what problems does trying to be involved in international trade present for LICs
- primary products are low/fluctuate in value
- overdependence on one or two goods is dangerous for a country (one commodity dependency)
- manufactured goods sell at high prices
-trade barriers are often used by HICs to prevent imports from damaging their own economy - rich countries use a lack of trade restrictions in poorer countries to get rid of excess goods where overproduction has occurred (dumping)
Trade in goods (merchandise)
- china became the worlds biggest trader in merchandise in 2013 - trade surplus of $259 billion (2.8% of GDP)
- then USA, Germany and Japan made up the top 4
- South Korea, Mexico, Brazil, India, Thailand and Malaysia are worth noting
- Affluent countries with small populations, such as the Netherlands, Belgium and Switzerland are also worth noting
- the least developed countries’ share of total global merchandise exports totalled only 1.1% compared to 75.5% of the G20`
Trade in services
- USA remains firmly in the leading position in global trade in commercial services
- UK 2nd
- Japan less significant
- India in top10
- least developed countries (LDCs) have shown pleasing progress
- between 2000 and 2013 this grew by an average of 14% per year in LDCs
- e.g. Cambodia - leading LDC tourist destination - Ethiopia - expansion of air transportation services (Ethiopian)
- share has been decreasing in North America and Europe but increasing in Asia
- Asia’s exports of commercial services rose from 21.7% to 26.2% whilst Europe’s share fell from 51.8% to 47.2%
WTO role
- to ensure trade flows as smoothly, predictably and freely as possible
- trade without discrimination
- not completely a free trade body as it allows tariffs and trade restrictions under certain conditions
WTO how does it attempt to settle trade disputes
- countries bring disputes to the WTO if they think their rights under the agreements are being infringed
- judgements are made by independent experts and are based on interpretations of the agreements and individual countries’ commitments
- the system encourages countries to settle their differences through consultation
- if this fails, a staged procedure is followed
- a country’s membership is at stake if they do not adhere to a settlement of a dispute
criticisms/disadvantages of WTO
- free trade benefits developed countries more than developing countries - less protection for developing businesses
- process of settling disputes takes a long time (350 out of 614 settled)
- trade rules are still unfavourable towards developing countries - developed countries were allowed ‘tariff protection’ when they were emerging but not now
successes/advantages of WTO
- 350 trade disputes settled since creation
- increased number of disputes brought to them - showcasing the WTO as a forum for settling trade disputes
- WTO regulations and co-operation helped avoid a major trade war; significant during 2008/09 recession
stages of the Butler model
- Exploration
- Involvement
- Development
- Consolidation
- Stagnation
- Rejuvenation (A)
- slight increase (B)
- Stabilised (C)
- Slight Decrease (D)
- Decline (E)
Everyone In Devon Can Sing, Dance and Rap
Butler model critique
still valid:
- applies to countries with varying levels of development
- lack of timescale aids applicability and flexibility
- Christaller’s ideas still hold true (adventurous tourists seeking authentic, uncommercialised experiences will shy away once it becomes popular)
- destinations still dominated by TNC tourism
- tourism is still quite unregulated
Outdated/Flawed:
- findings were not based on empirical research
- doesn’t account for external shocks
- Malthusian view of tourism and carrying capacity
- stage descriptions are subjective
- model loses applicability when initial attraction is not physical
- can’t be applied to destinations with differing markets depending on the season
- wide range of new, niche tourism
what is meant by allocentric tourism?
- tourist who seeks new experiences and is keen to meet strangers
- Curious about different places and cultures
- Will make own travel arrangements
what is meant by psychocentric tourism?
Unadventurous traveller who will have little interest to seek out strange places
- Happy to keep returning to same place and will use travel agents package tour
why is tourism considered to be volatile and vulnerable to external shocks?
- Perceptions/image of a place can change instantly
- Trade – Tourism has no powerful governing body to intervene/compensate -Completely at the hands of the tourism markets
- Natural phenomena initially draw interest from tourists… tourism if unmanaged may well destroy such initial attractions - Difficult to stop less developed nations becoming greedy in terms of economic benefits of tourism
what is the tourism multiplier effect?
- Substantial rise in per person incomes
- Higher business and personal tax base increases local government spending power
- Improvement of physical and cultural infrastructures
- Establishment of hotels and other tourist facilities
- Expansion of local job opportunities and population
- Inflow of business and capital to satisfy increased local demand
what are the economic leakages in tourism?
