Inspired by recent endorsement of a global travel club from Malaysia’s Minister for Domestic Trade and Consumerism, Hamzah Zainudin, I would like to re-inspect the economic benefits of travel and tourism on countries.
Despite Brexit making big news across international tabloids, it seems that the travel industry has no intentions of slowing down still. Not Tony Fernandes at least. Air Asia just locked in another order worth US$12.5 billion. And she isn’t the only budget carrier that is looking at expansion.
So what is the whole deal with travel industry?
According to the World Travel and Tourism Council (WTTC), global travel industry has generated US$7.6 trillion in 2014. Its global total GDP contribution, specifically, surpassed some of the giant industries such as Agriculture, Education, Chemicals Manufacturing and Automotive. In percentages, global tourism is responsible for 9.8% of the global GDP.
The sheer mass of this giant alone reveals significant economic benefits to countries which like to boost their local economy. Not forgetting to mention that in terms of global direct employment, travel industry constitutes 105 million people – 2 times more than global financial services industry, 4 times more than mining and 7 times more than automotive.
Travel industry is one of the world’s leading job creators with a stake of 9.4% in total impact, overshadowing every other industry, with exception to retail and agriculture industry.
With the support document from World Tourism Organization, it is no surprise that travel and tourism industry played a massive role in improving any country’s economy, especially the ones who have been significantly delayed by various factors such as a global economy downturn.
- A well developed travel and tourism industry can improve access to International markets, enhance business relationships, and increase trade opportunities.
- Increased connectivity as a result of travel industry, can drive both domestic and foreign investment, enhancing a region’s attractiveness as a place to locate regional headquarters, distribution or manufacturing facilities.
- Investments in public, private and hard infrastructures directly benefits all economic sectors.
- Travel industry provides a complex hub-spoke relationship between industries and hence boosts economic development as a whole.
From a business / entrepreneur perspective, travel industry continues to be a lucrative platform to discover countless opportunities. While it stands vulnerable to fluctuations as a result from global economic shifts, travel industry has proven to continue growing despite facing global economic crises and natural disasters over the last 3 decades, and in my opinion, possibly remained as one of the few industries that rebounded the fastest.