As emerging markets develop new attractions and tap into new visitor source markets, they are leveraging technology and sustainable development in line with emissions targets. This strategic refocus comes as tourism numbers surpass pre-Covid-19 pandemic levels. According to the World Travel & Tourism Council (WTTC), travel demand is set to make 2024 a record-breaking year, with the sector projected to contribute approximately $11.1trn to the global economy and underpin nearly 348m jobs.
Support Policies
As international tourism rebounds following the easing of travel restrictions, some governments are pushing reforms to create more equitable tourism sectors. In St Lucia, for example, where tourism accounts for some 65% of GDP, lawmakers have launched the Community Tourism Agency, with a mandate to increase local participation in the sector. Such policies often aim to support micro-, small and medium-sized enterprises (MSMEs) – which make up an estimated 80% of the sector globally, according to the WTTC – while also providing more authentic experiences for visitors.
Tourism is expected to generate an additional 126m employment opportunities worldwide by 2032, with more than 60% of these jobs in the Asia-Pacific region. The lifting of travel restrictions in China and Japan announced at the end of 2022 fuelled an increase in activity in the region. South-east Asia in particular is set to benefit from an uptick in demand from China, which was the world’s largest outbound tourism market in 2019, and many countries are investing in training programmes to increase the availability of workers in the tourism sector.
In Thailand, the Ministry of Labour has rolled out measures to support students working part-time in the hospitality industry and provide tourism-related training for the unemployed, hoping to address a labour shortage as tourism rebounds. The country saw over 28m arrivals in 2023, making it the 11th-most visited country in the world. Prior to the pandemic, tourism activities, both domestic and foreign, accounted for 18% of the country’s GDP.
Africa’s tourism sector, meanwhile, is expected to grow at an average annual rate of 6.5% in the decade from 2023 – more than twice the 3.2% growth rate for the continent recorded that year – creating a projected 18m new jobs in that period, according to WTTC data. Private sector actors in particular are involved in efforts to develop the tourism industry. Purple Elephant Ventures, a Kenya-based venture studio, was founded in 2020 with the goal of building four start-ups per year. During the pandemic the studio launched a software-as-a-service product that allowed hospitality providers to take direct online bookings, and it raised $1m in a pre-seed funding round in late 2022.
Targeting Diversification
Tourism is an important plank in economic diversification efforts in the Middle East, and a number of high-profile projects are seeking to boost arrivals in the region. Even as spending slowed elsewhere, the Middle East became the fastest-growing region in terms of tourism figures, seeing a 26% year-on-year (y-o-y) surge in international arrivals in the first seven months of 2024.
Saudi Arabia has centred its goals for the sector around Vision 2030, with a target to attract 150m domestic and foreign tourists by 2030 and create 1m job opportunities. These objectives are being supported by the simultaneous development of various tourism-focused giga-projects – in January 2023 the Kingdom’s Public Investment Fund designated Diriyah as its fifth giga-project. Encompassing the At-Turaif district, a UNESCO World Heritage site, the project is intended to educate visitors on the history of the country and promote sustainable building practices.
In Egypt, tourism revenue rose 4.7% y-o-y in the first half of 2024 to $6.6bn, with a total of nearly 7.1m arrivals in that same period. The Ministry of Tourism and Antiquities aims to attract 30m tourists by 2028, and the government launched a new strategy for the sector in March 2024. Beyond conventional tourism initiatives, Egypt is pushing the use of metaverse technology to promote the medical tourism segment. According to Ahmed El Sobky, chairman of the General Authority for Health Care, the use of 3D virtual-reality software will allow prospective patients to remotely tour health care centres in governorates such as Luxor and Port Said.
The global rise in medical tourism can be attributed to Western patients seeking more affordable health care options in emerging markets like India, Malaysia, Thailand and Turkey. This demand, in turn, has been propelling investment in medical equipment that utilises the potential of artificial intelligence and robotics. Additionally, wellness tourism is emerging as a prominent trend. The segment was worth $651bn globally as of April 2024, with projections from the Global Wellness Institute indicating an annual growth rate of 16.6% through to 2027 to a value of $1.4trn.
Saudi Arabia’s giga-projects aim to provide a range of wellness tourism offerings alongside eco- and adventure tourism options (see overview). The Kingdom is also employing strategic partnerships with other countries to boost its medical tourism appeal. For example, in August 2023 the government signed a memorandum of understanding with Morocco to foster collaboration on health care outcomes.
Regenerative Tourism Projects
Achieving netzero emissions has become a tourism sector priority. The industry accounted for 6.5% of global emissions in 2023, down from 7.8% in 2019. In January 2023 UN World Tourism and the Development Bank of Latin America announced a strategic partnership to fund tourism projects in Latin America and the Caribbean. The initiative is focused on attracting increased foreign direct investment to support projects seeking to reduce the sector’s greenhouse gas emissions. It aims to focus on firms working at the intersection of technology, climate and tourism.
In addition to mitigating climate change, conservation efforts often align with tourism outcomes, as more emerging markets highlight their diverse natural heritage as part of their offering. In mid-2022 a team of UK scientists made important progress by using machine learning to develop an algorithm capable of using sound to assess the health of coral reefs. The technology has been deployed on a small scale in Indonesia. The country is also home to the Mars Coral Reef Restoration project, which is using hexagonal reef stars to kick-start coral growth across more than 40,000 sq metres of seabed.
Such endeavours represent a significant step forward as countries look for ways to diversify their economies and tap into the potential of the tourism industry. By focusing on the regeneration of local ecosystems and creating competitive tourist destinations, major projects around the world are driving economic growth and generating employment.
Read More from OBG
