Diversification dynamics: Gold Coast's tourism industry in economic development perspective

Abstract

The post-COVID landscape poses significant challenges and opportunities for the tourism sector in Gold Coast, prompting a reevaluation of policies and strategies to ensure sustainable recovery and future growth. This study examines the impact of tourism loss on a regional economy, focusing on mitigating upheavals through economic expansion in a portfolio framework. Utilizing modern portfolio investment strategies and economic development perspectives, we determine an optimal balance of high returns and low risk for the entire economy. Each sub-sector of tourism is analysed to understand its role in risk minimization, diversification, and long-term economic growth, integral to the Gold Coast's economic plan. Additionally, we explore how tourism intersects with other high-value industries. Initial findings suggest tourism could outpace overall economic growth and currently reduces 90 % of total risk in a fully diversified economy. Using the modern portfolio investment framework, we identify significant intersections between tourism and other sectors. This framework aids policymakers in devising effective sector development initiatives for stable long-term growth.