Tourism And World Trade: Pillars Of Global Economic Growth And Stability

Tourism and world trade are the two most significant and relevant industries that are supporting the growth and stability of the global economy. Both the industries have proven phenomenal dynamism and growth due to the recent changes in market globalization, significant developments in transportation, and constant innovations in technology. National linkages have been improving at an alarming rate because of great surges in cross-border trade, travel, and transactions due to vanishing borders in national and international markets.

It should never be lost sight of the fact that tourism is a vital enterprise that actively generates cash, employment, and cultural exchange. Tourism does not enjoy leisure alone. By extension, "international business" is an all-encompassing category that includes all travels abroad: foreign trade, FDI, and the work of MNCs. That type of activity acts as a driving force for the development of countries, affecting commercial politics at the domestic level and world trade laws, to begin with.

The tourism sector is one of the biggest and fastest-growing industries in the current world economy. According to the World Travel & Tourism Council, the tourism industry maintained 319 million jobs worldwide in 2018. To complicate its vastness, the industry contributed to 10.4 % of the world's gross domestic product. Some of the factors responsible for this include rising disposable incomes, better transportation networks, and the growth of online travel agencies, which have greatly increased the ease of travel. The urge for international travel has also increased significantly in developing economies due to the growth of the middle class, further fueling the tourism industry.

While this has been great growth, the tourism sector is still faced by a couple of difficulties. Among the major constraints is the unstable situation of the political constituency in vast regions. Tourists, as a rule, try to avoid destinations they perceive as unsafe, so political instability, war, and terrorism have strong instant negative impacts on tourism. For example, during the 2010 Arab Spring, travel to the Middle East and North Africa markedly declined because very many travelers chose to cancel or postpone their trips to such regions. Travel has not been a high priority during most global economic downturns, whether experienced from the 2008 financial crisis or the recent economic disruptions induced by the COVID-19 epidemic. As a rule, customers invariably start to curb their discretionary spending, such as for travel, which has a swift impact on the dollars the tourism sector harvests. Tourism contracted worldwide like never before, with international arrivals contracting 74 percent in 2020 as a result of the COVID-19 epidemic, declared UNWTO-the United Nations World Tourism Organization.

Another major challenge for the tourism industry is environmental issues. Environmental degradation boasts victims and contributors in the tourism industry. As such, it is headed for confrontations with nature, including climate change and natural calamities, which are bound to ruin most favorite tourist destinations that entice people to reduce their value and their accessibility. Tourism, however, in itself has the potential to worsen ecological problems such as pollution, habitat, as well as biodiversity loss. All these environmental problems are consequent to the growing popularity of mass tourism, which deals with the overpopulation in most precincts. For instance, the beautiful city of Venice, Italy, has been hit by acute issues resulting from excessive tourism, which has caused the degradation of the local ecology, destruction of its historic buildings, and a decline in its resident quality of life.

There are a number of factors contributing to such significant growth in the international business, for example, from the rise of global supply chains, trade policy liberalization, to technical advances, which allow the world to enjoy cross-border trade, foreign direct investment, and multinational corporations' activities. Similarly, the process of transportation of goods and services across different countries' borders has been streamlined with the introduction of free trade agreements (FTAs) and removal of all trade restraints and this makes it a reality for businessmen to actualize business across their frontiers. With the advancement of technology comes more interestingly the communication and transportation; the process is even much easier with reducing time and costs of not only tech but also manpower.

Of course, international trade is not without a number of problems. One among them is international competition; it is one of the greatest challenges. Businesses are hit with rising competition from domestic businesses and foreign companies alike as marketplaces get more integrated. Price wars, cut-short profit margins, and innovation as a necessity to really stand ahead can be the by-product of such competition. Furthermore, political turmoil and economic decline in important markets can interfere with the operations of companies, leading to reduced investment and losses in those companies. For instance, the current trade disputes between the United States and China are affecting companies operating in those two big markets and are certifying the world economy.
Trade is additionally restricted due to processes involving the expansion of a global company with protectionist policies and regulatory barriers. Leading to loss on this front, several regions around the world have experienced a decline in liberalized trade due to heightened globalization. A number of countries have resorted to protectionist policies to protect their domestic industries. Import restrictions, tariffs, and quotas can also make it more complex to operate for foreign companies and restrict the free flow across borders. What makes it more complex is that the global business environment is affected by the reemergence of protectionist policies in some parts of the world due to rising nationalism and attitudes of anti-globalization.

