Chapter 3: Different Sectors of the Travel and Tourism Industry PDF

# Chapter 3: Different Sectors of the Travel and Tourism Industry ## The Third Chapter: The different sectors of the Travel and Tourism industry ### 1- Residence For an ordinary person, the essence of a good vacation away from home is made up of three main elements: satisfactory accommodation, se...

# Chapter 3: Different Sectors of the Travel and Tourism Industry ## The Third Chapter: The different sectors of the Travel and Tourism industry ### 1- Residence For an ordinary person, the essence of a good vacation away from home is made up of three main elements: satisfactory accommodation, secure transportation, and suitable entertainment. However, for those involved in the tourism industry, a good vacation or a good trip also includes professional intermediary services, and providing and delivering services related to travel. Accommodation is the temporary home for travelers. It ranges from simple sleeping places to luxury suites for dining, entertainment, and sleeping. Travelers can stay overnight in any type of accommodation from an African treehouse to a castle in Europe. The accommodation industry consists of hotels, motels (motor hotels), resort hotels, campsites, hostels, and guesthouses. Hotels are classified in different ways, and the location is one of the most common ways, such as: Downtown resort, airport, suburbs, or highway. ### 2- Transportation How can a traveler reach their destination? The actual movement of passengers is usually classified as air transport, water transport, roadways, and railways. Transport is one of the most important factors that contributed to the international development of tourism, providing the basic link between the tourist origin and the tourist destination. It also facilitates the movement of travelers, whether for leisure or business. #### 2-1- Air transport First-class passengers enjoy the privacy of their own cabin area with seats that can be converted into flat beds. A lot of good food and entertainment are provided on board the aircraft, in addition to a personal video screen. First-class passengers benefit from the first-class passenger lounge service. Business class passengers have comfortable, spacious seats with plenty of legroom. They can also enjoy good food, free drinks, and free newspapers. Although economy class passengers have narrower seats, they get suitable services and meals. Generally, most airlines offer different classes on board the aircraft, from first class, business class, and economy. Currently, some airlines offer "premium economy class." This class provides better individual service (e.g., more comfortable seats) to passengers at a lower price compared to business class. Flights can be categorized into the following: - Scheduled flights These are flights that operate regularly according to published timetables and prices. - Non-scheduled flights These are also known as chartered flights. - They do not operate on a specific schedule and do not have a pre-set fare structure. - "Charter" flights can go anywhere and anytime not covered by scheduled service, often complementing traditional service during peak seasons. #### 2-2- Sea transport - Via water Sea transport, or transport by sea, is divided into two main sections: transport by cruise ships of various sizes with their different services, and transport by ferries - Cruise ships What is a cruise? A cruise is a holiday trip made by ship. Passengers are given the opportunity to relax in a comfortable atmosphere with excellent service and good food, with changes in scenery from time to time. - Despite the potential positive effect of cruise tourism on the local economy, there is a danger facing the local tourism sector, which is that cruise tourism could replace other forms of tourism as hotels and tours become overcrowded with cruise passengers, reducing the accommodation capacity available to other tourists. - Cruise ships are essentially self-sufficient destinations: passengers live, dine, are entertained, and travel. Tourists choose cruises for enjoyment, not just for transportation, as most cruises start and end at the same port. - Ferry services Ferry service is a short sea voyage between ports. Both local passengers and tourists use this mode of transport. For example, there is a high demand for ferry services between Hong Kong and Macau, with three companies providing scheduled services throughout the year. #### 2-3- Land transport (by road) Land travel is the most flexible and economical form of mass transit. Modern highway networks have made it easier to reach major cities. - Bus services (examples) - Local services - Operating in Latakia - Regional - Between Damascus and Aleppo - International services - Services between Canada and the US in North America - Tour buses - Shuttle buses for transportation to and from the airport - Car services Passengers choose their destination, route, and travel time more freely, whether using private rental cars, taxis, or their own vehicles. - Business travelers and vacationers prefer car rental services for different reasons: - Business travelers are looking for a suitable and reliable mode of transportation to get from point (A) to point (B) with minimal fuss. - Vacationers are looking for convenient ways to travel to places they intend to