Assignment On Tourism Sector | Foreign Exchange Sector
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Added on 2019-09-26
Assignment On Tourism Sector | Foreign Exchange Sector
Added on 2019-09-26
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Part 1One of the major foreign exchange earner sector and the main growth area in any of the countryis its tourism sector. Tourism sector is highly beneficial for the places with cultural and naturalresources in abundance. In the past five years the world tourism market has depicted atremendous growth of 3.7 percent and is even further suspected to show a growth of 4.9 percentin the coming five years. It is expected that the Pacific region and Asia would record the highestgrowth. Sri Lanka arrived in the international tourism sector in the 1960s era. Due to theabundance of natural and cultural resources, the country has shown that tourism sector is one ofthe most promising sector for the economic development of the country especially after theperiodical setbacks during the civil war along with the natural disasters and world terroristattacks. For instance, it was seen that the number of international tourists entering Sri Lankaincreased in 2008 accounting for 438,475 whereas the count was 18,969 in 1966. Particularly,the Travel and Tourism contribution was seen to be around 7.5% of the total GDP of Sri Lankaneconomy in 2009. In 2009, tourism contributed around 503,000 jobs, 6.2% of the overallemployment and these facts are expected to grow by 2020 to around 6.7% of the totalemployment. Sri Lankan Travel and Tourism economy, out of the 186 registered countries of theWTTC is ranked at number 87 worldwide and at 110 as per the contribution of tourism to thenational economies. The strategic issue in the field of tourism industry of Sri Lanka is considered to be thecompetitiveness. In contrast to the other regions in Asia and the world, the last five years of thetourism growth in Sri Lanka are found to be highly flat. The tourism sector has realized that lackof growth in due to the civil conflict in the nation and the sector has also recognized the otherserious constraints related to the tourism business and its operations in the way the business is
proceeding. This can be evaluated using the Porter’s model of the competitive advantage or thePorter’s Diamond.Porter’s model of the competitive advantage which is also known as the Porter’s Diamond isused as a powerful methodology which can help to establish enterprise for achieving superiorcompetitiveness in this whole while world of globalized economy. This model does not definethe competitiveness of the enterprise present in a nation on the basis of the natural as well asfavorable factors nut also depends on the factors that are generated by negative and positivesynergies having an ultimate goal towards the productivity growth. Therefore this mode ofcompetitive advantage helps the companies to establish a new position on the basis of thesurroundings which further depend on the primary factors and the secondary factors. Theprimary factors can be seen as the state of the productive elements like the condition of thedemand or the existence of the qualified human resources along with the variations,characteristics and development of the associated sectors. Whereas the secondary factors are theones influenced by the primary factor like the action by local government.The Porter’s model or the ‘Diamond of National Competitive Advantage’ has presented fourmajor elements of the nation that will help in shaping up of the local firms to compete so as tohamper or may be support the competitive advantage namely: factor conditions, demandconditions, related and supporting industries, firm strategy, structure and rivalry. Additionallythe role of government and the role of chance should also be taken into account for assessing thecompetitive advantage of the nation.
1.Factor conditionThe factor conditions include the factors like infrastructure which can be realized by thegovernment along with the human resources. The Sri Lankans are aiming to shape the policiesrelated to their civil aviation along with the domestic air travel so as to provide in the reforms forimproving their tourism-related infrastructure along with presented a unanimous voice towardsthe policies like land planning, tourism planning, taxation, environmental protection, municipalgovernment etc.The factors related to the airports infrastructure and related issues can affect the competitiveadvantage of the Sri Lankan tourism can be seen by the attacks at Bandaranaike InternationalAirport in July 2001 depicting the damages that can be done to the tourism performance of thecountry.
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