Travel economy is expected to total 4.8% of the GDP by 2003

By Our Corporate Bureau | 31 May 2003

New Delhi: World Travel and Tourism Council (WTTC) has released the findings of the third set of Tourism Satellite Accounting Research 2003.

The report, released by Jean-Claude Baumgarten, president, WTTC, highlights the historical results, estimates the current performance of India's travel and tourism, and provides short- and long-term forecasts based on the most recent national and international data sources and econometric models developed by Oxford Econometric Forecasting.

The report findings highlights that in 2003, India's travel and tourism industry is expected to generate 2.0 per cent of the gross domestic product (GDP) and 11,093,100 jobs, while the broader travel and tourism economy is expected to total 4.8 per cent of the GDP and 23,839,800 jobs. Looking ahead, the forecast for travel and tourism demand is expected to total 7.4-per cent real growth in 2003, and 8.8-per cent real growth per annum between 2004 and 2013.

"India is a potential market for the travel and tourism industry. Through the Tourism Satellite Accounting Research 2003 we will bring the travel and tourism industry together to reach higher skies for achieving the best optimum results," says Yogesh Chandra, secretary general, WTTC.

The WTTC research quantifies and documents the travel and tourism economics for India, the first step towards addressing mission-critical issues such as tourism management, tourism marketing and promotion, tourism infrastructure, taxation, aviation policy and much more.

The SARS report
Baumgarten also elaborated on the impact of SARS on travel and tourism in South East and East Asia, particularly China, Hong Kong, Singapore and Vietnam. He mentioned that personal and business travel in these countries had declined by 25 per cent and capital investment by 10 per cent during the SARS epidemic.

Travel and tourism demand had declined by 4.9 per cent in Vietnam, 13.4 per cent in Singapore, 10.4 per cent in Hong Kong and 13.4 per cent in China. The total loss of jobs has been 61,700 in Vietnam, 17,550 in Singapore and 27,340 in Hong Kong. It is feared that China will suffer a loss of 2.8 million industry jobs or 20.0 per cent of the total.

Baumgarten gave the WTTC assessment of a fall in travel and tourism demand of -0.6 per cent because of the SARS epidemic. Globally, the loss of travel and tourism industry jobs will be 2.9 million or 4.3 per cent of the total employment.

The Kerala TSA
WTTC is delighted to have collaborated with the Kerala government to produce the report — the first simulated Tourism Satellite Account (TSA) for an Indian state. Kerala is also one of the first state or provincial governments in the world to quantify the far-reaching contribution of travel and tourism to economic growth and employment thanks to the implementation of this new accounting concept, approved by the United Nations Statistical Commission.

This report estimates the current performance of Kerala's travel and tourism and provides forecasts based on the most recent national and international data fed into econometric models developed by WTTC's research partner, Oxford Economic Forecasting.

It quantifies all aspects of travel and tourism demand, from personal consumption to business purchases, capital investment, government spending and exports. It then translates this information into economic concepts of production, such as gross state product and employment, which can be compared with other industries and the economy as a whole to provide credible statistical information that will assist in policy and business decision processes.

The report highlights that travel and tourism is already one of the highest priority industries and employees for the Kerala government. Demand growth in Kerala is the highest in the world and is projected to increase by 11.4 per cent per annum over the coming decade.

The major policy recommendations in the report are:
1. Establish development authorities for selected destinations.
2. Encourage greater market and product diversification.
3. Promote coastal cruises, luxury houseboats, water sports, ayurveda, Kerala's cuisine and traditional festivals:

• Reconstitute Kerala's policy-making system.
  
• Place high priority on education and training.
  
• Improve airline access.

The report underlined access to Kerala as the single-largest deterrent to travel in the state.

WTTC is the business leaders' forum for travel and tourism, working with governments to raise awareness of the importance of the world's largest generator of wealth and jobs. With the chief executives of more than 100 of the world's leading companies in membership, WTTC has a unique mandate and overview on all matters related to success in travel and tourism.