The Slovene project of implementation of TSA

Institute for the Socio-Economic and Business Evaluation

Faculty of Economics, University of Ljubljana

dr. Hugo Zagoršek

Prepared for the CEI meeting, Dolenjske toplice, 17th-18th October, 2007

ISBE The structure of presentation

1. History of the TSA implementation in Slovenia

2. Basic principles and sources used

3. Challenging issues

4. Techniques for estimating same-day tourists’ consumption

1. Characteristics of TSA for Slovenia in year 2003

2. Physical flows

3. Internal tourism consumption

4. Main tourist aggregates

5. Recommendations

6. Lessons learned

ISBE

TSA for 2003: methodlogy

ISBE

Phases of TSA implementation in Slovenia

Feasibility study

TSA for year 2000

TSA for year 2003 and extrapolation for year 2006

2001 2004 2007

Ministry of the Economy, Directorate of tourism

International Institute for Tourism

ISBE, Faculty of Economics

Statistical Office of the Republic of

Slovenia

2009

TSA estimated regularly at 3 year intervals

ISBE

Basic principles and specifics of TSA estimation in Slovenia

Principles:

• Following RMF as closely as possible

• Based on previous studies

• Upgrading methodology and sources

• Reliability

• Transparency

Specifics:1) Small and open economy

2) Diverse attractions and activities

3) Large number of day tourists (both foreign and domestic)

4) Large number of transit tourists

5) Small number of large tourist companies – accessible for personal interview

6) Good existing statistical coverage of tourism

7) Shadow economy?

ISBE

Secondary sources

Slovenian Tourist organization (visitor surveys)• Hiking and mountaineering• Sightseeing• Spa tourists• Cycling, golf• …

Balance of payments

AJPES

1. Accounting database on Slovenian organizations

Office for gaming supervision:• Data on gambling in

Slovenia

Statistical Office of the Republic of Slovenia:

1. National Accounts

2. Accommodation facilities, tourist arrivals and overnight stays

3. Survey on tourism travels of domestic population

4. Survey on foreign tourists in the Republic of Slovenia in summer season 2003

5. Visits to selected tourist sights, museums and galleries, swimming facilities, casinos ..

6. Nautical tourism

7. Survey of border crossings

8. Slovenian travel agencies

ISBEPrimary sources

1. Interviews with experts from various fields

2. Disaggregated data on types of visitors and their consumption provided by major tourist companies in each TSA category

3. Data on operating margins and expenditure structure provided by major tourist agencies

4. Data on the place of the residence of domestic visitors to casinos and gambling parlors

5. Daily data on the number of cars passing toll stations in Slovenian highways (DARS), data from car counting (DRSC).

Crucial for estimation at

the lower levels of

aggregation.

Secondary data is

usually too much

aggregated for TSA

requirements

Crucial for estimation at

the lower levels of

aggregation.

Secondary data is

usually too much

aggregated for TSA

requirements

ISBEChallenging issues

1. Travel agency, tour operator and tourist guide services

• Net valuation – difficult to get data

• Could not disaggregate in 3 subcategories (travel agency, tour operator, tourist info and guides)

2. Sports and recreational services – many providers, many sources, missing and conflicting information

3. Existing data and surveys not suitable for TSA – not enough monetary information; different categorizations

4. Treatment of goods (e.g. gasoline) – only trade margins

5. Tourism social transfers – what to include and how to estimate it

6. Second home ownership – imputed rents

7. Outbound tourism consumption (TSA Table 3) – could get the total consumption estimate, difficult to disaggregate

8. Collecting primary data is high resource consuming activity

ISBE

Techniques for estimating the consumption of same-day tourists (I)

Foreign same-day visitors: the problem of detection

1) Sightseeing: based on survey (STO)

2) Activities: based on survey (STO, SORS)

3) Gambling: combination of survey and expert estimates

4) Transportation: company records (e.g. airlines), border surveys

Distinction between same-day foreign tourists and transit tourists – purpose of visit

Transit visitorsTypes of expenditures:

1) Gasoline

2) Road tools

3) Food, beverages, etc. (convenience shopping)

Methods:1) Cross-border traffic survey as a baseline

estimate2) Traffic-flows estimates and traffic-counting

data to determine major transit tourists routes3) Subtraction of other types of traffic4) Estimate consumption using data from gas

station operators, toll-roads and expert interviews

ISBE

Techniques for estimating the consumption of same-day tourists (II)

Domestic same-day visitors: the problem of definition.