- Transport costs paid to airlines and other carriers
- Payments to foreign owners of hotels and other facilities
- The cost of goods and services imported for the tourist industry
- Remittances sent home by foreign workers
- Foreign debt relating to tourism
- Payments to foreign companies to build tourist infrastructure
facts about cruise ship tourism
- Uses heavy fuel oil – bad for the environment
- Uses around 1,200 tonnes of fuel
- Releases the same amount of CO2 as 5 million cars travelling the same distance
- 500 cruise ships
- Alternatives could be diesel but is 1/3 more expensive, using local energy instead of the engine generator, using a filter to reduce emissions
- Fish in Kotor, Montenegro have reduced significantly
- Venice has statistically more excess lung cancers found in population compared to the rest of Italy
environmental impacts of tourism
- Overuse of local water sources for recreational activities
- Overuse of local resources such as energy which is already in short supply
- Land degradation due to increased construction of tourism and recreational facilities
- Air and noise pollution – tourism now accounts for 60% of air travel, a single transatlantic flight emits almost half of the CO2 emissions produced by all other sources consumed by an average person yearly, noise pollution can disturb wildlife
- Solid waste and littering – cruise ships in the Caribbean are estimated to produce 70,000 tons of waste each year
- A person on a cruise ship, on average generates 3.5kg of waste compared with 0.8kg on land daily
- Sewage – tourism increases sewage pollution and sewage run off
- Aesthetic pollution – due to large buildings taking over sky lines
- Deforestation
Examples of Niche tourism
Medical tourism:
- Thailand in 2017 saw 2.4 million hospital visits related to medical tourism
- South Korea has the highest number of cosmetic procedures per capita in the world
- In 2020, the global medical tourism market was around 44.8 billion which is expected to grow every year by 21.1% from 2020 to 2027
- The number of medical tourists around the world is expected to grow by 25% every year
Slum Tourism:
- Involves tourism to impoverished areas, particularly in India, Brazil, Kenya and Indonesia
- Provides an opportunity for tourists to see the ‘non-touristy’ areas of a country or city
- Comuna 13, Medellin was one of the most dangerous neighbourhoods in Medellin but is now known for its street art
- Rainbow village, Indonesia - small slum village which has been transformed by vibrant paint and designs
- About 25,000 tourists arrive in Comuna 13 every week
- About 5 million passengers pass through the Rainbow village every year
Nepal case study economic impacts of tourism
Positives:
- total 7.8% of GDP (2017)
- total 1.03m jobs (2017)
- 49th ranked/185 for growth of tourism industry
Negatives:
- Well behind other nations at same level of development (Maldives – 32% Bahamas – 19%) of GDP
- 9 in 10 jobs are in the same three sectors (food and beverages, transport and accommodation) low skilled, menial and low paid
- 70% of jobs are informal
- Seasonality of the tourism (short seasons)
- Vulnerability of tourism to external shocks
- ‘Visit Nepal’ 2020 target was 2 million and 3.5 million in 2025 but actually got 230,000 visitors in 2020
Nepal case study social/cultural impacts of tourism
Negatives:
- Impact on house structure - 60% now live in home of modern style (erasure of culture)
- Impacts on family structure - shift to nuclear family
- Impact on religion - Animism (the main religion) is fading and locals have started celebrating other festivals e.g. Christmas
- Impact on moral behaviour - Gambling, theft, drug addiction, linguistic acculturation (erasure of native language) demonstration effect (adopting western clothing), commercial hospitality and retaliation
- impacts on physical products - food and drink being commercialised, dances are performed for show and theft of religious and cultural objects
Positives:
- discovering a sense of worth and pride in the host population
- develops social and cultural understanding
what is a trade surplus?
a positive or favourable balance of trade
what is a trade deficit?
occurs when the value of a country’s imports exceeds the value of its exports
what is a tariff?
An import barrier that charges tax on imported goods in order to protect domestic industries from foreign competition and to raise revenue for government
What is a quota?
An important barrier that sets a physical limit on the quantity or value of goods that may be imported into a country
economic and social progress since Doi Moi reforms
- economic growth of 6-7% rivals china
- Vietnam was the largest exporter of clothing and second largest for electronics by 2017
- since 2010, GDP growth has been at least 5% per year and in 2017 peaked at 6.8%
- GDP per capita was barely $230 in 1985, it was more than 10 times that in 2017 ($2,343)
- women’s employment rate is within 10% of that of men
