The problem of forecasting and predicting growth and change

A feature of this article has been the forecasts about tourism’s future. Witt and Song are clear about which methods work, and Frechtling makes some telling points about which factors will influence tourism in the next decade. But most econometric and statistical trend projections are based on the principle of ceteris paribus – all things remaining equal. What if they do not? A feature of the 20th century, especially the second half of the century, was relative stability in many aspects of tourism, but this may not be true for the 21st century.

Global tourism is forecast to grow, but overall growth forecasts hide tremendous differences between regions and countries. According to Teye Africa receives only 4% of all international tourists and only 2% of total international tourism receipts. He shows that many African countries are economically worse off now than they were 40 years ago, still over-reliant on agricultural and/ or mineral production, with tourism presenting both cultural and environmental challenges. He concludes that there have been and still are a myriad of obstacles to tourism development, such as political instability, economic restructuring, human resource constraints, lack of regional co-operation and a lack of basic infrastructure.

An optimistic view of Europe and North America is that at best their tourism industries are stable. In their respective chapters, Cook states that short-term growth in US arrivals will be slow, whilst Cleverdon suggests tourism in Europe is growing at a rate of 3% compared with a global rate of 4%, and its market share is forecast to decline from 59% (1995) to 47% by 2020. On the other hand, South America looks set for a period of sustained tourism growth. Arrivals have been growing at an annual rate of 9% and

receipts at 12%. It has some tremendous advantages, including its relative proximity to lucrative North American markets, historic and language links with Europe, and excellent natural resources (rainforest/ Andes/ beaches).

Asia Pacific also seems to be on an upturn. Chamberlain quotes the WTO as forecasting that this region will ‘grow faster than any other’ and will pass the Americas to become second to Europe in the number of visitor arrivals. This means five times as many visitors in 2020 as in 1998 – admittedly a low year – although there may be some difficulty in accommodating that number of visitors and it might pose strains on the infrastructure in the region. Asia Pacific illustrates perfectly how vulnerable these industries are to unexpected events. The recent financial crisis in this region led to dramatic falls in arrivals, hotel rates and hotel occupancies, not only in the Pacific region but globally. This kind of event makes forecasting tourism performance in some regions almost impossible. No one can predict what might happen in the Middle East, the Indian sub-continent and the Russian Federation. Political instability, economic turbulence and religious differences could all have negative effects on potential tourism development and growth. Overall, there is evidence of extremely rapid growth in some regions, that this growth will continue, and that other regions will begin to attain a greater share of tourism in the years ahead. But there is really no such thing as a ‘fair share’ despite what ministers and NTOs say. Not everywhere needs or can expect to attract large numbers of tourists. Those places that have not grown significantly or do not have major tourism industries generally are in that position for good reasons. Cetron identified some of these reasons – a lack of perceived attractions compared to other areas, relative or absolute inaccessibility, unsuitable climate, political regimes which discourage tourism, problems of security, health and safety, relatively high cost and often a combination of several of these.

What is needed is an examination of which, if any, of these elements are likely to change significantly in the short- to medium-term future, to understand if those regions are likely to see major increases in tourism. Even then, should such a change in situation come about, we need to see whether the region is appropriately equipped to handle such an increase effectively. Rapid percentage growth is rather easy from a low base, but long-term sustained growth is what is important, if indeed it is growth that is desired. If the world is serious about sustainable development and living within the limits of the resources available, then growth, especially rapid growth, may not be the pattern desired or acceptable in all regions. This aspect is rarely tackled in forecasts, where the focus is normally on growth.