Tourism's Role in the Global Economy

Few things drive me crazier when marking student papers than coming across quoted and cited claims that tourism is the world’s largest industry. Tourism is certainly a huge and important economic activity. But tourism is not the world’s largest industry. As a diverse service activity, the challenges of defining and measuring the tourism economy are so daunting that we will likely never know the true size of the global tourism economy. However, we can get part of the way there by examining international trade data from the World Trade Organization (WTO, not to be confused with the UN World Tourism Organization, or UNWTO). This looks only at international travel receipts. The World Travel and Tourism Council (WTTC) estimate total world tourism receipts at about twice what I get from the WTO data, indicating that domestic tourism receipts are about equal to international receipts. Their data are based on Tourism Satellite Accounting (SAT), a methodology that varies enormously from one country to the next and is highly unreliable for comparative purposes (more on that in the next issue of the Tourism Geographies Discussion Forum.) So maybe the domestic tourism economy is the same size as international tourism around the world. I would guess, though, that it is smaller in Europe where international travel is so easy to do, and many times larger in China where domestic tourists outnumber international tourists by 20 to 1. In addition, in many countries, domestic tourists spend much less than international tourists and make shorter trips, which further complicates this situation. Looking solely at the WTO’s international trade numbers, the tourism economy, it probably ranks about fifth or sixth in international trade, after trade in fossil fuels, telecommunications and computer equipment, automotive products, and agriculture. It is just slightly smaller than agriculture, though given the fuzziness of all numbers of this type, tourism at best might be fifth, just ahead of agriculture. Tourism is the