This document discusses the economic, socio-cultural, and environmental impacts of tourism on a host country. It notes that tourism can provide both economic benefits through jobs and income, but also costs through leakage of money out of the local economy and overdependence on tourism. The document also examines how tourism can positively and negatively impact the local culture through commercialization or preservation of traditions. Environmental impacts discussed include increased pollution but also funding for conservation efforts.
Falcon Invoice Discounting: Aviate Your Cash Flow Challenges
The impact of tourism on a host country
1. The impact of tourism on a
host country
Economic
Socio-cultural
Physical
2. ECONOMIC Impact: Advantages
Direct – created directly by the tourists
themselves. (visitor spends $500 in a hotel
directly increases income of hotel by $500)
Indirect – the flow-on effect of the direct
impact. (the $500 flows into the economy
increasing the income of the region by
more than the $500)
3. Direct and Indirect employment benefits
Direct employment - ie tour guide or
hotel receptionist.
Indirect employment - ie the supplier of
the tour buses to the tour companies or
the provider of uniforms to the hotels
employing the hotel receptionists.
4. Economic ‘Leakage’
Leakage occurs when some of the monies
earned through tourism ‘leak’ out of the
economy in the form of savings or
imports.
$1000 spent in a hotel in Auckland
doesn’t necessarily all stay within the
Auckland economy as some of that will
flow on through wages and taxes, and
some of that may be put aside as savings,
some more may be used to travel
overseas or purchase goods from
overseas.
5. Leakage Factors
The size of the country
The structure and diversity of the national
economy
The nation’s import policy
Whether or not supply can keep pace with
demand
The type of tourism
The class of visitor
The location of development
6. Sources of leakage
Expenditure on overseas promotion
Imports of materials and equipment
Imports of consumables such as
food and drink
Interest paid on foreign loans
7. Leakage considerations
Leakage is expressed as a Multiplier (number).
The lower the number, the less leakage takes
place.
Leakage varies from 56% (small island nations
where much of the tourism dollar is not
retained within the economy as so much needs
to be imported from overseas to serve the
tourism industry) to 11% for more developed
countries which have lower dependency on
imports to meet the needs of tourists.
8. Changes to the Multiplier occur:
Changes in any of the factors used in
calculating the Multiplier can change
the result Eg. If more people save or
more people buy goods for overseas
then the Multiplier will increase.
If people switch to buy local goods,
spend more of their income, then the
Multiplier will decrease
9. ECONOMIC Impact: Disadvantages
Over dependence on tourism - money invested in
tourism facilities instead of more fundamental investment
needs.
Tourism plant is not transferable - cannot be easily
converted to other uses.
If there is over capacity it cannot easily be switched to
something else.
Tourism is a seasonal activity in many
countries/locations with facilities being used extensively
often for less than half the year - wasteful use of
resources as funds invested in infrastructure and
superstructure are not used year round.
Seasonal unemployment - social and economic
problems.
Inflationary impact of tourism - social and economic
problems. The high demand for food, clothes and
transport causes price rises causing pressure for local
residents.
Demand for land for tourism facilities can lead to a
dramatic increase in land values and building costs.
10. SOCIAL Impact: Disadvantages
Employment
Inflation
Over dependence on tourism
Foreign investment
Undesirable activities
Competition
Consumption behavour
Separate tourism development
11. SOCIAL Impact: Advantages
Employment – tourism is a generator of
jobs impacting on a community’s mental
and physical health
Redistribution of wealth –income is
generated in one area and spent in a
different area.
Improvement in lifestyles – tourism
brings increase in supply of basic
amenities, attractions and recreational
facilities for residents as well as visitors.
12. Factors influencing social impact
The number of visitors – the more visitors to an
area, the greater the impact of the tourism.
The length of stay – short stay visitors often do
not fully appreciate or understand local culture
leading to inappropriate behaviour or unintended
offence.
Economic characteristics of tourists – the closer
the economic levels between visitors and residents,
the less chance for resentment, envy and anger
among local population.
Social and cultural characteristics of tourists –
the more alike the tourists and local residents are in
terms of social and cultural characteristics, the less
chance there is for social and cultural clashes.
13. CULTURAL Impact:
Same factors as social impact:
The number of visitors
The length of stay of the visitors
The economic characteristics of the
visitors
The social and cultural characteristics of
visitors
The stage of economic development of
the destination
14. Local culture meeting needs of visitors:
The strength of the local culture
and the extent to which it meets
the needs and expectations of
visitors without compromising its
underlying values influences the
extent to which tourism affects
that culture.
(Lundgren - 1974)
15. CULTURAL Impact: Negative
Staged authenticity –demand for local culture often
results in the commercialization of culture by
transforming traditional festivals and ceremonies into
staged events performed for the tourist trade.
Breakdown in cultural respect – this
commercialization leads to breakdown in respect
among locals for their own culture.
Airport Art – creation of mass-produced imitations of
local art, introduced to serve the tourist need for
inexpensive ‘trinkets’ to take home as a souvenir.
Environmental bubbles – separate tourism
developments creating islands of tourist development,
alien to the host culture.
Premature modernization and commercialization
– local population forced to adopt new lifestyles and
lose traditional values and techniques.
16. CULTURAL Impact: Positive
Revival of local customs and traditions – interest
demonstrated by tourists increased local interest in
their own cultural icons
Demand for local products – reviving the interest in
cultural heritage.
Improvements in self-worth – the creation of
indigenous craft and art has shown increased self-
value and identify.
Employment – for artists, craftspeople, cultural
leaders
Preservation of history – tourism can lead to
improved awareness of importance of local history,
and preservation and restoration of historic buildings,
museums, parks and reserves.
Cross cultural empathy - - more likely to occur
when tourist contact is more than a short and
commercial encounter, but does happen.
17. ENVIRONMENTAL Impact: Negative
Increased levels of pollution – air, water,
noise, visual
Destruction of the natural environment – due
to tourism infrastructure & superstructure
Ecological congestion – leading to erosion and
destruction of habitat
Overloading – of waste disposal and sewerage
systems
Overuse – of water & other resources
Destruction of buildings – being worn away
18. ENVIRONMENTAL Impact: Positive
Strengthening of conservation and
heritage – restored, revitalized and even
saved from extinction due to tourism
interest.
Stimulating the funding of
conservation – helps protect natural
assets, including landscapes, animals and
birds important to tourism
19. Environmental impact of tourism on N
Z
EXAMPLES:
Queenstown conflict re introduction of Air NZ 737 aircraft,
plus aircraft activity in Aoraki/Mount Cook National Park +
Franz Josef and Fox Glaciers.
Westland – noise created by helicopters causing problems
Concern over the effect that infrastructure and
superstructure has on the NZ landscape
Erosion of tracks eg. Tongariro Crossing and Milford Track
Degredation of natural habitat in Shotover River catchment
Disturbances to wildlife on Otago coastline
Erosion of sand dunes at Cape Reinga
Damage to rocks at Dolomite Point, Punakaiki
Overcrowding in National Parks
Conflict between keeping ‘wilderness’ wild and opening
access to tourism
Issues around ‘equality’ – the rights of residents to enjoy
walking tracks and amenities when volume of tourists may
restrict access