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Tourism and the World Trade Organization

From development projects on the beaches of Liberia and a hotel school in Sierra Leone to trade negotiations in Switzerland, tourism’s international linkages extend around the globe. International tourism. Over the past decades, international tourism has experienced continued growth and diversification, becoming one of the world’s largest and fastest-growing economic sectors, accounting for over one-third of the value of global services trade. International tourism is a highly inclusive service sector with participation in trade by economies at all levels of development. In many developing economies, the tourism and travel-related industry records the highest contribution to exports by micro, small and medium-sized enterprises (MSMEs) and by women.

In services MSMEs, the highest shares of exports by firms owned by women were in tourism and travel- related services, such as travel agencies, tour operators, hotels and restaurants, as well as in transport.

Tourism is not only an important source of female employment but also offers concrete opportunities for female business-owners to trade internationally. The new trend towards sustainable tourism will offer further export opportunities to areas not yet touched by tourism development. In many developing countries, these new market opportunities (that also represent employment and entrepreneurship opportunities) are often considered as a means to promote natural resources conservation, while improving the living conditions of local communities in terms of
education, the empowerment of women, and health and income.

Ghana beach

Tourism in the World Trade Organization (WTO)

Tourism services are covered by the World Trade Organization’s General Agreement on Trade in Services (GATS), which went into effect in 1995, at the conclusion of the Uruguay Round of trade negotiations. The number of Members with GATS commitments in ‘tourism and travel-related services’, 132, is higher than in any other sector. This likely reflects the fact that members at all levels of development attach high importance to tourism and have an interest in expanding their tourism sectors and encouraging investment as part of their efforts to promote economic growth.

African street

GATS commitments in tourism

GATS commitments in tourism and related services can contribute importantly to the policy environment for the sector by providing for greater transparency, predictability, and contestability. This is key to fostering trade and investment to grow the local tourism industry and reap broader economic benefits. In 2020, the Trade in Services and Investment Division (TSD) in the WTO organised a webinar entitled “Building Back Better in Tourism: The roles of International Organisations”. During the webinar, the UNWTO, OECD, ITC, the Commonwealth and the WTO presented the specific measures undertaken to address the COVID-19 pandemic and discussed the broader tourism roles of international organisations. Aid for Trade and the Enhanced Integrated Framework (EIF)

Because of the COVID disruption, reviving the tourism sector is posing major challenges to governmentsaround the world. In the WTO, a series of meetings have been organised to highlight the importance of targeted Aid-for-Trade disbursements to MSMEs and to analyse how Aid-for-Trade can positively affect global tourism. COVID-19 has enabled an opportunity for a sector reset, through intensified collaboration amongst governments, donors and the private sector.

Conclusion

In addition, for the least developed countries (LDCs), the EIF is helping to bridge the gap between demand and supply for Aid for Trade and to mainstream trade in national development plans. Projects in West Africa include a Surf Tourism project in Liberia with the collaboration of the International Trade Centre (ITC) and the World Tourism Organization (UNWTO), and a Sustainable Tourism Development and a Promotion project in Sierra Leone2 being implemented by the Sierra Leone National Tourist Board. The objectives of the project in Sierra Leone are twofold: (i) for Sierra Leone to own a tourism agenda aligned with trade policies and conducive to sustainable pro-poor growth; and (ii) to increase the presence and perception of Sierra Leone in the international market as an attractive tourist destination.

Countries in West and Central Africa can prioritise the development of tourism as a key sector to help drive inclusive growth and poverty reduction, with the goal of increasing participation in the multilateral trading system, through these projects.

In short, if you want to learn more about the cultures of the world, look at our Blog.

Author: Ester Rubio

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