Transcript The Economic Impact of Tourism

The Economic Impact of
Tourism
David Campbell, Chief Executive
Visit London
Activities of persons travelling to
and staying in places outside
their usual environment for not
more than one consecutive year
for leisure, business and other
purposes
 Includes all types of
visitors, not just
traditional tourists
 Includes both staying
and day visitors
World Tourism Organisation
 Despite recent events, tourism is still one of the
fastest growing sectors in the world economy
 World tourist arrivals: 1960 = 70m, 2003 = 700m!!
 Huge economic impact
What is Tourism
Direct spending by visitors
is only the tip of the
iceberg
The indirect
impact of tourism
is much larger
Relatively easy to
measure: visitor
numbers, expenditure
Hard to measure:
subsequent spend by
suppliers, induced
effects, investment etc
Huge Economic Impact
Direct Tourism Expenditure 2002
UK
England
London
Overseas
11.7
10.4
5.8
Domestic
26.7
20.8
2.8
Domestic Day
Trips*
34.2
30.9
5.0
3.3
-
1.3**
TOTAL
75.8
62.1
14.9
% GDP
4.4%
Expenditure
£bn
Fares to UK
carriers
Employees
2.1m
c10%
1.7m
c0.3m
* These figures represent tourism day trips, these are defined as trips lasting 3 hours or more which are
not taken on a regular basis and are estimates based on1998 data
** London’s share of fares to UK carriers
Source: DCMS, UKTS, IPS, UK Leisure Day Visits Survey, GLA Economics, VisitBritain
Direct Impact
• Indirect effects: generated from economic activity of
subsequent expenditure (eg: hotels purchase supplies
and use local services)
• Induced effects: arising from spending of income
occurring to local residents from tourism wages and
profits
• Investment activity: arising from capital investment in
new facilities for visitors
• Government: public sector funding
Tourism Multipliers used to calculate indirect impacts
• North East: 1.8x (eg: every direct £1 = another £1.80)
• Treasury: 1.7x
• UK: ??
• London: ??
Indirect Impact
• Direct spending by visitors is only the
tip of the iceberg
• The indirect impact of tourism is
much larger
• What about non monetary items
(eg: quality of life)?
Conclusion