visit and where public transport does not reach easily. #### 4-2- Rail transport Despite the decline in the importance of rail travel and its giving way to private cars and air travel, it has revived lately, as many services have been designed specifically for tourism, both domestically and internationally. Some examples are "Orient Express" in Europe and "Indian-Pacific" across Australia. Also, the "Trans-Siberian Railway" and the "Bullet Train" in Japan. ### 3- Intermediaries Intermediaries work as a link between the client and the supplier. In the travel sector, the suppliers consist of airlines, cruise and ferry companies, bus and rail companies, hotels and motels, car rental agencies, etc... While the customers are holidaymakers, business travelers, and those visiting friends and relatives, and others. Theoretically, distribution in tourism is similar to what happens in other industries, involving the participation of wholesalers, retailers, intermediaries, and intermediaries in transferring or providing the service from the producer to the consumer, but practically, the distribution process for tourism services differs from other types of goods for two reasons: - The first reason is that tourism services are different from agricultural and industrial products. While the latter are shipped to the consumer or to the market, in tourism, the consumer is transported to the location of the tourist product. - the second is that unlike physical goods, which are mostly storable, tourism service is lost if not consumed directly, as it cannot be stored. #### 1-3- Definition of a travel agency The World Tourism Organization (UNWTO), affiliated with the United Nations, defines a travel agency as "a service organization that provides information about the cost and terms of travel, accommodation, and related services. Travel agencies contact suppliers or wholesalers for travel and accommodation for tourists, before travel requests are made, through organizing transport, booking various types of accommodation, and arranging all other services." #### 2-3- Systems for distributing tourist products There are two types of sales distribution systems for tourist products: direct sales and indirect sales, each with its own characteristics and structure. - Direct distribution system: This system is simply through contact between the seller and the consumer without any intermediary, that is, the traveler books for themselves in an airline, hotel, and other tourist facilities. This method is characterized by saving time for the buyer and increasing the profits of the seller, who represents the airline or hotel ... etc.), because there are no commissions to pay to intermediaries. - Indirect distribution system: Sales are made through an intermediary. Typically, a wholesaler will book a large number of rooms in travel locations for their tour packages. This type is characterized by the fact that intermediaries usually offer lower prices than those offered directly to the consumer. This is natural, given that intermediaries buy in bulk. Also, competition between travel agencies and companies offering tour packages makes each of them seek to offer the best product at a price that ultimately benefits consumers. #### 3-3- Types of intermediaries in tourism Intermediaries in tourism can be divided into several types, their functions may overlap, but the size of their businesses is different. Here is a common classification of intermediaries in tourism: - **Wholesalers:** - Wholesalers purchase large quantities of products at relatively low prices from tourism service providers such as airlines, hotels, and attractions and then sell them to tourism retailers who, in turn, sell them to the retail market. They usually do not sell travel products directly to the general public. However, some strong travel agencies also create retail sales departments to sell these products directly to customers. There are also some wholesalers who are run by a number of airlines and hotel chains so that they can promote travel packages that include the airlines and hotels they deal with. - **Retailers:** - Retailers order large quantities of various types of travel products from a supplier of tourism services or wholesalers such as airlines and request hotel products and tourist attractions, then they plan and gather individual products and add some special services of the retailer such as guide services, etc., to organize them into a travel package sold to customers. - **Inbound tour operators:** - Inbound tour operators are usually local, specialized in catering to individual tourists and groups when they arrive in a local destination. The operators provide services such as transportation, accommodation, and tickets to attractions. Typically, this type of intermediary will organize, on a regular basis, groups to bring people from Syria (for example) to all over the world, and these trips will be accompanied by a group leader or a tour guide from the start. - **Outbound tour operators:** - This type of travel agency mainly serves business clients or corporate clients. These clients often travel for business meetings or exchanges, or to discuss business matters, etc. The travel pattern of these clients usually includes a lot of flying and typically requires deferred bookings and short stays. - **Tour operators:** - These companies