Handbook Coverage of Foreign Investment in Tourism
The Sage Handbook of Tourism Studies offers a fantastic overview of the issue of tourism and tourism studies but as has been pointed out is developed from the perspective that the world was not necessarily about to experience an extreme global recession. For instance in the timeline associated with tourism development internationally the work provides the last section of the timeline to include the 1990s and 2000-and beyond (Jamal & Robinson 2009, p. 153). What this offers the reader is the sense that the climate for foreign investment and especially investment in developing nations will remain static as the research and development of national tourism sites will continue to be an issue of economic advantage for both the investor and the nation of focus. Though the work does also challenge the issue of investment oversees in developing nations as something that can and does challenge the developing nation and even arguably make it more dependent on both foreign investment and possibly even the colonial powers in postcolonial nations, lacking the infrastructure of technology to maintain such tourism (2009, pp. 166, 191) and in developed nations the economic and political challenges of investment are also briefly discussed (2009, p. 123). The work does not however plainly discuss the issue of economic challenges to new and existing foreign tourism investment, as the issues noted above would clearly be multiplied in the climate of the current global recession. Investors and investment sites, especially in those places where infrastructure needs high levels of investment as well will be challenged to continue to receive foreign investment dollars as investors exhibit necessary fear and conservatism with regard to any investment and seek those with the lowest perceived risk.
Changes in Foreign Investment in the Wake of Global Recession
All of the above issues are paramount, as are several others with regard to foreign investment in tourism during a massive international recession as investors and nations alike are often channeling funding to areas of greater importance, i.e. maintaining existing infrastructure and conservative investment strategies that offer only limited risk. For example during economic downturns a great many people turn within, staying closer to home, to satisfy their travel desires and spend less money while doing it. The effect this has on tourism is substantial as a greater number of destinations must actively advertise and cut deals to maintain numbers, while simultaneously using fewer funds to build and/or maintain services. In the years following the research base for the work including 2008-2011 even relatively stable nations like Greece and Italy have very obviously began to show fearful economic destabilization, making even traditional "safe" investment bets something of the past (Executive Summary, 2011, pp.9-10). With this change investment in nations where infrastructure including; technology, transportation, and logistics will become even more challenging and risky to the investor. Finally investment or reinvestment in "safer" locations will clearly be dependent on national and international economic recovery (2009, p. 166). Additionally those investments in locations that have a higher perceived risk will likely remain on the backburner for quite a while after recovery begins, partly because investment opportunities in lower risk locations will likely increase as those investment players challenged by the downturn in the economy will have vacated promising investment opportunities during the downturn leaving the climate ripe for new investment takeovers in locations with proven destination track records for positive returns in the past (Rogers, 2011)("A Private Sector-Driven"2011, p. 1-7) (Bahar, & Kozak 2007) (Patsouratis, Frangouli, & Anastasopoulos 2005).
Changes in Foreign Investment regarding Education and Trainign in Tourism in the Wake of the Recession
The future of education and training in tourism is also one that has been demonstratively challenged by the global economic recession as to many this is also an aspect of the infrastructure discussed earlier. Though a positive turn in the situation may include the tendency during tough economic times for the tourism industry and especially the hospitality industry to retain workers for longer periods, i.e. when there are fewer opportunities for employees to seek other employment they are more likely to keep what they have (Jamal & Robinson 2009, p. 19). This could also create a decreased immediate need for training, though there are also trends that say that training and investment in it will increase as individual cites stress quality and value to retain a customer base and remain a highly desired location, or become a highly desired location (Bahar, & Kozak 2007) (Devaney 2011). In general the investment in education increases during times of economic downturn as many people, during high unemployment seek to improve their marketable skills and return to school (Browne, Dooley, Rogers, Pike, Roberti, Eisen, Allison, Terrero, & Fox 2009). This trend will likely improve the climate of training and education in toruism industries as many of these people seek short-term, i.e. vocational and rapid certificate training either to retain current employment and/or to possibly sharpen skills or to develop marketable skills for the very near future. This could potentially continually improve the hire-ability of future workers and the entrance skills of hospitality industry workers. The same can be said of foreign investment as challenged economies often also invest in educational opportunities for displaced workers, often an outgrowth of other foreign investment during troubled economic periods (Bodman, & Le 2011) (Gideon 2011).
Direct Foreign Investment in South Africa in the Wake of the Global Recession
Direct foreign investment in South Africa has been challenged for a long time, following the 1990s international emphasis on massive income disparity as well as the continuing legacy of the segregated racist policies of the nation, at the time. Since then foreign direct investment has been sparked by a desire by some nations to both aide in the recovery of the apartheid dismantling. Additionally, many tourism issues associated with the nation had to do with restrictions that were associated with apartheid laws benefitting the minority population and restricting services to the black majority ("C/A deficit growing, 2010). Prior to this time the nation's destination status was high for the wealthy from all over the world. The point then is that over the last 20 years the South African nation has undergone serious upheaval and was up to the current recession progressively rebuilding and recovering under a more equitable ideal. Direct foreign investment returned to the nation in zeal by 2000, though challenges and disparities still of course remain. In 2010 the nation hosted the World Cup football tournament, which was seen as a resounding economic success and required massive investment from foreign and local sources to be so (Bloomberg, 2010). This is not to say that the tournament did not also have its massive detractors who challenged that the investment and the massive infrastructural building benefitted the nation's poor in any way, as they were in most cases barred from even the most basic participation as a result of high costs.
Bloomberg, N, 'South Africa proclaims World Cup a tourism win', Toronto Star (Canada), December, 7 2010, Newspaper Source, EBSCOhost, viewed 11 December 2011.
This work demonstrates the perspective of financial and economic assistance that was provided South Africa as a result of the World Cup in 2010. The work looks at the manner in which the nation supported massive sports complex infrastructure building, aided a great deal by direct foreign investment. This event and its scale will likely continue to add to the development of tourism investment in South Africa and result in a long-term gain for the nation.
Gideon, S 2011, 'London tourism body taps up top mandarin', Evening Standard, 25 May, Newspaper Source, EBSCOhost, viewed 11 December 2011.
This work details the example of London based investment opportunities and stresses the new emphasis on international fares. The work describes ways in which the tourism industry in London specifically is focusing on attracting direct foreign investment as well as greater tourism dollars from international consumers. They are doing this clearly through upgrading existing services and specifically direct private sector investment into existing services in the hope of securing host status for the 2012 Olympic and Paraolympics Games as well as other focused investments both private and public, foreign and domestic.
Roger, Y, & USA, T Sept. 9, 2011, 'Hotels drop their reservations about upgrades', USA Today, Sept. 9, 2011., Newspaper Source, EBSCOhost, viewed 11 December 2011.
This work demonstrates a great example of the kinds of upgrades and investment opportunities that will be available in the near future to demonstrate improvements in quality in the tourism and hospitality sector. The work does discuss mostly domestic examples but it would not be difficult to demonstrate this type of trend occurring internationally, especially in investment in traditionally "hot" and secure tourist destinations such as those in the Mediterranean as well as South Africa.
'A Private Sector-Driven Recovery. (cover story)' 2011, Latin America Monitor: Caribbean Monitor, 28, 7, pp. 1-7, Business Source Premier, EBSCOhost, viewed 11 December 2011.