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The role of tourism in the economic development of LEDC's
Poverty and tourism in Siem Reap, Cambodia
Background
Tourism is the world's fastest growing industry and is estimated to provide one in every ten jobs. The World Tourist Organisation estimates that international tourist arrivals increased from 25.3 million in 1950 to 610 million in 1997.
Causes of poverty in Cambodia
Cambodia is one of the poorest countries in the world.
•· GNP per capita of $270.
•· According to the UN's HDI, the country ranks 121 out of 168 in terms of living conditions.
•· One in ten children dies before the age of five.
•· Life expectancy is low. For males it is 53.6 years, whilst for females it is 58.6 years.
For many years Cambodia was a protectorate and colony of France. As a result, many of its resources went overseas. The country gained independence in 1953 but suffered from corruption and inefficiency in its political system. There was a bitter civil war in the 1970's. Pol Pot's Khmer Rouge seized control in 1975. The heralded the start of a period of torture and mass-murder. Development was halted, money was abolished, aid was cancelled and intellectuals including teachers and doctors were killed. Vietnamese forces invaded in 1979, but the fighting continued. Peace has now come to Cambodia. However, the country has been devastated and millions of land mines are still scattered about the country.
Tourism as a development strategy
In 2000:
•· Tourism brought in $200 million in Cambodia
•· Tourism contributed 4% to the country's GDP
•· 100,000 jobs have been created. This figure may be higher as many tourism jobs are in the informal sector
Like many LEDC's the government hopes that tourism will bring economic benefits through the multiplier effect creating formal and informal jobs in construction, hotels, catering, guiding and transport, bringing in much needed foreign currency. The theory is that as the economy improves, the benefits will trickle down to the poorer regions. Consequently, social conditions will improve.
Are the economic benefits distributed evenly?
Major development occurs in tourist hotspots, while rural areas remain undeveloped. In Siem Reap, the government has invested in the infrastructure. However, on the outskirts the roads are unpaved. There is a striking transition from subsistence farming on the outskirts to modern restaurants and hotels in Siem Reap. The hotels in the town do employ a large number of local staff. However, the majority of the hotels are foreign-owned. Consequently, the profits flow overseas. The World Bank estimates that 55% of revenue made through tourism in LEDC's leaves the country. But, 45% does remain.
Unreliable income
Reliance on western tourists for the economic well-being of a country is risky. International events can impact on visitor numbers. Tourist numbers have been affected by the 11th September terrorist attack, the war in Iraq and the outbreak of the SARS virus. Another disadvantage is that in the rainy season visitor numbers fall due to the risk of contracting Mosquito-related diseases.
D.Drake 2009
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