3. Important terms
Trade – import and export of goods
Balance of trade – difference between imports and exports – imports greater than exports – negative balance of trade
exports greater than imports – positive balance of trade
Visible trade – import and export of tangible goods and
Services
Invisible trade – import and export of intangible goods and
Services
Tarif – tax imposed on imported goods
Quota – limit to the amount of imported goods
Free trade – ability to trade legally without restrictions
6. GLOBAL INEQUALITIES IN TRADE FLOW
• In most countries global trade accounts for many of the goods bought
and sold.
• Previously governments restricted international trade based on
MERCANTILISM
• Mercantilism – countries were all competing to maximize their store of
gold.
• Governments imposed tariffs to restrict imports and promoted exports
in order to sell more goods to buy more gold
In the 19th century mercantilism was replaced with FREE TRADE
INTRODUCTION
7. CAUSES OF INEQUALITIES IN TRADE
1. Most of the worlds trade takes place between just 8 countries, know as the G8
8. 2. Type of goods
• HIC’s export valuable manufactured products and import cheaper primary products
• LIC’s export cheaper primary products and import valuable manufactured products – this means that developing
countries have limited purchasing power, making it difficult for them to pay back their debt and escape from poverty.
3. Fluctuation in the price of goods
• The price of primary products fluctuates a lot – workers and producers in developing countries lose out when the
price drops.
• The price of manufactured goods is steadier – HIC’s therefore have a stable income
4. Restriction to trade (quotas and tariffs)
• HIC’s impose tariffs and quotes imported goods which makes foreign goods more expensive to the consumer
• Quotes are limits to goods that are imported and usually work in favor of HIC countries.
5 Trading blocs
• Rich countries often act together – allow free trade amongst member states e.g. EU , NAFTA (North Atlantic free
trade agreement)
• Trade links have improved within these trading areas – motorways, high speed rail links and tunnels link most
countries in the EU
9. 6. Dumping
• Products are exported at costs below their production costs
• Most producers in developing countries cannot compete against goods that have been dumped in their country at
a lower price
7. Patent rights
• MNC’s pressure their governments to increase their protection rights of intellectual property, this increases the
prices of necessities such as seeds, medicine and computer software. As a result many people in poverty cannot
afford the medicine they need.
8. Trade alliances
• In 1990 a number of trade agreements were made
• These agreements can have a positive or a negative impact
• Positive – strength political base of the country
- ensure security against price fixing, tariffs and quotas
- e.g. Economic development in Vietnam improved due to its entry into the Asian free trade agreement
areas (ASEAN)
• Negatives – some countries a locked into unfair trade agreements
- they cannot afford to withdraw from these agreements as multi-national companies will take their
business elsewhere
10.
11. FACTORS AFFECTING GLOBAL TRADE
Global trade is affected by:-
• Historical
• Political
• Environmental factors
12. 1. Resource endowment
• Some countries have an abundance of raw materials e.g. gold, coal, timber, oil etc. due to their geology
• This enables these countries to become exporters of these raw materials e.g. the presence of coal enabled north west
European countries to become net exporters of goods in the 19th century.
• Many countries in the middle east became wealthy due to the export of oil.
2. Locational advantage
• The location of market demand, influences trade patterns.
• It is advantageous for an exporting country to be close to the markets for its products; for example, it reduces transport
costs.
• Manufacturing industry in Canada benefits from the proximity of the huge US market.
• Some countries and cities are strategically located along important trade routes, giving them significant advantages in
international trade.
• For example, Singapore, at the southern tip of the Malay peninsula is situated at a strategic location along the main
trade route between the Indian and Pacific Oceans.
• Locational advantage has seen an increase in foreign direct investment in newly industrialized countries (NIC’s) through
TNC’s who take advantage of proximity to raw materials, cheap labor, relaxed tax regulations and environmental laws.
13.
14.
15.
16.
17.
18.
19.
