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The role of tourism in international development Batir Mirbabayev

1. Introduction In the modern world tourism is one of the largest and dynamically developing sectors of external economic activities. Its high growth and development rates, considerable volumes of foreign currency inflows actively affect various sectors of economy, which positively contributes to the development of own tourist industry. The share of tourism in international gross national income is 6%, in world investments 7%, in world customary expenditures 11%, as well as it accounts for every 16th work place. Tourism is one of world integration processes factor and tourism industry is now becoming a more important sector of economy. The importance of tourism in the world is permanently increasing that consistently increase the influence of tourism on countrys economies. In the economies of separate countries international tourism plays a range of important functions: 1. International tourism the source of foreign currency inflows to the country and a tool to maintain work force employed. 2. International tourism increases inputs to the cash flow balance sheets and GDP of a country; 3. International tourism contributes to the diversification of economy, by creating new sectors which provide services to the sphere of tourism; 4. Tens of thousand new work places are created and the problem of unemployment is solved;

5. Along with the increased employment in tourism sector population incomes grow at the same rates which positively influences living standards and total wealth of nation. International tourism is one of the three main export sectors, which comes after oil industry and automobile industry the share of which in international export is 11% and 8,6% correspondingly. Today aggregate international income coming from international tourism exceeds more than 7% from the total world export.

2. International tourism and its impact on social and economic development International tourism is spread around the world quite unequally, what is first of all explained by different rates of social and economic development of countries and regions. The greatest development of international tourism accounts for western European countries. The share of this region is above 70% of the world total tourist market and is around 60% of all foreign currency inflows. Around 20% belongs to the United States of America, less than 10% to Asia, Africa and Australia altogether. The travel and tourism industry continues to be one of the largest employers in the U.S., directly and indirectly employing a total of 15.8 million people. In fact, approximately one of out of every 17 Americans is employed due to patronage of travelers to and within the U.S. Travel and tourism ranks as the first-; second; or thirdlargest employer in 32 states. Travel employment, including jobs generated by both domestic and international visitors, produced a total of 121.6 billion in payroll in 1996. In Hungary, according to estimations, tourism currently provides employment for 250,000300,000 people.

International experience shows that tourism in many countries is one of the most profitable articles of income and hard currency. For example, currency income from tourism in Australia increased from 2,1 to 110 billion shillings during last 30 years, that is a 55 time increase. In Hungary tourism is one of the most important industry of the economy, which was ranked 8th in the world concerning the number of international visitors in 1997. The country had approximately 40 million visitors of which approximately 20 million tourists. In Hungary the country's official income from international tourism exceed 1,8 billion USD, in Uzbekistan it was 20 980,14 thousands USD. Income of Hungary from foreign tourism had 30% increase compared to 1989 and was more than one billion American dollars. Travel and tourism is America's largest services export, one of the America's largest employers, and America's third-largest retail sales industry. International travelers visiting the U.S. spend $248 million per day, $10 million per hour, and $172,000 per minute. In France European tourists spend $60 per day, Americans spend $200 per day, and Japanese spend $300 per day. In Uzbekistan tourists spend $1200 per year. Tourism as a specific form of export is the most effective way of the foreign currency reception. The tables below shows the income received by countries with highly developed tourist industry. The income from the tourism at first ten countries in the world (international tourist arrival) in 2002 Position 1. 2. 3. Country In the World USA Spain France Income billion dollars 474 66,5 33,6 32,3 (%) 2002/2001 3.2 -7,4 2,2 7,8 Share in world-wide ratio (%) 100 14,0 7,1 6,8

4. 5. 6. 7. 8. 9. 10.

Italy China Germany Great Britain Austria Hong Kong (China) Greece

26,9 20,4 19,2 17,8 11,2 10,1 9,7

4,3 14,6 4,0 9,5 11,1 22,2 3,1

5,7 4,3 4,0 3,8 2,4 2,1 2,1 .

