Abstract:
This study estimates the determinants of tourism demand in Southern Africa
Development Community (SADC) region using Generalised Least Squares (GLS)
estimation procedure and panel data for the period 1997-2015. The results obtained
suggest that the elasticities of tourism demand with respect to real capital investment on
the tourism sector, real exchange rate, real gross domestic product (GDP), proportion
of population with access to internet and global peace index are positive, while that
with respect to inflation rate is negative. These results imply that for any country in the
SADC region to attract more arrivals of tourists: it should invest significantly on the
tourism sector, in terms of upgrading tourism infrastructure; implement exchange rate
policy that is favourable to international tourists; and promote a reputation of being a
peaceful and less corrupt country. Since tourism has strong linkages with other economic
sectors, it is an ideal prospect for economic diversification.
