The response of international tourism industry to economic and globalization
|Topics:||🌎 Globalization, International Business, Logistics, Tourism, 💱 Macroeconomics, 💳 Microeconomics|
The response of Tourism to Economic and Globalization
Globalization refers to a variety of phenomena which integrates the nation states’ economies, society, and culture through modern world system of trade, immigration, communication, and transportation. It tries to define a way in which the occurrences in one part of the world system may have a significant influence on other individuals in another part of the world. Globalization tries to incorporate people of the world into a society of a single world. In essence, it is a term that is currently used frequently but with an unclear meaning due to the confusion with other closer terms like globalism. However, we can undoubtedly distinguish it from other terms by outlining its drivers which include economic, social, technological, environmental, demographic, and political drivers (Dwyer 2015). This means that globalization brings a broad understanding multidimensional process where all these drivers take place simultaneously. In a narrow perspective, in terms of economy, we can refer to as economic globalization; there is the exchange of ideas, products and other aspects of the economy. Ideally, economy and globalization have a great effect on the tourism as propelled by the globalization drivers.
International tourism has largely responded to the globalization and economic factors. As globalization take effect in most part of the world, so does tourism. The drivers of globalization work to the effect of ensuring that the tourism is fostered. For example, when we consider economic drivers of globalization, we emphasis on those factors that affect the economy of a nation positively or rather those that lead to the economic growth which is broadly referred to as positive changes in the size of production of fundamental goods and services in a nation (Dwyer 2015). These economic drivers include increased income, global trade, market forces, financial markets, global completions, and capital mobilization among other. When there is income growth, there will be new markets and new competition within the emerging economy. This will eventually lead to the widening of the global chain in an attempt to integrate the new market into the global networks. The response that is created by the powerful economies of the global world economy generates the economic source for domestic and international tourism. This is because globalization has enlarged the interdependence between nations, economies, and people. Not only do the giant corporations participate, but also small and medium-sized companies (Felsenstein and Freeman 2001). Therefore, the practice has led to the formation and operation of worldwide tourism markets where destinations anticipated to compete on the same basis irrespective of the nation of origin function interactively.
Another economic driver is the infrastructural investment which is an endless cycle (Dwyer 2015). It is believed that one of the things that stimulate a long-term economic growth is the infrastructure development. Many countries have leaped ahead into the world by establishing themselves as tourism economies through infrastructural development. For example, the city of Dubai is strategized to be one of the cities to compete in the global tourism market by its signature architectural projects, enormous shopping, entertainment attractions and hyper-networks for transportation. It has promoted its image through the strategy of worldwide higher visibility by their record-breaking skyscraper Burj Khalifa and luxurious hotel Burj Al Arab among other respected architectural designs (Katodrytis 2005). McNeil (2009) define Burj Khalifa as ‘the growing glory of Gulf economic strength.'(p.19). Through this process, Dubai has attracted many tourists in the recent years from all sorts of the world. This is because it is regarded as the safe haven for tourism bearing in mind that the industry is pioneered by the royal family which has high taste for luxury and beauty (Katodrytis 2005).
It is believed that one of the most influential driving forces of tourism is the transport network which is a technological driver. Technology has made transportation very easy and there is continued mobility of people over a great distance in a more comfortable and lesser time (Dwyer 2015). The travel and tourism sector has been transformed by the new technologies that have sophisticated database management systems from its mass, uniform and inflexibly parceled nature into a more tailored, flexible, personalized activity reacting to individual preferences and motivating tourism buying. Due to these changes, technology changes have ensured that there is a growing number of tourism organizations to realize the ambitious goals of increasing their capacity to add value for their consumers and reduce operating costs. Modern global transportation system has been created with the help of tourism sector to continue making accessible the remote destinations. In order to support the traveling to the remote destinations, ‘moorings’ have been established in other places that help in maneuvering from the hotels, resorts, and airports (Cohen 2012). The speed and cost of travel have also reduced drastically through use of new technology through easing the process of booking of flights and other processes enabling the economies of scale. The ease of these functions has also ensured that there is less labor demanding essentials leading to the overall reduced cost of travel. Therefore, transport network as a driver of globalization propelled by new technology has helped promote the growth of tourism.
Another driver of globalization under technology is the communication sector. New technologies in the communication sector have improved the process of acquiring information. Tourism sector and other industries related to tourism like the aviation industry have continued to use the internet and the social media to market their products. The current huge growth in the use of Facebook, Skype, Twitter, and YouTube has enabled the cross-cultural communication very easy and acquiring information about a particular tourism destination is very simple. There are certain destinations of tourist that are little known but have reach culture, wildlife, and other tourist attraction sites. Due to the extensive use of technology to advertise and market their sites, they have been able to attract tourist to those destinations. For example, Kenya in Africa has managed to have constant growth in tourism network through their extensive technological marketing. Therefore, technology in the communication sector opens up a place by providing information about it which can be accessed easily by the majority. For continuous growth of tourism, there must be wide use of technology in communication and information and the wide use of internet in sales and marketing in the tourism sector (Dwyer 2015).
