lectutes notes.

1. Tourism Environment and Industry
Week 4 lecture: Economic and Environmental Impacts of Tourism
1

2. 2
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3. Session
Overview
3
Welcome and introduction
Recap on Week 3 – Structure of Tourism Sector and Role of Host
Community
Today’s learning outcomes: Identify the economic benefits of tourism for a nation
and be aware of the negative effects of tourism for destinations. Understand the
importance of sustainable tourism as it relates to the environment.
Attendance
Formative Assignment Feedback in Class
Class Discussions

4. Session Learning Objectives
 Identify the economic benefits of tourism for a nation, both
nationally and regionally and be aware of the negative
effects of tourism for destinations.
 Understand the importance of sustainable tourism as it
relates to the environment.

5. The economic impact of tourism

6. International tourist
arrivals and receipts
In 2014, there were 1.133 billion international tourist arrivals worldwide,
with a growth of 4.3% as compared to 1.087 billion in 2013. The top 10
international tourism destinations in 2014 were:

7. International tourist
arrivals and receipts
• International tourism receipts grew to US$1,245 billion in 2014,
corresponding to an increase in real terms of 3.7% from 2013. The World
Tourism Organization reports the following countries as the top ten
tourism earners for the year 2014, with the United States by far the top
earner. (Turkey is in the 12th place in the list – 29.5 billions $)

8. Travel propensity
• Net Travel Propensity
• Percentage of population which have travelled at least once
• Will be less than 100% reflecting that some of the
population will not have travelled at all
• Gross Travel Propensity
• Total number of trips taken in relation to the size of the
population
• May be more than 100% due to some of the
population taking multiple trips

9. Economic value of tourism is
influenced by the level of demand
• Demand levels
• Relative cost compared to income
• Influence of exchange rates
• Time to travel
• Paid holiday entitlements
• Including cost of travel

10. The economic impacts of
tourism
1. Income is generated from pay and salaries, interest, rent and profits.
In a labour-intensive industry such as tourism, the greatest
proportion is likely to be derived from pay and salaries for those
working in jobs either directly serving the needs of tourists or
benefiting indirectly from the tourists’ expenditure. Income will be
greater in those areas that generate large numbers of tourists, where
visitors tend to stay for longer periods, where destination attracts an
upmarket or more free-spending clientele and where there are many
opportunities to spend.
2. Employment
3. Balance of Payments
4. Investment and development
The flow of tourist between generating and receiving areas can be
measured in four distinct ways. We must examine the effect on income,
employment, the area’s balance of payments and investment and
development.

11. Economic factors (Continued)
• 1. Income
• Generated through:
– Wages
– Interest
– Rent
– Business profits
– Taxes

12. 2. Employment
• May be influenced by the level of dominance of the
tourism industry
• Is tourism employment just a low-wage job?
– Some jobs may offer low salaries but may not be true
for management positions
– Some tourism jobs may require fewer entry-level skills,
making it accessible to more people
– Jobs may be created in areas where there are few
alternatives, thus, tourism can be better paid than
other opportunities
– Seasonal and part-time work may suit some employees
(students, parents with young children)
Economic factors (Continued)

13. 3. Tourism Balance of Payments
• Receipts minus payments = Balance of Payments
– Example: Country A receives £50 billion from overseas
tourists who visit its lands. However its
own residents travel overseas, spending a total of £60
billion
• The balance of payments is a £10 billion deficit ($50bn –
£60bn = – £10bn)
– Country B receives £20 billion from overseas tourists who
visit whilst its residents spend only £5 billion when they
travel overseas
• In this case the balance of payments is in credit to the
amount of £15 billion. (£20bn – £5bn = £15bn)
Economic factors (Continued)