Nepal is a perfect piece of country for studying how tourism and global trading work together to mold a country's economy. This is a small mountain country deep in the Himalayas but making it big on the world spectrum due to beautiful natural settings, rich cultural history, and adventure tourism possibilities. Contributing to this is the breathtaking scenery: the snow peaks of Mount Everest and the tranquil beauty of Pokhara make Nepal a popular tourist place and raise the GDP of that country.

The gain shared with regional economies and employment opportunities created are crucial to the Nepali people. Retail, hospitality, and transportation industries have been developed based on increased tourism trends in Nepal. Also, local business catering to visiting tourists, such as eateries, accommodations, and curio shops, gain from the demand they have created. This way, an important share of the population and especially women, along with young people who might have no career options, are employed within the labour-intensive tourist sector of Nepal.

For example, the fact that tourism increases demand for a range of goods and services and, therefore, promotes international trade goes a long way in showing how tourism and international business are related. In that connection, the demand for such goods as handicrafts, hiking gear, and traditional clothes has blossomed for Nepal because of international business linked, in this case, to tourism. These goods also serve as exports in the overseas markets apart from being sold to domestic tourists, thus increasing the trade income of the country. Because of the increased demand for these products, the export from Nepal has increased and the local industries are growing and thus tourism forms an important part of the foreign commercial policy of the country.

Besides this, increase in FDI came through the growing tourism sector in Nepal, which international investors investing in developing the infrastructure of hotels, resorts, and airports, with an increase in capacity by the country to accommodate more tourists and enable comfortable travel to remote areas. For instance, the ongoing expansion of Kathmandu's Tribhuvan International Airport, possible due to investment from the abroad, has enriched the competence of Nepal to connect with the outside world and made it accessible to foreigners for traveling, purposes of tourism, and business.

However, issues are in need for the tourism industry in Nepal. Frequent earthquakes and landslides in this country often bring severe damage to attractions and infrastructure associated with the tourism sectors. For instance, the 2015 Nepal earthquake ruined so many of the tourism sites and national heritages of Nepal; as a result, tourists are massively decreased. Large financial costs are involved in restoration and reconstruction works after such calamities, and the tourism industry usually records a positive change in recovery.

Secondly, the political turmoil in Nepal has made it difficult for the tourism and travel industry. Unpredictability stirred up by regular change of governments, political strife, and strikes might potentially keep off foreign visitors to the country. For instance, the political turmoil that followed the 2006 end of the Nepalese Civil War led to a slump in the number of tourists as potential travelers were never comfortable with their safety and security while in the country.

But even then, the country's tourism industry is still a major force promoting current economic growth and a significant contributor to foreign trade; so, based on the maximization of Nepalese natural and cultural resources, the rich potential of the industry can be added, more foreign investment made, exporting dominated, and a solid position maintained in the international market.

"In 2019 Nepal hosted 1.17 million international tourists, generating NPR 240 billion into the national economy, creating more than one million employments. The growth shows that the role of tourism has been significant in the economic development of the country, therefore supporting local communities and preserving their cultural heritage" (World Bank, 2020).

Tourism Data on Nepal
The economy of Nepal has long relied on tourism, which in turn provides a boost to GDP, jobs, and cross-cultural exchange. Prior to the global pandemic, back in 2019, more than 1.17 million foreign visitors had come to Nepal. Huge contributions to the tourist sector make up almost NPR 240 billion, which is about 7.9% of the country's GDP. The industry had provided jobs for more than a million people, and still both directly and indirectly employed, so it was one of the significant livelihood industries for most of the native and indigenous people from Nepal. The impact of COVID- 19 from the year 2020 reduced the foreign arrivals dramatically to probably the lowest level in history, and the industry had to derogate it severely.

The industry almost came to a standstill with almost 80% fall in tourist visits. This steep decline translated to huge losses for the entire industry, from travel and hospitality to local businesses highly reliant on visitor spending. It broke the record for the highest employment losses in two consecutive months, further multiplying the economic mess the pandemic laid on the country. It is in 2023, as the world began to heal from the pandemic, that this could be seen rebounding in the tourism business, as well.

The nation received between 500,000 and 700,000 foreign visitors, indicating a slow yet steady rise of confidence in travelers. These numbers are still lower than pre-pandemic numbers, but they are a good sign in the right direction. Share of tourism industry in GDP recovered too but gradually and remained very much less than that of 2019. Employment inside the industry also began to grow as the firms started to reopen and new job opportunities appeared both in the transportation and hospitality sectors and in all allied sectors. With a forecast increase of foreign tourist arrivals expected to exceed 900,000 in 2024, Nepal is well placed to continue its recovery.

