t,1'ti,'flONAJ. l.t4-.f' ~~ 1> ~ ~ IWOIILD BANK I INTERNAT.IONAL BANK FOR· \ f .RECONSTRUCTION AND DEVELOPMENT ,j.">:tt.. ~ON AN0o1' ~.,./ 1818 H STREET, N.W., WASHINGTON 0. C. 20433 TELEPMONE: EXECUTIVE 3-6~60 June 28, 1972 World Bank Sector Study TOURIST INDUSTRY'S ROLE IN ECONOMIC DEVELOPMENT Developing countries face a number of important issues in promoting tbe tourism industry as part of their economic growth efforts, according to a sector working paper just published by the World Bank. The World Bank Group -- which includes the Bank, the International • Development Association and the Intemational Finance C.Orporation -- has been directly financinli tourism proj ecta for only five years. During that period the Group has assisted 13, projects with financing totaling almost $80 million. And, through intermediary institutions, it has provided an additional $32 mil- lion for 79 tourism projects. Among the key issues that ~ave emerged during the Bank's relatively brief period of activity in assisting tourism projects are: * Appropriate strategies of tourism development in partieular count1"1.es with special reference to market possibilities and to the types and location of tourist facilities; * Appropr.late air transport policies, especially the pre- eminent issue of severely restricted tourist traffic because of limitations b:r 3 host country of landing rights of foreign airlines, especially for air charter operations; • * The o~ environmental, ecological, cultural and social impact tourism development in particular areas; and * The ownersh:i.p and use of land for tourism purposes. /more - 2 - The sector paper also describes the growth of tourism throughout the world, the various factors which have affected this growth, and the prospects • for developing countries to benefit more fully from tourism. It outlines the World Bank Group's role in encouraging the establishment and extension of the tourism industry in developing countries as well as indicating its future plans in this sector. In the 1972-76 period the Group expects to more than triple the number of its tourism projects with a fourfold increase in financing ing. Tourism has become a leading f 0:r~::.gu 1:Acl1c:U.1i,c c:cii'ner. in a number of developing countries, the sector ,aper points out, with receipts, in many cases, amounting to more than 20% of the total value of merchandise exports. • l-k>reover, n,?t foreign exchange receipts from touri~m are relatively high. In major tourism countries such as Mexico, Spain and Yugoslavia they are over 8S% of gross receipts and they seldom fall below 45% in any of the developing countries. The Tourism Sector Paper consists of five main sections: a review of the sector, World Bank Group operatiocs in tourism, other external financial and technical assistance, future Bank Group operations, and an annex of data tables. It· is the eighth in a series being published by the World Bank. Topics of earlier sector papers were education, water supp1y and sewerage, electric power, tell;'toDDDunications, transportation, population planning, and industry. All sector working papers can be obtained free of charge from the Bank's Publications Department, Room .AllO, 1818 H Street, N.W., Washington, D.C., 20433, U.S.A. - 0 - •