20. Use examples to explain how resource endowment and locational advantage affect
trade. [10]
To what extent does resource endowment explain global patterns of trade flows? [20]
21. resource endowment is likely to be considered with reference to mineral resources, such as oil. Accept
agricultural potential and human resources. May consider examples such as Namibia’s mineral wealth or Japan
and Singapore’s lack of physical resources. Discovery of mineral resources or the effect of substitutes on trade,
e.g. for copper, may be seen.
locational advantage is the role of strategic situation, for example, in relation to the world’s shipping lanes or
access to major markets such as the US or China. Compare relative locational disadvantage to overcome, e.g. for
landlocked countries and remote islands. May consider changes in transport technology and relative costs.
There must be some attempt at assessing the extent to which resource endowment is explanatory of global patterns of
trade flows, most likely alongside other factors and/or reasons.
Any factors and reasons may be considered:
locational advantage
historical factors such as colonial ties
trade agreements
changes in the global market
the role of the WTO
free trade and Fairtrade
any other relevant social, economic, environmental or political factors
Award marks based on the quality of the response using the marking levels below.
22. 3. FOREIGN DIRECT INVESTMENT
• Investment in a country is the key to increasing trade
• FDI’s has taken place in Newly industrialized countries (NIC’s) through TNC’S
• The TNC’s take advantage of – proximity to raw materials
- cheap labor
- relaxed tax regulations
- relaxed environmental laws
- good location close to markets
TNC’S main aim is profit so they avoid countries that are experiencing corruption and weak governments as such
countries
Like HAITI , HONDURAS and most of SUB-SAHARAN AFRICA receive very little foreign direct investment
23. 4. HISTORICAL FACTORS
Historical factors based on colonial ties remains an important factor in establishing trade links.
What is colonialism? (class discussion)
The UK still maintains significant trade links with common wealth countries.
There are approximately 40 common wealth countries ….. Can you name them?
Study the two maps showing the UK’s trading partners in terms of imports and exports and state how many of these
countries belong to the common wealth?
When the UK joined the EU, trade with the common wealth countries decreased however they still make up at least
10% of the UK’s trade
Colonies played a subordinate role in trade which brought them very limited benefit in trade
This TRADE DEPENDENCY is the reason why tropical countries have such a limited share of world trade.
24. VIDEO STUDY
Watch the video on colonialism and trade and answer the questions that follow.
1. When was the navigation acts implement?
2. Explain the navigation act
3. Why did England want any product that was sold to the colonies to go to England first?
4. Explain why the ships that were used for trade had to be built in England?
5. According to the video, explain the concept of MERCANTILISM
6. What did countries do to avoid paying the high taxes in Britain?
7. Explain the two trade triangles
8. With reference to the first triangle explain why all countries in Africa are still classified as LIC’S
25.
26.
27. 5. TRADE AGREEMENTS/TRADING BLOCS
Trade agreements are treaties that allow two or more countries to trade without hinderance so that good and services
can move freely within their borders without taxes or tariffs.
These groups of nations are some times know as trading blocs
Examples of trading blocks:
• NAFTA – North Atlantic Free Trade agreement
• ASEAN – Association of South Eastern Asian Nations
• CARICOM – Caribbean Common Market
Some trading blocks practice PROTECTIONISM – goods produced outside the block are subjected to tariffs and quotas
28.
29.
30. GENERAL INFORMATION
MISSION
• Promote FREE TRADE by encouraging countries to abolish import tariffs and other barriers to trade
AIM
• Supervise free trade agreements
• Settle trade disputes
• Organize trade negotiations
WTO is the only global body that determines the rules of international trade
All countries belonging to the WTO must abide by the rules and regulations set down by the WTO
Based in Geneva – founded in 1995 and it replaced GATT
WTO regulates trade in services as well as goods
In terms of services, it regulates banking, telecommunication and property rights
WTO meets once every two years
A general council made up of an ambassador from each member state handles the day to day running of the WTO
31. CRITISMS AGAINST THE WORLD TRADE ORGANIZATION
• WTO has to much power and it can make countries
change their laws and policies
• WTO is run by HIC’S for their benefit and does not
address the problems in LIC’S
• WTO has little to no interest of the impact of free trade
on workers rights, child labor, the environment and
health
• WTO has not democratic accountability – dealings on
trade disputes takes place behind closed doors
32. CASE STUDY – WTO AND THE BANANA WARS
6 year trade dispute between the USA and the EU
• America believed that the trade agreement between the EU and banana produces in the
Caribbean and the European colonies which gave banana producers special access to
European markets broke free trade rules
• The EU favored imports from former European colonies and from Africa with no import
duties imposed on bananas however the EU charged import duties on bananas from other
countries.
