Effects of Tourism Sector Development on Economic Growth in Zanzibar : 2005 -2020.

Issa, Ahmed Yahya (2023) Effects of Tourism Sector Development on Economic Growth in Zanzibar : 2005 -2020. Masters thesis, The Open University of Tanzania.

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Abstract

The intention of the thesis is to analyze the effects of tourism sector development on economic growth in Zanzibar. It involved and focus on tourism sector in Zanzibar for a period of 15 years, from 2005 - 2020. The study employed foreign exchange rate, government expenditure and international tourist arrivals as independent value in economic growth. The thesis employed Tourism led growth hypothesis and endogenous growth theory that embraced a multiple regression model in scrutinizing the data on examine the effects of tourism sector development on economic growth in Zanzibar. The study employed time series research design, the analyzed data obtained from Office of chief government statistician (OCGS), Zanzibar tourism Commission (ZTC), Zanzibar investment promotion authority (ZIPA), Migration of Zanzibar and Bank of Tanzania (BOT). The findings expose that there is a positive affiliation between foreign exchange rate, government expenditure and international tourist arrivals with insignificant relation to economic growth of Zanzibar. The thesis concluded that there is need for government intervention into the tourism sector through relevant policies such as enhancing the tax body on all foreign companies dealing with tourism activities within the country; there is high influence of tourism sector in economic growth of Zanzibar being a case as shown on the regression model results. Furthermore, this study recommends that Zanzibar should ensure political, economic and social stability for attraction of more high quality tourists. Keywords: Foreign Exchange Rate, Government Expenditure, International Tourist Arrival.

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