gE Blog Series: Impacts of International Tourism Part 4 - Too Much of a Good Thing?

Globalization is occurring and the world is growing more interconnected and accessible, and as a result it is now easier to travel to other countries. Cultural awareness is increasing, and as a result, tourism is too as people want to experience the culture of other countries. The tourism industry accounted for 9.5% of the world’s GDP in 2013 (U.S. $7 trillion) and currently employs 266 million people worldwide. In perspective, the global tourism industry employs 1 in 11 people on this planet. One aspect related to tourism, that is often not considered, is that with benefits and new opportunities, come new challenges.  

The growth of tourism has been a boon for developing countries world-wide, and has assisted in infrastructural growth and provided job opportunities for their citizens. Tourism has several economic advantages; it raises awareness of the country and its culture, and often times serves as a mechanism for stereotypes and taboos to be broken through experiences. It can bring in foreign investments, which can further assist economic growth by creating jobs and generating income.  Another benefit of tourism has been the rise of eco-tourism. Eco-tourism raises awareness for a region or country and hopefully leads to protection, with Costa Rica being one of the first countries to develop this industry with others soon following.

The problem arises when a country develops an over-dependence on the tourism sector, to where it inhibits further economic growth. Tourism tends to be treated as a jump-start to the economy, and is one that doesn’t require a lot of upstart capital. However the problem lies in the long-term sustainability of the industry, where sustaining and developing the tourism industry tends to direct capital away from the development of other important industries. In times of crisis, the economy is oftentimes the first to feel the effect and there is a lot of unpredictability and fluctuations in the tourism sector. When a significant risk to a country’s national interest or security occurs, such as terrorism or a natural disaster, tourism is one of the first sectors to feel the ripple effects of such events. These types of events have the potential to cause dire effects for those countries whose economies that are closely tied to tourism.

Tourism is an important sector in the global economy however; tourism should not be treated as the focal point for long-term sustainable growth. Perhaps it is time for countries to turn their focus inwards to further develop their other industries to create a stronger internal economy, which in turn would benefit the global economy. As globalization increases, it is now important to not only focus on increasing cultural awareness but also realizing that we are now becoming more economically interconnected, and we are only as strong as each other.