professor ian goldin, director, james martin 21st century school
TRANSCRIPT
Tourism and the G20
G20 Travel and Tourism Summit 24th February 2010
Ian Goldin Director, James Martin 21st Century School
Professorial Fellow, Balliol College University of Oxford
Presentation Outline
• Globalisation and changing
demographics
• Economic growth and the
MDGs
• Crisis and recovery
• Jobs, trade, infrastructure, and
sustainable development
• G20 Challenge
• What has the G20 achieved?
• How can the G20 stimulate the
T&T sector?
Globalisation will bring affluence
Source: A. Johansen & D. Sornett, Finite-time singularity in the dynamics of the world population and economic indices, Pysica A 294 (3-4), 465-502 , May 2001
Globalisation benefits
Since 1970:
• Life expectancy increased by 20yrs
• Illiteracy halved
• Income increase: population on <$1/day down 300m, despite population increase of 2bn
Source: Globalization for Development, Goldin and Reinert
Global inequality will increase
Source: Branko Milanovic 2007. Worlds Apart: Measuring international and global inequality.
Eco-affluence
Global population will be close to 9bn
Solid line: medium variant
Shaded region: low to high variant
Dashed line: constant-fertility variant
Source: http://esa.un.org/unpp/
Asia has the largest, fastest growing older population
Source: UN Population Division, World Population Prospects: the 2006 revision, New York, UNESA, 2007
Increasing life expectancy
Source: Oxford Institute of Ageing, 21st Century Institute, University of Oxford
Rapid fertility decline
Source: UN Population Division, World Population Prospects: the 2006 revision, New York, UNESA, 2007
Ageing
Growth of Tourism
Source: United Nations World Tourism Organisation, Tourism Highlights 2009 edition.
• 25 million international arrivals in 1950 to an estimated 806 million in 2005 • Average annual growth of 4.3% between 1995 and 2008
International Tourist Arrivals, 1950-2020
Tourism and Economic Growth
• Tourism demand depends on economic conditions in major generating markets • In years when world economic growth >4%, the growth of tourism volume is higher
• When GDP growth <2 %, tourism growth is lower. • Tourism proves resilient in economic downturn with strong recovery
Source: UNWTO, 2007, ‘Tourism Market Trends: World Overview’
T&T and the MDGs
MDGs How T&T contributes...
Poverty • Employment and income generating
opportunities
Gender
equality
• Female leadership
• Fair working conditions for women.
Disease • Entry points to raise awareness about
disease transmission.
Environmental
sustainability
• Economic incentive to protect the
environment
• Promotes understanding of the value of NR
and cultural landscapes
Global
Partnership
• National and international agencies
contributing to marketing of local tourism
products to increase local economic
development.
The Economic Crisis and the MDGs
Source: European Commission, 2009, ‘Millennium Development Goals - Impact of the Financial Crisis on Developing countries’
• The crisis has undermined progress in developing countries reducing per capita growth rates
• Decreasing remittances, reduced
foreign investment, and falling demand for goods and services are
all expected to adversely affect developing economies and
emerging markets
• Risks subtracting the MDG gains already made
The Economic Crisis and Tourism
• International tourist arrivals declined worldwide by 4% in 2009 to around 880 million. • Growth returned in the last quarter of 2009 after 14 months of negative results.
Source: UNWTO World Tourism Barometer, 2010.
Forecast 2010
Source: UNWTO World Tourism Barometer, 2010.
• International tourist arrivals to grow by 3-4% for 2010 reaching 1 billion • East/South Asia, the Middle East and Africa to experience strongest rebound
Forecast 2020
Source: UNWTO Tourism 2020 Vision, volume 7 , Global Forecasts and Profiles of Market Segments.
• International tourist arrivals to reach 1.6 billion
by the year 2020
• 2.5 times the volume recorded in late 1990’s
• US$ 5 billion a day spent on
tourism in 2020
• Top 3 receiving regions in 2020; Europe (717million tourists), East Asia (397 million), Americas (282
million)
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International TourismReceipts (US$ billion)
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2020
“Tourism and travel mean jobs, infrastructure, trade and development...what we need is recognition of the value of travel in this mix and most importantly its capacity to generate jobs”.
- Taleb Rifai, Secretary-General, UNWTO
Employment
• T&T drives 6 % of jobs in G20 economies.
• Strong multiplier effect on related services, manufacturing, and
agriculture. • Fast entry vehicle into the
workforce for young people and women in urban and rural
communities. • 238.3 million jobs in 2009 • 296.3 million jobs by 2019.
Source: World Travel and Tourism Council, progress and priorities, 2008/09: UNTWO, 2010
Trade and Investment
• Export income generated by T&T was US$ 1.1 trillion in 2008
• T&T exports account for 6% of overall global exports of goods and
services. • As an export category, tourism
ranks fourth after fuels, chemicals and automotive products.
Source: UNWTO, 2009. ‘International Tourism Highlights 2009 Edition’.
Infrastructure Investment
Tourism can induce the local government to make infrastructure improvements
such as better water and sewage systems, roads, electricity, telephone
and public transport networks
Source: UNWTO, 1994. ‘National and Regional Tourism Planning: Methodologies and Case Studies’
Sustainable Development
Global Sustainable Tourism Criteria
1. Demonstrate effective sustainable management.
2. Maximize social and economic benefits to the local community and minimize negative impacts.
3. Maximize benefits to cultural heritage and environment and
minimize negative impacts.
