Page 7 - Grade 12 Tourism

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- Short term jobs are created.

Negative

- Enormous investment of funds is required preparing for the event.
- Due to the required capital, debts can be incurred that may take time to pay off
way after the event.
- Facilities built for the event may not be useful after the event.

3. The impact of hosting a global event on the host country

- The legacy left behind after the event can improve the long term well-being and
lifestyle of citizens.
- It places the country on the global map.
- It impacts positively on international tourism and investments.

Impact on domestic tourism in the host country

- Domestic tourism slows down as this is displaced by foreign tourism.
- The prices are inflated due to an increase in demand for products and services
and this will be expensive for local citizens.
- There will be disruption of local activities with cancelling or postponing to later
dates.

The impact on the economy of the host country

- There is an increase in the inflow of foreign currency due to an increase of
international tourism before, during and after the event.
- It provides an opportunity for foreign investments.
- More spending during the event will result in high economic activity.

4 Advantages and disadvantages for the host country

The advantages of hosting an international event outweigh the disadvantages. This is
the reason why so many countries bid to host such events.

The most important advantages are:

- Development of infrastructure
- Generation of foreign exchange income
- Increase in international tourism
- The possibility of future foreign investments
- Job creation

The Multiplier Effect

This refers to how many times money spent by tourists circulates through a country’s
economy. When tourists spend their money in hotels, restaurants, retail outlets and on
transport and communication services, it creates a direct income for them. They then
spend some of the money on their suppliers, transport, heating and lighting,
accountancy and other businesses. Therefore jobs are created indirectly elsewhere in
the economy. The demand for local products increases and this increases secondary
employment.

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