• This is the policy that America was against
• However 75% of banana production in South America were owned by American TNC’s
• In spite of this USA filed a complaint against the EU in the WTO and won in1997
• WTO instructed the EU to alter its rules
33. 1975 -EU trade agreement with the former colonies and the Caribbean
involved a quota on bananas that could be sold to the EU. This was
done to protect small banana farmers
This deal also tried to protect small banana farmers in the Caribbean
from competition from large banana farmers in south America
After the WTO’s ruling USA still felt that free trade rules were not
restored although the EU said that they had changed their rules
34. USA retaliated by imposing 100% tariffs on goods imported from the
EU
The USA see state support of agriculture – common agricultural
policies as being anti free trade
In December 2009 the EU and USA reached an agreement in the WTO
for the EU to gradually reduce its tariffs on all all imported bananas by
35 % by 2017
38. FAIR TRADE FOUNDATION IS CONCERNED WITH
• Introducing better prices
• Suitable working conditions
• Fairer terms of trade
• Environmental protection
• Getting rid of child labor
For farmers and workers mainly in LIC’s
39. HOW DOES THE FAIR TRADE ORGANISATION WORK?
Coffee, cocoa, cotton and rice –FTF only supports small scale operations – small farmers. They
offer farmers a stable income
to plan for the future
Bananas, tea and flowers – the foundation supports plantations – (large scale farming
operations) They protect workers rights
Through healthy and safe working conditions and other measures that will be found in HIC’s
FTF pays a minimum cost for the sustainable production of that particular goods in that regions
Producers receive the market price if the market price is higher than the FT minimum price
This protects the farmer from fluctuations in the market
40. Farmers are also paid a fair trade premium
The premium is the additional sum of money paid on top of the minimum price that the
farmers and workers receive for
their product.
This money can be invested in:
Social
Economic
Environmental projects which will improve the communities they live in
50% of the FTF is owned by producers representing farmers and worker organizations. As
a result farmers and workers are
Involved in decisions on:
• Use of resources
• Setting prices
• Premiums
• Overall strategies
41.
42. Fig. 7.1 shows percentage share in trade of goods for members of the 4 World Trade Organization (WTO), by world region, 200
Compare the trends in the share in trade of goods for North America and Asia shown in Fig. 7.1.
43. CASE STUDY – FAIR TRADE COFFEE IN
CENTRAL VIETNAM
In 2008 Dakman – coffee processing and export company
They started working on improving the quality of coffee from producers in the area.
They provided the farmers with training and helped farmers set up a cooperative producer group.
In 2009 they received fair trade foundation certification.
Coffee sales have provided the money to improve infrastructure (fuel for water pumps and fertilizers) which in turn l
Improved coffee production.
The fair trade premium has been used to improve the quality of life of the farmers which includes
• Construction of coffee storage warehouse
• Administration offices
• Community development projects
• Support for members to help them to improve their production
44. The map below shows the average cultivated area per farmer in 2013.
Describe the distribution of Fairtrade farmers and farm workers shown on the map
45. The Fairtrade mark means that the Fairtrade ingredients in the product have been produced by small-scale farmer
organizations or plantations that meet Fairtrade social, economic and environmental standards
Fairtrade is an alternative approach based on partnership between those who grow food and those who consume it.
Trade rather than aid
For certain products, such as coffee, cocoa, cotton and rice, Fairtrade only certifies small-scale farmer organizations
Fairtrade also certifies plantations for some products such as bananas, tea and flowers, but sets standards to protect
workers’ basic rights and for wages that progress towards a localized living wage benchmark
Fairtrade offers the stability of income which enables them to plan for the future
Fairtrade minimum price is set to cover the cost of sustainable production for that product in that region. If the market
price for that product is higher than the minimum price, farmers and workers receive the market price. Payment of
the minimum price is regularly audited and checked by the organization
The Fairtrade premium is the additional sum of money paid on top of the Fairtrade minimum price that farmers and
workers receive which can be invested in social, environmental and economic developmental projects to improve their
businesses and their communities
The farmers and workers themselves decide how the Fairtrade premium is invested
Farmer and worker organizations own 50% of the global Fairtrade system with an equal voice in decision-making
within the general assembly and board of directors
Consumers are willing to pay a higher price for the products
46.
