FINANCIAL BENEFITS OF TOURISM
In most developed and developing nations of the world, tourism is a major source of employment, gross domestic product (GDP) or national income, income to the tourism promoters and the tourism destination points/communities and a catalyst for socio-economic development of the communities concerned through social infrastructural amenities like electricity, water supply, communication, transportation, motor-able roads and health improvement facilities.
All sectors of the economy play an important role in making a stable and long running development. Tourism is one of the sectors which plays an important role in development and also generates foreign revenues.
This sector is peaceful and reflects the nature and beauty of the country. It helps people of far flung areas to promote their culture and norms, it also provide opportunity to country to make a better image around the world.
1. INCOME GENERATION:
If properly used, tourism generated income can be tremendously beneficial to the host country and it’s local communities. Tourism generated income can be used on a national and local level to better education, improve infrastructure, to fund conservation efforts, and to promote more responsible tourism. Income can be generated through many ways such as taxation.
Tax is the money that you have to pay to the government so that it can be use in building and maintenance of public services. Tourists often pay tax on products and services they experienced. Which includes the following:
a) Exist formalities and taxes
i) entry taxes
ii) terminal charges at airport, sea ports national borders
iii) accommodation VAT (A tax added to price of goods and services, also called value added tax). Other ways includes sales tax, hotel levy, bed night tax, taxes on transport, food and beverages, shopping, environmental taxes, visitor attraction taxes, etc.
2. EMPLOYMENT:
The tourism industry encompasses many different areas, so it also creates jobs in many different areas. With tourism comes hotels, restaurants, car rental agencies, tour companies, service stations, souvenir shops, sports equipment rentals, cooks, cleaners, photographers, waiters, ticket retailers, choreographers (cultural dancers), drivers, and much more. All of this creates many different levels of employment for people in a given community.
3. ECONOMIC BENEFITS:
Tourism can provide direct jobs to the community, such as tour guides or hotel housekeeping. Indirect employment is generated through other industries such as agriculture, food production, and retail. Visitors’ expenditure generates income for the
local community and can lead to the alleviation of poverty in countries which are heavily reliant on tourism.
4. POVERTY REDUCTION:
Poverty is an economic condition of lack of both money and such basic necessities of successful life as food, water, education, shelter and other basic life needs. Tourism could serve source of poverty reduction in Nigeria if the people trapped in the vicious cycle of poverty are brought into the desirable cycle of riches. This could happen through the employment opportunities tourism could provide for them, offering of social infrastructure like good motorable roads to the communities hosting the tourist attraction centers, school and health facilities, electricity and other social means that could add life to the people in question.
In all, with the increase in tourist centers and supported by tourists visiting/patronizing the
areas, market women could sell their goods, taxi drivers will be in business and other social
activities in the areas concerned will improve, thus, reducing drastically the poverty rate in the places involved Tourism in many developing and least developed countries is the most viable and sustainable economic development option, and in some countries, the main source of foreign exchange earnings.
Part of this income trickles down to different groups of the society and, if tourism is managed with a strong focus on poverty alleviation, it can directly benefit the poorer groups through employment of local people in tourism enterprises, goods and services provided to
tourists, or the running of small and community- based enterprises, etc, having positive impacts on reducing poverty levels
5. FOREIGN EXCHANGE GENERATION:
In addition to income creation and employment opportunities, tourism equally helps a country to overcome balance of payment problem. This is because international tourists who buy tourism services add value to the receiving country’s revenue accounts in that nation’s invisible transaction.
6. BALANCE OF PAYMENT:
This is the record of all economic transaction between the residents of the country and the rest of the world in a particular period (usually annually). Tourism has a specific role in improving and/or correcting errors/imbalances in country's balance of payment.
7. NEW BUSINESS:
A thriving tourism industry supports growth in other sectors, such as transport, construction, agriculture and retailing. As tourism increases, there are more opportunities for small business to develop.
8. INCREASED COMMERCIAL AND RESIDENTIAL DEVELOPMENT
Tourism development often results in increased revenue to councils through rates and other charges. Tourism can act as a shop window for the lifestyle of the area. It is increasingly common for people who visit and are impressed with the area to return as residents, thereby increasing demand for housing and other services.
9. DIRECT SPENDING BY TOURISTS AND THE ASSOCIATED ECONOMIC MULTIPLIER EFFECT:
Tourism generates different types of income for a community: business income, wage earnings, share earnings, rates and levies. Direct spending by visitors has a positive impact on business profitability and employment growth. The money that is then circulated and re-spent in the economy is often referred to as indirect spending or the multiplier effect. Because much of a region’s tourism patronage comes from metropolitan centres, it is an effective way to redistribute wealth from urban to rural areas.
10. A VARIED ECONOMIC BASE:
The expectations and needs of visitors can often lead to the creation of new businesses and commercial activities. This builds a more diverse economic base and reduces reliance on one or two traditional industries, which is often the case in rural communities.
SOCIAL BENEFITS OF TOURISM
1. INCREASING COMMUNITY FACILITIES
Tourism can stimulate new and expanded community facilities and infrastructure initiatives, such as the improvement of retail, restaurant and entertainment options, transport services, education and sporting facilities. These increase the quality of life for the community, which may not otherwise warrant the improvement, based on the residential population alone.
2. PRESERVATION OF CULTURAL HERITAGE
Tourism activity often prompts the conservation of cultural heritage, either as a result of increased awareness and pride, or because it can be justified on economic grounds as a tourist attraction.
3. BENEFIT LOCAL PEOPLE:
The introduction and development of tourism allows local people an opportunity for economic and educational growth that would not otherwise be available. In addition, it allows both the tourist and the local community a chance to experience other cultures, which broadens understanding.
4. RECREATION:
Travel based recreation provides relief from the monotony of daily routine. A change in place and climate helps a traveler to recharge his mind, body and spirit.
5. ENVIRONMENTAL BENEFITS:
Tourism provides financial support for the conservation of ecosystems and natural resource
management, making the destination more authentic and desirable to visitors. It also adds more value to the local tourism business.
6. DIVERSIFICATION:
In addition to bringing prosperity to an economy, it also allows an economy to develop a new form of income. This acts as an insurance policy in case of hard times, because the additional dollars coming in can help support traditional industries in case they come under financial pressure.
7. INFRASTRUCTURE:
The additional revenue that comes into a community also benefits the local council or governments. It means more tax dollars, which allows public projects to be launched or developed. This means the infrastructure improves, with new roads being built, parks developed and public spaces improved.
The better facilities brings in more visitors, but is a fantastic benefit to local residents, especially when there is enough revenue to build new airports, schools and hospitals, which all support the economic development even further.
OTHER SOCIAL BENEFITS INCLUDES THE FOLLOWING:-
Brings in outside dollars to support community facilities and services that otherwise might not be developed.
Encourages civic involvement and pride.
Provides cultural exchange between hosts and guests.
Encourages the preservation and celebration of local festivals and cultural events.
Facilities and infrastructure developed for tourism can also benefit residents.
Encourages the learning of new languages and skills.
Tourism related funds have contributed towards schools being built in some areas.
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