The role and impact of tourism on local economic development: A comparative study
Abstract
The purpose of this study was to determine what role tourism plays in the economic development of
local regions. Tourism is globally recognised as one of the largest and fastest growing economic
sectors. In developing countries, tourism is specifically seen as a tool to promote economic
development, and alleviate poverty as an alternative to other traditional economic sectors such as
industrialization. The study was conducted using tourism statistical data from two geographical areas
namely the Metsimaholo municipal area and the Emfuleni municipal area (region previously known as
the “Vaal-Triangle”), South Africa. Secondary data were used from the Global Insight data base.
Global Insight is one of the world’s largest sources of global financial, economic and sectoral data.
Data obtained from this source were further analysed, refined and reported on. The results indicated
that tourism trips in both areas have shown a steady growth from 2001 to 2013. Within the Emfuleni
municipal area, business tourism specifically has shown rapid growth of 8.36 percent per annum,
while holiday tourism has grown at a relatively slower rate of 3.31 percent. The Metsimaholo
municipal area on the other hand has shown much lower tourism growth. If the two areas in the study
region are compared with international standards on the percentage contribution of gross domestic
product (GDP) of tourism, the Emfuleni area compares well with a 7.7 percent contribution and
Metsimaholo with only a 2.2 percent contribution. Globally the contribution of tourism is between 8 to
10 percent of GDP. Tourism as a low skilled, labour intensive industry, has many benefits for local
regions including poverty alleviation and a key sector for local economic development (LED).
Collections
- Faculty of Humanities [2033]