• How to operationalize the definition of “usual environment”?

• How to apply it in practice?

Method:

• Survey data on the number of day trips

• Data from other surveys

• Interviews with the experts

Most problematic categories:• Food and beverage serving services• Cultural services• Sports and recreational services• Gambling

ISBE

SLO TSA 2003 overview

ISBE

Characteristics of TSA for Slovenia in year 2003

1. Completed in 2007. Estimates for 2003 and 2006 (extrapolation).

2. Harmonized with national accounts, but based on additional primary and secondary data

3. Harmonized to a greatest extent possible with the international guidelines (RMF)

4. Inspired by the previous national satellite accounts (for year 2000) but incomparable to them because of different methodological assumptions and different data sources

5. Extended to include calculation of indirect effects: Value added and GDP produced in the national economy due to tourism

6. Estimated TSA tables 1 – 7 and 10. Developed methodology for estimating TSA tables 8 & 9 (not yet estimated)

7. Published in the comprehensive report in Slovenian language with English summary

ISBE Physical flows – arrivals of tourists

1.425

1.658

1.9572.086

2.1622.246

2.341 2.395 2.482

0

500

1.000

1.500

2.000

2.500

1991 1996 2000 2001 2002 2003 2004 2005 2006

Arr

ival

s (1

.000

)

TotalDomestic t.Foreign t.

Domestic t.

Foreign t.

ISBE Arrivals and overnights, 2003

Foreign tourists in Slovenia

Domestic touristsDomestic tourists

abroad

Number of trips1.373.000 873.000 2.114.197

Number of overnights (official statistics)

4.175.000 3.327.000 9.880.868

Number of overnights (from survey)

5.255.557 13.163.948

ISBE Internal tourism consumption

43% 50%

€ 1.158

€ 933

€ 2.167

Inbound tourismconsumption

Domestic tourismconsumption

Total

Same-day visitors

TouristsInbound tourism consumption

Domestic tourism consumption

Other components of tourism consumption

ISBE

Structure of internal tourism consumption

Inbound tourism consumption

Domestic tourism consumption

Non-specific products

Connected products

6.2-Gambling

6.1-Sports and recreational sport services

5-Cultural services

3-Passanger transport services

2-Food and beverage serving services

1-Accomodation services

ISBE

Key tourism aggregates for Slovenia 2003 (m€)

Tourism value added 824

Share of tourism value added in the total VA of the economy 3,82%

Tourism characteristic industries' VA 678

Other industries' VA 146

Share of tourism characteristic industries in total tourism VA 82,26%

Tourism GDP 1.229

Share of tourism in national GDP (%) 4,94%

GDP of Tourism characteristic industries 766

GDP of other industries 462

Share of tourism characteristic industries in total tourism GDP 62,37%

Employment in tourism characteristic industries 30.644

ISBE

Assessment of total economic impact (m€)

Tourism value added without domestic business travel 706

Tourism GDP without domestic business travel 1.093

Total output of the national economy due to tourism 2.540

Value added produced in the national economy due to tourism

1.426

Share of total national value added (%) 6,60%

GDP of the national economy due to tourism 1.921

Share of total national GDP (%) 7,72%

ISBE Recommendations for SLO TSA

1) Applying TSA methodology to narrower segments of tourism sector

2) Estimating regional TSA for Slovenia.

3) The needs of TSA should be taken into account in all tourism-related statistical activities, especially survey preparation.

4) Tourism field surveys should gather more monetary data, instead of being mostly limited to physical indicators.

5) More diligence should be focused on same-day visitors.

6) Transit tourism should be researched more in depth.

7) TSA should be extended with estimation of the total “leisure” services and expenditures

ISBE Lessons learned

1) TSA is the most comprehensive methodology for estimating the economic impact of tourism

2) It is difficult to operationalize in practice, since it demands plenty of data, that is not usually available

3) It is necessary to use many assumptions and rough estimates

4) Different researchers may use different methodologies. That may damage the comparability of results over time

5) Transparency of estimating methods and procedures is important

6) TSA estimation is an on-going learning process

ISBE

Discussion?

ISBE Contact information:

dr. Hugo Zagorsek

Institute for socioeconomic and business evaluation

Faculty of Economics

University of Ljubljana

hugo.zagorsek@ef.uni-ljsi

+386 41 370 161