TRANSCRIPTS
my view it will be incredibly hard to move them in the right direction. The effect of their unstoppable growth has been very harmful, in my opinion, especially from an environmental point of view. Their bottom line is market share and filling planes, isn’t it?
Now, let’s turn to economic influences on the world of business, including tourism and hospitality. An important economic dimension is the changing importance of different business sectors over a period of time. Peter Drucker, who was a major business thinker, gives a good description of this in his article entitled ‘The New Society’ published in The Economist in 2001. By the way, if you don’t know anything about Drucker, a good introduction to his work can be found on a website at the University of Pennsylvania – I’ll give you the URL later. Briefly, in The Economist article, Drucker explains how at the beginning of the 20th century (in 1913) farm products accounted for 70% of world trade, but farming has now fallen to less than one-fifth of the world’s economic activity. In many developed countries the contribution by agriculture to their GDP has reduced dramatically. More recently also, manufacturing has seen a substantial decline in many of the developed nations. Manufacturing as an economic activity in many developed countries has given way to a major increase in service industries such as tourism and hospitality, with a consequent rise in the importance of finance and the money markets. These changes in the nature of economic output are, of course, reflected in the types of business which we find in these countries.
At the same time, in the newly emerging boom economies such as China, governments are trying hard to reduce people’s reliance on farming in favour of new manufacturing and also tourism. India is another example of this: it has seen a boom in both these areas.
A thought to finish with is the question of to what extent these booming economies will become the main drivers of the global economy. One writer in Money Management magazine has no doubt that, and I quote, ‘China will continue to be a dominant player driving world growth, which will have flow-through to other economies.’ This could mean that we may see the older economies such as the United States losing out increasingly to China and India. In terms of tourism, we are likely to see improving facilities for tourists travelling to these countries, but also significant numbers of tourists from these countries travelling both within their own countries and to overseas tourist destinations. Now, I’m going to stop at this point …
Unit 11, Lesson 2, Exercise F 2.10
You need to wonder, though, whether these attitudes can have an effect on the mainstream. Mass tour operators are a case in point. Can we really convince these operators, who take the majority of tourists around the world, to prioritize environmental issues? The UN-led Tour Operators’ Initiative for Sustainable Tourism Development is a positive step. However, critics of tour operators argue that they are always going to put their own interests first. The evidence shows that this is especially true with respect to airline carriers. In my view, it will be incredibly hard to move them in the right direction. The effect of their unstoppable growth has been very harmful, in my opinion, especially from an environmental point of view. Their bottom line is market share and filling planes, isn’t it?
Unit 11, Lesson 2, Exercise G 2.11
1 I’m going to try to explain some of the major factors which exert pressure on the sector from the outside, that is to say, I shall mainly be looking at some of the different types of external influences which affect the way businesses in tourism and hospitality operate.
2 Don’t misunderstand me, I don’t want to imply that there are no internal questions for a company.
3 To some degree, individual companies will be affected differently.
4 … but it is fair to say that they will all have to keep an eye on which way inflation or interest rates are going, or demand and competition in a particular location.
5 Not only that, but they also have to keep track of the government policies of the country or the countries where they operate.
6 In an attempt to try to keep the discussion of external pressures on business reasonably simple, though, I’m going to focus mainly on three areas: politics, economics and, very importantly, the environment.
7 The evidence shows that this is especially true with respect to airline carriers.
8 Mass tour operators are a case in point.
9 Peter Drucker, who was a major business thinker, gives a good description of this in his article entitled ‘The New Society’ published in The Economist in 2001.
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