offer travel products such as visits to attractions, entertainment to customers, and also provide services such as tour guides and transportation (sightseeing tour) and food. ### 4- Services connected to travel Services connected to travel can be classified into the following six groups: - Travel insurance - Foreign currency exchange - Credit cards - Retail shops and restaurants - Printed and electronic travel publications - Internet solution companies #### 1-4- Travel insurance: Buying travel insurance is an important aspect of maintaining "peace of mind" while traveling, especially when using "special" tickets, which are mostly non-refundable. This is because insured passengers may receive partial compensation if they are unable to board the aircraft for various reasons. We are referring to personal insurance, but in other situations, it is recommended to include motor vehicle insurance. Why is it important to buy travel insurance? Because travel insurance covers the following: - Medical expenses and hospitalization expenses - Personal accident involving loss of life or limbs - Loss of luggage (including a small amount of cash) - Delay of luggage for more than 12 hours past the scheduled arrival time (reimbursement of the cost of purchasing essential personal hygiene items, such as a toothbrush, underwear, essential medications, etc.) - Cancellation fees in case of illness, injury or death. These include non-refundable deposits and trip costs - Some cash - Personal liability #### 2-4 - Foreign currency exchange: Many travel expenses can now be paid for with credit cards, so it seems that exchanging foreign currency is no longer important. However, when it comes to shopping, catching a taxi, or making a phone call, travelers need local currency (and some coins - tips). You can get local currency from banks (in some countries), post offices, major international hotels, and some exchange booths in busy business centers, airports, train stations, and ports. #### 3-4 - Credit cards: Credit cards are an important part of a cashless payment system for travel. They offer simplicity, speed, and safety, and security, and comfort for travelers. #### 4-4 - Retail shops and restaurants: Retail shops and restaurants are essential areas in the tourism industry anywhere in the world, as shopping is one of the favorite tourist attractions in Dubai, for example. Tourists in Dubai can also enjoy food from many countries with a variety of prices that can suit different tastes and budgets. #### 5-4- Travel publications (printed and electronic): Travel publications are one of the growing industries related to travel in this day and age. Tourists can get a wide range of travel information from different forms of publications. #### 6-4- Internet solution companies: E-commerce through the internet provides an opportunity for customers to have direct access to major service providers such as airlines, hotels, car rental companies, or to distribution channels such as travel agencies. In addition to presenting basic product features, potential customers can enjoy a variety of services such as information displays, bookings, tickets, accommodation, and entertainment. # Chapter 4: The Role of Government and International Organizations in Tourism ## The Fourth Chapter: The role of government and international organizations in tourism ### 1- The Role of Government #### 1-1- The main roles of the government in the development of travel and tourism - Planning and facilitating tourism - Supervision and monitoring of tourism - Direct ownership of components of the tourism industry - Tourism promotion in domestic and foreign markets - **Planning and facilitating tourism:** - Governments set policies and plans for development. This includes creating guidelines and objectives for the growth and administration of tourism in the short and long term, and setting strategies to achieve these goals. - Tourism planning requires scientific research to determine the level of demand or potential demand in the region, and to estimate the resources needed to meet this demand and how to best distribute these resources. Planning requires providing training through hotels, restaurants, and tourism schools to achieve the skills needed for the industry. - The planning and facilitation tasks undertaken by the government can be delegated to the National Tourism Office in the country. - **Supervision and monitoring of tourism:** - The government plays a key role in monitoring and supervising tourism. This is necessary to prevent unwanted tourism growth, maintain quality standards, help balance supply and demand, and protect tourists from malpractice. - Granting permission (or refusal) in planning - refusing or granting planning permission is a clear example of government control over tourism development. - **Direct ownership of components of the tourism industry:** - Some governments own parks, airlines, airports, museums, historical sites, streets, high-speed railways, buses, ferries, metro lines, hotels and resorts, swimming pools, golf courses, even liquor stores, all to facilitate the development of the tourism industry. - **Tourism promotion in domestic and foreign markets:** - The government produces and distributes maps, brochures, and tourism publications. It also operates information centers, advertises, and organizes