ISLAMABAD: The World Tourism Organisation (WTO) of the United Nations has said 517 tourism foreign direct investment projects were recorded in the Asia-Pacific region between 2018 and 2022, representing $65.1 billion capital investment and creating more than 105,600 jobs.
The ‘Tourism Investment 2023’ report released to mark World Tourism Day being celebrated on Wednesday says following a decline in 2020 and 2021, the number of announced projects in the region increased marginally by 2.4pc to 42 projects in 2022.
Job creation in the region peaked in 2018, with more than 49,000 jobs created and fell to its lowest in 2021, when approximately 4,300 jobs were created through tourism FDI. The number of jobs created from tourism-related investments increased by 6pc from 2021 to 2022.
China attracted the highest number of tourism FDI projects between 2018 and 2022, receiving 79 announced projects - 15pc of the total market share in the region. China peaked for tourism FDI in 2019, with 30 announced projects, yet inbound project numbers have steadily declined since then.
India attracted three times more tourism FDI projects in 2022 than it did in 2021, and ranked as the top destination country in the region last year.
Foreign investors announced a total of 2,415 foreign direct investment (FDI) projects in the tourism cluster between 2018 and 2022. These projects involved a total capital investment of $175.5 billion and created an estimated 388,000 jobs.
While international travel continues to rebound from the coronavirus pandemic, the number of greenfield foreign direct investment (FDI) projects in the tourism cluster started its tentative recovery in 2022 after posting declines in both 2020 and 2021.
FDI project numbers and job creation in the tourism cluster grew by 23pc from 286 investments in 2021 to 352 in 2022. Job creation in tourism FDI over the period also increased by 23pc to an estimated 36,400 in 2022.
As one of the areas of FDI most affected by the coronavirus pandemic, tourism has taken a long time to recover from the initial shock of 2020 - when the sector experienced a 59pc year-on-year decrease in the number of projects, dropping to 312. Capital investment in the sector also experienced a 70pc decrease, with estimated capital investment dropping from $60.9 billion to $18.2 billion.
The US was the largest recipient of tourism FDI between 2018 and 2022 with 198 projects, followed by the UK (160), Spain (133) and Germany (133). The top 10 countries for tourism FDI attraction accounted for nearly half (47pc) of all announced tourism projects globally between 2018 and 2022.
Capital investment in the sector totalled $175.5 billion between 2018 and 2022 with Spain being the leading recipient ($19.4 billion), followed by China ($11.5 billion) and the Philippines ($11.1 billion). Job creation in tourism FDI was highest in Mexico between 2018 and 2022 with an estimated 31,000 jobs created in the sector, followed by China (22,130) and Spain (20,590).
The hotel and tourism sector accounted for almost two-thirds of all projects in the tourism cluster between 2018 and 2022. Foreign direct investment (FDI) project numbers increased by 25pc from 2021 to 2022. However, capital investment in the hotel and tourism sector declined from $48.9 billion in 2018 to $7.8 billion in 2022.
Between 2018 and 2022, accommodation remained the largest sub-sector of tourism FDI globally, accounting for more than half (51pc) of all FDI projects. More than 70pc of capital investment ($126.8 billion) and job creation (270,000) in the tourism cluster was generated by the accommodation sub-sector during the same period.
Software and IT services were the second-largest sector for tourism FDI projects between 2018 and 2022. Its share of global FDI tourism projects grew from 10pc in 2018 to 16pc in 2020, 22pc in 2021 and 28pc in 2022, indicating the sector’s resilience and its ongoing shift towards digitisation.
Published in Dawn, September 27th, 2023