These are expected to generate a revenue of NPR 250 billion to NPR 270 billion, thereby providing support to the national economy and helping the sector to get into its pre-Covid growth trajectory. With the upsurge in tourist inflow, direct and indirect employment opportunities will correspondingly increase in the tourism industry. Sustainable tourism practices have become the goal in Nepal, as the government and tourist stakeholders have taken the extra mile to ensure a balance between economic growth and the conservation of the country's natural and cultural heritage. The long-term objectives for the tourism sector in Nepal are quite ambitious. For example, the country is targeting to receive 2 million foreign tourists by 2025 considering that the earnings will rise to an approximated NPR 300 billion. Provisions for the extension of the Tribhuvan International Airport and the completion of the Gautam Buddha International Airport have both been critical for the facilitation of capacity to the number of inflow tourists with ease; they would demand huge investments in the infrastructure development fronts. There are also efforts to gear up the digital infrastructure and road networks in place in order to help in the spread of tourism. One of the areas the country has focused on is adventure tourism— set to be one of its major attractions in Nepal.

The country will also further its tourism offer in outback, hidden places, and new development in trekking, climbing, and adventure sports. This is an approach that will try to distribute advantages of the tourism experience across the nation in a fair way, in addition to attracting more tourists. Increasing its tourism offerings and developing infrastructure, Nepal is thus gearing itself to recover the losses arising due to the pandemic and move ahead for a bright future. Goals and Target

Tourism Goals and Target
While addressing the issues that stand in their way, the goals and measures of tourism and international business aim to maximize the benefits they have on economies and societies. Here is a brief overview of the most important goals.

The most important goal in this area is growth from the figures in economy while preserving the environment and cultural treasures.

One of the more major goals is to increase the number of foreign visitors. For instance, in 2025, Nepal wants to receive 2 million foreign visitors. With the increase in tourists, it is believed that companies will be empowered to increase incomes and jobs at a local level. To achieve this, investments in infrastructures are required. It ranges from developing new and renovating old airports to improving transit systems and modernizing the digital infrastructure of the country. Another significant goal is to encourage eco-friendly travel. Ecotourism is an enabler in that it is an instrument that ensures that tourism businesses and destinations commit to reducing adverse environmental impacts and improving natural resources. For instance, Nepal is focusing on promoting the practice of eco-tourism. Eco-tourism helps increase tourism in less-visited locations to ensure that benefits are shared more equally and to ease the crowding at major destinations. It is aimed at ensuring there is a balance between the preservation of natural and cultural resources and economic benefit.

International Business Objectives and Outcomes
The key goals of international business include increasing market competition, encouraging FDI, and promoting international trading activities.
The other most critical goals are: reduction of tariffs to ensure efficient cross-border transactions; elimination of trade barriers; simplification of the business process. Countries are now developing business climates that adhere to policies that promote trade liberalization with investment in infrastructure to support this type of business continuously. For example, governments aim to increase their exports, encourage foreign investors, and enhance an overall economic situation through international trade agreements that promote regional economic blocs. Sustainable development and economic growth are both common interests in international businesses and tourism. They both guarantee countries long-term benefits arising from: creating many job opportunities, making efficient cross-cultural contacts, and attaining higher living standards. Directives

Investment for infrastructure, cultural exchange, and policy-making for trade and travel are the areas in which the hands of governments have very vital roles to perform, which should be viewed under multifaceted strategies to contribute towards the development in tourism and international business. This will help in creation of an environment by the governments in the ways to promote such sectors.

In terms of upgrading connectivity in many places, roads, airports, and trains are some of the transportation means that can be improved for more convenient travel.

Telephone networking and high-speed internet are being invested also in the area of tact and communication infrastructure, which can serve as a support in operating international organizations. A case in point is the investment that countries such as Singapore and the United Arab Emirates have made in modern airports and efficient transportation systems; they have become world-class and significant international centers of trade and tourism that attract millions of tourists and investors every year. More generally, international businesses and tourism become more competitive from a global perspective through cross-border business activities and cultural and intellectual exchange programs. Besides that, governments can boost tourism in a region by cooperating in combined marketing campaigns, sharing visa regulations, and working in joint tourism projects.

