The Contribution of Tourism to Economic Growth: The Case of Qatar
Abstract
Most of the Gulf Cooperation Council (GCC) countries’ wealth was attributed to revenues generated from oil and gas exports. However, with the fluctuation of oil demand and prices, leaders of GCC countries acknowledged the importance of economic diversification to reduce their dependence on oil exportation and allow for revenue generation from non-energy sectors. As a result, GCC countries, including Qatar, have witnessed rapid development in the tourism sector. The Qatari government commenced several local and intra-regional development plans, which promised more inflow of tourists both from GCC countries and other countries. Yet, impacted by the GCC crisis, the total number of visitors to Qatar noticeably decreased. These changes raise unanswered questions on whether the investment in the tourism sector can create a sustainable non-energy source of revenue. Since little attention has been paid to this issue, this paper contributes to the current understanding of the issue by examining the contribution of tourism to economic growth in Qatar. Using annual data from 1995 to 2018 and employing an Autoregressive Distributed Lag (ARDL) model, the paper tested whether the Tourism-Led-Growth Hypothesis (TLGH) is valid for the case of Qatar. Results suggest that tourism does not have a statistically significant impact on economic growth in the short-run. However, it has a statistically significant impact in the long-run, such that every 10 percent increase in tourist visits causes a 3 percent increase in GDP growth. The results suggest that the investment efforts in the tourism sector should continue to stimulate economic growth and development and diversify the economy away from the energy sector.
References
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[3] Aratuo, D. N., Etienne, X. L., Gebremedhin, T. and Fryson, D. M. 2019. Revisiting the Tourism-Economic Growth Nexus: Evidence from the United States. International Journal of Contemporary Hospitality Management, 31(9): 3779–98. DOI: https://doi.org/10.1108/ijchm-08-2018-0627
[4] Bassil, C., Hamadeh, M. and Samara, N. 2015. The Tourism Led Growth Hypothesis: the Lebanese Case. Tourism Review, 70(1): 43–55. DOI: https://doi.org/10.1108/tr-05-2014-0022
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[7] Fayissa, B., Nsiah, C. and Tadasse, B. 2008. Impact of Tourism on Economic Growth and Development in Africa. Tourism Economics, 14(4): 807–18. DOI: https://doi.org/10.5367/000000008786440229
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[10] Hvidt, M. 2014. Economic Diversification in GCC Countries: Past Record and Future Trends. Library Services. London, UK: Middle East Centre. Available at: http://eprints.lse.ac.uk/id/eprint/55252
[11] Hye, A., Muhammad, Q. and Khan, R.E.A. 2013. Tourism-Led Growth Hypothesis: A Case Study of Pakistan. Asia Pacific Journal of Tourism Research, 18(4): 303–13. DOI:https://doi.org/10.1080/10941665.2012.658412
[12] Katircioglu, S.T. 2009. Revisiting the Tourism-Led-Growth Hypothesis for Turkey Using the Bounds Test and Johansen Approach for Cointegration. Tourism Management, 30(1): 17–20. DOI:https://doi.org/10.1016/j.tourman.2008.04.004
[13] Khatai, A. and Ahmadova, N. 2020. Testing Tourism-Led Economic Growth and Economic-Driven Tourism Growth Hypotheses. Tourism, 68(1): 43–57. DOI: https://doi.org/10.37741/t.68.1.4
[14] Oh, Chi-Ok. 2005. The Contribution of Tourism Development to Economic Growth in the Korean Economy. Tourism Management, 26(1): 39–44. DOI: https://doi.org/10.1016/j.tourman.2003.09.014
[15] Pesaran, M. H., Shin, Y. and Smith R. J. 2001. Bounds Testing Approaches to the Analysis of Level Relationships. Journal of Applied Econometrics, 16(3): 289–326. DOI: https://doi.org/10.1002/jae.616
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[17] Salifou, C. K. and Haq, I. 2016. Tourism, Globalization and Economic Growth: a Panel Cointegration Analysis for Selected West African States. Current Issues in Tourism 20(6): 664–67. DOI: https://doi.org/10.1080/13683500.2016.1175421
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[19] Škrinjarić, T. 2019. Examining the Causal Relationship between Tourism and Economic Growth: Spillover Index Approach for Selected CEE and SEE Countries. Economies 7(1): 1–19. DOI: https://doi.org/10.3390/economies7010019
[20] Tang, C. F. and Tan, E.C. 2013. How Stable Is the Tourism-Led Growth Hypothesis in Malaysia? Evidence from Disaggregated Tourism Markets. Tourism Management, 37: 52–57. DOI: https://doi.org/10.1016/j.tourman.2012.12.014
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Published
2021-03-29
How to Cite
OZTURK, Ozcan; AL-KUWARI, Maryam.
The Contribution of Tourism to Economic Growth: The Case of Qatar.
Journal of Environmental Management and Tourism, [S.l.], v. 12, n. 2, p. 598-607, mar. 2021.
ISSN 2068-7729.
Available at: <https://journals.aserspublishing.eu/jemt/article/view/5982>. Date accessed: 03 july 2024.
doi: https://doi.org/10.14505//jemt.v12.2(50).29.
Section
Article
Copyright© 2023 The Author(s). Published by ASERS Publishing 2023. This is an open access article distributed under the terms of CC-BY 4.0 license.