promotional sales and public relations activities targeting both domestic and foreign markets. - The government tries to increase tourism growth through effective marketing, focusing its publicity on locations or geographical areas that are less popular, and do more promotional work outside tourist seasons. #### 1-2- The main roles of the government in the development of travel and tourism - **Active participation:**  - Facilitate investments - Operational support - Research and planning - **Planning and facilitating tourism:** - Governments set policies and plans for development. This includes creating guidelines and objectives for the growth and administration of tourism in the short and long term, and setting strategies to achieve these goals. - Tourism planning requires scientific research to determine the level of demand or potential demand in the region, and to estimate the resources needed to meet this demand and how to best distribute these resources. Planning requires providing training through hotels, restaurants tourism schools to achieve the skills needed for the industry. - The planning and facilitation tasks undertaken by the government can be delegated to the National Tourism Office in the country. - **Supervision and monitoring of tourism:** - The government plays a key role in monitoring and supervising tourism. This is necessary to prevent unwanted tourism growth, maintain quality standards, help balance supply and demand, and protect tourists from malpractice. - Granting permission (or refusal) in planning - refusing or granting planning permission is a clear example of government control over tourism development. - **Direct ownership of components of the tourism industry:** - Some governments own parks, airlines, airports, museums, historical sites, streets, high-speed railways, buses, ferries, metro lines, hotels and resorts, swimming pools, golf courses, even liquor stores, all to facilitate the development of the tourism industry. - **Tourism promotion in domestic and foreign markets:** - The government produces and distributes maps, brochures, and tourism publications. It also operates information centers, advertises, and organizes promotional sales and public relations activities targeting both domestic and foreign markets. - The government tries to increase tourism growth through effective marketing, focusing its publicity on locations or geographical areas that are less popular, and do more promotional work outside tourist seasons. - **Active participation:**  - Facilitate investments - Operational support - Research and planning #### 1-3- Active participation - Government support for foreign investment - Providing land by the government at a lower than the market value - Low interest rates - **Operational support** - Increase operational efficiency. For example, provide or finance vocational training, or allow foreign qualified workers to be employed - Provide visa arrangements for tourists entering the country - Negotiate with tourist-generating countries regarding air traffic rights and air routes #### 1-4- Research and planning - Conducting research to find the most suitable locations and best ways to develop tourism. - Planning for good infrastructure to meet the needs of tourism development. - Assessing resources (tourist attractions, facilities, and available labor) in the country to support further tourism development ### 2 - Travel Procedures: The world is divided into several countries, and since travelers have different nationalities, some official procedures are required for international travel. - **Passport**:  - **Entry visa (visa)** - **Health requirements** - **Customs and taxes/fees** - **Public security** #### **2-1- Passport:** The passport is the most important travel document and the official document that can clearly identify the nationality of the tourist.. Passports are issued by sovereign governments, identifying the nationality of the holder and some basic personal information, such as date of birth, gender, correspondence, contact in the event of an emergency, and a picture of the passport holder is placed on the front page with an official stamp to confirm the validity of the document. The date of issue and the validity period of the passport are also specified. Every passport contains blank pages, allowing embassies of other governments to attach or stamp visas, as well as allowing border officials in host countries to stamp their dates of entry and exit. For national security reasons, all passports have been designed and implemented carefully to prevent counterfeiting. Advanced printing technologies, such as laser markings, have been implemented to achieve this with great success. Types of Passports: - **Joint passport:** Some countries allow people to travel together on a joint passport that can include spouses or children or both. No member of the family listed in the joint passport can travel without the main passport holder. The joint passport holder can travel alone without dependents, provided that the other people listed in the passport remain in their country of residence. For example, a mother and her child entered Australia together using a single passport. The mother cannot travel to the UK, leaving the child in Australia, as the child will have no proof of legal entry to Australia and will not be able to leave