The example of the Schengen Agreement of the European Union that allows travel between its member nations without any visa considerably increases tourism within the European Union because visitors now have the ease of visiting many nations on a single visit. Trade agreements and regional economic communities can add more spice to trade through the reduction of tariffs, equalization of laws, and promoting an environment that is more open towards international trade. Furthermore, expansion of International trade and tourism can be highly contributed by trade liberalization regulations and treaties that facilitate visa-free tourism. Visa-free travel agreements enter into practice, such as the above-mentioned Schengen Agreement, serve as one more means of making travel across borders more convenient both for recreational and business occasions. Trade liberalization policies, such as reducing tariffs and non-tariff barriers to trade, make ways for goods and services across borders, thereby encouraging foreign capital injection and expanding the economy. In order to make sure that tourism and international trade develop sustainably in the long term, governments and companies have to take extra steps beyond these developments; the adoption of sustainable tourism activities is on the rise with greater awareness to the problems of environmental problems.

Countries will find it possible to be able to cut down their harsh environmental practices and at the same time be able to attract the attention of foreign investors and tourists who are environmentally conscious in the instance they advocate ecotourism and pursue businesses in an environmentally conscious manner. For example, with its strict environmental policies, protection of its national resources and promoting environmentally appropriate visits, Costa Rica has become a famous country to a destination on eco tourism. Issues Although tourism brings in lots of benefits to the national and international economies, it highly faces external shocks. Economic downturns, environmental challenges, and political instability can dent potential adverse effects on both industries in relation to decreasing revenues, loss of jobs, or slowing of economic growth.

For example, the COVID-19 pandemic and the global financial crisis of 2008 have crippled travel and international trade.

At the same time, as consumer confidence heads south under such circumstances, the final product is that there are reduced outlays on luxuries, for instance, on holidaying.

At the same time, companies become risk-aversive, reduce their activities and make less investment internationally. Tourism was greatly affected by the COVID-19 pandemic, which saw the industry almost grind to a halt for much of 2020 and throughout 2021. In addition to the pandemic causing production and supply chain disruptions, global supply chains have been proven to be tenuous, hence justifying the risk. The environmental threat is also a key one to the tourist and international commercial sectors. These natural disasters as well as climate change and environmental degradation may come in the way of smooth supply of goods and services in the global marketplaces and related tourism activities.

Tracking of the changes: Infrastructure damage due to extreme weather events or changes and destruction of parts of some locations, while the levels of sea rise may lead to a negative trend of purposes of waves against the banks and famous tourist sites. Environmental impacts of mass tourism involving acts like pollution, habitat loss, and depletion of natural resources must be well taken care of, especially by the tourist sector. Being free of all sorts of problems and issues from the surroundings, tourism can safely survive for the beneficial working involved in the growth of the world economy. Political instability is another great problem that could lead to an adverse impact on international business and tourism. This is because travelers and businesses often move away to safer and more stable areas, which leads to a decline in tourist arrivals and foreign investment levels within a country that experiences political turbulences, conflicts, or terrorism.
Tourism in regions such as the Middle East and North Africa is clearly affected by political unrest, whereby continuing hostilities and security issues have seen a fall in tourists. The same problems that companies working within politically hostile territories face are expropriation, corruption, and regulatory uncertainty impinging upon their potential long-run viability and earning potential. Conclusion and Recommendations This adds to the importance of international business and tourism as drivers of global economic growth. Not only do these industries depend on each other, but each one supports the other in one way: tourism stimulates international investment and trade, whereas international business supports the solubility of the tourism services and infrastructure.

These industries must be harnessed and strategized to ensure growth and survival in the face of several issues surrounding them: political upheavals, environmental problems, and economic shifts. To address all these and try to bring about an environment that would ensure the strong and sustainable growth of both tourism and foreign trade, the governments, transnational corporations, and international bodies must work together.

Financial support for cross border cooperation, infrastructure development, and cultural interchange should be maintained at the proper level to give special attention to the issue of building up the strength of such organizations. With betterment in travel and other communication networks, promotion of initiatives on the regional level in the field of tourism and other such international commercial operations, and introduction of visa-free travel arrangements help countries develop increased activity of tourism and commercial activity functioning in an increased scope of monetary exchange and job offers.

The latter, on the other hand, is important for making sure that the industry continues into the future while reducing the negative impacts of tourism on the environment. To save money in setting aside or establishing more national reserves and to maintain habitats that are also tourism fry zones, countries may advance toward eco-tourism, ethical travel, and sustainable economic practices still maintaining its natural and cultural legacy while luring environmentally concerned tourists and investors.

In brief, although travel and international business offer great financial rewards, at the same time, they encounter a host of issues that entail cautious management with carefully planned strategies. If these problems are dealt with, the possibilities would be harnessed fully in these sectors, and farther, they would result in collaboration among corporations, governments, and international bodies for the growth and stability of the world economy.

Writers Apeksha Subedi and Anusha Shrestha are students of MBA at SAIM College.