Wttc Turism

Only available on StudyMode
  • Download(s) : 66
  • Published : April 25, 2013
Open Document
Text Preview
Global Travel & Tourism in 2011:
A Year of Challenge
Like all global industries, Travel & Tourism was impacted throughout 2011 by significant social unrest and economic instability in different parts of the world, not to mention a number of major natural disasters affecting specific markets and destinations. Yet, despite these different challenges, the industry overall still recorded positive annual growth in employment and GDP globally, demonstrating its resilience and underlying strength. 2011 saw a series of dramatic and, in some cases, unprecedented global events, including national political revolutions, global economic instability and large-scale natural disasters. These combined to create a very challenging business environment for the different Travel & Tourism industry players. Economic instability

Many economists have said that 2011 was the toughest global macroeconomic environment since the financial crisis and deep recession of 2008-2009. In 2011, the challenging economic environment was due to a combination of factors, including: • Continuing uncertainty over the future of the eurozone, with a series of bailout packages failing to convince the markets that a solution had been found, leading to the eurozone’s slide towards recession by the end of the year; • Weakening global business and investor confidence, a sharp dive in world stock markets and a fall in world trade growth – all linked to adverse eurozone developments. Although many corporates are still ‘cash rich’, uncertainty and low confidence have held back investment and recruitment; • A sluggish initial performance of the US economy – although it began to show more positive signs by the end of the year; • A slowdown in the main emerging economies as world trade growth slowed – even in the BRIC1 countries, on which overall global growth had depended heavily for a number of years; • High levels of public debt and borrowing and increasing government austerity, coupled with rising unemployment and inflation in many developed countries Together, these factors meant that world GDP growth in 2011 was weaker, at 2.8%, than had been forecast at the beginning of the year. Negative GDP growth was even recorded in some countries and regions, including Japan and North Africa, on the back of damaging one-off events. These developments, primarily by reducing real disposable incomes and corporate travel budgets – alongside the impact on international travel – naturally served to reduce demand for Travel & Tourism in these markets and destinations. During 2011, it was clear that leisure demand was again trending towards short-haul and domestic travel at the expense of longer-haul international travel – as had occurred during the downturn in 2009. Nevertheless, business rather than leisure travel was the sector that under-performed more in 2011 relative to expectations at the start of the year Natural disasters 2011 was marked by a number of major natural disasters, inflicting widespread human and financial damage on the countries and regions affected. The devastating earthquake, tsunami and subsequent nuclear accident in Japan’s Tohoku Province not only resulted in the loss of up to 20,000 lives and severe disruption to the lives of survivors, but it also had a significant impact on Japan’s economy and Travel & Tourism sector. Foreign visitors were understandably discouraged from travelling to the country, and the Japanese themselves became more reluctant to travel domestically and abroad, particularly on leisure trips. Japanese Travel & Tourism GDP fell 4% during 2011, with domestic spending down 2.9% and visitor exports down 27% – in line with a 28% decline in international tourist arrivals. This in turn had a knock-on effect on capital investment in Japan’s Travel & Tourism sector, which fell by an estimated 6.2%, despite major reconstruction efforts later in the year. Japan’s Travel & Tourism performance could have been much...
tracking img