Tourism as a Development Strategy - Essay Example

Tourism as a development strategy Lecturer Introduction Tourism is a politically sensitive economic sector as political developments are key in influencing the flow of tourist in and out of a nation. In many nations, it acts as a major drive for development through employment creation and as a source of foreign exchange. The industry generates substantial economic benefits on both the home and host nations. As with other impacts, the massive industry results in both negative and positive consequences (Sharpley 2000). Often, the rich developed nations are greater beneficiaries of tourism and make greater profits than the third world developing countries. The major reason behind this is the large-scale transfer of tourism revenues out of the third world countries as well as the exclusion of local products and enterprises (Pritchard, Morgan, & Ateljevic, 2011). The paper analyzes whether indeed tourism is a developmental strategy and whether or not in the last three decades, it has brought about poverty alleviation in the Third World countries, in particular, the Philippines. Myth of tourism The United Nations has recognized tourism as a great source and influence of a country economic growth. In 1967, it declared the year as the “International Tourism Year” mobilizing all its agencies to finance as well as assist in tourism programs and research in an effort of initiating the tourism sector among the developing nations. Liburd (2012) states that tourism in a country is a major source of foreign exchange and currency that is important for ensuring that there is a balance of payments deficit in the country and helps in servicing the foreign program debts in existence in the third world nations (Unep Wto, 2005). This provides a balance between the nations expenses and revenue that is gained. As a result, in 70s, tourism development was enhanced by the IMF-WB adjustment programs through a combination of investors that included transnational corporations under hotel and resort control, by taking foreign-funded infrastructure projects such as mapping out tourism and the provision of loans to help with funds for infrastructure construction in support of tourism exploitation (Jazminda, 2008). As a result, third world nations with exotic culture and places opened up, providing fresh and alternative gateways of tourism encouraging tourism exploration. It is important for these countries to take advantage of their exotic cultures and natural resources to enhance tourism. According to Jazminda (2008), tourism can be considered as a hotel and airline industry as these sectors control the bulk of the tourism industry. Most of the spending that a tourist will spend, whether foreign or domestic goes to the transport and accommodation sectors. According to statistics, an overall tourist daily expenditure of 37 percent is spent on accommodation while 24 percent is spent on food. The rest of the expenditure around 37 percent is spent on transportation facilities. Thus, tourism is a major source of the countrys revenue. With over three decades passed, it is essential to determine whether tourism as a development strategy has led to the alleviation of poverty in the third world countries, in particular, the Philippines country. According to research, tourism has worsened the inequalities and impoverishment of the third world nations creating a difference between the developed and developing nations (Duffy, 2010). For example, Philippine has been utilized by the developed countries such as Japan and U S as a mere extension of tourism. It is considered as a major avenue for profit transnational corporations for the liberalized world economies. Philippine case study on tourism The Philippines case study is a good illustration of the effects of tourism on the third world nations. Tourism has been associated with social evils and costs such as human and drug trafficking and debt burden resulting from the dramatic reforms and changes. Three decades after its establishment, it still remains exaggerated as a primary development driver (Jazminda, 2008). According to estimations of the tourism department, travel and tourism in 2006, tourism contributed 3.5 million jobs, thus strengthening its position as a major employment source. However, this represented only 1 percent of the nation’s gross domestic product. According to major stakeholders in the country, they have attributed the low tourism contribution to the lack of a competitive edge, making it slow in development (Virola, Remulla, Amoro, & Say, 2001). The sector is expected to grow by 4.5 percent annually between the period of 2009 and 2018 translating to 1.3 percent of directly industry GDP as well as 2 percent of the total Philippine growth domestic product accounting for 0 percent employment growth (Virola et al., 2001). This proves that tourism is not a development strategy in the Philippines and other third world countries. Major beneficiaries of the tourism in the Philippines are the tourist corporations and the housing Taipans in the nation that include the Tan, Gotianum, Sy, Gokongwei and Zobel families (Jazminda, 2008). However, the bearers of the cost involved are the marginalized