THE IMPORTANCE OF TRAVEL & TOURISM IN GLOBAL ECONOMIC RECOVERY | ANITA MENDIRATTA & Associates

Earlier this month the world witnessed a remarkable joining of global forces. With one central focus – the quest to quickly, confidently and sustainably lift the world out of the current economic crisis – the G20 came together in London to engage in never seen before deliberations and negotiations around development of an interdependent solution. Despite the temptations to look backwards, point fingers sideways and delegate responsibility forwards, the pains of the world, both economically and socially, were too distracting for G20 members to do anything but deal with the issues at hand. Together. And now.

Through the G20 Summit, and over the past year of intensifying economic turmoil, a number of new world truths have emerged.

First and foremost, today’s global crisis requires global solutions. No single nation, no single leader, no single action can yield holistic recovery and evolution of the global economic community. Leadership is found in both the power of one and the power of all.

Secondly, every single individual has an impact on, and is impacted by, the state of our global economy. Borders and boundaries have been erased across the globe when it comes to individual buying power. Whether we are purchasing books, budget airplane tickets or foreign bonds, we are able to cross border with one single click or one simple call in to a local retailer. As a result our actions have consequences, far reaching, both in terms of geography and impact.

Thirdly, where we are today is not only a result of a crisis in the economy. It is also the result of a crisis of conscience. ‘Responsibility’, ‘accountability’ and ‘legacy’ have lost their value as verbs. The economic recession has triggered off a severe emotional recession. Critical to recovery of the global economic system is trust in the system.

Stimulus packages now being applied to major markets around the world will not only seek to restimulate collapsing businesses, they will seek to restimulate consumer confidence in buying so that banks can regain confidence lending again.

One of the areas which is being focused on by several governments around the globe for application of stimulus package funding is the Travel & Tourism sector. The reason for this goes far beyond the image and appeal of travel, be it for business or leisure purposes. It is far, far more fundamental than that.

The reason? Simply this: the Travel and Tourism sector has evolved dramatically over the past decade not only in terms of numbers – arrivals, revenues, length of stay, dispersion, repeat visitation, all of the metrics used to quantitatively measure performance – but also in its importance in four key areas of nation (re)building:

1. ECONOMIC:
In addition to the money which travellers directly inject into the places to which they travel, the sector has proven its ability to be a powerful attractor of investment. These funds, be they FDI or other, are then able to be channeled towards the development of essential infrastructure needed by the destination for Tourism sector development, as well as general infrastructure. Mass transport systems, airports, ICT networks, safety and security services, sports and leisure facilities, hotels and attractions. All of these areas of destination engineering receive strong support from investments made to uplift and increase the competitiveness of the Travel and Tourism sector.

2. POLITICAL:
The Travel and Tourism sector has become a valuable driver of the strengthening of the focus, fabric and future advancement of nations. Governments across the globe have recognised the importance of the sector in the unification and development of both the economic and social dimensions of the nation. In defining the Travel and Tourism sector as a priority of the government of a destination, political leaders of the destination begin the process of shaping the identity and core objectives for growth.

3. SOCIAL:
Importantly, the Travel and Tourism sector has proven to be invaluable in bringing together people of the destination around a shared national identity and invitation to the world, regardless of age, race, religion, profession, personality and political point of view. The low barriers of entry of the sector make it possible for all people of the destination to play a role in the sector and therefore the tourism community and economy. Artisans, architects, advertisers, travel agents or government advisors – everyone has a valuable part to play to deliver a unique, compelling and competitive tourism experience which will sustainably attract visitors for business or leisure travel purposes. The Travel & Tourism sector empowers an increasing number and range of citizens to play a meaningful, recognised role on national growth and upliftment.

4. PSYCHOLOGICAL:
Over the past decade the world has flattened and perspectives have broadened. Travel is no longer about movement from logistical A to B. It is about social movement, economic movement, spiritual movement, the movement of cultures closer to one another. Since the bamboo curtain has fallen billions of new capitalists have entered the global ‘”because I can” community. When it comes to business, it has become essential in breaking down barriers and out of date perceptions about who we used to be. Travel & Tourism plays a role in shaping one’s individual, and greater community, identity. And, interestingly, travel has become a form of personal therapy – the opportunity to escape, experience, exhale…whatever the need may be in these increasingly stressful times.

As stated by the UNWTO in a G20 statement regarding the importance of the sector in nations across the globe:

  • Tourism currently drives some 6% of jobs in G20 economies with a strong multiplier effect on related service, manufacturing and agriculture sectors, which depend on travel demand. It is one of the largest employment sectors in most countries and a fast entry vehicle into the workforce for young people and women in urban and rural communities.
  • Tourism and travel represents some 5% of GDP of G20 countries and 27% of their services trade. It is even more significant for the world’s poorest countries where it is a mainstay of their economies, a key factor in employment and exports, as well as a vital lifeline for their development.

During challenging economic times the Travel and Tourism is one of the sectors which acts as a thermometer of society’s determination to endure and overcome current difficulties of today and move forward to a stronger tomorrow. Societies are more resilient, more creative, more connected and more committed to future prosperity than any other time in history.

Immediately following the recent G20 Summit in London Mr. Rifai, Secretary-General a.i. of the UNWTO expressed optimism re. the rightful appreciation and participation for the global Travel & Tourism industry.

“In many countries, tourism has suffered from a lack of political and popular support because its true economic significance has often been underestimated. Now there is increasing awareness of tourism’s role as a productive activity and its potential to generate employment, government income and other benefits whether directly or through induced effects in the economy. This is increasingly important due to the role tourism can play in combating the current crisis.”

There is no denying the crisis is touching all parts of the globe. The situation is serious. And recovery will take time.

Travel and Tourism is, however, one way to keep the wheels of the global economy turning. Increased activity in the sector will not only enable us to fulfill our personal wishes and wants – it will also help nations caught in the clutches of the economic crisis to break free and rebuild both their economies and spirits.

We must keep moving.


Copyright: ANITA MENDIRATTA 2009