Tourism can Contribute Positively to Poverty Reduction - Research Paper Example

Tourism can Contribute Positively to Poverty Reduction Introduction This study is an attempt to examine the potential that exists for tourism to contribute to poverty reduction. It identifies the relationship between the two and the opportunities presented by tourism in poverty reduction. Consequently, how and where the tourism industry can provide the poor with better opportunities, empowerment and security? Tourism with an impact far beyond its economic and business aspects is one of the largest and fastest-growing industries in the world. The World Travel and Tourism Council estimates that the tourism industry contributes around 10 per cent of global GDP and provides employment to some 215 million people worldwide (UNESCO, 2005). Tourism by the virtue of its size and outreach is a major catalyst for globalization in terms of intensified economic, social and cultural relations across borders. However, there are numerous challenges to the effective use of tourism as a tool for poverty reduction. This study goes into the causal factors responsible for bringing about positive as well as negative impacts in the lives of local poor. The paper will also elaborate on some essential elements of tourism to make tourism more effective tool for poverty reduction and eventually leading to sustainable development of the poor communities. 1. Contextualizing tourism into poverty discourse Tourism and poverty is a relationship between the opposites. At one end of the spectrum, there are people enjoying leisure pursuits and spending income on recreational activities and on the other people in misery suffering from limited socio-economic means to lead a dignified life. Any possibly relationship between the two seems unlikely. But there is a clear relationship between the two as tourism impacts upon poverty in so many ways, directly and indirectly. It offers labour-intensive and small-scale opportunities, unlike non-agricultural activities (Deloitte, 1999), with a high employment opportunities to women, and helps in value addition to natural and cultural resources which in essence are core assets of the poor. Yunis (2004), Chief of Sustainable Development at the World Tourism Organization at a World Bank conference in Brussels in May 2004 argued for tourism as a major player in the development of people in poorer countries. Tourism is growing faster in developing countries than in developed countries and there are evidence that prove tourism to be a successful tool in reducing poverty (Yunis, 2004, WTO, 2002; Ashley et al, 2001). Yunis (20004) points out that tourism may not address poverty automatically. Nevertheless, there are some experts who have expressed their skepticism of positive externalities and subsequent benefits of tourism on poverty. According to them the tourism industry has been market driven and hence, it is a buyers’ market. Akama (1999) argues that tourism development may lead to an economic structure of dependency on an external market demand. This, he argues, is akin to an ‘alien’ development to which locals cannot relate to, both socially and economically. Tourism is often used to demonstrate the contemporary potency of development theory (Clancy, 1999; Scheyvens, 2002) and there is considerable skepticism amongst academics and development practioners who point to the negative socio-cultural and environmental impacts, higher leakages and the capture of benefits by the metropolitan and local elites (Scheyvens, 2002, Harrison, 2001). 2. Complementarities between tourism and other livelihood strategies Tourism if considered an additional diversification option for the poor, not a substitute for their core activities, then it has high potential to complement other forms of activities poor generally engage themselves in. Availability of option to avoid forms of involvement in the industry which require capital investment and choosing forms which complement existing livelihood strategies, the poor can maximize their returns. Local poor generally show enthusiasm and aspiration to participate in tourism related activities provided their existing livelihood activities do not clash with the earlier. In the initial articulation of the sectoral approach to development, case for achieving full potential of tourism necessitated monitoring and evaluation as absolute must (Goodwin, 1998). Yunis (2004) emphasized the need of developing some simple indicators and systems to measure the impact of tourism on poverty. Literature on the subject reveals that barring a few incidents of monitoring, not many cases have been monitored. Exceptions include SNV initiative in West Humla, Nepal which was retrospectively analyzed using a livelihoods approach (Saville, 2001), and The Gambia poor producers involved in a market access initiative which calculated the income gains between two seasons (Bah and Goodwin, 2003). Tourism as a source of waged employment can be sufficient to lift poor households from insecurity to security. But as often is the case, tourism waged employment may only be available only to a minority, and not the poor. Casual earnings per person may be meager, but much more widely spread (Ashley, 2000; Shah, 2000), and may be enough, for instance, to cover school fees for one or more children. Ashley’s study of tourism in Kenya and Namibia illustrate that work like guiding, although casual, is often high status with relatively good income which in principle benefit all residents. Tourism development can change poor people’s access to assets and related livelihood options. On the positive side, it can generate funds for investment in health, education and other assets, provide infrastructure, stimulate development of social capital, strengthen sustainable management of natural resources, and create a demand for improved assets like education. On the negative side, tourism can reduce local access to natural resources, draw heavily upon local infrastructure, and disrupt social networks. 