47. VOCABULARY
External debt (foreign debt) is that part of the total debt in a country owed to creditors
outside the country. The debtors can be the government, corporations or private households.
The debt includes money owed to commercial banks, other governments or international
financial institutions such as the World Bank.
Debt service ratio is the ratio of debt service payments of a country to that country’s export
earnings.
Debt relief is the cancellation of debts owed by developing nations to industrialized nations or
institutions such as the World Bank, in order to allow the government to shift funds towards
social development.
Debt crisis occurs if major debtors are unable or unwilling to pay the interest and redemption
payments due on their debts, or if creditors are not confident they will do so.
48. Odious debt is a national debt incurred by a regime for purposes that do not serve the
best interests of the nation, such as wars of aggression or internal corruption.
Colonialism is the building and maintaining of colonies in one territory (or a number of
territories) by people from another territory.
49. CAUSES, NATURE, AND PROBLEMS OF DEBT AT THE NATIONAL SCALE
COLONIALISM
Many countries who were previously colonized, gained independence from their colonial rulers. However these countries
were ruled by government officials that belong to the colonial rulers
These new government rulers, ruled the newly independent countries as if they still belonged to their colonial rulers. e.g.
India gained independence from England in 1947 however an office of the governor general was established to represent
the interest of England (Crown)
These newly independent countries borrowed large sums of money from western Banks to invest in industrial development
and Public works projects e.g. Egypt borrowed money to build the ASWAN DAM
The profits gained from these investments were squared by the new government (ruling elite) . This is know as
SOVEREIGN DEBT.
The borrowed money was spent on arms for the ruling army and live lavish lives. E.g. building of the palace of RASHTRAPATI
BHAVAN
50.
51. THE OIL CRISIS OF 1973 -1974
Due to the fact that the USA supported Israel during the Arab Israeli war – the Arab
countries imposed a
TRADE EMBARGO ON OIL – they stopped the sale of oil to the USA
This caused the oil prices to increase and this had a drastic impact on the LIC countries
• LIC’s had to borrow more money
• Oil crisis led to inflation which caused the HIC’s to raise their interest rates on loans
• Inflation led to a world wide recession which further put the LIC’s countries into debt
• The recession reduced the demand for exported goods from LIC’s
• This caused the LIC’s to borrow more at a higher interest rate
52. HEAVILY INDEBTED POOR COUNTRIES – HIPC’S
• With the help of the World Bank and the International Monetary Fund the HIPC initiative was launched in 1996
• This initiative was launched so that no country faces a debt burden that it cannot manage
• In 2005 the HIPC initiative was supplemented by the Multilateral Debt Relief Initiative (MDRI)
• The MDRI provides 100% debt relief on eligible debts by 3 multilateral institutions - IMF , WB and the African development
fund (AfDF)
• HIPC’ and the IMF constantly negotiate the structuring of the debt and the issuing of new loans
• New loans are only issued to HIPC’s if they adopt structural adjustment programs – austerity measures
• Austerity measures are designed to control inflation, limit government corruption and reduce public services
PROBLEMS WITH AUSTERITY MEASURES
• Austerity measures involve the cutting back of social services e.g. health care, education, import of food products. These
measures hurt the population rather than helping them
• Much of the money that HIPC’s get from exports are used to pay of their debt so very little goes into developing the country
53. ODIOUS DEBT
Loans given to dictators and repressive governments.
• Iraq built up debt while under the rule of Suddam Hussein
Ruler of Iraq between 1979 and 2003
War between Iran and Iraq
GULF WAR
54. • South Africa built up odious debt while under rule of the previous apartheid government –the government of Nelson
Mandela was saddled with this debt which totaled 11 billion US dollars
• Argentina is still paying of debt incurred by the military junta in the 1980’s
Junta – government led committee of military leaders
Junta is Spanish for meeting or committee
A large portion of the countries income goes to paying off this odious debt as a result health and education services
suffer, there is a lack of investment in services such as utilities etc.
