Impacts of Tourism

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10c) Examine how tourism has had social and economic impact on one country.

Case study of a national tourist industry

Vietnam is located in south east Asia. It has land borders with China, Laos and Cambodia. The capital of Vietnam is Hanoi, but its principal city is Ho Chi Mich City (formerly Saigon). Vietnam is the 13th most populated country in the world with over 90 million citizens. In 2008 its GDP was $241 billion and its GDP per capita of $2,800. It is one of the fastest growing economies in the world with growth exceeding 6% in 2008.

Vietnam has had quite a turbulent history. Vietnam officially declared independence from France in 1945, but the French influence in the country lasted until 1954. In the same year, South and North Vietnam divided. The north was led by Ho Chi Minh and backed by China, the south was backed by the US. War broke out between the north and south in the 1960's. American involvement escalated during the war, ending with their departure in 1973. The south was then defeated in 1975 and the country has been united under communist rule ever since.

Despite its rapid growth, the majority of Vietnamese still work in the primary sector (55.6%). The main crops in Vietnam are rice, coffee, soybeans, peppercorns, rubber, fruits and cashew nuts. Despite the primary sector being an important employer, the secondary sector generates the most income (nearly 43%). Vietnam has become an important offshoring location because of its cheap labour and growing market.

FDI: Foreign direct investment is money spent in a country by a foreign company or country. Countries try and attract FDI by setting up enterprise zones, low tax rates, relaxed planning, etc.

Economic leakage: Money that is generated in a country, but then leaves the country. This normally happens when there are a large number of TNCs, removing money and sending it back to their home country.

Infrastructure: A country's or business's basic underlying structure and...
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