Boards may attempt to influence visitor perceptions.
2. Suggest 3 strategies used by hoteliers or government that could help workers/citizens be more enthusiastic about tourism.
Here are 3 suggestions to maximise the advantages and minimise the disadvantages to tourism. Come up with some more.
1. Government policies:
- Groups can put pressure on government to change tourism policies that cause problems.
- Government can hold town-hall meetings so citizens can share their feelings on major decisions (e.g. should we introduce casino gambling, give tax-holidays?)
2. Provide clear, sensible pointers on how visitors can stay safe, making sure they won't cause visitors to be too afraid to go to a destination.
3. Educate citizens about the need to give good service and interact positively with ALL persons, whether tourist or resident. Everyone is treated well. This way, citizens won't feel they are less important than visitors.