Source: The Partnership for Global Sustainable Tourism Criteria, 2008
Tourism in South Africa
• 9.6 million arrivals in 2008 (highest recorded)
• T&T Economy is expected to grow by 4.3% per annum in real terms between 2010 and 2019.
• Contributed directly 3.2% to GDP in 2009
• 483,000 tourists are expected to travel to SA for the World Cup, resulting in US$ 1.1 bn of foreign
spending and the creation of 415,000 jobs
Source: WTTC, Travel and Tourism Economic Impact, South Africa, 2009: Grant Thornton FIFA World Cup economic impact assessment, 2003
Tourism in Brazil
• 6.5 million arrivals in 2009
Tourists seek out the following activities in Brazil:
1. sun & beach (44.6%), 2. culture (22.1%),
3. ecotourism (20.6%) 4. sports (6%).
FIFA World Cup 2014 and
Olympic Games 2016 – projected 10-15% increase in tourist arrivals
Source: Brazil Ministry of Tourism (EMBRATUR), Plano Aquarela, 2020.
The G20
The G20, established in 1999, brings together systemically important industrialized and developing economies to discuss key issues in the
global economy.
The G20 have not explicitly focused on tourism...
What has the G20 achieved?
Source: Prasad, E & Sorkin, I, 2009, ‘Assessing the G-20 Economic Stimulus Plans: A Deeper Look’
• Coordinated the largest (US$5 trillion) macroeconomic fiscal stimulus plan in
history
• Implemented monetary policy instruments and significantly enhanced
financial regulations with Financial Stability Board (FSB)
• Strengthened the International
Financial Institutions (IFIs), including the expansion of resources and the
improvement of precautionary lending facilities of the IFIs
The Economic Crisis
• How can the G20 facilitate a greater contribution from the T&T sector for economic recovery?
• How can the T&T sector support the emerging G20 institutional architecture in the global agenda of job creation, economic growth and development?
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Emerging market/developing countriesWorldAdvanced economies
A 6% point decline worldwide in 2009 and modest recovery in 2010
Source: Shelburne, R C, 2009. ‘The Great Recession of 2007-2009: Analysis and Prospects’
What should T&T ask from the G20?
• A Green New Deal •Stimulus for Jobs and
Technology • Trade Policy and Tax Reform • Development Assistance
A Green New Deal
1. Stimulating clean tech innovation, stabilizing and boosting employment and protecting vulnerable
groups.
2. Cutting carbon dependency and GHG emissions, reducing degradation of ecosystems and their goods and services and tackling water scarcity.
3. Furthering the opportunity to achieve the MDG
of ending extreme poverty by 2015.
Source: UNEP, 2009, ‘Rethinking the Economic Recovery: A Global Green New Deal’
“The travel and tourism sector can be a leader in the transformation to a new green economy”
- Taleb Rifai, Secretary-General UNWTO
Stimulus for job creation
• Direct stimulus funding for jobs in the T&T service sector • Creation of Green jobs
T&T green employment sectors: • Renewable energy
• Buildings and construction • Transportation • Basic industry • Agriculture
• Provide greater R&D funding for zero-carbon technologies
• Upgrade polluting public transport systems with hybrid, electric and hydrogen technologies
• Renew airline fleets
Zero-carbon transportation technology
Source: Institute for Carbon and Energy Reduction in Transport, 21st Century School, University of Oxford
Trade Policy and Tax Reform
• Public expenditure on tourism infrastructure • Scale up eco-taxes to lighten the tax burden
falling on jobs and income • Implement high carbon taxes to discourage polluting and carbon-intensive vehicles and
industries
• Visitors are exports • Encouraging travel will strengthen two
way trade • This will promote essential export income
for poorer countries and improve the performance of suppliers such as airlines
who are largely from G20 states.
International Development Assistance
• G20 direct WB and other international agencies to give
greater attention to the sector • Channel development assistance towards T&T sectors of the Green
Economy
United Nations The World Bank
Summary
• More affluent, mobile and dynamic society who can engage in T&T
• T&T is a resilient industry that is projected to grow • T&T results in jobs, infrastructure, trade, and sustainable
economic development • Climate change is a challenge for the sector but can lead the
transition to a green economy • G20 can facilitate a greater contribution from the T&T by stimulating jobs, technology, trade policy, tax reform and
international development assistance
Tourism and the G20: T20 Strategic Paper
Objectives Identify the contribution of T&T to economic recovery,
growth, development, and transition to a green economy
Part 1 • Current economic situation and its impact on
employment and growth • Significance of the G20 in response to the economic
crisis
Part 2 • Potential for T&T to contribute to the economic recovery
and create sustainable job opportunities •G20 facilitating a greater contribution from T&T • G20 and World Bank development assistance
Tourism and the G20: T20 Strategic Paper
Part 3 • Measures to ensure the development of a Green
Economy • Address climate change and environmental
degradation • Trade and investment policies
•Promotion of zero-carbon technologies • T&T supporting the emerging international
architecture
Part 4 • Inclusive globalisation in which T&T play a greater role
in addressing the economic crisis • The G20 can utilise the T&T for economic recovery and
growth • The G20 can help stimulate the T&T sector