55. MISMANGED LENDING
In the 1960’s the USA spend more money than it had.
This resulted in the printing of more dollars
The value of the dollar dropped
Oil producing countries that used the dollar as a form of currency were affected by the
devaluing of dollar
The 1973 oil crisis caused oil producing nations to increase the price of oil
They earned a large amount of money which they deposited in western banks
Interest rates drop and inflation increased causing these banks to lend more money to
avoid a financial crisis.
Most of these loans went to countries led by dictators which did not benefit the people
of the country at all
56. THE DEBT CRISIS AND DEBT RELIEF
From the 1990’s various countries were in a debt crisis
Some HIPC’s could not escape from the debt trap
the world bank introduced a new development program for poor countries called the POVERTY REDUCTION STRATEGY PAPER
in 1999 – PRSP
THIS PROVIDED MEASURES AND A TIMETABLE FOR POVERTY REDUCTION
PRSP SHOULD BE
• Driven by individual countries
• Focused on benefiting the poor
• Involve a partnership between government, domestic stakeholders and external donors
A country needs to comply with the WB poverty reduction strategies for 3 years in order to get PRSP status
A country that reaches the PRSP completion point can have their debt cancelled.
57.
58.
59.
60.
61. Aid (overseas development assistance
(ODA)- assistances that
GOVERNMENTS, NGO’S, BUSINESSES
and INDIVIDUALS from one country
give to another country to help them
reduce poverty and achieve sustainable
Development goals
62. DIFFERENT TYPES OF AID
1. RELIEF AID (HUMANITARAIN AID) – short term aid – save
lives, reduce suffering and respect human dignity
• This type of aid is used in humanitarian crisis and natural
disasters
e.g. civil war in Syria
Famine in Dafaur
Earthquake in Haiti
Ethnic cleansing in Myanmar
Forced migration in Libya
63. 2. DEVELOPMENT AID – INTERNATIONAL AID –
FOREIGN AID - OVERSEAS AID
• This is financial aid given by governments and
other agencies to support economic, social,
environmental and political development within
a country
• This is long term aid
• Focuses on reducing poverty
64. 3. TIED AID
• Foreign aid that must be spent on buying products from
the donor country that provided the aid
• HIC’s will provide loans but they will indicate that the
money must be spent on buying goods and services from
their countries.
e.g. UK government funded the building of a hydro-electric
dam on the Pergau river in Malaysia and the Malaysian
Government spent 1 billion pounds buying arms from the
UK
65. 4. BILATERAL AID
• Aid given by one government directly to the government
of another country
66. 5. MULITI-LATERAL AID
• Assistances provided by governments to international
organizations such as the world bank, IMF and the UN
to be used to reduce poverty in developing countries
68. In 1970 HIC’s agreed to give 0.7% of their GNI as official international
development aid every year
However many HIC’s have failed to meet this target
Much of the aid that is given comes with conditions attached to it
• The receiving countries must buy overpriced goods and services from donor
countries
• Most aid does not go to the poorest people that need it the most
• HIC’s use aid as leverage to open their markets to MIC’s and LIC’s
• Corrupt governments often embezzle the money that is given in aid
69. THE ROLE OF NGO’S – NON GOVERNMENT ORGANIZATIONS
70. According to the world bank , NGO’s are defined as non-
profit organizations that carry out activities that relieve
Suffering, promote the interest of the poor , protect the
environment, provide basic services, or undertake
community development projects
71. 15% of ODA is distributed via NGO’s
Approximately 30 000 national NGO working in LIC’s
CRITISMS OF NGO’S
• Creates an over dependence on aid. The focus should be to help
the recipient countries to help themselves
• NGO’s distribute food for free in certain countries and this
undercuts local producers. This has a negative impact on the local
farmers and the economy of the country
• NGO’s some times misunderstand family and community
structures in the societies that they help
• Many NGO’s are religious organizations
78. REASONS FOR THE GROWTH IN TOURISM
Advances in travel technology - the invention of the
jet engine and the introduction of budget airlines e.g.