14. 4. Investment and Development
• Investment in tourism development traditionally seen
as risky
– Need tourists to justify investment but need investment
to attract tourists
• Public sector often involved in starting investments
– Often use grants or loans to encourage development but
may actually construct facilities directly
• Need to minimize leakages to maximize benefits of
investment
• Need to balance economic diversification, avoiding
over-reliance on single industry
Economic factors (Continued)

15. Tourism multiplier
• Considers the circulatory effect of changes in the economy caused by
tourism
• Compounds the direct, indirect and induced effects
The multiplier effect of the circulation of income
• Commonly considers income but can also consider employment
and government revenue

16. Leakages – reducing the
multiplier effect
• Leakages of expenditure can occur through the:
• Cost of imported goods, especially food and drink
• Foreign exchange costs of imports for the development
of tourist facilities
• Remittance of profits abroad
• Remittance of wages by expatriates
• Management fees or royalties for franchises
• Payments to overseas carriers and travel companies
• Costs of overseas promotion
• Additional expenditure on imports resulting from the
earnings of those benefiting from tourism

17. Opportunity costs
• ‘Opportunity costs are the benefits that would
be forthcoming if the public resources
committed to a tourism project were
(1) Redirected to other public services or
(2) Retained by the taxpayer’
(Crompton, J.L. (2006) Economic Impact Studies:
Instruments for Political Shenanigans?,
Journal of Travel Research, Vol 45, No 1 pp67–82)

18. Statistical measurement
• Measure a variety of themes:
• Numbers of travellers (arrivals, departures and domestic
tourists)
• Demand over time (each year, each month)
• Country of origin for international tourists, regions generating
domestic tourists
• Level and distribution of spendings
• Mode of travel
• Duration of visit
• Facilities and resources used (accommodation, attractions and
transport, etc.)
• Purpose of visit
• Demographic profiles (e.g. age, social class) and sociographic
profiles (personality, lifestyle, interests and activities)
• Satisfaction levels

19. Tourism Satellite Accounts (TSA)
• UNWTO approach designed to establish
standardized procedure for measuring tourism’s
economic contribution to GDP
• Includes the indirect values
• Considers
• Level of tourism expenditure
• Contribution to GDP
• Level of tourism employment

20. Environmental impacts of Tourism

21. Let’s review...Does anything last forever?

22. Tourism and the environment
• Tourism is perceived as a major despoiler of the
environment
• Transport pollution (air, sea and river and automobiles)
• Congestion (roads, buildings, airports and sites)
• Overdevelopment or inappropriate development
• Visual pollution (billboards advertising tourist resources,
insensitive designs or materials, litter and graffiti)

23. Measuring congestion
• Congestion may be psychological as well as
physical
• The perception of overcrowding differs
according to the site

24. Managing congestion
• By restricting visitor or vehicular access
• By limiting numbers
• By licensing operators
• By price

25. Visitor capacity for selected sites
Site/activity Visitors per day/hectare
Forest park 15
Suburban nature park 15–70
High-density picnicking 300–600
Low-density picnicking 60–200
Golf 10–15
Fishing/sailing 5–30
Speedboating 5–10
Waterskiing 5–15
Skiing 100 (per hectare of trails)
Nature trail hiking 40 (per kilometre)
Nature trail horseriding 25–80 (per kilometre)
Visitor capacity of selected sites
Source: E. Inskip, Tourism Planning: An integrated and sustainable development, van Nostrand Reinhold, 1991

26. The economic impact of
environmental protection
• The National Park Authorities imposed a
10 mph speed limit on Windermere Lake in
2005. As a result:
• The local TIC received 12,000 fewer enquiries in the
succeeding six months
• Boat registrations and launches fell sharply
• Traditional high-spending water skiers and powerboat
users withdrew
• Local businesses faced losses of around
£7 million annually

27. Tourism’s environmental impact on the Alps
1. Soil erosion, due to
• Development of ski lifts, chalets and whole villages above
6,000 feet
• Deforestation to provide pistes for skiers
2. Loss of trees and other plant life, due to
• Acid rain caused in part by traffic exhaust emissions
• Use of artificial snow-making machines in absence of
adequate snowfalls
3. Loss of wildlife, retreating as plant life suffers

