How government can boost the local economic impacts of tourism. The first of a new series of blogs.
The poor can participate in the tourism industry in many ways – as workers, entrepreneurs, and neighbours. They gain new opportunities but also face constraints. They earn incomes, but also suffer costs of tourism. These impacts vary enormously from destination to destination. Enhancing the opportunities and impacts for the poor is the concern of this new series of blogs.
Many governments (particularly those of developing countries) have declared their policy to harness tourism for poverty reduction. The question for most governments though, is what should they do in practice to boost the flow of benefits to the poor?
The language varies: harnessing tourism for poverty reduction, implementing pro-poor tourism, or boosting the impacts of tourism on the local economy. But whatever it is called, the principle is to adapt the way that tourism is done in order to generate more benefits for the local economy and poor people. In these blogs we will use the term ‘pro-poor tourism’ or ‘PPT’ for short.
PPT is about how the business of tourism is carried out. The impacts of tourism on the poor depend very much on the behaviour of private companies and individual tourists. Yet these are strongly influenced by Government, through its policies, regulations, public investment, expectations, and actions, not only in tourism but in other sectors too.
There are no fixed rules about how different types of tourism generate benefits to the poor. The little quantitative data that exists already illustrates quite clearly that what matters is not the type or size of tourism, but how the tourism economy is structured, how supply chains work, how far linkages extend into different parts of the local economy, and how tourists spend their money when they arrive. In other words, there is a great deal that government can do to influence flows to the poor, whatever type of tourism they have.
OPPORTUNITY ONE: Diversifying the destination, including more products of the poor
Assess options for product diversification
Every destination has its core attraction (whether it is the coast, forests, cultural heritage or a mountain-bike trail) plus accommodation. But some destinations have a great deal more. A more diverse destination is likely to be better for everyone – more opportunities for entrepreneurs, large and small, more to do for tourists, increased length of stay for hoteliers. It is particularly important for the poor because they are less likely to be involved in the hotel sector or in operating the main attraction, but will have more chance of participating in the ‘add-ons’.
Product diversification that is likely to involve the poor includes:
- Agritourism: making a feature of food products, other agricultural products (health remedies) or making excursions and activities related to agriculture and farms.
- Rural tourism: creating activities in rural areas, whether it is visiting a traditional homestead or more adventurous sport on bikes, rivers and mountains.
- Cultural tourism and entertainment: this may be witnessing living culture in rural areas, learning about historic sites, or enjoying urban night life.
- Shopping: arts, crafts, tailoring
- Use of local transport: boats, bicycle rickshaws, tuk-tuks, horse and cart, donkeys … for touring an area or getting place to place.
While there may be some overlap between these five (excursions focused on cashew nut farming could fall into all five groups) it is important to remember that diversification into music, dance, night life and shopping can just as easily be in urban areas and is equally important for the urban poor.
Create opportunities through rural cultural tourism
Tourism that involves visiting cultural sites, rural villages, or engaging with the living culture provides many opportunities for participation by poor people. If the product potential exists, it can be invaluable to encourage this kind of tourism, so long as it is structured in ways that expand opportunities for the poor.
It is of course wrong to pigeon-hole poor people into one segment of the tourism industry or to make assumptions about cultural tourism benefiting the poor. On the other hand, there are some businesses that are clearly not within the means of those with little financial capital and marketing skills, such as hotels, tour operation and car hire. There are other businesses which do require the assets that the poor often have, which is cultural knowledge, handicraft expertise, access to traditional raw materials, and their own land, natural resources, culture and a village way of life which are themselves tourist attractions for some.
Influence the environment for cultural and rural tourism development
Government influences the overall strength of cultural products by how it:
- Defines the national tourism product and brand image
- Profiles cultural and rural products in tourism marketing
- Prioritises investments in transport and tourism-related infrastructure investments
- Prioritises areas for new hotels and other private sector investments
- Funds restoration and interpretation of historical sites
Sometimes it is important to get people thinking differently. Cultural heritage tourism is about making a product and excursion that builds on, and interprets, the local way of life. The very idea of making an excursion from how normal people live can be totally new. But it is an idea that is catching on in many destinations, whether based on tea factories, coffee plantations, traditional medicine, indigenous cooking or simple home-stays.
Urban tourism, township tours and more
In some ways it is easier for government to stimulate diversification in towns and cities because the strength of municipal organisation can be used. Government can:
- Organise municipal events and entertainment, giving a platform to local musicians and talent.
- Facilitate ‘township tours’ or other tours to poorer parts of the city and to projects. This involves attention to transport, parking and security issues.
- Licence different kinds of transport and take them into account in urban planning.
- Develop shopping venues, such markets, with the backing of municipal advertising.
Focus on how the poor can benefit. Don’t just assume.
Cultural tourism, rural tourism and urban tourism do not necessarily generate cash flow for the poor. It all depends how it is done. Therefore, government needs to establish mechanisms that ensure local people can provide services directly, do not get cut out by more established operators, and can, where appropriate, charge fees for accessing their resources.
- Work with private operators to establish a common system for paying fees to villagers or settlements when they themselves are the ‘product’, or their facilities are used.
- Help villagers reach standards and economies of scale so they can supply food and water to tourists and operators.
- Encourage longer visits involving rural overnighters so that local people become accommodation providers.
- Review entrance fees for rural natural or cultural attractions to ensure local people get fair shares.
- Support local people to develop a wider range of quality products for sale to tourists.
- Develop fee-paying activities that enable tourists to experience an aspect of local life first hand.
Future blogs will deal with ‘Boosting local craft and tourist shopping’, ‘Boosting local inputs into the hotel supply chain’, ‘Stimulating micro and small tourism enterprises’ and more.
Contact Lorton Consulting about diversifying your village, town or region’s tourism offering to enhance the opportunities and impacts for the poor — we would be more than willing to advise you.
With acknowledgement to UNWTO, SNV and ODI