A panel data analysis of tourism and economic development in Southeast Asian countries

Abstract

Southeast Asia is a strategic region in tourism because of its natural and cultural richness. Thus, tourism ministers of ASEAN countries agreed to launch a joint ten-year plan to make Southeast Asia as one destination package for international tourists. The aim of this plan is to increase the share of tourism to the regional economy by 15 percent in 2025. This paper estimates the relationship between tourism and economic development in ten Southeast Asian countries of Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam using regression analysis of panel data. It tests the effect of tourism factors such as visitor exports, internal travel and tourism consumption, business tourism spending and capital investment in tourism industry on gross domestic product from 2014 to 2016. The best model obtained is fixed effect model and the tourism aspects that have positive significant impact on gross domestic product improvement in Southeast Asian countries are internal travel and tourism consumption also capital investment in tourism industry. Furthermore, the factors that effect gross domestic product negatively are visitor exports and business tourism spending.