EasyJet, Air Asia and the use of regional airports has
made international travel accessible to a large number
of people. More people own cars which increases
domestic tourism
Increase in disposable income (amount of money
left over after spending on essential items e.g. food,
medical, school, clothing) Salaries have increase in
most HIC’s and in most HIC families both mother
and father are working and this increases their
disposable income
People are also having less children which
increase their disposal income
Shorter working hours : Many people are able to finish
work early on Friday – or work ‘flexi-time’ – so they work
some ‘long days’ and ‘short days’. This gives people more
time to go on mini-break over a weekend. People have
longer holidays
Changing lifestyles : improvement in medical care has
resulted in an increase in life expectancy. People take early
retirement and they tend to travel more
79. Changes in the types of holidays – mass
tourism and package holidays have opened
up the market to large number of people.
Extreme tourist destinations and ecotourism
have risen in popularity. Travel agencies
offering low cost accommodation and flights
for international destinations has increased
tourism
More awareness of holidays : Lots of TV programmes show different
holidays, comparing resorts and whole satellite channels devoted to
holiday ideas means more desire to go away for a few days. With
retired people living longer and college students wanting to travel there
are huge numbers of people looking for information about where to go
next – who have the information, and money to travel.
80. POSSIBLE REASONS FOR A DROP IN TOURISM
Civil unrest - civil unrest and political
instability in a country can decrease
tourism e.g. Civil war in Syria.
Public demonstrations and civil unrest
in Hong Kong. There were 3.31 million
arrivals in Hong Kong in Oct 2019 this
was a 43,7% decrease from Oct 2018
Pandemics - The spread of the Corona virus
in 2019 – 2020 and the introduction of travel
bans by many countries has had a huge
impact on international tourism. UNWTO
predicts a 3% drop in global tourism due to
the virus. The Cruise ship industries suffered
a huge economic blow due to the large
number of people that were infected on
cruise ship. The SARS virus caused tourism
to decrease in Hong Kong by more than 60%
Economic crisis - Stock market crash in 2008
caused many people to lose money. The
economies of many countries experienced
inflation, there was a drop in disposable
income and hence in drop in global tourism
Terrorism – Bali bombing in 2002 caused a drop in international
Tourism. 9/11 terrorist attack caused a decline in tourism in
America
Terrorist attracts in morocco ( 2011) and Tunisia (2015) caused
many governments to advice their people not to travel to these
countries
81. IMPACT OF TOURISM
SOCIO- CULTURAL ENVIRONMENTAL
ECONOMIC
POSITIVE/NEGATIVE POSITIVE/NEGATIVE
POSITIVE/NEGATIVE
82.
83. ENVIRONMENTAL IMPACT OF TOURISM
NEGATIVE IMPACTS:
• Over-use of natural resources
• Pollution
• Landscape degradation
• Threats to biodiversity
84. OVER USE OF NATURAL RESOURCES
Increase in tourism has led to an overuse of water resources by HOTELS, SWIMMING POOLS, GOLF COURSE, PERSONAL
USE, WASTE WATER DISPOSAL
Golf tourism has increased in recent years but the construction and use of golf course causes massive depletions of water
Resources
Maintenance of Golf course requires huge amounts of water everyday which could result in water scarcity.
Deforestation caused by land clearance for tourist developments has had a negative impact on the land.
In Nepal each tourist on a trekking vacation can consume up to 5kg of firewood per day.
85. POLLUTION
Tourism can cause air, noise, land and water pollution
In areas that experience a high volume of tourist, waste disposal is a serious problem and improper disposal of water
Can effect the aesthetic beauty of the environment.
Cruise ships are estimated to produce about 70 000 tons of waste per year.
Some trails in the Andes mountains and in Nepal are called the “coca cola trail” and the ”toilet paper trail” because of the
amount of litter that is left behind.
Construction of hotels and other tourist facilities lead to increased sewage volumes which could lead to polluted seas, rivers
and lakes
Sewage runoff creates serious damage to coral reefs because it stimulates algae growth which covers the filter feeding coral
Which hinders their ability to survive
According to the united nations environmental program approximately 85% of the sewage discharged into the Caribbean is
untreated and this could affect the lives of humans and animals.
86.
