Mar 31, 2008 3
The Explosion of International Tourism
Read an interesting article from the Harvard Business Review courtesy of my college. Focusing on trends on the business horizon, international travel is expected to double, from 800 million international visits in 2008 to 1.6 billion visits in the year 2020. Looking at the economics of this trend, there can be only so many people that can visit museums or enjoy a beach. The demand for traveling to popular destinations will create a scarcity of place, according to the article.
The article gives 3 probable market responses: First, as demand will skyrocket past supply, tourism relate costs will rise dramatically, from hotel rooms in world cities to even taxis and airplane availability. There will soon be scalpers not just for sporting events and concerts, but soon for airline tickets and passes to museums or parks. Government will also control demand by putting taxes on travel to destinations. One example is the Galapagos Islands of Ecuador, as more and more people coming to visit, the trend is impacting the ecosystem, which is leading to talks of raising parks entrance fee or restricting visitors, which leads to second…. Wait lists.
Expect to be on wait list for months, even years, before you can travel to popular destinations. With these wait lists forming, leading to number three, you can expect the creation of new destinations, more like replications of the wait listed places. For example, China is currently developing islands like Macao to rival Hawaii. You see it here in America, with casinos popping up in major cities, or the Indian casinos here in California, drawing business away from Las Vegas.
As scarcity of popular travel destinations around the world grows, there will be tons of opportunity to profit from the ever growing demand. I found this particular trend very interesting, and I am going to try and discover trends similar to world travel in the future. For instance, like the summer Olympics in Beijing this summer, I am going to look at investment opportunities in South Africa for preparation of World Cup 2010, perhaps the biggest sporting event in the world.
Any opportunities that you recognize or can think of with this trend in mind?
