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Full Project – Significance of modern rail transportation on the development of the hotel industry

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Chapter one

Introduction

1.1 Backgrounds to the study

In world of change, one constant in the last quarter of the twentieth century has been the sustained growth and development of hotel industry both as an activity and an industry (occupation). Brotherton and Wood define hospitality as a contemporaneous human exchange, which is voluntarily entered into and designed to enhance the mutual well-being of the parties concerned through the provision of accommodation, and/or food, and drink (Brotherton and Wood 2000). The hospitality industry is a broad category of fields within the service industry that includes lodging, food and drink service, event planning, theme parks, travel and tourism. It includes hotels, tourism agencies, restaurants and bars. The growth and development of hotels depends on transportation to a great extent. Although transportation and hotel industry development are, nevertheless, this paper has tried to demonstrate that the relationship between these two issues is somewhat controversial owing to the many schools of thought that are available.

The main things that can be deduced from the description of hotel industry above is that, it has to deal with the movement of people (transportation) from their usual place of residence to another by providing accommodation, food and drinks to the hosts. Nevertheless, new technologies in transportation has greatly improved hospitality sector. The development of these newer technologies has come about because there is a growing demand for newer, faster and more efficient modes of travel. Development in transportation impacts on the mobility of individuals, not to mention that it influences their demand and motivation (Duval 2007). The role played by transportation in hospitality development remains controversial mainly because there are various schools of thoughts regarding its role in comparison with development. In their work, Khadarooa and Seetanahb (2008) have identified the role played by rail transportation network in the growth of a country’s hospitality sector. They see transportation network as a vital ingredient for the successful development of the hospitality sector. Transportation is also important in terms of promoting the growth and development of hospitality industry. It is important to note that by providing ideal transportation services to hitherto dead centers for tourist destination, we are likely to transform them into active and successful. Prideaux (2000) has also recognized the role played by transpiration infrastructure in tourism development. Even as many authors have recognized the importance of efficient transport as a prerequisite for the successful implementation of a tourism development program, there is not much work that has been carried out to explore the role played by transportation in tourism development.. Even as many authors have recognized the importance of efficient rail transport as a prerequisite for the successful implementation of a hospitality development program, there is not much work that has been carried out to explore the role played by transportation in hospitality development. hospitality industry’s history can be traced back by the end of 1700s in the Colonial Period. This industry has been the subject of important development over the years as it has faced many obstacles such as the World Wars, the great depression, the industrial revolution and other social changes. However, the hotel industry as seen today in its modern concept took place in the 1950s and 60s. The idea of renting an accommodation to visitors appeared since ancient times, and the modern concept of a hotel as we know started 1794, when the City Hotel opened in New York City; the City Hotel was claimed to be the first building designed exclusively to hotel operations. Other similar hotel operations follow the trend and appeared in other cities such as Philadelphia, Baltimore and Boston in 1809. One of the key factors that play a pivotal role in the hotel industry development growth is the presence of a reliable and efficient transportation system, this is mainly due to the fact that a well-developed transportation system provides adequate access to the region which in turn is a necessary condition for the efficient operation of manufacturing, retail, labour and housing markets. Transportation is a critical factor in the economic growth and development. It is a wealth creating industry on its own inadequate transportation limits a nation’s ability to utilize its natural resources, distributes foods and other finished goods, integrate the manufacturing and agriculture sectors and supply education, medical and other infrastructural facilities. There is the need therefore to maintain and improve the existing transportation and build new infrastructures for a national wealth. The national wealth is the growth domestic products (GDP) which is an indicator or measures of the rate of economic growth. Transportation is maybe the most exemplary form of infrastructure. Transportation network required huge upfront investment during its construction as its end results provides service over many years by reducing and facilitating easy transport of people, goods and services. For many years’ roads, canals, railway and later on airports have been considered as the most important ingredients, and they continue to be high policy maker’s agenda until today. The transport sub-sector contributes immensely to the economic growth and poverty eradication in the country through various ways. An efficient transport infrastructure is vital in supporting economic growth and improvement of the quality of life of the populace. The accomplishments of the transport sector projects require huge capital investment; therefore, the government has a fundamental responsibility of investing in transport sector where private sector is not able to invest in order to sustain economic growth linkages especially those related to National Development Plan (NDP).

