Falling oil prices and volatile equity markets, as well as several other global developments, including the slowdown in the Chinese economy and the devaluation of the ruble, shook the markets last year. Many industries witnessed both revenues and volumes dwindling and hitting rock bottom. However, one sector sustained itself through the tumults and the turmoil: travel and tourism, according to the World Travel and Tourism Council (WTTC).
According to the council’s latest report, the industry contributed more than $7.2 trillion to the world’s gross domestic product and added 7.2 million jobs last year.
The travel and tourism industry in the Middle East region saw 5.9 per cent growth in contribution to GDP during the year.
“Despite uncertainty in the global economy and specific challenges to Travel & Tourism last year, the sector grew by 3.7 per cent, contributing a total of 9.8 per cent to the global GDP,” says David Scowsill, President and CEO of the WTTC.
Scowsill adds that travel and tourism also supported a total of 284m jobs in 2015, an increase of 7.2m, “which means it now supports, directly and indirectly, one in 11 jobs on the planet.”
The annual Economic Impact Report 2016 states that terror attacks, disease outbreaks, currency fluctuations and geopolitical challenges have impacted the sector at a country or regional level, but, at the global level, it showcased a robust performance.
The growth of the sector, the report finds, was driven by a worldwide increase in middle-class income households and an ageing population, which tends to travel more. The growing connectivity between destinations, which makes travel more accessible and affordable, has also pushed the sector.
The sector’s direct contribution to GDP growth outpaced overall GDP country growth in 127 of the 184 countries covered by the research.
Qatar and Saudi Arabia were among the countries where the industry most markedly outperformed the wider economy in 2015.
In terms of growth in total contribution to GDP, Southeast Asia was the fastest-growing region, with a growth of 7.9 per cent, followed by South Asia, which grew at 7.4 per cent. The Caribbean region saw a 5.1 per cent growth, while, in Sub-Saharan Africa, it was 3.3 per cent. Meanwhile, North America and Europe witnessed 3.1 per cent and 2.5 per cent growth, respectively.
Outlook for 2016
Meanwhile, WTTC trimmed its forecast for the current year, with the sector’s total contribution to GDP being forecast to grow by 3.5 per cent, down from last year’s 3.7 per cent. However, it is expected to outpace global economic growth for the sixth consecutive year.