Global Experience Industries. Jens Christensen

UNWTO. Facts and Figures. Newer data are not available.

      At country level, USA has the largest number of incoming and outgoing tourists and tourist spending, followed by Germany, China and Japan (Figure 2). Spain, France and Italy are next in line. In some countries more tourists are coming in than going out, particularly Spain and to some degree France and Italy, and further down the line Turkey and Greece. The reverse is the case in other countries, in particular Germany, UK, China and Japan, while in the USA outgoing and incoming tourists are almost at the same level. Germans and Britons are those who travel most internationally, followed by the Dutch and the Danes. Per capita, they spend more money on traveling than other countries, which results in a travel deficit. The main destination is to the sunshine of Southern Europe. A similar traveling pattern is seen in North America and Asia.

      The fifteen nationalities which travel most comprise almost half of all incoming travels and two-thirds of all outgoing travel. Furthermore, 80 percent of all international travel in both 1990 and 2005 took place within the same regions. North Americans travel mainly across the borders of USA and Canada and USA and Mexico, and West Europeans cross borders to other countries in the region. The same is the case in Asia Pacific.

       The Global Tourism Economy and Industry

      Statistics

      While it is not too difficult to measure the amount of international travel, it is more complicated to determine the economic significance of tourism. Tourist demands are met by a number of separate industries dealing with transportation, accommodation, catering, attractions, etc. Because national statistics only measure revenues at total trade level, they do not reveal who buys the goods. To make a national tourist account, it is necessary to extract the relevant parts from several trade or industry statements and methods to do so have been developed, even on an international level, to make a so-called ‘satellite account’.⁴ Consequently, it is possible to measure the economic significance of tourism on a national and a worldwide level. In practice however, this is no simple task and only few nations have established a national tourism satellite account.

      Satellite accounts comprise the value of direct tourism consumption. Indirect impacts of tourism on national and world economies are not included, however: the so-called multiplier effect. Mainly, the tourist satellite account encompasses the supply and demand of goods related to the tourism industry and is therefore, the best estimation of the businesses dealing with tourism. The results of satellite accounts are larger than traditional tourism measures, among other things because they include short-term travel which so far has been excluded from tourism accounts. As a consequence in most official statistics, the economic importance of tourism is underestimated at local, national and global levels.⁵

      In spite of these statistical shortcomings, WTTC has commissioned Accenture to make annual global and national accounts of the tourism industry and economy.⁶ Although it is called a satellite account, judging from the numbers the results are lower than a full satellite account.⁷ The WTTC account may therefore be seen as a conservative estimation of national and global tourism. The account measures the size of the tourism industry that supplies tourist goods and services as well as the size of the broader tourism economy.

FIGURE 3 The Global Tourism Industry and Economy in $bn, 1970-2015

      Source: UNTWO. Historical Perspective of World Tourism. WTTC. The 2007 Travel & Tourism Economic Research.

      The Tourism Economy and Tourism Industry

      Since the 1960s, tourism has grown in step with general economic developments, except somewhat faster, and it is projected to continue growing at the same pace.

      Mass tourism, as it is known today, began in the 1960s and continued to expand hereafter. Wealth and technology enabled millions of people to travel at home and abroad by car and airplane. Since the 1960s, the tourism industry accounted for 3 to 4 percent and the broader tourism economy for 10 percent of world GDP, export and employment. Everything indicates that this will continue in the future, and maybe even accelerate. In 2005, the world tourism economy totalled about 5000 $bn and the tourism industry about 1700 $bn (Figure 3).

      Primarily, the tourism industry includes activities related to travel and stay. Also included, are governmental expenses to cultural institutions, parks and other direct tourism-related activities and, finally, tourist shopping. Personal vacation travel makes up about 80 percent and business travels about 20 percent of all expenses. In addition, the tourism economy includes all indirect private and public expenses and investments which enable tourism to take place (Figure 4).

FIGURE 4 The Tourism Industry and Economy Flows

      Source: EU (2002). Structure, Performance and Competitiveness of European Tourist Enterprises, 6.

      Tourists spend more money at home than abroad. However, since the 1970s international tourism spending has increased much more than domestic tourism and the two numbers are approaching each other. While international tourism spending accounted for less than 10 percent of total tourism revenues in 1970, its share increased during the next two decades to 30 percent in 1990 and 40 percent in 2005 (Figure 5). The difference between domestic and international tourism spending varies a lot from country to country, just as developed countries spend much more on tourism compared to developing countries. The North Europeans spend more on international tourism than on domestic tourism, for example, while USA spends five times as much at home than abroad. Although climate and access to sun and beach seem to be the most important factors driving world tourism, the rise of one day and short-term vacations means that shopping, visits to family and friends as well as city tourism, make up an increasing share of total tourism spending.

FIGURE 5 Global Domestic and International Tourism in $bn, 1970-2015

      Source: UNTWO. Historical Perspective of World Tourism. WTTC. The 2007 Travel & Tourism Economic Research. Numbers are estimated.

      Looking at ways of traveling, cars and airlines dominate completely. In the US, the car is the most important means of transportation for vacations, because here short term vacations prevail. The car is also important in Western Europe as a means of tourism transportation, but the longer vacations in this region means that flying plays a greater role. Ferries, trains and busses are of much less significance.⁸

FIGURE 6 The Tourism Economy and Industry of the World’s Largest Tourist Countries in $bn, 2005

      Source: WTTC. The 2007 Travel & Tourism Economic Research.

      The US tourism sector is by far the largest in the world, making up a quarter of total tourism economy and industry (Figure 6). There is quite a gap down to number two, Japan, with an 8 percent global share, followed by China and the five large West European tourist countries, Germany, UK, France, Italy and Spain of 4 to 6 percent. China has just recently joined the top ten and rapidly moved into third place. The ten largest tourist countries account for 70 percent of total world tourism spending. As we shall see later on, the world tourism industry that provides travel services is completely dominated by companies in developed countries.

FIGURE 7 High Income and Low Income Countries’ Share of World Tourism in $bn, 2005 and 2015

      Source: WTTC. The 2007 Travel & Tourism Economic Research.

      To a high degree, world tourism deals with travelling in and between developed and high income