Modelling and forecasting gross domestic product (GDP) growth with special focus on tourism in Zanzibar

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University of Dar Es Salaam
The Gross Domestic Product (GDP) is a measure of a country’s economic performance. It is the value of all final goods and services produced within the borders of a country in a given year. The economy of Zanzibar is highly dependent on agriculture but in the recent years the contribution of the tourism sector to the country’s GDP has substantially increased. Although it is agreed that development of the tourism industry leads to economic growth, there are very few studies in Zanzibar that address this issue. This study attempts to predict Zanzibar’s GDP growth based on tourist arrivals. Annual data of tourist arrivals and GDP for the period 1991 to 2009 are used in the regression analysis to establish the statistical relationship between the GDP and the tourist arrivals. Then the model is used to predict tourist arrivals, after which we predict the GDP growth using the relationship obtained. Statistical methods were used in the collection, analysis, explanation and presentation of the time series data of tourists’ arrivals. After some analysis, the ARIMA (2, 0, 1) model has been selected as the final model. The study provides a method for prediction and forecasting based on the data, which may be used by both government and business entities. The study has served to shed light on the dynamic relationship between tourism and the GDP in Zanzibar. It is expected that this model will be used by stakeholders in problem solving, decision making and developing policies for the tourism sector in Zanzibar. Furthermore, the results of this study may help to explain the extent to which the tourism sector is contributing to and could enhance poverty reduction in Zanzibar.
Available in print form, East Wilbert Africana Collection, Dr. Wilbert Chagula Library, Class mark (THS EAF G155.Z36M63)
Tourist trade, Gross domestic products, Economic growth, Mathematical models, Zanzibar
Moh’d, S.S(2013)Modelling and forecasting gross domestic product (GDP) growth with special focus on tourism in Zanzibar,Master dissertation, University of Dar es Salaam, Dar es Salaam