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Fix it and they will come.

Summary: The received wisdom goes something like this: Tourism is a mainstay of the Lebanese economy, and the country, rich in history, climate and culture, could attract even more tourists if the stars aligned properly. More tourists would equal more cash inflows, which in turn could help an insolvent government while enriching the average Lebanese person....

The post Fix it and they will come appeared first on Executive Magazine.

The received wisdom goes something like this: Tourism is a mainstay of the Lebanese economy, and the country, rich in history, climate and culture, could attract even more tourists if the stars aligned properly. More tourists would equal more cash inflows, which in turn could help an insolvent government while enriching the average Lebanese person. So, the thinking concludes, let's fix the sector.

The latest report from the World Travel and Tourism Council (WTTC) plays nicely into this narrative. Tourism directly accounted for 6.9 percent of GDP in 2013 it claims, and was responsible for 6.7 percent of jobs. Indirect effects were even larger -- 19.2 percent of GDP and 18.4 percent of employment -- and are set to grow this year, the group forecasts (see " The ghosts of seasons yet to come ").

The WTTC's numbers are hypnotic. They are trumpeted by evangelists of the tourism-as-savior myth, from failed presidential contenders, to independent commentators, to the Investment Development Authority of Lebanon. But Lebanese citizens and policymakers shouldn't buy into this reckless hype for three reasons.

First, the WTTC has been dead wrong on the major indicators for the past two years -- according to the group's own numbers. In its 2012 report, the group projected tourism's direct contribution of $4.13 billion to the economy in 2011 would grow to $4.32 billion in 2012. Instead, it fell to $4.12 billion -- but, the WTTC assured us, it would grow again to $4.2 billion in 2013. In reality, the numbers dropped dramatically to $3.16 billion. Rest assured, the WTTC again tells us that 2014 will see another rise to $3.23 billion.

Furthermore, there are excellent reasons why too much dependency on tourism could be a bad thing. Given the country's small size and troubled neighborhood, Lebanon is uniquely vulnerable to shocks outside its control -- events that can stunt tourism for a year or more. And internally, tourism does not provide the kind of high paying, knowledge-driven jobs that Lebanon will need to reverse the country's massive brain drain. Jobs in tourism tend to be seasonal and low paying -- precisely the opposite of the financial security needed to attract and retain talent.

Finally, the notion of growing any one sector is itself flawed. Lebanon's sluggish economy is not due to improper focus on any particular area; it is caused by larger problems that affect broad swathes of the society.

When it comes to tourism, the problem should be obvious: poor security. No one wants to be murdered or kidnapped while on vacation. Those who can afford it will choose safer destinations, many others will just stay home. And no public relations campaign or government money can change this. The new tourism minister appears to have grasped this principle (see interview with Michel Pharaon ), but then again so did the one before him, and the one before him. Yet they are essentially powerless when faced with such huge challenges and tiny budgets.

So let's stop with the tourism happy talk -- especially from politicians and policy experts who should know better. Secure the country first, and all of Lebanon's economic sectors will improve.

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Publication:Executive (Middle East)
Date:May 7, 2014
Words:607
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