Travel and Tourism

Q.1  Way In Which Economic Policy Can Positively Affect the Country's Travel and Tourism Sector

Travel and tourism business has generated a large number of jobs for the global economy. The growth of the travel and tourism business is fast besides the challenges that are being faced by the sector. This industry is continuously outperforming in the global environment. There is a positive impact of economic policy on the travel and tourism sector of the country that is in terms of increasing the number of people who can work in this sector. Further, the living standard of people residing can also be increased to a significant level (Chen and Choi, 2008). The economic policies deal with taxation policies that assist in the regulation of the flow of funds as well as in the purchasing power of individuals. However, such policies have a direct and indirect impact on the tourism sector. The taxation policy helps domestic industry in the development of sources of funds. Therefore, it acts as an aid in developing the country as well as its services. Airport taxes support in the creation of a high impact on the funding of domestic services. This acts as an aid for the country in the management of funds for the development of airport services. It highly affects the travel and tourism sector. Along with that, service tax on hospitality and food services results in the creation of an indirect source of funds for the nation. Thus, it creates a favorable impact on the development of income within the country. For instance, if the government of a nation has allocated larger funds for the development of travel and tourism due to enhanced economic conditions then it shows a positive influence on the travel and tourism sector. Apart from this, economic policy involves full employment, and through the presence of policies associated with the same the entire sector can hire a skilled and knowledgeable workforce. Through this entire sector can easily carry out major operations. For example in case if policy regarding price stability has been introduced with the motive to control situations such as inflation or deflation. So, travel and tourism companies have to control prices through which they are able to manage overall performance in the market.

Q 2. Implications of Political Changes On the Travel and Tourism Sector In Each Country

The implication of political changes in the travel and tourism sector of Tibet and Cuba is explained in:

Tibet: Political changes result in the reformation of policies and procedures in the economy. The government of Tibet has altered the policies relating to travel and tourism at present. This has developed higher prospects for the growth of the nation. The policy of liberalization has assisted Tibet in the creation of suitable development aspects in the nation. The country possesses higher cultural and heritage value which is the main source of earnings for the tourism sector that ultimately contributes to the economy of the nation. Therefore, it has assisted the nation in development and reforming as a whole. China has developed its tourism sector in a manner that it has become the major source of income. Changes within policy have assisted in the domestic development of industry. The source of income, disposable income, as well as employment rate, are offering assistance to the nation. The Tibet travel permit situation changes on a continuous basis which relies on the political situation in Tibet. Further, many regulations have been developed by the government such as the new travel regulations which are implemented on tourist vehicles which is so-called Tibet Transportation Co-Op backed by the communist government. Further, group travel in Tibet is not required where solo travelers are allowed to travel to Tibet.

Cuba: In the present era, protests against the political parties have resulted in creating a huge amount of loss for the tourism funds. Political instability in the country leads to a decrease in the number of tourists. The major reason behind such is the political unrest that exerts pressure on people to think several times prior to visiting a specific destination. This affects the travel and tourism sector of a nation that is Cuba. Along with this, it also reduces the amount of profitability that is earned by the particular industry. The policy of engagement contemplates political change within the nation. Further, the overall changing policy of the US has propelled Cuba into a growth industry. Apart from this, the laws that are associated with tourism involve no sailing on tourist boards, no public demonstration allowed, and lack of investment opportunities in small and medium-sized enterprises.

1. Tourism Demand

From a geographic perspective, tourism demand can be defined as the total number of individuals who are willing to travel or are traveling and making use of facilities and services of the destination which implies the place that is away from the local area where they work or live.

2. Identification Of Factors that Affect Tourism Demand

There is the presence of several factors that affect the demand for the travel and tourism industry. These have been enumerated in the manner stated as under:

• Technology: It is the most significant factor for tourism businesses to possess technological advancements which they are required to update at regular intervals of time (Korstanje and George, 2012). For instance, if the tourism business in the UK makes use of more advanced technology for the maintenance of effective communication then it results in increasing awareness among a number of people with respect to the facilities offered by the tourism sector in the UK.
• Political stability: It is viewed that several tourists are affected by the political stability that is maintained within the country (Bunja, 2003). A large number of tourists is attracted to a nation where the political environment is healthy and stable. In a situation where political parties are not stable then it can create disturbance in the economy and would not be beneficial for travelers and tourists. For instance in case if political laws in Cuba and Tibet are stable which allow travelers to access tourism services on a continuous basis then in such case overall demand for services will increase and this in turn can act as a development tool for the destinations.
• Disposable income: This can be referred to as the income that is left with an individual after making all expenses and paying taxes on several commodities. There is a high impact of disposable income on the demand of the travel and tourism sector. For instance, if people living in society have high disposable income then in such case they will prefer to visit different places such as Cuba etc on a continuous basis. In short, high purchasing power can allow to access tourism services on a continuous basis and this can be beneficial for countries that are mainly tourist destinations.

3. Detailed Explanation Of Two Factors Influencing the Tourism Demand

The two factors that would be explained in detail have been enumerated in the manner stated as under:

Disposable income: Disposable income plays a crucial role in affecting the demand for the tourism sector as people travel for the purpose of vacation and to spend leisure time only when they have a good amount of disposable income in their hands. In case if the disposable income is high then individuals intend to make a greater amount of investment in the travel and tourism sector (Bernick and Boo, 2013). In contrast to this, if in case the disposable income is lower then there will be an adverse impact on the travel and tourism sector.

Technology: Technological advancement has changed the manner of looking at the travel and tourism sector (Lashley, 2007). Organizations that are operating in the tourism industry make effective utilization of several portals as well as online websites in order to increase their demand in the market to a significant level.

Conclusion

It can be concluded from the study that the role of the travel and tourism sector is increasing significantly. Factors like technological advancement and disposable income prove to be highly influential for the demand in this industry. There is the presence of several political changes within nations like Tibet and Cuba which is having a huge impact on the travel and tourism sector.

References

• Bernick, N. L. and Boo, S., 2013. Festival tourism and the entertainment age: interdisciplinary thought on an international travel phenomenon. International Journal of Culture, Tourism and Hospitality Research. 7(2). pp.169 - 174.
• Bunja, D., 2003. Modernizing the Croatian tourism industry. International Journal of Contemporary Hospitality Management. 15(2). pp.126-128.
• Chen, J. P. and Choi, Y., 2008. Generational differences in work values: a study of hospitality management. International Journal of Contemporary Hospitality Management. 20 (6). pp. 595-615.
• Korstanje, M. and George, B., 2012. Sustainable tourism and global warming: panacea, excuse, or just an accidental connection? Worldwide Hospitality and Tourism Themes. 4(4). pp.383 -394.
• Lashley, C., 2007. Discovering hospitality: observations from recent research. International Journal of Culture. Tourism and Hospitality Research. 1(3). pp.214 - 226.

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