Australia without the mother. - **Foreign passport:** Some countries issue this type of passport to foreign nationals. A foreigner is considered to be a person living in a country, but not holding the nationality of that country. - **Diplomatic or consular passport:** This is issued to diplomats, consular officials, and other government officials in diplomatic missions, which grants the holder diplomatic or consular status under international law and custom. - **Other passports:** Such as a Nansen passport, which is a temporary document issued by internationally recognized organizations, such as the United Nations and the International Committee of the Red Cross. This temporary identity card is primarily issued to refugees or displaced people who have not been able to obtain a regular passport. - **Official, private, or service passports issued to government officials or others on government missions.** In this case, the issuing entity must specify the purpose of the trip on the passport. #### **2- 2 - Entry visa (visa):** In addition to a passport, an entry visa is the most important document for travel. Tourists from foreign countries that do not have strong political ties with the host country, often need to apply for a visa at the embassy of the host country (or a representative office of the country in their own country before departure. Documents such as a passport, a letter from the employer, a return air ticket, confirmation of hotel reservation or proof of accommodation in the host country are often required. Embassy officials may also request other papers such as bank statements to prove the applicant's financial ability to travel) and travel insurance. The applicant must also submit a personal photo or multiple photos with the application. Every visa has a specified validity period. If a tourist wants to stay in the host country beyond that period, they must apply for an extension, which can be arranged during their stay. Tourists who wish to study abroad instead must get a student visa. In this case, documents from the educational institution concerned will be necessary. #### **2-3- Health Requirements:** Tourists departing from a specific region known to be facing an epidemic are usually required to provide proof of their health status or a vaccination certificate issued by a doctor or a recognized medical institution, aiming to prevent the spread of epidemics. Elderly travelers often need travel health insurance or even a medical certificate stating that they are in good health to obtain a visa. #### **2-4- Customs and taxes/fees:**  Different countries in the world have a list of prohibited items that foreign tourists or even their citizens are not allowed to bring into the country, for reasons related to trade, public health or security.. Narcotics are prohibited in most cases. Tourists who bring firearms or other deadly weapons may face penalties or severe punishments. For example, tourists convicted of drug trafficking in countries such as Thailand may face the death penalty. A limited quantity (in terms of weight or size) of goods subject to taxation, such as tobacco and alcoholic beverages, can typically be brought in. Other items (except for hand luggage), including household appliances, may also be subject to tax. Tourists who wish to travel with their pets often need prior permission and may require a vaccination certificate. The United States, for example, has strict policies regarding the import of agricultural products or even herbs and plants.. Tourists entering materials that are not exempt from customs duties must fill out a designated form and submit it at the point of entry. #### **2-5- Public security:** Public security is one of the main issues for governments around the world, especially security at airports.. Many airports have implemented strict security measures to ensure air travel safety. ### 4- Roles of Major International Organizations #### 1-4- World Tourism Organization (UNWTO) UNWTO is the United Nations agency responsible for promoting responsible, sustainable, and accessible tourism. It is the leading international organization in the field of tourism, promoting tourism as a driver for economic growth, inclusive development, and environmental sustainability, providing leadership and support to the tourism sector, whether in the development of tourism knowledge or in shaping tourism policies worldwide. - It encourages the implementation of the Global Code of Ethics for Tourism to maximize the social and economic contributions of tourism while minimizing its potential negative impacts to the minimum. It is committed to promoting tourism as a tool for achieving sustainable development goals to reduce poverty and promote sustainable development around the world. - Its membership includes 158 countries and 6 Associate Members (as of November 2017), including private sector representatives, educational institutions, tourist associations, and local tourism authorities. #### 2-4- International Air Transport Association (IATA): The International Air Transport Association was founded in 1945 to promote safe, regular, and economical air transport. The members of this association are international airlines. - Its functions include: - Acting as a clearinghouse for airline tickets. - Ensuring standardized pricing, ticketing and baggage handling. - Its main role is to coordinate international commercial aviation activities and reach agreements on international airfares.  #### 3-4- Universal Federation of Travel Agents Associations (UFTAA): The UFTAA’s objectives are: - To act as a negotiating body for various branches of the tourism industry and travel agencies on their behalf.  - Providing professional and technical advice to travel agencies on the realities of the global economy and the realities of tourism - Improving the reputation of travel agents and the general appreciation for them; - Providing training courses for travel agency staff. #### 2-4- World Travel & Tourism Council (WTTC): The World Travel & Tourism Council was founded in April 1990. It forms a global forum for members who are CEOs from all sectors of the industry, including accommodation, food, entertainment, recreation, transport, and other travel-related services. - The World Travel & Tourism Council is led by an executive committee, while daily operations are managed by a small team of permanent staff based in London, Brussels, and Washington, with the Council's goals including: - Working with governments to prioritize economic development and job security. - Moving toward open and competitive markets. - Working toward sustainable development. - Removing barriers to growth and realizing the full economic potential of tourism and its ability to generate jobs. - The Council also conducts extensive research to determine the size of tourism and travel and its contribution to the global, regional, and national economies. #### 4-4- International Civil Aviation Organization (ICAO): The International Civil Aviation Organization was established in 1947, which is an organization composed of governments that have come together to improve civil aviation on a global scale. It (the organization) is a means of ensuring the highest possible level of cooperation in the unification of systems, standards, procedures, and regulations on matters related to civil aviation. - The organization has led civil aviation towards the 21st century to deal more effectively with the ever-evolving challenges facing civil aviation, particularly in the areas of aviation safety and security. Its strategic work plan focuses on eight key objectives to promote the safety and security and efficiency of international civil aviation. # Chapter 5: Economic Impacts of Tourism ## The Fifth Chapter: The economic impacts of tourism ### 1- The Positive impacts Tourism has a number of positive impacts at an economic level. The most important of these impacts are: - **Job creation** - **Generating tax revenues** - **Improving the balance of payments** - **Generating income and the multiplier effect** - **Economic growth and standard of living** #### 1-1- Job creation: Tourism is a labour-intensive industry and relies heavily on people with different levels of skills and abilities (such as porters, tour guides, hotel managers, etc.). In general, the tourism industry has the capacity to provide more job opportunities than any other sector. There are two main types of employment generated by tourism, direct and indirect. - **Direct employment** is employment generated by businesses that directly provide services to tourists. - Examples include:  - Accommodation and food (hotels) - Tourist attractions and commercial facilities (e.g., convention centres and conference halls) - Information provision and tourism promotion (such as travel agencies or tourism boards) - **Indirect employment** refers to the jobs of those people who either: - Provide services to both local residents and tourists, or - Manufacture goods and provide services that are purchased or used by companies and organizations that serve tourists directly. - **Examples:** - Taxi drivers, shopkeepers, factory workers making bedroom furniture for sale to hotels - Sectors that account for the largest share of workers in the tourism industry include: - Food services - Accommodation - Transport - Entertainment - Travel agencies and tour operators #### 2-1- Generating tax revenues: Tourists pay taxes like most people. As they come from other regions or countries, their spending will increase the tax base of the host country. The government gets these taxes from: - **Direct taxes:** - Payroll taxes (on personal income) - Corporate income taxes - **Indirect taxes:** - Sales taxes (on consumer spending) - Excise taxes - Departure taxes and hotel room taxes - Increasing tourism spending will lead to an increase in: - Income for those working in the tourism industry - Profits for business owners - This will ultimately result in an increase in tax revenues for the government. #### 2-2- Improving the balance of payments: The balance of payments is an accounting statement of the flow of goods, services, and capital in and out of a country over a given period (usually a year). If a country pays out or agrees to pay more than it receives, it will have a balance of payments deficit. If it receives more money than it pays out, it will have a balance of payments surplus. Every country wants to achieve a current account surplus rather than a deficit. A flourishing tourism industry (especially inbound tourism) can improve the balance of payments by bringing in a significant amount of foreign currency. Inbound tourism for a country is a non-visible export, bringing