28. Sustainable tourism: example of Botswana
• At the Xigera Camp in the Okavango Delta, a
sandpit between the river and camp is raked each
night
• The guide provides a talk the following day on the
footprints appearing overnight
• Land for the camp is leased from indigenous tribal
owners
• Local residents are employed by the operator and
are well-paid by local standards
• Locals provide local excursions through the Delta
for visitors
• Food provided to tourists is locally grown

29. Sustainable planning: example of
Disneyworld, Florida
• The site selected was largely scrubland
• The site lay in an economically deprived area
needing economic support
• Disney incorporated infrastructure in its
development, including new road networks and
an airport
• Sensitive sites requiring protection were
designated, and the extent of urban
development clearly established

30. Tourism and climate change
1. Climate change is the single and most
important global environmental and
development issue facing the world
today (Scott, Hall and Gosling, 2012).
2. Climate change is already affecting the
tourism industry and is anticipated to
have profound implications for tourism
in the next decade.
3. Consumer choices will change and new
destinations will need to adapt or
evolve.
4. The competitiveness and sustainability
if destinations and the contribution of
tourism to international development
will be far reaching.

31. Time to make a change!
 For decades, the Travel & Tourism sector has been trying to make sustainable
and responsible practices more mainstream.
 It shouldn’t be called ‘sustainable tourism’ as a niche, but rather just ‘tourism’.
 Considering the size of the sector, Travel & Tourism is difficult to regulate
through a single governing structure, and requires both the sector and the
travellers themselves to make demands for change.

32. Toxic Tourists – GO AWAY
INSTAGRAM

33. The quality of the environment, both
natural and man-made, is essential to
tourism.
The relationship of tourism with the
environment is complex. It involves many
activities that can have adverse
environmental effects.
Many of these impacts are linked with the
construction of general infrastructure
such as roads and airports, and of tourism
facilities, including resorts, hotels,
restaurants, shops, golf courses and
marinas.
The negative impacts of tourism
development can gradually destroy
environmental resources on which it
depends.

34. Negative impacts
 Negative impacts from tourism occur when the level of
visitor use is greater than the environment's ability to
cope with this use within acceptable limits of change.
 Uncontrolled conventional tourism poses potential
threats to many natural areas around the world.
 It can put enormous pressure on an area and lead to
impacts such as soil erosion, increased pollution,
discharges into the sea, natural habitat loss, increased
pressure on endangered species and heightened
vulnerability to forest fires.
 It often puts a strain on water resources, and it can force
local populations to compete for the use of critical
resources.

35. Depletion of natural resources –Water
 Tourism development can put pressure on natural resources when it increases
consumption in areas where resources are already scarce.
 Water, and especially fresh water, is one of the most critical natural resources.
The tourism industry generally overuses water resources for hotels, swimming
pools, golf courses and personal use of water by tourists.
 This can result in water shortages and degradation of water supplies, as well as
generating a greater volume of waste water.
Water is likely to become increasingly scares in the coming years in some
destinations – and the waste generated buy tourism needs to be managed to
ensure it does not create a problem for destinations.

36. In dry and hot regions like the
Mediterranean
 The impact of water scarcity is
of particular concern.
 Because of the hot climate
and the tendency of tourists to
consume more water when on
holiday than they do at home,
the amount used can run up to
440 litres a day. This is almost
double what the inhabitants of
an average Spanish city use
(WTO, 2014).

37. Local resources
Tourism can create great pressure on local resources
like energy, food, and other raw materials that may
already be in short supply.
Greater extraction and transport of these resources
exacerbates physical impacts associated with their
exploitation.
Because of the seasonal character of the industry,
many destinations have ten times more inhabitants in
the high season than in the low season.
High demand is placed upon these resources to meet
the high expectations tourists often have (proper
heating, hot water, etc.).

