ECONOMIC ASPECTS OF TOURISM

Economic aspects of tourism

Abstract

Some warzone countries have tremendous potential for tourism. Afghanistan is one of such warzone country that posses immense travel potential. The supply and demand issues can be analyzed in the light of various economic ideas.

Economic Aspects of Tourism

Introduction

According to The World Tourism Organization (WTO), tourism is referred to the activities of an individual who is travelling or staying in places which are outside to their environment for business, leisure or other reasons, for the time span of not more than a consecutive year (South Asia Economic Journal, 2009, pp. 187-207). War zones have enormous tourism potential provided customers can be persuaded to travel there. Warzones like Afghanistan, Pakistan, and Palestine etc. have immense potential to attract tourists and restore their economy.

Discussion

Afghanistan with tourism potential

After the Russian attack, in 1979 and the troops sent by president Obama in 2001, Afghanistan turned into a warzone, and its tourism industry suffered because of the Taliban terrorist regime there. Immediately after President Obama's plan to withdraw the troops and killing of the Taliban leader, Osama bin laden in 2011, there is foresight of restoring its tourism as it has the potential to attract the tourists (Baran, 2001).

Recently, a Canadian tour operation company called Bestway Tours and Safaris laid out plans to bring tourists into Afghanistan (Baran, 2001). With tourism, however, several economic issues of supply and demand emanate. Therefore, we will assess and evaluate these issues and consider the importance of its potentials in the light of economic ideas to solve these issues.

The economic impacts generated by tourism includes generation of foreign exchange, job opportunities, greater tax revenues, regional development, building infra-structure, increased trade and income regulation, and multiplier effect. In order to build tourism and ensure supply, demands must be met, in the light of economic ideas. This includes,

Income Elasticity in Afghanistan

Leisure tourism should be price and income flexible (Cooper et al, 1993), and should address the economic conditions in both Afghanistan and traveller-generating countries (e.g. USA & Japan). The increase or decrease in prices in host tourist country i.e. Afghanistan would have a direct impact in encouraging and attracting. The prices in Afghanistan are very cheap and affordable for tourists from USA etc as around $8 /hr for boating in Grand Canyon Sea in Afghanistan. The amount of money the visitors would spend on boarding, lodging, food and other services would contribute in the financial economy of Afghanistan. Therefore, in turn it creates new supplies for consumer demands.

Foreign Exchange

Tourists from Foreign countries covert their foreign currency and spends for different services for their needs. This, in turn, helps the host country i.e. Afghanistan to acquire more foreign currency to and invest in different social and economic areas. One American dollar is equivalent 50 afghan currency. Annually, millions of Afghanis could be generated (http://www.eturbonews.com).

Measuring Economic Impacts

Measuring the economic impacts of tourism is relatively complicated than direct, Indirect and Induced Multiplier ...