Moreover, the magnitude of the impact of transport system on the national and regional economy is subject to the level of economic development and varies in rural and urban areas of developing countries. Modern transport system facilitates business development, reduces product price, provide admittance to global suppliers and consumer markets and create more cost effective global production process by lowering transport costs and increased accessibility. Goetz (2011), Lakshmanan (2007) and the White House (2014) argued that economic development can be influenced by transport infrastructure mainly through direct and indirect channels which can be traced by input-output analyses (Avonds and Gilot (2002); Wixted et al. (2006)). This means that the direct channels activates the transport sector contribution to the Gross Domestic Product (GDP) by granting easier access to inputs and reduced cost of intermediate purchases. The second channel works through additional input to other sectors. An efficient transport system provides faster, cheaper and more reliable and flexible transport services which can contribute to a higher productivity. Investment in transport infrastructure benefits the economy in short run by creating jobs in different industries specially those which are difficult to ship their raw materials overseas. For example, railway construction requires workers (both professional and non-professional) grading and paving equipment, gasoline or diesel to run the machines, raw inputs of cement, gravel, asphalt (The White House, 2014). Railway system is one among the oldest and common type of transport system worldwide, it is said that the world first intercity passenger and cargo railway started in Great Britain during the 1830’s between Liverpool and Manchester city. Currently National Rail Network (NRN) in Great Britain covered about 10,072 route miles (equivalent to 16,116 km) and carries over 18,000 passengers and 1000 freight trains daily. Transportation infrastructure is critical to sustain economic growth because people want to improve their standard of living and they see increased income as the way to achieve that goal, transportation system enhancement are in turns a means of maintaining or improving economic opportunities, quality of life and ultimately income for people in a particular region. Transportation also has a broader role in shaping development and the environment. Policy concerns in the next millennium will increasingly focus on the effects of transportation on where people live and on where businesses locate; and on the effects that these location decisions have on land use patterns, congestion of urban transportation systems, use of natural resources, air and water quality, and the overall quality of life Issues of urban sprawl, farmland preservation, and air and water quality have already pushed their way to the forefront of policy debates at both the national and local levels. To make prudent decisions, policy makers must be equipped with the best information and analysis possible about the interactions among these various factors. Transportation becomes the back bone of any economy, especially countries like Nigeria, as such an anatomy of aspects relating to inefficiencies and lack of good transportation network in Nigeria coupled with low rate of economic growth (GDP) is crucial, attached to this is the poor government policy on transportation (Lack pf regulation of fees charged by private transporters, inadequate fuel. Lack of spare parts and above all the prevalence of bad roads and lack of security have succeeded in trimming down the transport system in Nigeria which have a negative effect on the economic growth. Investment in transportation infrastructure is critical to sustained economic growth. Mobility studies show that transportation is absolutely essential to economic productivity and remains competitive in the global economy. An international study found every 10 percent increase in travel speed; labour market expands 15 percent and productivity by 3 percent (Barrister and Berechinan. 2000). The provision of transport infrastructure and services helps in reducing poverty. It needs no emphasis that various public actions aimed at reducing poverty cannot be successful without adequate transport infrastructure and services. It is difficult to visualize meeting the targets or universal education and healthcare for all without first providing adequate transport facilities. All sectors, including transport, operate within the socioeconomic framework provided by the State. Specific policies are designed within the framework for each sector in order to, meet national goals and objectives. As it is well known that transport system is one of the heart of the hotel industry development as it plays a major role in facilitating and boosting trade and various projects, movement of people, goods and services. That is to say a modern transport system particularly the railway system will speeds up fast the hotel industry development. Therefore, this study intended to investigate the significant of modern railway transportation system in the development of hotel industry; basing on railway system as a perspective.

According to G. O. Ogunremi(2003). The ultimate purpose of transport is to serve mankind. It is an integral part of the economy of every society whether advanced or simple economies; and both production and distribution of goods at all levels rely heavily on transport. Transport economists such as Bonavia, Norton, Sharp and Healey see transport as being indispensable to any economy which necessitated the construction of rail roads in Nigeria in the pre-colonial and colonial times. According to Hugh Norton, transportation enables society to enjoy the advantages of specialization of resources, and the benefits of division of labour by making it possible for products to be brought from great distances thus avoiding the necessity for local production of needs. More importantly, the earliest demand for transportation of things arose from the fact that men wanted a variety of natural products but nature did not provide them in one place. This buttresses Walsh Healey’s assertion which says “man as a hunter and gatherer carried himself to wherever there was a surplus to meet his needs.

Rail construction in Nigeria served as a major catalyst to the socio-economic development of major towns in Nigeria, Port Harcourt and other communities in Kwara State as an integral part of the country benefited immensely from it since 1912. The construction of rail terminus in Port Harcourt boosted economic activities of Port Harcourt and its environs because it attracted many people to Port Harcourt.This research analyzes why it is necessary to formulate a policy that would hasten the rehabilitation of existing rail lines, particularly the existing structures at Port Harcourt terminus erected by the colonial master for the benefit of Port Harcourt community and travellers. It is important to look at the geographic location of Port Harcourt as a strategic point for white men during the period of railway construction. Transportation as both heritage and contemporary attraction has been undervalued by tourism and leisure promoters. However, it is increasingly being recognized that transport has significant potential both its own right and in combination with other locally or regional based attraction. The transport experience can be the primary reason if not exclusive tourism experience, embracing qualities of heritage nostalgia, education, uniqueness, added value and entertainment. Also, certain form of transportation offers a unique transport experience based on the nature of the transport and location it is set in, thereby contributing to the easy movement to the place. The unique transport experience increases the demand for transportation. Transportation as one of the features of the hotel industry is as old as human existence. In ancient times, before hotel industry came into realization, people move on foot and travel along distance through a lot of time was wasted, because the primitive means of transportation was used. Modern day transportation came into existence due to the limitation placed on the places that can be reached on foot and has greatly contributed to the development of hospitality. Conclusively, hotel industry and transportation is two inseparable twins as one helps the other which means the role transport plays in tourism cannot be under emphasized.