87. LANDSCAPE DEGRADATION
The construction of tourist attractions
clash with the natural environment
A lack of land-use planning and building
regulations often result in the
construction of tourist facilities that do
not fit in with the natural environment
88. THREATS TO BIODIVERSITY
The ecosystems most threatening by tourism are the ecologically fragile areas such as the Alpine regions, rainforests,
wetlands, mangroves, coral reefs and seagrass beds
The building of alpine style ski resorts
has led to many
Environmental issues such as habitat
and biodiversity loss, soil erosion from
the preparation of ski runs and the over
use of water resources to produce
artificial snow during periods of low
snow falls.
89. The development of coastal
facilities such as marinas can cause
changes in currents and coastlines
leading to the destruction of
habitats such as coral reefs and
mangroves.
90. Increased sediment in the water,
trampling by tourist and divers,
ship groundings and anchoring,
pollution from sewerage,
overfishing and fishing with
poisons and explosives destroy
coral reefs.
The Maldives experiences many
of these threats including rising
sea level from climate change
91. Tourist using the same trail over
and over again, trample vegetation
and cause soil erosion. Which
eventually causes damage to the
environment and leads to the loss
of biodiversity.
In the British and Irish upland
areas, trampling is a yearly
problem
92. POSITIVE ENVIRONMENTAL IMPACTS OF TOURISM
• Planting trees and landscaping to minimize the visual impact of any development
93. Environmental protection
programs e.g. hotels using
sustainable sources of
energy, efficient sewage
systems and constructing
tourist attractions using
efficient and non-polluting
construction material
94. The Grupo Punta Cana resort in the
Dominican Republic
was designed to conserve the natural
environment .
10 000 hectares of land was designed a nature
reserve and native fruit tree garden, including 11
fresh water springs surrounded by a subtropical
forest that consists of many indigenous fauna
and flora
At the resort there are also programs to
• Protect the barrier reefs
• Recycling waste water to be used in the
irrigation of golf courses
• Establishment of a biodiversity lab
95. ECONOMIC IMPACTS OF TOURISM – POSITIVE
• Generation of foreign exchange
• Creation of new jobs and employment opportunities
• Stimulation of trade especially in the service and small business sector
• Provision of new infrastructure
• Increase regional development
• Greater tax revenue which permits greater government spending on
other services
• The impact of the multiplier effect
96. • Tourism in LIC are controlled by overseas companies in the form of resorts and hotels
• Marriot – owned by an American multinational corporation
• Sheraton – owned by an American multinational corporation
• Hyatt
• Hilton
• Disney land
These multinational co-operations employ local people in low paying jobs
• Chamber maids
• Domestic workers
• Waiters
Management positions are generally held by foreign nationals who are from HIC’s
• Hotel manager
• Chef
These hotels import food, drink and luxury products from overseas
97. Negative economic impact of tourism
• Leakages of expenditure our of the local economy
• Increased imports
• Opportunity costs
• Displacement effects
• Over-dependence on tourism
• Inflation and higher land values
• Seasonality issues
• Over reliance on expatriate labor
• Problems over foreign investments
99. SOCIO- CULTURAL IMPACTS OF TOURISM
Refers to the impact on people in the host community from direct and indirect impacts associated with
tourism
COMMODIFICATION – involves rituals, festivals, and dress. This type of entertainment is put on daily
for tourist and they lose their significance for the local people
STANDARDISATION – tourist expect to see familiar facilities in unfamiliar surroundings.
CULTURAL CLASHES - clashes between locals and tourist over cultures, ethnicity, religion, values ,
lifestyle, languages etc. e.g. in countries there are strict rules regarding dress code and consumption of
alcohol. Many tourist ignore this, appearing on beaches wearing bikinis and consuming large amounts
of alcohol.
HAVE AND HAVE NOTS – growing distinction between have and have not’s in LIC’s and this causes
social tension
Jobs in the tourism sectors involve long working hours and low pay.
Mass tourism often results in the increase in crime
100. ACCULTURATION – tourism can cause cultures to mix and eventually become similar. Most resort areas are
often influenced by western cultures.
• Strengthening communities
• Facilities developed for tourists can benefit the community
• Revaluation of cultures and traditions
• Encourages civic involvement and pride
101.
