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2017.07.26
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[Tourism & Leisure] Current Status and Future Outlook of Korea’s Tourism and Leisure Industry

The tourism and leisure industry provides tourist services related to transportation, accommodation, dining, sports, entertainment, vacationing, tourism and the operation of tourist facilities.

More than any other industry in Korea, the tourism and leisure industry has been effective in creating revenue, employment and added value, significantly contributing to national economic development.


Current Status & Future Outlook of the Industry


According to the United Nations World Tourism Organization (UNWTO), international tourist arrivals grew by 4.6 percent worldwide in 2015, reaching a record-breaking 1.19 billion arrivals, after topping the 1 billion mark in 2012. Globally, Korea ranked 23rd in the number of foreign tourists.

In 2015, the number of domestic tourists in Korea increased 0.7 percent from the previous year to 38.31 million. In the same year, the number of foreign tourists to Korea reached 13.23 million, down 6.8 percent from 2014. This was largely due to the outbreak of the Middle East Respiratory Syndrome (MERS) in May.


World Tourism Outlook for 2030

(million people)

Source: UNWTO Tourism Highlights (2016)


As to reasons why tourists visited Korea, traveling for “leisure, recreation and vacationing” accounted for the largest share in 2015, followed by “business and professional” reasons, “shopping” and “visiting friends and relatives”.

Meanwhile, because the tourism market is an industry of final demand, the demand for tourism is considered a direct indication of future growth. The number of international tourists worldwide is expected to steadily increase, reaching 1.4 billion in 2020, and 1.8 billion in 2030.

From 2010 to 2030, tourists are expected to grow at an average annual rate of 3.3 percent worldwide, and at a higher rate of 4.9 percent in Northeast Asia.


Industrial Competitiveness


Marinas

A marina is an area on a coast with mooring docks and subsidiary facilities for leisure boats, providing services for a variety of marine leisure activities. Unlike many advanced countries with highly developed marine leisure cultures based on established marina facilities, Korea is still in the early stages of marina development.

Korea currently has six marinas, and plans to open 58 new marinas by 2019. To vitalize the marine leisure equipment industry, the Ministry of Knowledge Economy established a plan in 2010 to develop leisure ships, produce finished products and parts and build a foundation to facilitate their supply. This plan aims to contribute to the country’s efforts to open marina facilities and develop relevant service businesses.

To prepare for the increase in future national income driving up the demand for marinas, the Korean government established a plan to build marina ports in 2015, and has since been actively working on its implementation.

Resorts

Resorts are business establishments that provide tourists with a variety of facilities suitable for sports, entertainment, dining and recreational activities. Through the Third Tourism Development Basic Plan (2012-2021), Korea’s tourism ministry has designated tourism belts for areas along the eastern, western and southern coasts, the Peace Life Zone North-South Tourism Exchange Belt along the northern border, the Riverside Eco-Culture Tourism Belt for the tourist areas with inland rivers and waterside environments and the Baekdudaegan Ecological Culture Tourism Belt, taking advantage of the natural and cultural resources of the Baekdudaegan mountain range.

Theme Parks

According to TEA/AECOM’s annual Global Attractions Attendance Report, about 235.6 million visitors attended the top 25 theme parks in the world in 2015. Magic Kingdom at the Walt Disney World Resort in Lake Buena Vista, Florida, ranked first in the world, with about 20 million visitors in 2015. In Korea, Everland and Lotte World respectively were ranked 14th and 16th place.

The recent trend toward high-tech theme parks is increasing the adoption of cutting-edge communication, IT, robot and other technologies in the industry. High-tech theme parks differ from general theme parks in that the main focus is on the advanced technologies, such as virtual reality, simulation and hologram technologies. Examples of high-tech theme parks overseas include Epcot (Florida, USA), Space World (Kitakyushu, Japan) and Joypolis (Yokohama, Japan).

Success in the digital entertainment industry, which aims to entertain through technology, relies heavily on how well quality cultural content can be integrated with cutting-edge technologies. Moreover, when the industry has a stable foothold in local communities, establishing a steady supply of human and technological resources, they can create synergy with high-tech theme parks.


Foreign Direct Investment & Success Cases


The biggest amount of foreign direct investment made in tourism-related industries in 2016 was the USD 517 million spent in the lodging industry, followed by USD 297 million in the food industry and USD 31 million in the leisure and sports industry. While foreign direct investment in tourism-related industries tends to fluctuate each year, the lodging industry continues to attract the greatest amount. Meanwhile, two of Korea's most highly anticipated tourism districts are Saemangeum District and Taean Tourism and Leisure City.


Foreign Investment Trends

(no. of cases, USD 1,000)

외국인 투자 추이
Industry 2012 2013 2014 2015 2016
No.of cases Amount No.of cases Amount No.of cases Amount No.of cases Amount No.of cases Amount
Lodging 21 822,965 23 916,421 50 454,010 51 625,818 33 517,532
Food 223 85,155 104 20,714 67 287,721 88 29,647 148 297,545
Leports
(leisure+sports)
19 82,963 16 23,635 24 145,487 21 1,052,594 16 31,483

Source: Ministry of Trade, Industry and Energy


Saemangeum District

Upon completion of the Saemangeum Seawall and in compliance with the Comprehensive Saemangeum Development Plan, the Saemangeum Tourism Complex is being developed into a world-class hub for the tourism and leisure industry on the west- ern coast. The district will be comprised of sections that focus on tourism and leisure, international cooperation, and industrial research. The project plans to connect the locational merits of Saemangeum with the surrounding natural landscape, including Byeonsanbando National Park and Gogunsan Islands, thereby allowing visitors of all ages to enjoy this region all year around.

Taean Tourism and Leisure City

When complete, Taean Tourism and Leisure City will be equipped with a wide range of facilities such as golf courses, fairway villages, theme parks and international business complexes. As such, tourists will be able to enjoy sightseeing, leisure activities and entertainment all in one place. Most notably, the city’s high-tech complex will focus on fostering bio-agriculture, biotechnology and biotechnology research.


Recent Government Policies to Promote Tourism


To improve the international competitiveness of Korea’s tourism industry, the ministry is focusing its efforts to nurture high added-value tourism businesses in Korea. To develop the strategic convergence industries of cruise tourism, MICE (meetings, incentives, conferences and exhibitions) tourism and medical tourism, the ministry has strived to provide greater support, and improve various institutional conditions.

The tourism ministry has also pushed forward with various policies to attract more tourists to regional locations and create a stronger foundation for local tourism. To develop traditional cultural content into the representative tourist products, it has strived to search for traditional cultural resources that have potential to be recreated into quality tourist products.

In 2015, the ministry completed the selection of 10 themes for the industry, including historical sites, culture of Joseon-era scholars (memorial halls for Confucian services and old houses), traditional lifestyles (Korean medicine, traditional houses, clothes and pottery) and stories (folktales and characters), and is currently engaged in developing related tourist products to attract a growing number of foreigners.


By Dock Key Kim
Senior Research Fellow, Korea Culture and Tourism Institute / dkkim@kcti.re.kr




The opinions expressed in this article are the author’s own and do not reflect the views of KOTRA
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