New approach needed to boost strong and sustainable tourism growth, says OECD | WPN World People News

Governments should recognise tourism’s role as an essential driver of jobs and growth and boost their support for the sector. The industry accounts for 4.7% of GDP and 6.0% of employment in the developed world, according to a new OECD report.

Tourism Trends and Policies 2014 says that OECD countries still account for over half of international tourism arrivals (57%) and spending (54%) but are losing market share, notably to Asia-Pacific. Growth in international tourism arrivals to the OECD area grew moderately between 2008-2012 (+1.9%, compared to +2.9% globally), says the report.

Domestic tourism accounts for the vast majority of spending in OECD countries, making up nearly 80 cents of every dollar spent. In Canada, Germany, Japan, Mexico, the United Kingdom and the United States, the figure exceeds 80 cents.

Launching the report at the ITB trade fair in Berlin, Sergio Arzeni, Director of the OECD’s Centre for Entrepreneurship, SMEs and Local Development said: “Countries and operators will need to adapt quickly to new market realities, such as changing demographics, shifting travel patterns, and advances in digital technology, to attract visitors from abroad.”

Long-haul flights from Europe have fallen in recent years, for example, as more people choose to take shorter trips and often stay closer to home. Travellers are also getting older, with around one in four (23%) aged over 55. In the medium to long-term, demographic change will also affect the industry, with populations growing fast in Asia and the Americas.

To drive growth, attracting more tourists from emerging economies will be key. More Chinese tourists travelled abroad than from any other country in 2012, generating revenues of USD 102 billion, an increase of 37% on 2011. Chinese spending on tourism is now eight times what it was 12 years ago.

But travellers from these countries are likely to encounter more demanding visa and entry formalities when visiting OECD countries. In an increasingly competitive global
market, reducing the time, cost and effort involved for tourists can help, says the report.

Governments should put in place measures that identify and facilitate high volume, low risk legitimate travellers so they can travel more freely and reduce time spent at borders, says the OECD.

The report also compares how countries are using tourism-related taxation to stimulate job creation and encourage visitor spending. There has been an increase in the number and scope of tourism-related taxes, fees, charges in recent years, notably those designed to better manage the environmental impacts of tourism.

Governments need to better monitor the impacts of taxation on competitiveness in order to support the long-term sustainable growth of the tourism industry.

Greater coherence across government policies, especially taxation, transport, innovation and visas, is needed to boost tourism and economic growth. Governance reforms can also support this aim, says the OECD.

Source: Organization for Economic Co-operation and Development