The Impact of Tourism on Economy of Singapore

Topics: Tourism, Singapore, Singapore dollar Pages: 5 (1500 words) Published: August 17, 2014
The Impact of Tourism on Economy of Singapore
Introduction
Located in the southern tip of Malay Peninsula, Singapore is a sovereign city-state and island country in Southeast Asia. By 2012, the population of the country was 5.3 million, composed by 62 percent citizens and 38 percent permanent residents or foreigners. As a small country with limited resources, it is strategized to develop itself as a trading-based and tourism-based country. In 2013, there were 15.6 million tourists visited the country, and the tourism revenue reached 23.5 billion SGD (18.8 billion USD). Tourism plays an important role by contributing significantly to the country’s GDP. In addition, it is also able to positively contribute to create job opportunities in Singapore. The report is to discuss how tourism impact Singapore’s economy and as well what policies Singapore government should carry out to stimulate tourism industry or its relevant industry to sustain its economy growth. Impacts of Tourism on Economy of Singapore

Unlike other tourism countries in Southeast Asia, Singapore’s tourism-based strategy is built upon man-made resources. The representative of Singapore includes Orchard road, which is a shopping center in downtown area. Other tourist places include Sentosa, which is a man-made island resort and night safari which allows tourists to observe animals and habitants at night without any barriers. Gambling is another important tourism destination in Singapore. As a main stimulator of economic growth in Singapore, tourism is closely associated with its economic sectors, including transportation, construction, retail trade, entertainment, and hotels and restaurants. The expense of tourists in Singapore has sustained its economic growth directly or indirectly. According to the statistics from Travel and Tourism Economy Bureau of Singapore, travel and tourism contributed 18 billion Singapore dollars (13 billion US dollars), which is 7.3% of Gross Domestic Product (GDP) in 2009 (Chang and Yeoh, 2009). But as travel and tourism are associated with various sectors of the economy, its real impact is even larger. However, the figure is expected to grow 0.9% annually over the next ten years. From macroeconomic perspective, tourism has significant impact on Singaporean economy. Tourism is closely link with service industry, which accounts 66% of GDP in Singapore. As well, tourism will stimulate the output in sectors which is directly or in directly associated with tourism industry. To evaluate the impact of tourism on economy, GDP is the most important and visualized indicator. GDP is defined as monetary value of all the finished goods and services produced within a country’s borders in a specific time period, usually on annual basis (Chang and Yeoh, 2009). Normally the GDP is composed of all private and public consumption, government outlays, investments and exports less imports. In 2013, the direct contribution of travel and tourism to GDP was 19.1 billion SGD (15.3 billion USD), which accounts 5.3 percent of Singapore’s GDP. And the figures are predicted to increase to 20.3 billion SGD (16.2 billion USD) and account 5.8 percent of Singapore’s GDP (Khan et al., 2013). The figure is primarily associated with tourists’ expense on accommodations, travel agents, airlines and other transportation services, restaurants and entertainment industries which receives direct support from tourists. Employment is another one of the most important indicators to measure the impact of tourism. Many Job opportunities are created by tourism in direct and indirect ways. In 2006, 140 million jobs were created by tourism economy in Asia and Pacific region, accounting 8.9% of total employment. It was reported by the International Labor Organization that a large population of female employees are engaged in hospitality industry. In 2010, the ratio of females to males engaging in hotels and restaurants was 48.5:51.5, comparing with 39:61 gender ratios for the...
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