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AN INVESTMENT PERSPECTIVE ON GLOBAL VALUE CHAINS
has linkages to many other parts of the economy, it directly contributes to poverty reduction. For many developing countries, tourism is one of the main sources of foreign exchange income and a major component of exports, creating much-needed employment and development opportunities (UNCTAD 2007). Conceptualizing the tourism industry from a GVC perspective provides insights into the main actors and their relationships, different value creation processes, and upgrading pathways. Figure 9.1 shows the tourism GVC as a sequence of direct flows of money from consumers to service providers along different distribution channels. There are three types of actors in the tourism GVC: consumers, intermediaries, and service providers (Daly and Guinn 2016). There are also three main distribution channels: 1. Direct booking channel. Through this channel, consumers bypass distribution intermediaries and book directly with service providers such as airlines and hotels. 2. Online package channel. Online portals and travel agencies such as Expedia, Priceline, and booking.com have grown in prominence in recent years. These online portals offer many of the same services as in-person travel agencies. In some cases, they work together with the global distribution system. The global distribution system provides a shared platform for information regarding airline, hotel, and tour scheduling, including prices, which allows travel agents to reserve and book directly in real time. FIGURE 9.1 The tourism global value chain Consumers
Consumers
Distribution intermediaries
Service providers
Direct booking
Leisure tourism inputs
Online package
International transport
Online portals
GDS Domestic transport
Package booking Traval agents
Global tour operators
Destination management companies GDS
Lodging
Hospitality
Excursions Inbound tour operators
Communication flow
Activities performed by international actors
Direct flow of consumer’s money
Activities performed by domestic actors
Indirect flow consumer’s money
Activities performed by international and domestic actors
Source: Duke Global Value Chains Center, in Daly and Guinn 2016. Note: GDS = global distribution system (coordinating online portals).