and poor society members. As a result, communities have been displaced, leading to the loss of their live hood. The community land previously used for agricultural purposes has been grabbed and set aside for tourism, leisure activities such as golf courses. Thus, the society is fixed in the corner of bearing the costs associated. An example is the 5,700-hectare Hamilo coast that was developed in Batangas province. It was part of over 8,000 hectares that was used for agricultural production as well as fishing. Over 3,000 farmers were displaced together with their families (Fabinyi, 2010). Tourism has resulted in the banishment of fisher folk from the traditional fishing grounds, disposition of the indigenous population from its ancestral land in favor of eco-tourism altering and destroying forests, marine and mountain wildlife habitat. A good example of this case scenario is the destruction of natural limestone formations around the Sagada Cave where burial caves were desecrated as tourist collected bones as souvenirs (Catibog-Sinha, 2010). Tourism has led to cultural displacement of the traditional culture. Cultural displacement has made the local’s to turn to tourism-oriented activities such as weaving, hand craftsmanship and woodcarving as a result of poor income from upland farming. Easy income from the tourism industry has made the indigenous population to stop crop cultivation, such as rice causing a decline in the agricultural production (Roxas & Chadee, 2013). High prices of health and medicine services, commodities have affected the local population that has resulted from the promotion of medical tourism. Organ trade is a major issue among Filipinos the locals are selling their body organs to pay off their debts and keep up with the changing economic demands in the country. Tourism has led to cultural immorality with sexual exploitation of Filipino women and children being the order of the day. Sex business has become a billion, generating industry. According to national statistics, the Philippines is ranked as the fourth most nations with most child prostitution with numbers estimated to be between 60,000 and 100,000. Among the top cities where prostitution is practiced, include Angeles City, Cebu, Metro Manila and Davao (Jazminda, 2008). Negative implications of tourism in developing nations Tourism generates many hidden costs that have unfavorable economic effects in the host countries involved. Many of the wealthy countries are major beneficiaries of tourism over the expense of the poor ones. The third world countries have the most urgent need of employment, need for income and a need for raising the living standards of their citizens, but they are in the last position of achieving this from tourism. A major reason is the large-scale transfer of the tourism revenues out of these nations as well as the exclusion of local products and business. This can be demonstrated through import and export leakage. Import leakage often is bound to occur when the host nation cannot supply the tourist demands for food, equipment and other products for the tourists. This often occurs in the developing countries where such facilities are imported, as locals are not up to the expected standards. This causes much of the income resulting from the industry to leave the country in paying for the imports (Lussean, 2004). Export leakage as illustrated in the Philippines case scenario, is often bound to occur in the poor tourism developing destinations. The multinational corporations and large foreign enterprises usually have a large substantial share in the industry, as they are the only ones that are capable and possess the necessary capital to invest in the construction of the tourism facilities and infrastructure. These investors often take their profits back home to their country, leaving the developing countries with little to benefit from (Guttentag, 2009). A lot of costs are involved in the promotion of tourism. The development of tourism in a country can cost the local government as well as the local taxpayers a large amount of revenue. Promotion of tourism in a country calls for improvement of airports, roads and other facilities by the government. Thus, the developing countries are bound to spend a lot of revenue in an effort to promote tourism. The local taxpayer, therefore, gets involved in financing these projects, thus are the real bearers of the costs as illustrated in the case of the Philippines. As well, these revenues spent on tax breaks and infrastructure construction may reduce the nation’s investments in other crucial sectors such as education and health at the expense of tourism that can have a great implication on the countries development (Kim, Chen, & Jang, 2006). Tourism causes an increase in prices of products such as the health in the Philippines. This often results from an increase in demand for the basic goods and services from the tourists causing commodities hikes. This negatively affects the local residents in the developing countries as their income does not increase proportionally to cater for the increase in product prices. As a result of tourism, the land values, and building costs are bound to increase. This makes it very difficult