What is outbound tourism and why is it important?
15th February, 2023
Outbound tourism is an important type of tourism. Many countries rely heavily on travellers leaving their home country in search of an international tourism experience.
But what does it actually mean to be an outbound tourist? In this article I will explain what is meant by the term outbound tourism, provide definitions of outbound tourism and I will discuss the advantages and disadvantages of outbound tourism. Lastly, I will provide examples of destinations which have significantly sized outbound tourism markets.
- What is outbound tourism?
- Outbound tourism definitions
- The growth of outbound tourism
- The importance of outbound tourism
- The growth of the Chinese outbound tourism industry
- Positive impacts of outbound tourism
- Negative impacts of outbound tourism
- The value of outbound tourism to the UK
- Outbound tourism: Conclusion
- Further reading
What is outbound tourism?
Outbound tourism is the act of travelling ‘out’ of your home country for the purposes of tourism.
Outbound tourism does not include the purchasing of good or services before or after the trip within the tourism generating country.
To learn more about what a ‘tourism generating country’ is, read my post about Leiper’s Tourism System.
The terms outbound tourism and inbound tourism are often used interchangeably.
This is because a tourist who is travelling internationally is both an outbound tourist (because they travel OUT of their home country) and an inbound tourist (because they travel IN to another country).
The only exception to this would be if a person was travelling on a multi-centre trip, for example a backpacker. This is because they are not necessarily travelling from their home country.
Outbound tourism definitions
The most widely utilised definition of tourism, proposed by the World Trade Organisation (WTO) and United States (UN) Nations Statistics Division (1994), prescribes that in order to qualify as a tourist one must travel and remain in a place outside of their usual residential environment for not more than one consecutive year for leisure, business or other purposes.
When considering outbound tourism, it therefore makes sense to simply add in the prerequisite of leaving your home country country…
Based on this commonly accepted definition (although this is not without its limits- see this post for more details), therefore, outbound tourism can be defined as:
‘The act of leaving your home country to travel internationally for not more than one consecutive year for leisure, business or other purposes.’
Some other organisations have also offered definitions for the term outbound tourism.
The European Union define outbound tourism as:
‘Visits by residents of a country outside that country’.
Similarly, Visit Britain state that outbound tourism is:
‘The activities of a resident visitor outside of their country of residence’.
The growth of outbound tourism
The outbound tourism market has grown considerably throughout the years.
Of course, the outbound tourist market has grown at different rates in different parts of the world, but the reasons for this growth are largely the same.
Three of the biggest factors contributing to the growth of outbound tourism are: the advent of low cost travel, increases in disposable income and leisure time and globalisation.
The advent of low cost travel
The past two decades have seen significant developments in the history of tourism.
Increased competition within the marketplace and the introduction of low cost airlines has meant that more of us are able to travel more often.
Increased disposable income and leisure time
In recent years the amount of disposable income that the average person has each year has increased. This means that people have more money to spend on international tourism.
People also have more leisure time than they used to. Paid holidays and increased flexibility as a result of flexi-time practices at work, means that people have more opportunities for international tourism than they did in the past.
Other posts that you might be interested in:
–What is tourism? A definition of tourism
–The history of tourism
–The structure of the tourism industry
–Stakeholders in tourism
–Inbound tourism explained: What, why and where
–What is ABTA and how does it work?
–The economic impacts of tourism
More people want to experience outbound tourism nowadays than ever before. Globalisation has opened up many opportunities for us around the world.
Many destinations that were not previously accessible have opened up and subsequently developed their tourism industries.
The importance of outbound tourism
Outbound tourism is hugely important to many countries around the world. The OECD have a handy tool on their website which demonstrates the value of this tourism in different parts of the world.
Outbound tourism has many positive economic impacts that reaches further than just the tourism industry. Outbound tourism can help to enhance the economies of many countries by providing economic boosts in a range of sectors such as retail, healthcare and education.
Many countries, however, rely too much on outbound tourism. Should there be a reason that tourism declines, for example during the 2020 Coronavirus pandemic, a country’s economy could face dire consequences if they do not diversify their income.
The growth of the Chinese outbound tourism industry
A major recent development in the tourism industry is the growth of Chinese outbound tourism.
Today, China is the largest outbound tourism market in the world.
Chinese tourists spent more than $288billion on international travel in 2018, which equates to a whooping 25% of global tourism spend. It is predicted that Chinese tourists will take 160 million overseas trips by 2020.
This growth is largely attributed to rising incomes amongst Chinese workers and new freedoms allowed to the population. Many countries around the world now offer simpler and easy to obtain visas for Chinese citizens than they did in previous years.
This has resulted in a boom in Chinese outbound tourism. Whilst Chinese tourists travel all over the world, markets in Asian countries such as Thailand and Bali have seen particular increases in overall tourism numbers as a result.
Chinese tourists typically spend significantly more money when they travel than tourists from other countries. This means that the Chinese outbound tourism market is particularly welcomes in many destinations around the world.
Positive impacts of outbound tourism
Outbound tourism can be beneficial for both the traveller generating region and the tourist destination region.
In the tourist’s home country, outbound tourism can help to boost the economy. If tourists use a local operator to organise their travel arrangements, such as the national airline or a domestic travel agent, then some of the profits made will be retained in the home country.
When the tourist reaches their holiday destination there are many economic advantages to the host destination. The graph below by the Office of National Statistics (ONS) outlines the areas that profit the most from outbound tourism.
Foreign exchange income can be particularly beneficial in destinations where the currency is weak. Many destinations focus their marketing efforts in countries that have strong currencies, such as the UK, USA or Europe.
Another positive impact of outbound tourism is that income from tourism can be used to help boost the wider economy. Money can be reinvested in areas such as healthcare and education.
Negative impacts of outbound tourism
There are two major economic impacts that can have a negative effect on the destination.
The first is economic leakage in tourism. Outbound tourists often seek the familiar and may choose to spend their money in large chain organisations such as a Hilton Hotel or a McDonalds fast food restaurant. This causes money to be taken out of the tourist destination region, thus limiting the positive impacts from tourism.
The second is over dependence. If a destination relies too heavily on their outbound tourism industry, they could come into trouble should this be disrupted.
Disruptions to the tourism industry occur frequently around the world. Reasons include natural disasters, political unrest, economic instability and pandemics.
You can read about the economic impacts of tourism in more detail here.
The value of outbound tourism to the UK
According to the ONS, outbound tourism is a significant market in the UK, accounting for 1.8% of GDP.
The outbound tourism sector accounts for more than 221,000 jobs in the United Kingdom.
The economic contribution of UK outbound tourism equates to £37.1 billion.
The graph below indicates which destinations UK outbound tourists are choosing to travel to, with Spain being the most popular.
Outbound tourism: Conclusion
Outbound tourism is an important part of the structure of the tourism industry. Many countries rely heavily on outbound tourist markets and outbound tourism is a significant economic contributor. The outbound tourism market has grown and developed throughout the years, with the most significant and rapidly emerging market being the Chinese.
- An Introduction to Tourism: a comprehensive and authoritative introduction to all facets of tourism including: the history of tourism; factors influencing the tourism industry; tourism in developing countries; sustainable tourism; forecasting future trends.
- The Business of Tourism Management: an introduction to key aspects of tourism, and to the practice of managing a tourism business.
- Tourism Management: An Introduction: gives its reader a strong understanding of the dimensions of tourism, the industries of which it is comprised, the issues that affect its success, and the management of its impact on destination economies, environments and communities.