1.2 Statement of the research problem

For many years worldwide, railways maintained a key role in transporting bulk cargos, people, as well as raw materials, passengers and services from one destination to another at a low cost. However due to strong and aggressive competition with the other transport sectors like roads, airways and waterways. The railways in Nigeria started to encounter a serious challenges has it been a case everywhere else on the globe. For more than three decades’ railways in Nigeria have implemented various structural change in order to survive with flexibility and the development of hotel industry. Despite the government efforts to revive the railway system, Hotel industry in Nigeria has suffered a lot of set back during the last few years due to a lot of factors such as transportation travel risks, high increases in transport fare, government policy, insecurity, bad road that leads to various hotel destination and lack of public private partnership (PPP) in managing the railways investment, outdated railways infrastructures. All these culminate to negatively affect the hotel industry and this study aims at significance of modern railway transportation system in the development of hotel industry. It cannot be denied that the modern railway transportation system contribute immensely to development of hotel industry. The modern railway system facilitates the movement of goods and people, especially travelers to their final destination. This has also help in the development of hotel industry by transporting travelers to the hotel.

1.3 Research question

Therefore, it is against this background, the study seeks to answer the following question:

Does rail transport have significant effect on hotel industry development?
Are there any relationship between rail transportation and hotel industry?
Is there any government’s participation in hotel industry in reference to transport system in Nigeria?
Does rail transport development contribute to the level of revenue from hotel industry?

1.4 Objectives of the study

The main objective of the study is to examine the significance of modern railway transportation system in the development of hotel industry and for efficient and effective transportation system in hotel industry. The study intends to achieve the following specific objectives:

To ascertain the significance of rail transport on hotel industry development.
To examine the relationship between rail transportation and hotel industry.
To ascertain government’s participation in hotel industry in reference to transport system in Nigeria.
To identify whether rail transport development contribute to the level of revenue from hotel industry.

Statement of hypotheses

In order to achieve the objectives of this study, the following hypotheses will be tested:

H₀₁: Modern railway transportation does not have significant effect on the development of hotel industry.
H₀₂: There is no significant relationship between rail transportation and hotel industry.

1.6 Significance of the study

The purpose of this study is to highlight the significance of modern railway transportation system in the development of hotel industry. The importance of railway infrastructure towards hotel industry growth is observed through directly availing employment opportunities to people carrying out the activity of construction and repairs as well as travelers who are provided with the link to their place of destination. The research will also help the government and policy makers on planning how much should the government need to spend on railway system and also know the public views on the development of the railway system.

1.7 Scope of the study

This research work covers activities on rail transportation, its development, significance to the economy, hotel industry and its performance.

1.8 Limitation of the study

This following were some problems encountered during the research process:

Some of the officials were constantly too busy to listen to the researcher and the process of distributing questionnaires among the workers was very difficult as most of them were reluctant to collect them.
Some collected and took time to answer them especially among the lower official.

1.9 Definition of terms

In this study, key terms/terminologies used have been defined by the researcher in order to clarify some terms so that the reader understand and avoid unnecessary confusion.

Transportation: is the process which involves the movement of people, goods, and services from one point to another. Generally, the process involves a system which facilitate this movement and that system may be air way, water way, and road way.
Development: according to the World Bank report (1990) development means encompasses the need and the means by which to provide better lives for people in poor countries. It includes not only economic growth, although that is crucial, but also human development providing for health, nutrition, education, and a clean environment.
Hotel industry Development The hotel industry is usually one of the largest revenue producers for countries since it deals with a variety of businesses. Hospitality usually focuses on extra money that people have to spend on pleasurable things and leisure, though not always. Business conventions, trainings, and meetings in different countries also affect the hospitality industry greatly. Besides this domestic and international travellers also contribute to it.
Railway system: are line that is the commercial organization responsible for operating a system of transportation for trains that pull passengers or freight.
Back head: the cab-side rear panel of a steam locomotive boiler through which the firebox is accessed.
Bad order: a tag or note applied to a defective piece of equipment. Generally, equipment tagged as bad order must to be used until repaired, inspected and approved for use.
Bail off: to release the locomotive brakes while the train brakes are applied to permit smoother handling and prevent excessive slack, wheel slide and flat wheels.
Allocation: it refers to allocation of rooms (conference or event may have an allocation of rooms at an agreed rate.
ARR: average room rate is the total room revenues divided by the number of rooms occupied.
Loyalty programme: a reward programme for the regulars. For instance, voucher, room upgrades etc.

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