Another driver of globalization is the social drivers which have a wide range of elements. A few of these elements include education and skills, ecological awareness consumerism, changing demography, and growing leisure society among others. This is indeed one of the globalization factors that have actually led to a wide growth of tourism. Many of tourist result from the desire for leisure and experience of other cultures. There is an increase in this desire because of the increased connectivity and awareness. The transmission of the ideas and values that is also diffused by the internet enables the desire to experience these cultures in their natural habitats. A case example is the sporting industry which has continued to draw a lot of interest by a number of countries. Many of the holders of the world events like the world cup football and the Olympics have realized the effect of these global events. Many tourists are experienced during these events and the economy of the nations are grown (McGovern 2002). According to the Brazil’s tourism board, the number of tourists that visited the one month long 2014 world cup was one million. This is in considerably a huge number compared to the 2910 world cup in South Africa who received foreign tourist of about 310,000 but a much lesser number to the 2006 world cup in Germany (Chao 2014).
Political drivers of globalization have also lead to growth in the tourism sector. When there is increased liberalization of trade through reduced trade barriers, global trade improves and many tourists are received. This is because of the ease of access across borders by more foreign tourists which also results in enlarged global competition from global tourist destinations. According to Fu, Oum and Zhang 2010), when there is sustained liberalization and deregulation of air transport and a country adopts an ‘open skies’ policy, then there is assured growth of trade and tourism. Another credit to Dubai is the adoption of the Open Skies policy. The advantage of this strategy is that it has enabled the airlines to effectively fly in the countries embracing it without much restrictions and interference by the government. Therefore, airlines can actually offer affordable, efficient and convenient air services to their customers. Growth and sustainability in the Dubai’s tourism industry are enhanced by favorable rules and regulations in the air transport and this is through the favorable open sky policy. Therefore, the current tourism sector mainly depends on the civil aviation which can be improved if nations improve on liberalization of air transport. When there is an improvement in the travel coordination between air transport, infrastructure, and policies, then the tourism improve due to ease of travel.
Even though globalization is widely lauded for the positive benefits in the tourism sector, it has also been characterized by other negative effects as well. Critics have argues that most of the developing countries that have strategized as tourism destinations highly depend on the foreign market making them susceptible to any economic interference that might happen in the developed countries where they get their tourist. Again, the disruptions may also be internal like the political instability of a tourist destination and this may lead to traveling advisory to members of these countries by governments of the developed countries. These criticisms of globalization are significant because they highlight the increased threat that these smaller economies are associated with due to the dependence of their overall economy on tourism as an export market. The global financial crisis confirmed the risks associated with tourism dependency coming from unexpected negative fluctuations in demand from global markets (Sheldon and Dwyer 2010). Therefore, globalization puts the economies that are dependent on foreign markets at risks due to the tremendously sensitive of tourism to crises of every nature.
The economic disparity is another driver that has also greatly affected the tourism sector especially to the disadvantage of the developing countries. This is because the developed countries have continued to maximize the use of their resources to their advantage by exploring other avenues for the tourism sector. According to Dwyer (2015), it has been realized that depending on one factor as the tourist attraction can lead to the collapse of the economy especially when there is disruption as earlier explained. Therefore, to spread risks, the developed countries have diversified their tourist attraction amenities to the disadvantage of the developing countries that still stick to the natural habitats as their only attraction amenities. This has led to the shifts of the tourist to other destinations where variables can be found at one place. For example, Dubai has many tourist sites that include their natural reserves like the wildlife reserves Ras Al Khor and Mangrove kayaking, Dubai zoo and activities like the Camel & horse rides. In order to stamp their authority as a tourism destination, they have used their resources to make Dubai city itself a tourist destination by beautifying it using signature architectural buildings and the aquarium and underwater zoo at the Dubai Mall, which has more than 33,000 living animals (Animals and wildlife in Dubai 2014).
Another disadvantage of globalization is experienced by technological drivers. Technology has made the access to information very easy. Through use of internet and the social media, very important information is received by tourist about their potential destinations. However, this has also created imbalanced competition, especially to the small economies. Most of the developing countries have not gained the full benefit of the technology and are still lagging behind. Developed countries have taken advantage of their infrastructure and financial power to create an economic disparity between them which further translates to the Travel and Tourism Competitiveness. Too much use of technology in the Tourism sector by a section of the market renders others uncompetitive because the current customers are crowded by technology (Cohen 2012). Another perspective of the disadvantage of technology is the risk that it subjects to these tourism destinations. When there is too much of information, then the information may be used by other rivals or terrorist which is a disadvantage to those destinations. Therefore, globalization, as driven by technology, not only brings its positive influence but also the negative influence to some tourist destinations.
In conclusion, globalization involves the integration of economies around the globe through trade and monetary streams. This concept means that there is involvement of the movement of people as labor and knowledge in technology across worldwide borders. Globalization is propelled by economic, social, technological, environmental, demographic, and political drivers which sometimes integrate to bring a complex outcome in various economies. In the tourist sectors, globalization has continued to create varied response both positive and negative depending on the type of drivers of globalization. Positive responses include ease of access to information, quick access, quality and variety of tourism sit, reduction in cost, and positive completion among others. Negative access includes risks of dependency and imbalance trade due to the difference in financial power.
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