FORECASTING INBOUND TOURISM FLOW TO TÜRKİYE: BVAR APPROACH

Abstract

The tourism sector is a significant revenue and growth source for Türkiye’s economy due to its foreign exchange provision and employment creation capacity and its connections with other sectors. Because of its increasing share and the potential it promises, it is expected that the sector will gain further importance in the following years. However, the growth potential depends on many factors, which are internal and external, as well as economic and social. Recognizing these factors as given, it is important to obtain realistic tourism demand forecasts for both the intra-sector players and political decision-makers. In this study, such a forecasting practice has been attempted. To this end, by using the Bayesian VAR method, forecasts obtained for the 2016–2023 period for the five most tourist sending countries to Türkiye and evaluation of the forecast success has been made depending on various criteria. Forecasts reveal that it is difficult to reach the government’s target of 60 million tourists in 2023. However, it is important not to ignore the impact of the COVID-19 pandemic, whose devastating impact has not yet been fully compensated, and the loss of purchasing power experienced all over the world.