for the locals to meet their basic daily needs and may result in dominance by the tourists (Bailey & Richardson, 2010). As a result of immigration, the tourists erode the economic opportunities for the locals and will eventually displace the residents. Diversification is an economy sign of wealth among the residents of a nation. However, as illustrated in the developing countries such as the Philippines, tourism in these nations has led locals to be over dependent on the industry. This puts much stress on the industry resulting in poor performance. A number of the developing countries have embraced tourism industry as a way of boosting their economy. Thus, it is important for such nations to invest in other sectors to enhance the development (Wagner, 1997). Tourists visiting these countries have a detrimental effect on the life quality on the locals. Tourism results in crowding, congestion in major cities, increased levels of crimes, drug and alcohol abuse and prostitution. This is illustrated in the Philippines, where a number of young children have become victims of the sex trade. As well, tourism infringes the human rights of the locals causing displacement of the locals to pave the way for the construction of social amenities, beaches, and hotels. Cultural erosion also results from tourist interaction. According to Green & Giese, (2004) tourism is a major threat to a nations cultural and natural resources such as beaches, water supply, heritage sites and coral reefs through overuse. It has also led to increased pollution through increased sewage production, littering, traffic emission and noise pollution. Positive implications of tourism in developing nations Tourism is a source of job creation that is illustrated through tourism direct job employment in the industry as well as indirectly through transport and other retail sectors. When the tourists spend their revenues on services and goods in the nation, they promote the creation of more jobs in the country. The industry also provides more opportunities for small-scale business enterprises, thus enhancing job creation and employment that is essential for the locals. It also generates extra revenues for the government, such as through hotels and airport taxes that can be used for promoting other sectors of the economy, such as education and health sectors essential for a countrys development (Bailey & Richardson, 2010). As a result of tourism, infrastructure, and new leisure facilities have been developed. These facilities and amenities also benefit the locals greatly, making their lives better. As well, tourism is essential in encouraging the preservation of the tradition, customs such as handicrafts and festivals. These customs are a great wealth to the locals and are important in attracting more tourists. Tourism results to the enhancement of cultural understanding through interchanges between guests and host members. This is crucial in enhancing the global awareness of global issues such as poverty and human rights (Pritchard, Morgan, & Ateljevic, 2011). Tourism is essential for the promotion of the natural resources and wildlife, especially nature and eco-tourism. Rainforests, natural features, and wildlife are regarded as tourist assets are often protected from destruction. Tourism is crucial as it helps in the generation of funds necessary for the maintenance of animal reserves and parks through the guidance and entrance charges charged (Xu, 2010). It also provides for alternative employment sources for the people reduces problems of deforestation as well as over fishing in these nations. Conclusion As illustrated, tourism as a strategy for development will never lead to poverty alleviation as well as development of third world countries. Major beneficiaries of the industry are the tourism corporations with the locals suffering. Often, the rich developed countries benefit greatly from tourism than the developed nations as illustrated in the Philippines case. Whereas the developed nations have the urgent need for income and employment, they are least able to realize these benefits. If tourism is managed with a strong focus on poverty alleviation, it will directly benefit the poorest countries through employment and foreign exchange. This can be attained through the utilization of Adam smith strategy of development where he identified three sources of growth of a nation: a growth of the stock market and labor force, improvement of capital efficiency utilization through greater labor division and technological progress and promotion of foreign trade to enhance growth. In enhancing tours as a source of development, it is important for the governments of the countries to be involved in tourism investment and enhance local investors rather than the foreign investors. This is essential in enhancing capital accumulation and maximization of profits in raising the tourism total demand and increase the extent of the market. To prevent the over-dependence of tourism diversification of other sectors is also essential in an effort of enhancing development. References Bailey, E., & Richardson, R. (2010). A new economic framework for tourism decision making. 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