in foreign currency by providing services to foreign visitors. Outbound tourism for a country represents non-visible imports, as local residents spend money abroad. However, other countries will not receive all of what foreign tourists spend, as some of their spending may have gone to local tour operators. In conclusion, if inbound tourists (foreigners) spend more than outbound tourists (citizens traveling abroad), the country will have a net surplus that will help improve the balance of payments. #### 4-1-Generating income and the multiplier effect: Income is generated from wages and salaries, interest, rent, and profits.. In a labor-intensive industry such as tourism, a large portion of income comes from wages and salaries earned by people who are directly or indirectly involved in the industry. Moreover, the benefits of tourism can be spread throughout the economy, creating more job opportunities in sectors other than tourism. For example, a hotel receptionist may save part of his income, buy a car or a TV set, thereby creating work for manufacturing and retail industries; when a tourism bus driver takes his family out to eat, this leads to more business for restaurants. - In general, income is greater in areas that attract a large number of tourists with high purchasing power to stay for longer periods. Moreover, tourism’s contribution to the destination’s income is greatly enhanced by the tourism spending multiplier effect. - This happens when the money that tourists spend in a region is spent again by those who received the initial amount of money spent by the tourist. #### 5-1- Economic growth and standard of living: Most developing countries face a shortage of foreign currency, and they are struggling to finance their economic development. The tourism industry plays an important role as a source of foreign currency. This is very important for developing countries with limited export potential for agricultural and manufactured goods. - Tourism contributes significantly to economic diversification. It is linked to other economic sectors such as construction, transportation, food production industries, etc. Tourism can spread its influence throughout the economy and achieve economic growth. - Tourism can also raise the standard of living for local populations. They may get more jobs that pay better than traditional jobs like agriculture and fishing. Local populations may have access to improved facilities and a wider choice of goods and services ### 2- Multiplier analysis: Multiplier analysis is used to estimate the knock-on impact of tourist spending in the economy. It is accepted that initial tourist spending will lead to an increase in demand to meet the needs of tourists, and a significant part of the initial spending will move through the economy to stimulate further indirect spending and re-spending generated by the initial spending. These terms reflect the fact that tourism is a multi-faceted activity. It (tourism) is mainly connected and depends on inputs from various economic sectors, including agriculture, industry, and public services. - The initial amount (primary) of tourist spending will lead to changes in the economy in terms of output, income, employment, and contribution to government revenue. Changes in various categories may be less than or equal to, or greater than, the initial change (addition) in tourist spending. - The (additional) rise in tourist spending is what initiated the economic process. The tourism multipliers refer to the ratio of changes in output, income, employment, and government revenue to the original change in tourist spending. The tourism multiplier can be divided into five main types: - **1- Transaction or sales multiplier:** An increase in tourist spending will lead to higher business revenues. This multiplier measures the ratio between the two changes. - **2- Output multiplier:** This relates to the additional output generated in the economy as a result of an increase in tourist spending. The main difference between it, and the transaction or sales multiplier, is that the output multiplier relates to changes in actual production levels rather than the size and value of sales. - **3- Income multiplier:** It measures the additional income generated in the economy as a result of an increase in. tourist spending. - **4- Government revenue multiplier:** This measures the impact on government revenue as a result of an increase in tourist spending. - **5- Employment multiplier:** This measures the total amount of employment that arises from an additional unit of tourist spending. - To understand the movement of the tourism multiplier and its impact trends, input-output models are created to form a table that represents regional and/or national accounts in a matrix format. Each economic sector is shown in a column representing purchases made from other sectors of the economy and is also shown in a row as a sector that sells to other sectors. The purpose of input-output tables is to show cross-sectoral (cross-sectoral) effects resulting from an increase in demand in the economy. The models can be modified to include a column specifically for the tourism sector. However, input-output tables require a large amount of data and time to structure, and the data may be several years old and may not be relevant to the tourism sector, in particular.