The economic advantages and disadvantages of tourism in LEDC's

Created by: Thegirlwhoknewtoomuch - Team GR
Created on: 16-02-13 14:54


	The economic advantages and disadvantages of tourism in LEDC's
	Advantages tourism benefits other sectors of the economy- the multiplier effect tourism plays an important role in the balence of payments between nations tourism can provide employment in rural areas and decrease rural to urban migration and the associated impacts on a urban area tourism provides governments with considerable tax revenues tourism development can act as a growth pole which stimulates the economy of the larger area it can provide oppertuinity for small businesses it can support many jobs in the informal sector	Disadvantages economic leakage- 60-70% of the money paid for package holiday stays in the developed country money is borrowed for capital investment- this increases national debt tourism is labour intensive providing lots of jobs but many of these are low paid, menial tasks and these are seasonal positions. management positions are often filled by people from MEDC's a location can become over dependent on tourism which can lead to problems if visitor numbers fall asa a result of external shock tourism might not be the best use of local resources all inclusive deals do not encorage tourists to spend money in local communities international trade agreements e.g. general agreement on trade in services (GATS) allow global companies to set up in most countires- even if the host government would rather support local investors, they cannot prevent this.
	Evaluation Tourism can create many economic oppertunites and bring much needed employment and money into poorer areas, however most of this money is controlled by international companies in MEDC's meaning the full benefits do not often reach those living in LEDC's

The economic advantages and disadvantages of tourism in LEDC's

Advantages

tourism benefits other sectors of the economy- the multiplier effect
tourism plays an important role in the balence of payments between nations
tourism can provide employment in rural areas and decrease rural to urban migration and the associated impacts on a urban area
tourism provides governments with considerable tax revenues
tourism development can act as a growth pole which stimulates the economy of the larger area
it can provide oppertuinity for small businesses
it can support many jobs in the informal sector

Disadvantages

economic leakage- 60-70% of the money paid for package holiday stays in the developed country
money is borrowed for capital investment- this increases national debt
tourism is labour intensive providing lots of jobs but many of these are low paid, menial tasks and these are seasonal positions. management positions are often filled by people from MEDC's
a location can become over dependent on tourism which can lead to problems if visitor numbers fall asa a result of external shock
tourism might not be the best use of local resources
all inclusive deals do not encorage tourists to spend money in local communities
international trade agreements e.g. general agreement on trade in services (GATS) allow global companies to set up in most countires- even if the host government would rather support local investors, they cannot prevent this.

Evaluation

Tourism can create many economic oppertunites and bring much needed employment and money into poorer areas, however most of this money is controlled by international companies in MEDC's meaning the full benefits do not often reach those living in LEDC's

Comments

Mr A Gibson

Report Wed 1st January, 2014 @ 20:40

This definitely covers the main points of tourism in LEDCs. You will need some case studies obviously, but the theory is all here.

Emily Ether

Report Wed 29th June, 2022 @ 10:41

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The economic advantages and disadvantages of tourism in LEDC's