The indirect economic importance of tourism investment

Ahmed Majed Badawi Hamza
Supervisor: Prof. Dr. Abd Ali Kazim Al-Fatlawi

The income generated from investment in tourism activity does not stop at the tourism sector’s borders but extends to other industries. Therefore, the indirect economic importance of tourism investment is represented in the following:
A_Developing other economic sectors (multiplier): This means that tourism investment achieves an income that leads to an increase in the income of workers in it, and these workers will spend their income to meet their consumer demands, and this consumption leads to an increase in the income of others, which leads to a rise in demand for consumer and investment projects and expansion in their establishment, as the multiplier measures the change resulting from increased investment in both income and production.
B_Developing infrastructure: The demand for tourism requires providing a set of basic structures, which must keep pace with the various developments and changes occurring in the social and economic environment.

C—Increasing investment opportunities: Tourism projects are undoubtedly among the most attractive investments for foreign and local investors, as tourism investment areas are diverse. These include hotel accommodations, tourist villages, health and medical tourism centers, entertainment and leisure places, theaters, cinemas, sports centers, restaurants, and cafeterias.

D—Change in the general price level: Monetary inflation occurs when supply lags behind demand in any economic activity, especially during the peak season. This leads to an increase in the prices of tourism products and other goods that tourists accept to buy. (Morad and Jaloul, 2016: 92)