Source: World Tourist Organization (VTO) Accordingly, the number of arrivals from 1960 to 2000 has increased by ten times (Figure 1.). Average annual rates of growth of arrivals of foreign tourists which constituted 4,3% from 1990 to 2000 reflect the viability and firmness of international tourism before economic fluctuations. Dynamic of the tourists arrivals and the entering in the world by 1960-2000 Number Changes, % arrivals, million people 1960 69,2 1970 159,6 130,4 1980 284,8 78,3 1990 459,2 61,2 2000 687,3 49,6 Source: World Tourist Organization (VTO) Income, billion. dollars. 6,86 17,9 102,3 264,7 473,4 Changes, % 163,2 471,9 158,5 78,8

Profits of the countries providing tourism services have increased by more than 69 times from 6,8 billion us dollars to 473,4 billion dollars during this period (figure 2).

Figure 1
Number of arrivals, million people 800 700 600 500 400 300 200 100 0 1960?. 1970?. 1980?. 1990?. 2000?.

Figure 2
Income, billion dollars. 500 400 300 200 100 0 1960?.1970?. 1980?. 1990?.2000?.

Thus, international tourism is now playing more important role in the world economy. Tourist industry enters the list of economic forwards giving a big amount of value added. 3. Long term perspectives of international tourism development According to the forecasts of the development of tourism until 2020 as provided by World Tourism Organisation (WTO), the leading place of tourist arrivals will belong to Europe, America (ultimately USA) and Asia. The WTO forecasts that international arrivals will reach over 1.56 billion by the year 2020 (see below). Of these worldwide arrivals in 2020, 1.2 billion will be intraregional and 0.4 billion will be long-haul travellers

Source: World Tourism Organization

The total tourist arrivals by region shows that by 2020 the top three receiving regions will be Europe (717 million tourists), East Asia and the Pacific (397 million) and the Americas (282 million), followed by Africa, the Middle East and South Asia. East Asia and the Pacific, South Asia, the Middle East and Africa are forecasted to record growth at rates of over 5 percent per year, compared to the world average of 4.1 per cent. The more mature regions Europe and Americas are anticipated to show lower than average growth rates. Europe will maintain the highest share of world arrivals, although there will be a decline from 60 per cent in 1995 to 46 per cent in 2020.

Long-haul travel worldwide will grow faster, at 5.4 per cent per year over the period 1995-2020, than intraregional travel, at 3.8 per cent. Consequently the ratio between intraregional and long-haul travel will shift from around 82:18 in 1995 to close to 76:24 in 2020. It is also expected that profits from tourism will continue to grow which will reach 2 trillion US dollars in 2020 (in 2002 about $500 million) . Expenditures of an average tourist per one travel will also increase from 707 US dollars in 1995 to 1248 US dollars in 2020, i.e. by 1,8 times.

Top ten countries in tourist arrival in 2020


_ pp. 1 2 3 4 5 Country China USA France Spain Hong Kong Arrival tourists million people 137,1 102,4 93,3 71,0 59,3 Share in world flow, % 8,6 6,4 5.8 4,4 3.7 Average annual increase in 1995 2020, n % 8,0 3,5 1.8 2.4 7.3

6 7 8 9 10

Italy Great Britain Mexico Russia Czechia Total

52,9 52,8 48,9 47,1 44,1 708,8

3.3 3,3 3,1 2,9 2,7 44,2

2.2 3,0 3,6 6,7 4,0 100

Source: World Tourism Organization

Apparently China, including Hong Kong will be come the most attended country. High growth rates are also expected in Russia. The share of China will form 12,3% of the global tourist flow. The major changes will especially affect Russia: the number of arriving tourists will be 1,54 times higher than the number of tourists departing from its territory in 2020.

Top ten countries in tourist departures in 2020


Country 1 2 3 4 5 6 7 8 9 10 Total Germany Japan USA China Great Britain France Netherlands Canada Russia Italy 788,9 Departure tourists Million people 163.5 141.5 123,3 100,0 96,1 37,6 35.4 31.3 30,5 29,7 49.2 Income from international tourist flow, % 10,2 8,8 7,7 6,2 6,0 2,3 2,2 2,0 1.9 1.9

Source: World Tourism Organization

The largest number of tourists will depart from the Netherlands, Germany, Great Britain, Canada and Japan where the quantity of travels abroad per year per one citizen will be 1,5-2 travels. In the majority of other countries from the top ten the amount of tourist mobility is far less than 1.