The economic importance of tourism is undeniable. The impact of terrorism on a countries economy may be enormous. In an information free society, tourists might travel to destinations regardless of whether a terrorism threat exists or not. However, few information free societies exist. Via different forms, terrorism generates attention, which, when relayed back to tourists, has an impact on travel plans. Taken as a collective, these decisions affect tourism levels, which generates an additional question to consider. Does the level of reported terrorist activity have an impact on tourism?
In the last decades, the world has been increasingly threatened by terrorism. On September 11 2001 there was a series of coordinated terrorist suicide attacks. This has been the most influential act of terrorism affecting the travel and tourist industry in the 21st century. However these attacks weren’t targeted specifically at the tourist industry unlike the attacks on Bali but their economic impact on the industry was far more substantial overall due to the sheer size of the attacks and the effect it had on tourist’s behaviour. (DiMarco, 2007)
The attacks on the world trade centre in New York resulted in 4 million less international arrivals worldwide in 2001 in comparison to the previous year. This obviously indicates an element of fear introduced and an unwillingness to fly particularly on transatlantic flights showing that the tourist industry was affected on a global scale not just in America. (Fuller, 2003) American foreign travel to the USA was most affected with visits falling by 20%. In terms of the passenger numbers the short term affect was reasonably catastrophic for the airline companies.
Passenger numbers for the principal New York airports suffered a drop to 38,456,239 in 2002 compared to 44,166,012 in 2001. (Frankel, 2001). After 9/11 Tourism in the US plummeted by nearly one third in the following months. Hundreds of thousands of US airline, hotel and other travel industry workers lost their jobs. US airlines were flying with 40 – 50 percent of their seats empty, even after drastically reducing their scheduled flights. Per room revenue declined between 3. 5 and 5 percent in the following year. The largest decrease in room revenue in 33 years.
In New York the overall occupancy rate dropped to 45 percent where it would usually be at 75 percent, and 3000 employees where immediately laid off. Travel agencies where losing an estimated $51 million per day in sales. Corporate travel fell by 50 percent by January 2002. (Pillar, 2004) All terrorism and threats to national security are documented to have impacts on tourism demand. Terrorism attacks cause a shock to tourists’ utility, and a change in the image profile of destinations. Some destinations experience a strongly negative impact on their image and attractiveness.
Tourism is an industry where both demand and supply can be sensitive to extreme events such as terrorism or political violence. (Ritcher and Waugh 1986; Ryan 1993). These assaults had a major impact on the tourism industry across the United States and the world, since everybody feared a succession of attacks when travelling by air (Boger, Varghese and Rittapirom 2005). The 9/11 attacks had an impact on consumer preferences for alternative package destinations and on the image and value of the destinations.
In the following months marketing efforts were devoted to tourism image restoration. Tourism demand is sensitive to the influence of political violence and terrorist attacks, since tourists, like everyone else value tranquillity and peace for the enjoyment of the pleasures and activities offered by destinations. This incident was sensed worldwide because of its previously unknown mode, dimension, and magnitude, thereby causing a major shock to the tourism industry. Although the 9/11 attacks were not primarily aimed at the tourism industry the Bali bombings in 2002 were.
The 2002 Bali bombings occurred on the 12th of October 2002 in the tourist district of Kuta. The Bali bombings had a significant negative impact on the local and regional economies. Bali is heavily dependent on tourism, which plummeted in the wake of the attacks. Tourists cancelled long haul trips, and opted for domestic locations well away from western centers. 1. 5 million Tourists visit Bali every year, out of 5 million for Indonesia overall, underscoring that Bali is really Indonesia’s only real international tourist brand.
Despite magnificent scenery, water and volcanic features, Indonesia’s tourism infustructure is poorly developed. It is really only Bali that had got it together to the extent that just less than 1 in every 3 tourists to Indonesia visit Bali, and spend most of their money there. Bali has now lost its brand as a “safe” tourist destination. In an increasingly unsafe world, tourists may just opt to stay home. (Miller, Vandome and McBrewster 2009) The tourism industry in Bali was devastated by the bombings.
One year on, tourism numbers were still down on pre bombing levels. Tourism which employs around half of Bali’s population was devastated by the attack. Beach vendors stall owners and taxi drivers have all been affected and more and more Balinese have found themselves facing financial trouble. Bali residents suffered significant falls in tourism employment and income and sales from tourism since the attack. (Hoffman, 2006) The biggest hurdle the country faces is making sure it is perceived as a low risk destination.
No one wants to travel somewhere where they feel unsafe. Tourism is the backbone for Bali and needs to be recovered. It is undeniable that the effects of terrorism in tourist areas have an adverse effect on the economy and the tourist levels of that country. After an initial drop in tourist numbers it seems things eventually return to normal. This may be due to redevelopment of attacked areas, increased security or maybe because the possible threats of terrorism cannot cancel out the thrills of visiting foreign areas and being an international tourist.
In this modern era people need to fly to reach different destinations. As such a provider of employment and economic prosperity in many countries, the tourism industry must be able to remain resilient in the face of adversity. Although tourists act as an easy target for terrorists, if the industry remains flexible in its ability to diversify when tourism numbers take a downturn it will help ensure economic prosperity is maintained and defeat the primary objectives of the terrorist groups.