3. Two cases of pro poor and non-pro poor tourism My first case is about pro-poor tourism that has positive impacts upon poverty reduction and people’s empowerment is on Trinidad and Tobago. Trinidad and Tobago suffers from restricted natural resource endowments, with the exception of oil and gas. Governments in Small Island States and Trinidad and Tobago in particular are recognizing tourism as an export industry that generates foreign exchange, creates jobs and encourages economic diversification (Freitag, 1994; Hall and Page, 1996). In recent years, the government of Trinidad and Tobago has recognized that continuous dependence on non-renewable resources like petroleum can only lead to an uncertain future. The country aims to achieve developed nation status by 2020. Poverty elimination is a key component of the national development agenda of the government of Trinidad and Tobago. The new strategy by the government focuses more on renewable sources such as tourism. According to Henry et al (2006) measured poverty is high, and pockets of acute poverty persist in certain eastern, far south, and southwestern regions. These problems have been further accentuated by over dependence on energy resources. Over the last two decades, the number of displaced persons, unemployed youth and street children has increased. In its aim for developed nation status by 2020, the government does recognize that the energy sector is unable to fully sustain the economy in order to achieve this goal. Therefore, tourism has rapidly moved into the mainstream of economic development. The World Travel and Tourism Council report 2005 on tourism in Trinidad and Tobago (T&T) has forecasted 5.2% per annum growth in tourism between 2005 and 2015 (WTTC, 2005). The government has integrated this growth trajectory in tourism into its Development Plan 2020. 3.1. Development indicators of Trinidad & Tobago: the need for PPT Trinidad and Tobago is a politically stable economy and is one of the more developed territories in the Caribbean region with an average GDP of 12.6% and an unemployment rate of 7% (CIA, 2007). However, poverty does exist in spite of sound macro indicators. The level of poverty at 24% with approximately 8.3% of the population being indigent or suffering from hunger is quite worrisome (Ministry of Social Development, 2006:24-25). There are major pockets of poverty in areas, such as Nariva/Mayaro with an indigent population of 24%, St. Patrick 13%, and Victoria 15% (Henry et al, 2006). The basic cause of these pockets of poverty is attributed to the lack of inclusive growth and operative institutional framework for poverty reduction (Ministry of Social Development, 2006). The national development vision for the year 2020 is the creation of an integrated and inclusive society, free of poverty, with mechanisms to prevent and treat vulnerabilities of any type (Ministry of Social Development, 2006: 95). In 2001 the government entered into an agreement with the European Union to fund a Poverty Reduction Programme. At the heart of the PRP are three components: improvement of the delivery of poverty reduction services; strengthening of the institutional framework for poverty reduction; and strengthening of the information system on poverty and poverty reduction programmes (Ministry of Social Development, 2006: 25). Part of the PRP is also to develop sustainable communities. The government holds strong belief that citizens must be empowered to take responsibility for their communities; every citizen must have fair access to resources and facilities in their communities that are necessary for living a satisfying life; sustainable economies and business enterprises must be encouraged; and information sharing and knowledge development must be fostered within communities (Ministry of Social Development 2006: 40). The 2001 agreement with the EU takes into account tourism as a major component of the government’s development plan 2020. According to the Draft 2020 Strategic Tourism Development Plan, by the year 2020, tourism will be a significant economic sector contributing approximately 90,000 indirect and direct jobs to the economy. The WTTC indicates a consistently impressive growth by over 40% since the mid-1990s in international arrivals to Trinidad & Tobago (WTTC, 2005). Tourism development, many scholars argue, associated with high levels of leakage, foreign dominance of the industry and expatriate domination of management at high levels (Weaver, 1995) and hence, it may not work for the good of the poor. The challenges, according to Roe and Khanya (2001: 2) are to “enhance the many positive impacts it can have and reduce the costs it can place on the poor.” However, the new pro-poor tourism development strategies are two pronged strategies that seek to maximize tourism benefits to the poor and simultaneously reduce their negative impacts. 3.1.2. Pro-Poor Tourism – The Case of St. Lucia St. Lucia’s economy has been dominated by the export of cash crops, such as bananas, sugar cane and coffee. The island lost its competitive advantage in the wake of global trade liberalization policies as it had to compete against larger nations. As a result there were huge socio-economic consequences with poverty estimated at 24% in 1995 (Renard, 2001). This called for the introduction of pro-poor tourism which today accounts for 13.6% of the GDP. The key objectives of the Government of St. Lucia (GOSL) is “to establish tourism as a strategic economic development priority” (Caribbean Development Bank, 2005:105). In 1998 the GOSL initiated the European Union funded St. Lucia Heritage Tourism Programme (SLHTP) aimed at making St. Lucia the most diversified and sustainable tourism destination in the Caribbean. The programme seeks to ensure that the benefits derived from tourism are distributed more evenly throughout the island and especially to the rural poor. It was a strategic attempt to shift an entire sector to make it more sustainable, more equitable, and more focused on the needs of the poor people (Renard, 2001). The GOSL chose heritage tourism as the type of tourism to be developed in the different communities since local residents and their resources are the centre of attention. In order to change the existing tourism sector so that it focuses more on the needs of poor people, the Programme employs a two-pronged strategy: The SLHTP was introduced in a number of poor areas on the island. One such area is Anse La Raye where traditionally fishing had been the main livelihood for the residents. The village is said to be one of the poorest villages in St. Lucia and it lacks employment opportunities (Renard, 2001). The tourism sector was in minimal operation before the introduction of the SLHTP, but since its opening, a number of sites and activities have been developed, such as waterfalls, museums viewing sites at both entrances of the village and a weekly seafood night (Renard, 2001:12). These initiatives have enabled the community to use of its most abundant resources, the sea, to create a revenue generating activity while maintaining a cultural flavour. The PPT strategies implemented in the area had a positive impact on the village of Anse La Raye both economically and socio-culturally. 3.2. Dominican Republic and non-pro poor tourism My second case is about Dominican Republic which does not use pro-poor tourism as a strategy to reduce poverty. Tourism development in the Dominican Republic started with large scale foreign investment in the late 1970s. Scholars have argued that this sort of foreign investment led tourism led to the neglect of developments and innovation in the agricultural sector coupled with the enclave resort development maxim, characterized by its inclusiveness, meant that linkages to the local economy were not materialized. This sort of tourism, scholars have argued resulted into foreign control of cultural, as well as physical and environment resources as per the desires of the tourists (Britton 1982; Rodenburg 1980). One writer has even referred to this exclusionary tourism in the Dominican Republic as "the concentration camps of leisure" (Reid 1992: 75). Freitag (1994) has argued that the enclave resort model promoted by the Dominican Republics government appears to produce an economic situation whereby the lower-classes are exploited as a source of cheap labour with the national elite and foreign companies reaping the economic benefits. He has further argued that, tourism in the Dominican Republic must have produced some employment opportunities for the local poor, but the negative impacts were quite exploitative in nature and often led to commodity inflation, rising land prices associated with speculation, and higher crime rates. The potential of tourism as a local development option in Dominican Republic has been criticized due to persistent claims that the industry is plagued by high import content and subsequently high leakages. Those being targeted with these accusations are generally foreign-owned, top-end, mass tourism facilities, all inclusive and tour operators based in generating countries. It is argued that more could be done to link the tourism industry to other sectors of the economy so as to increase the overall development of a destination. An increasing number of destinations, largely due to concern over impacts on the environment, the experience of visitors and their target market, socio-cultural and economic impacts, have realized the fallacy of increasing visitor numbers but numbers alone do not reflect into positive impacts on the poor. 4. Conclusion While this study reveals clear links between tourism and poverty, and that tourism impacts positively on poverty reduction, there is a need for a paradigm shift in the way tourism is developed and the nature of the policies for both tourism development and poverty reduction to ensure that the poor benefit from the tourism development process. Tourism development can produce negative impacts on residents. In rural areas, displacement of people from their land and competition for other natural resources such as water, forest, and wildlife are likely to be the key trade-offs. Pro-poor strategies should therefore focus on minimizing negative impacts as well as exploiting potential benefits. The study highlights the need for proper coordination between the local, national and international governments and organizations as well academic institutions for planning and development of implementing mechanisms to ensure public and private partnerships. Governments have a major responsibility of identifying specific zones or areas within the country to attract public-private partnership investments with a focus on pro-poor development. Partnering and networking with other supporting institutions, organizations and programmes to provide economic and livelihood enhancement opportunities for the poor that can be achieved through enhanced links to the tourism industry. While tourism triggers development of poverty reduction process, recent global economic downturn has not left any sector of economy untouched. The current economic crisis has demonstrated that there are significant risks in relying upon tourism as the sole means of reducing poverty. Consequently, there is a need for government agencies and international institutions to integrate tourism, riddled with income generation risks, within the larger pro-poor development strategies. Pro-poor tourism can yield best results only when it is developed and implemented through community participation which ensures quality community leadership to make the community aware of the positive as well as negative impacts of tourism. Provisions should be made to provide locals tourism training based on local traditions and culture of ethnic minority groups. Tourism development in the areas is not linked to other sectors. For example, most of skilled jobs are given to foreigners, while local people take up unskilled and low paying jobs such as watchmen, room attendants and gardening. 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