102. CASE STUDY – BUTLERS MODEL – MOJORCA
DISCOVERY STAGE
1960 – Received less than half a million tourist per year
Employment was mainly in the primary sector and was dominated by fishing and agriculture
GROWTH AND DEVELOPMENT STAGE
1970 – rapid increase in tourism numbers – 3 million tourist arrivals
Popular package tourist destination for people from Northern Europe
Employment shifted from agriculture to tourism related work e.g. Construction, jobs in hotels, cafes and shops
This led to the construction of large hotels, restaurants, villas and shops
STAGE OF SUCCESS
1980’s – tourist arrivals rose to 7,5 million
This led to the over-utilization of resources like water
Approximately 70% of the population worked in the tourism industry
Tourist development blighted the landscape and locals were resentful of tourists
103. STAGNATION STAGE
1990’s – number of tourist arrivals began to decline
Unemployment rose to above30%
Bars and restaurants closed down because of a lack of customers
Older resorts began to look run down and certain resorts gained a bad reputation
REJUVENTATION STAGE
2000’s - attempts were made to clean up beaches and new public parks, gardens and nature reserves were built to
attract eco-tourists
New airport terminals along with upmarket hotels were constructed
By 2003 over 9 million tourist visited Majorca
104. NEW TRENDS IN TOURISM
- SUSTAINABLE TOURISM
- ECOTOURISM
- CITY BREAKS
- HOME STAYS
- PRO-POOR TOURISM
- MEDICAL TOURISM
- DARK TOURISM
- DOOM TOURISM
105. WHAT IS SUSTAINABLE TOURISM
Sustainable tourism is the concept of visiting somewhere as a
tourist and trying to make a positive impact on the
environment, society, and economy. Tourism can involve
primary transportation to the general location, local
transportation, accommodations, entertainment, recreation,
nourishment and shopping.
106.
107. CASE STUDY – ECOTOURISM IN THE
GALAPAGOS ISLANDS
Chain of islands belonging to Ecuador in
South America
For 1000 of years, the Galapagos islands
have been isolated from human
intervention and this has allowed the
fauna and flora to thrive in this region
The area was designated a UNESCO
WORLD HERITAGE SITE in 1979
108. 1950 – few adventure tourist visited this areas from HIC’s
1969 – cruise ship Lina started offering tours to the Galapagos islands
1974 – government of Ecuador formed a national body to improve tourism an regulate tourism in the
area
1894 – A master plan for tourism was introduced. Investments and projects initiated by the tourist
board greatly increased the number of people and money flowing into the Galapagos islands
Increased tourism has caused social, economic and environmental conflict in the area
Visitors pay an admission fee to the national parks and this money goes to finance its tourism
programs which include operational costs for ticket sales , park guards and patrol boat operators
Income from tourism to the Galapagos islands generates approximately 500million dollars a year for
the government of Ecuador.
109. IMPACT OF MASS TOURISM ON THE GALAPAGOS ISLANDS
The rise in tourism in the Galapagos islands has resulted in the immigration of a number of people from the mainland of
Ecuador to the Galapagos islands because they see the potential for employment
This rising population is increasing pressure on the available resources on the island
The local population has increased from 6000 to 25 000 official residents and around 6500 seasonal migrants in the last 25
years.
The number of airports, airline flights, cargo and cruise ships has also increased to the Galapagos islands
Increase tourism increases the risk of bringing invasive species to the island e.g. Feral pigs, dogs, cats and goats provides
the biggest threat to the endemic species on the island
The local inhabitants have turned remote fishing villages into strips of discos, restaurants, hotels and shops selling plants
and animals as souvenirs.
Although the seas around the Galapagos islands have been a protected marine environment since 1986 illegal fishing still
takes place particularly fishing for sharks
Local inhabitants have no idea about conservation.
• Dump plastic which is eaten by the turtles
110. • Catch lobsters when they are to small or when they are carrying eggs.
• Kill giant tortoises for their meat.
Tourists often make the mistake of startling birds which causes them to fly away from their nests leaving abandoned eggs
Some tourists have started feeding wild animals and these animals have become reliant on being fed and when this
practice was stopped these animals found it difficult to find their natural food source
POSSIBLE SOLUTIONS
• 1987 – Government imposed a restriction of 25 000 visitors pre year, however this figure has never been enforced
• UNESCO recommended that the Galapagos islands been placed on the worlds endangered list
