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Inbound tourism: benefit or damage to Primorye?

EastRussia expert discusses the pros and cons of visiting guests for the economy and ecology of the region

Today Vladivostok is experiencing a real tourist boom. In 2018, the region was visited by 650 thousand of foreign visitors, which became a historical record. In the first half of this year, more than 300 thousand foreign tourists have already visited Primorye. Given that the highest season is in the second half of the year, last year’s record will be at least repeated. However, it is not known whether such indicators bring more pluses or minuses to the region.

Inbound tourism: benefit or damage to Primorye?

Roman Tarantula

Entrepreneur, member of the Russian Geographical Society

Few talk about Russian tourists visiting Vladivostok, although their number is several times higher than the number of foreign guests. According to TurStat analytical agency, in 2018 about three million people visited the capital of Primorsky Krai with tourist purposes. Subtracting 650 thousand foreigners from this figure, we get the approximate number of Russians - 2,35 million.

Undoubtedly, such a high tourist flow carries many advantages for the development of the urban and regional economy, especially for small businesses. Foreign and Russian guests eat in restaurants, rent housing and transport, make expensive purchases in stores. But is the positive economic effect obtained from the growth of inbound tourism in Primorye?

Based on the data of Primorskstat, it is clear that during the active growth of inbound tourism in Primorye (2016-2018 of the year), retail trade turnover increased only by 5%, and the volume of paid services by 1%. The growth of tax payments of the regional tourism industry in 2018 year amounted to 6,9%. Of course, these are far from the numbers that I would like to see during the tourist boom. A significant share of financial transactions in the tourism sector remains “in the background” and does not bring a significant positive effect on the local economy.

At the same time, lately more and more people talk about the problem of “overtourism” in the region. However, Vladivostok is still very far from "overtourism" in its classical sense, since the current tourist load on the city is no more than 4,3 tourists per local resident. For example, in the cities most affected by “overtourism” (Venice, Las Vegas, Barcelona), this figure is from 20 to 110 people. However, the peculiarities of the geographical location of Vladivostok, the state of its transport infrastructure, the mentality of the population really lead to the fact that the current level of inbound tourism creates a whole complex of economic, social and environmental problems in the city.

The main difficulty for residents of Vladivostok is the rapid rise in prices in the real estate market. Moreover, this phenomenon is characteristic both for short-term and long-term rental of apartments, and for the sale of residential premises. The reason is that the growing tourist flow is pushing up the prices for daily rent of real estate. So, at the time of writing (16 August 2019 of the year) on the city site of Farpost announcements there were 104 existing proposals for the daily rent of one-room apartments in the city center. Price range - from two thousand to 12 thousand rubles. Using simple mathematical calculations, we get the average price for renting an apartment with the given parameters (one-room apartment in the city center) - 4 020 rubles. It is noteworthy that when expanding the boundaries of observation to the scale of the entire city, the average price for a one-room apartment remains approximately the same. For comparison, in the summer of 2017, according to the Avito advertising portal, the cost of daily rent of an apartment in Vladivostok was 2 440 rubles. Thus, over two years, the cost of daily rental housing increased by 65%.

The cost of short-term rental leads to a proportional increase in prices for long-term rental apartments. The reason is that the average monthly rental price of an apartment, as a rule, corresponds to 10-12 costs of its daily rent. As a result, according to the analytic portal Mir Apartments, in 2018, Vladivostok took first place in Russia in terms of growth in prices for long-term rental of one-room apartments, reaching a price increase of 19,1% compared to the 2017 year.

For clarity, we again turn to the advertising portal Farpost. At the time of writing, in the city center, 24 one-room apartments with an average cost of 34 350 rubles were rented out per month. At the same time, according to the results of the 2018 year, the average salary of a resident of Vladivostok, net of tax payments, amounted to 48 600 rubles (according to the administration of the city of Vladivostok). From the above figures it is clear that the average Vladivostok residents find it difficult to live in a rented apartment in the city center.

The rise in price of rental housing, in turn, leads to higher prices for the purchase of apartments, as people often buy real estate as a tool for further earnings. This trend is more characteristic of the secondary housing market, as buyers select apartments that do not require additional costs when putting them on the rental market. According to the Federal State Statistics Service, only in the first half of 2019, the price per square meter in the secondary housing market increased by 7,2%, and according to the results of 2018, the analytical agency Mir Apartments put Vladivostok in the first place in the rating of rising prices for secondary housing, since the average square price increased by the city amounted to 19,7%.

The rise in price of housing is only one of the problems that exists in the city, and which is not customary to link with an increase in tourist flow to the region. An important issue is also the change in the structure of employment in the city. Local residents are moving from industry and agriculture to “near-tourism” areas of activity (trade, transport, hotel services, catering), which is caused by the pursuit of “easy money”.

Primorskstat data on the number of employees by type of economic activity for 2018-2019 years indicate that the number of employees in retail trade increased by four thousand people. An increase in the number of employees was also observed in the areas of real estate operations, which include the rental of real estate (3 200 people), hotel services and catering facilities (1 100 people), transportation services (400 people).

The increase in the number of employees in the above-mentioned “tourism tourism” sectors was due to a decrease in the number of employees in the energy sector (by 2500 people), agriculture (by 900 people), manufacturing (by 700 people), professional, scientific and technical activities (by 900 people) , construction (for 400 people), education (for 250 people), water supply and sanitation (for 500 people), the provision of other types of services, which include computer repair, maintenance of household items, etc. (at 1100 person).

Of course, these indicators do not reflect the full and objective picture of the ongoing processes. At the same time, there is a tendency for the transition of workers from the spheres of production, energy and science to industries related to tourist services.

The spectrum of other problems associated with the high influx of tourists to Vladivostok can be combined by the collective term “predatory tourism”, which was used by the German magazine Spiegel to describe the negative impact of tourists on the ecology and historical heritage of the planet. This term is used to describe the sensational situation in the media around Stekljannaya Bay, from where foreign tourists take glass fragments washed by the sea, which made this beach so popular. Damage caused to the sights is not amenable to any statistical estimates, however, personal observations suggest that the beach acquired “bare” spots uncharacteristic of it two or three years ago.

Thus, the active growth of inbound tourism has not only positive aspects for the region, but also hides a whole range of diverse problems, such as the rise in price of real estate, lack of personnel in the field of production and science, damage to the environment and historical heritage. Of course, tourism is necessary for both the city and the region, since it is he who is the driver of economic growth, however, this resource must be used correctly, removing the income from the "shadow" and expanding the geography of tourist routes.

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