The economic contribution of tourism in Mozambique: Insights from a Social Accounting Matrix

Abstract

How much tourism contributes to the economies of developing countries is controversial and often not measured rigorously. Focusing on Mozambique, this study presents a simple accounting tool – a tourist-focused Social Accounting Matrix – which makes it possible to estimate the economic contribution of various tourism sub-types. Multiplier analysis is applied to evaluate the strength of backward linkages from tourism to the domestic economy. The results show the sector is moderate in size but has the potential to contribute significantly to aggregate economic development. However, potential weaknesses are already evident and careful attention must be paid to the full tourism value chain.

Keywords:

• economic contribution of tourism
• tourism development
• Social Accounting Matrix
• Mozambique

Acknowledgements

Thanks to Channing Arndt for valuable comments. The present study is based on work funded by the Danish Ministry of Foreign Affairs and undertaken in close collaboration with the Mozambican Ministry of Planning and Development and Ministry of Tourism. Especial thanks go to Hanifa Ibrahimo, Céu Matos, Hélio Neves and Paulo Nhampossa. The views expressed in this paper are those of the author; the usual caveats apply.

Notes

¹Further detail and discussion of TSAs can be found in OECD et al. (2001).

²For a general presentation and discussion of SAMs see Reinert & Roland-Holst (1997).

³This methodology has some similarities with the TSA simulations produced by the World Travel and Tourism Council (WTTC & Oxford Economicx [OE], 2009; for a critique see Smith & Wilton, 1997). However, these typically depend on a large number of assumptions taken from cross-country regressions or advanced country statistics. In contrast, we use a detailed range of country-specific data and distinguish between six tourism activities of relevance to Mozambique.

⁴These correspond to standard accounting identities: gross demand = (intermediate consumption + C + I + G + X) = gross supply = (Y + M + intermediate consumption).