38. Land degradation
Increased construction of tourism
and recreational facilities has
increased the pressure on these
resources and on scenic landscapes.
Direct impact on natural resources,
both renewable and non-renewable,
in the provision of tourist facilities
can be caused by the use of land for
accommodation and other
infrastructure provision, and the use
of building materials.

39. Pollution
• Tourism can cause the
same forms of pollution
as any other industry: air
emissions, noise, solid
waste and littering,
releases of sewage, oil
and chemicals, even
architectural/visual
pollution.
• In some areas it is
excessive.

40. We know the positive economic
impacts…
 However, tourism also places a
heavy strain on the environment
and has the potential to destroy
through overuse and
unsuccessful management
practices, the available common
environmental resources that
support tourism activities.
 The uneven allocation of tourist
arrivals in time (seasonality) and
space (tourism intensity) further
aggravates this impact.

41. The World economic
forum (wef)
• WEF considers climate change,
water and unemployment to be
among the top ten global risks in
terms of likelihood and impact for
the next ten years

42. Is tourism killing Thailand?

43. Tourism and the environment
The tourism industry has a significant carbon footprint, accounting
for 5% of global carbon emissions.
Half of that footprint is attributable to aviation, making fuel
reduction (and in the longer term, finding more sustainable
alternatives to aviation fuel) a critical challenge for travel and
tourism.

44. Tui – Global leaders in sustainability
The ambitious 2020 sustainability
strategy “Better Holidays, Better
World“ is built around four core
pillars to help shape the future of
sustainable tourism: step lightly,
make a difference, lead the way and
care more.

45. Tui sustainability strategy 2018

46. Green holidays with kuoni and tui
Tour Operators encourage hotels to adopt the Travelife Sustainability
System.
This helps recognise those that are environmentally and socially
sustainable.
The best performing hotels receive a Bronze, Silver, or Gold Travelife
Award.
Hotels who receive a Bronze have reduced their impact on the
environment and treated their people fairly; Silver is for hotels that
additionally played an active role in helping the local community and the
environment; and Gold is awarded to hotels that demonstrate advanced
sustainability practices, seek continual improvements, and communicate
their progress.

48. Global tourism is closely linked to
climate change
Tourism involves the movement of people from their homes to other
destinations and accounts for about 50% of traffic movements; rapidly
expanding air traffic contributes about 2.5% of the production of CO .
Tourism is thus a significant contributor to the increasing 2
concentrations of greenhouse gases in the atmosphere.
Air travel itself is a major contributor to the greenhouse effect.
Passenger jets are the fastest growing source of greenhouse gas
emissions.
The number of international travellers is expected to increase from 594
million in 1996 to 1.6 billion by 2020, adding greatly to the problem
unless steps are taken to reduce emissions (WWF, 2010).

49. Ecolabelling & certification
In essence an ecolabel is a seal of approval
awarded to a service whose provision
satisfies a number of conditions.
Tour operators and hotels use this as a level
of responsibility towards the environment
and society.
It educates tourists globally.
Assesses both how responsible tourists are
and the responsibility of organisations.

50. Fletcher, J. et al., 2018. Tourism: Principles and Practice. 6th ed. Harlow:
Pearson.
Holloway, J. C. and Humphreys, C. 2020 The Business of Tourism. 11th ed. Los
Angeles: Sage
Inkson, C. and Minnaert, L. 2018. Tourism Management - an introduction. 2nd
ed. London: Sage
Scott, P.A., Stone, D.A. and Allen, M.R. (2004) ‘Human Contribution to the
European Heatwave of 2003’, Nature, 432:610-614
Scott, D., Hall, M., and Gossling, S. (2012). Tourism and Climate Change:
Impacts, Adaptation and Mitigation. New York: Routledge, p9-91
References