26th April 2016 – Tourism in a diversified economy

The need for diversification of the Nigerian economy has been harped upon by economists and stakeholders in the last 30 years without concrete action to realise it. Rather, successive governments have concentrated on revenue accruable from oil and gas to the exclusion of other sectors of the economy. The effect has been a gradual crippling of Nigeria’s manufacturing industries and their raw material providers namely, the agricultural and solid mineral sectors. Not surprisingly, the economic activities hinged mainly on the oil industry began to fluctuate leaving the nation’s economy in a tail spin.

Diversification, in lay parlance, refers to development and sustenance of several other sectors strong enough to carry the burden of economic activities in the nation without any noticeable slide when one or two of those sectors run into troubled waters such as a crash of prices in the international market as has been the case with oil and gas in the past one year. Since the late ‘70s when the gap between the oil sector and agriculture became too wide to be ignored and former Military Head of State, General Olusegun Obasanjo, instituted the Operation Feed the Nation (OFN) programme, meant to send Nigerians back to the farms, the impact has been salutary. Indeed, importation of agricultural products, household goods, textiles, etc. has risen hugely that farmers had little or no incentive to continue. Manufacturing industries gradually closed shop one after the other. Today, imported goods account for over 90% of products in Nigerian markets!

It is difficult for the average Nigerian to comprehend how culture and tourism, a sector considered by many as abstract and intangible can directly or indirectly affect his livelihood or turn it around for the better. It is, therefore, not surprising that even government administrators fail to see the link between this sector and the escape route they are seeking from the economic woes facing the nation, hence, its comparatively low funding as against other sectors of the economy. But that culture and tourism can and have earned billions in dollars for nations who had the foresight to tap into its immense wealth potentials is a fact that cannot be gainsaid.

As early as 1999, the International Monetary Fund (IMF) revealed that in terms of global export earnings the previous year, international culture and tourism topped the table with an income of US$504 billion. Petroleum and allied products generated US$435 billion and ranked fifth behind automobile, chemicals and food. A few years later, the UN World Tourism Organisation’s report in 2006 indicated that for the previous three years, global tourism continued to record higher growth rates, whereas the 2006 performance exceeded the projected growth with about 842 million international arrivals, Africa maintaining its lead as the fastest-growing tourist destination.

Moving forward, the World Trade Organization (WTO) has continued to assert that tourism is a massive income earner the world over. On 2014 global earnings from the sector, it reports that exports from international tourism rose to US$1.5 trillion in 2014 and international tourism receipts increased by US$48 billion to reach a record US$1,245 billion. An additional US$221 billion was generated from the international passenger transport, bringing total exports from international tourism up to US$1.5 trillion!

Receipts from international visitors’ spending on accommodation, food and drinks, entertainment, shopping and other goods and services reached an estimated US$1,245 billion (Euro 937 billion) in 2014, an increase of 3.7% in real terms (taking into account exchange rate fluctuations and inflation). International tourism arrivals increased by 4.4% in 2014, reaching a total of 1,135 million up from 1,087 million in 2013.According to WTO Secretary-General, Taleb Rifai, international tourism is an increasingly-significant component of international trade as seen in export earnings from international tourism and passenger transport which reached US$1.5 trillion in 2014. “In a scenario with decreasing commodity prices, spending on international tourism grew significantly in 2014, proving the sector’s capacity to stimulate economic growth, boost exports and create jobs”, he added.

Going by the WTO’s assertions, it is obvious that culture and tourism would have been the best alternative for Nigeria to recoup some of its losses in the oil and gas sector at a time when American and European tourists have more money to spend on tourism as a result of the fall in prices of petroleum products which has resulted in a commensurate fall in prices of commodities, if only the sector had been given the necessary attention in terms of development funding to prepare it for the strategic role.

Glimpses from the above WTO reports may explain some of the nitty gritty involved in income generation from local and international tourism. By the mention of such terms as passenger transport, accommodation, food and drinks, entertainment, shopping and other goods and services, the WTO has inadvertently explained how this huge income earning comes about. Understanding this aspect is very necessary since the investment funding required for harnessing the sector’s potentials both from public and private organisations will not be forthcoming when investors have no clear understanding of the sources of profit.

It goes without saying that tourism, to a large extent, involves travel and travel costs money. That being the case, the next question that requires an answer is what motivates this travel and the huge spending on the part of the tourist? This is where art and culture come in. People are usually drawn to places whose art and cultural heritage differ from their own. They want to see for themselves how other people live and what relics of their past can be found in the present day. Africa being the oldest civilisation in the world attracts this attention in abundance due to the desire of the rest of the world to see where civilisation began. These fascinating art, culture and tourism heritage appear in forms of traditional and contemporary artistic representations, music and dances, festivals, cuisines, souvenirs, fashion and dress, historical monuments, natural endowments among others.

As soon as a tourist takes off from his residence, he begins spending money on transportation. When he arrives, he spends on food and accommodation, pays the tour guide who shows him around, buys gifts and souvenirs, art works and clothes. When he visits galleries and monuments, he pays access fees. All this money goes into the hands of the local people, boosting the local economy and consequently, that of the nation.

•Iwuoha, a culture researcher, writes from Abuja


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