Incentive Travel Factors

International Economic Overview: 1994 and Beyond

For more than three years, major economic forecasting organizations have consistently predicted that global economic recovery "lies just around the corner" (The rich, the slower, 1994, p. 92). With each successive forecast, however, the "corner" continues to remain elusively ahead of the present (The rich, the slower, 1994, p. 92).

The travel industry, particularly the incentive travel segment of the industry, is heavily dependent upon economic growth in the developed economies. The Organization for Economic Cooperation and Development (1993, p. 6), whose membership of 24 countries includes almost all of the world's developed economies, however, predicts an average growth for its members in 1994 of only 2.1 percent, increasing to a relatively modest 2.7 percent in 1995.

The 1994 growth forecasts range from a low of one-half of one-percent for Japan to a high of 3.7 percent for Canada, with 3.1 percent for the United States. The low forecast in 1995 is 2.2 percent for Germany, while the high is 4.1 percent for Canada, with projected growth in the United States falling to 2.7 percent.

While the rate of inflation is projected to remain modest in the deve

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he remainder of the 1990s likely depends upon avoiding a trade war with Japan, regardless of the trade deficit. Travel Industry Overview: 1994 and Beyond Tourism is a major industry on a worldwide basis (Frechtling, 1991, pp. 49-51). For many small, developing countries, tourism is a major source of income. For major industrial countries, such as Canada, Japan, the United States, and those in western Europe, income from tourism is an important source of income (Goodrich, 1991, pp. 37-41). Travelers from the United States comprise the largest national segment of the worldwide tourism industry. Thus, when in the wake of terrorist activities, war, a troubled economy, and other events directed at or affecting Americans, tourism by Americans declines substantially, and adverse economic effects are felt around the world (Williams and Shaw, 1992, pp. 133-143). Prior to 1973, tourism was a major growth industry on a worldwide basis. The energy crises of 1973-1974 and 1979-1980 increased the costs of travel significantly because of jet fuel price increases. Tourism growth suffered as a result during and shortly after each of the energy crises. Just as worldwide tourism was poised for another growth period in the early-1980s, the
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Approximate Word count = 3503
Approximate Pages = 14 (250 words per page)

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