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COMCEC Tourism Outlook-2019



The Importance of Tourism for Development

A strong tourism sector contributes in many ways to development and the economy. It makes

both direct contributions, by raising the national income and improving the balance of

payments, and indirect contributions, via its multiplier effect and by providing the basis for

connecting countries, through hard and soft infrastructure attributes that are also critical for a

country’s general economic competitiveness, international trade and foreign direct investment.

Over the past decades, many new destinations have emerged, challenging the traditional ones

in Europe and North America. Formany developing countries, tourism is one of themain sources

of foreign exchange income and the number one export category, creating much needed

employment and opportunities for development. The main positive economic impacts of

tourism relate to foreign exchange earnings, contributions to government revenues, generation

of employment and investment opportunities. Local recruitment and business opportunities in

tourism help reduce rural-urban migration. While fostering gender equality, entry level jobs in

tourism require less skilled workforce and this also enhances recruitment opportunities among

younger generations and disadvantaged groups.

Based on the information from countries with data available, the World Travel & Tourism

Council (WTTC) estimated that travel & tourism’s contribution directly to worldwide gross

domestic product (GDP) was 10% in 2018 and is expected to rise by 4% in 2019. The forecasted

growth of tourism’s contribution to GDP is around 3.7% on the average for the next ten years to

12% of GDP in 2029. This is much faster than the growth in global economy which was around

3.2% in 2018. With direct and indirect effects of more than 185 supply-side economic activities

that have significant connections to tourism, its total contribution to GDP is calculated as 10.4%,

a total of US$8.8 trillion, and is expected to grow by 4 to US$9.2 trillion in 2019. It is also

estimated that travel and tourism sector have attracted capital investment of US$941 billion in

2017 (WTTC, 2019a).

Tourism provided 123 million direct (3.8% of total employment) and 196 million indirect and

induced jobs with a total of 319 million (10% of total employment) jobs in 2018 and direct

contribution to employment is expected to rise by 2.9% in 2019. Since tourism affects

transportation, hotels and lodging, food & beverage, cultural and entertainment industries,

banking & finance, promotion and publicity services; tourism’s contribution to employment

tends to be much higher. In 2018, nearly 319 million jobs were supported in tourism related

industries (WTTC, 2019a). Tourism’s contribution is estimated as 10% of the overall number of

jobs or one in 10 jobs globally (UNWTO, 2019a). According to the WTTC, travel & tourism will

support 421 million jobs which indicates 12% of total employment by 2029 (WTTC, 2019a).