Pakistan’s tourism sector lags behind region’s growth

KARACHI: Pakistan lags behind  more than halfway to  reach the average GDP share of  region’s travel and tourism sector,  yet the growth prospect is  bright on a recent economic  upturn, a foreign advocacy  group said.  The country’s travel and  tourism sector contributed  $19.4 billion to GDP in 2016 as  compared to south Asia’s average  of $42.1 billion, World  Travel and Tourism Council  said in the country report,  “Travel and Tourism Economic  Impact 2017 Pakistan”.  London-based nonprofit organisation,  monitoring tourism  performance in 186 countries,  said the country’s travel and  tourism direct contribution to  GDP amounted to $7.6 billion  as against the region’s average  of $15.2 billion during the last  year.  Tourism GDP shares in  China, India, Thailand and Indonesia  stood above the region’s  average during the past  year.  The tourism body, however,  expects the sector’s share in  Pakistan’s economy to more  than double over the next  decade as rising spending by  local and foreign tourists  would fuel economic activities.  Pakistan’s economy  recorded a decade-high growth  of 5.3 percent during the last  fiscal year of 2016/17.  “This primarily reflects the  economic activity generated by  industries such as hotels, travel  agents, airlines and other passenger  transportation services  (excluding commuter services),”  the body said. “But, it  also includes, for example, the  activities of the restaurant and  leisure industries directly supported  by tourists.”  The sector accounted for  2.7 percent, equivalent to $7.6  billion, of the country’s GDP in  2016. Its share is forecast to increase  5.1 percent in 2017. The  contribution of travel and  tourism sector will reach $13.6  billion by 2027.  Total contribution of travel  and tourism to GDP was $19.4  billion, 6.9 percent of GDP in  2016, and is forecast to rise by  six percent in 2017, and to increase  5.8 percent a year to  $36.1 billion in 2027.  World Travel and Tourism  Council projects visitor exports  to grow 3.1 percent in 2017, and  increase 7.7 percent a year  from 2017-2027 to $1.94 billion  in 2027. In 2016, the country’s  exports revenue from the sector  amounted to $894 million,  around four percent of total exports.  Number of foreign tourists  is expected to reach 2.173 million  in 2027, it said.  Yet, domestic travel spending  generated 92.6 percent of  the sector’s GDP share in 2016  compared with 7.4 percent for  visitor exports.  The council said travel  spending by locals would grow  5.3 percent to $11.76 billion,  and rise by 5.6 percent a year to  $20 billion in 2027.  Domestic tourism is growing  in Pakistan after the improvement  in security condition.  The country’s most  sought-after tourist destination  in northern areas are witnessing  revival in interest of  tourists, reflecting in the increase  in revenue of hotel industry.  Gilgit-Baltistan is also  seeing a rush of local and international  travelers to the region’s  scenic meadows and valleys.  The group further said  investment in travel and  tourism sector would more  than double to $8.3 billion over  the next 10 years.  In 2016, the investment in  the sector amounted to $3.6 billion  and it would grow eight  percent a year to reach $8.3 billion  in 2027.  Yet, the sector is a little over  halfway to south Asia’s average  of $6.6 billion during the last  year.  The hospitality sector directly  supported 1.34 million  jobs, 2.3 percent of total employment  last year. This is expected  to rise to 1.76 million in  2027. Indirectly, the sector supported  3.55 million jobs in 2016  and within a decade the indirect  jobs would be 4.78 million,  according to the council.  South Asia’s average employment  in the sector was 4.78  million during the last year.  The council put Pakistan’s  hospitality sector on 47 position  in terms of size, 136 with  regards to GDP share, 45 in relation  to short-term growth  forecast and 33 for long-term  growth projection.