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Workshop on Expanding the Role of Tourism inPoverty Reduction

24 October 2007Nukualofa

Poverty Reduction through Tourism TheExperiences in Asia

Ryuji YamakawaUNESCAP

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Presentation OutlineI. Tourism in Asia.

II. Tourism and Poverty Reduction.

III. Asian Experience in Poverty Reduction through

Tourism: Case study Pro-poor community basedtourism development in Lao PDR.

IV. Challenges.

V. Actions to Expand the Role of Tourism in PovertyReduction.

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Tourism in Asia

Tourism in Asia growing faster than other regions.

1995 - 74 million arrivals.

2006 - 157 million arrivals.

Tourism in Asia has great potential for furtherexpansion.

Improved air linkage and transportation networks.

Emerging markets China, India, Russia.Simplified procedures for visa issuance.

Strong subregional cooperation in tourism.

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Tourism and Poverty Reduction

Tourism stimulates economic growth both at the national and local

levels and promotes the growth of the agricultural, industrial andservice sectors.

Tourism provides a wide range of employment opportunities easilyaccessible by the poor. Tourism businesses and tourists purchasegoods and services directly from the poor or enterprises employing

the poor. This creates opportunities for micro, small and medium-sized enterprises in which the poor can participate.

International and domestic tourism spreads development to poorregions and remote rural areas of a country that may not havebenefited from other types of economic development.

The development of tourism infrastructure can benefit the livelihoodof the poor through improvement in tourism-linked service sectors,including transport and communications, water supply, energy andhealth services.

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How Tourism Helps the Poor

Employment of the poor in tourism enterprises. Supply of goods and services to tourism enterprises by

the poor. Direct sales of goods and services to visitors by the

poor. Establishment and running of tourism enterprises by the

poor Investment in infrastructure stimulated by tourism also

benefiting the poor. Tax or levy on tourism income or profits with proceeds

benefiting the poor.

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Lao PDR

Tourist Arrivals, Revenue and Average Lengthof Stay, 1990-2006

Year Number of TouristArrivals

Revenue from Tourism(Dollars)

1990 14,400 N.A.

1993 102,946 6,280,000

2006 1,215,106 173,249,896

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Tourism in Lao Peoples Democratic RepublicRevenue and rank of various Lao industries (revenue in $US million)

2001 2002 2003 2004 2005Revenue Rank Revenue Rank Revenue Rank Revenue Rank Revenue Rank

Tourism 113.8 1 113.4 1 87.3 2 118.9 1 146.7 1Garments 100.1 2 99.9 2 87.1 3 99.1 2 107.5 3Electricity` 91.3 3 92.7 3 97.3 1 86.2 3 94.6 4WoodProducts 80.2 4 77.8 4 69.9 4 72.4 4 74.0 5Coffee 15.3 5 9.8 7 10.9 9 13.0 8 9.5 8AgriculturalProducts 5.7 6 25.6 5 11.1 8 20.5 6 26.6 6Minerals 4.9 7 3.9 8 46.5 5 67.4 5 128.3 2Handicrafts 3.8 8 2.7 9 12.4 7 1.9 9 2.7 9OtherIndustries

- - 19.9 6 17.1 6 13.4 7 11.9 7

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Case Study: Pro-poor Community-based TourismDevelopment in Lao PDR

Implementing organization: Lao National Tourism Administration

Project Implementing Units of Luang Namtha, LuangPrabang, Khammouane and Champasak Provinces.

Cooperation organizations: Committee for Planning and Investment

Ministry of Culture and Information

Ministry of Agriculture and Forestry

Ministry of Communication, Transport, Post andConstruction

Science, Technology and Environment Agency

SNV

Project funding: $1.6 million US dollars from ADB.

Project site: Luang Namtha, Luang Prabang, Khammouane andChampasak Provinces.

Project duration: January 2003 December 2007 (5 years).

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Case Study: Pro-poor Community-basedTourism Development in Lao PDR

(Contd)

Project objective:

Income generation and job creation at the locallevel.

Cultural protection and revival.

Natural resource conservation.

Gender equity and ethnic minority participation.

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Case Study: Pro-poor Community-based TourismDevelopment in Lao PDR (Contd)

Project activities:

(i) Institutional strengthening and community participation programme.

(ii) Awareness programme on tourism benefits and environmental and culturalconservation.

(iii) Pro-poor tourism products identification and development.

(iv) Small-scale tourism-related infrastructure.

(v) Capacity building for tourism-related local micro-enterprises and communities.

(vi) Gender development participation programme.

(vii) Ethnic minorities participation programme.

(vii) Marketing and promotion plan.

(vii) Promotion of community-based tourism networks and Eco-tourism StakeholderAssociations.

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Case Study: Pro-poor Community-based TourismDevelopment in Lao PDR (Contd)

Project performance monitoring system:

Annual provincial, village and household monitoring datacollection conducted every year in order to compare.

The level of income.

The number of tourists visiting the areas.

Families participating in tourism activities.

Income distribution, household profiles; and

Income generated by non-tourism activities.

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Financial Summary for LNTA/ADB

New CBT Products: (US Dollar)

No. villages/

estimated

number of

TotalRevenue

2005

TotalRevenue

2006

VillageRevenue

2005

Total 14

products

32/551 $68,194 $94,813 $40,548

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Financial Summary for Destinationsand Tour Operators

March 2005 February 2006

Destination

& TourOperatorSupport

No. Tours No. Tourists Total

Revenue

Village

Revenue

Total 700 64,727 474,596 260,947

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Summary of Benefits Job creation.

- 300 jobs created in Luang Namtha.

- Over 75% were in extreme poverty.

- Number of women employed : 140.

Increase in income levels.

- Target villages increased cash income by up to 35%.

Access to medical services improved.

Language skills improved. Solid waste management improved.

Traditional skills, arts and culture promoted.

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Lessons Learned

Lessons learned:

Criteria must be applied in the selection of target villages.

- poorest villages + tourist attractions.

- easy to access.

- located within a tourist circuit.

- market demand for the product exists.

- villagers should be interested in developing tourism.

- safety should be a consideration.

- a measurable link between tourism, heritage conservation

and economic development.

Not all the villages can get benefits and be involved in tourismactivities, especially those where there are no home-stay orcommunity lodges, or are located far from tourist sites.

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Lessons learned:

Pro-poor tourism development should take a two-prongedapproach.

- Develop community-based tourism circuits in villages

where there are potential tourist attractions (trekking,home stay, etc.).

- Research and develop supply chains betweenproduction villages and tourist markets.

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Lessons learned:

- Villages that host tourists overnight gain the greatest benefits from

CBT, but income might not be distributed widely.- Encourage villages to participate from the beginning in the planning

process of CBT development at the village level (design of tours).

- Ensure that rotational service roster is followed closely to alloweveryone a fair chance at gaining income from tourists.

- Allow poorest families priority access to village development funds inorder to help them to integrate into home stay rotations.

- Establish a village based ecotourism committee with a revolvingleadership that includes women.

- Build tourist facilities and small scale infrastructure facilities such ascommunity lodge, toilets, viewing points, rest area, information board,cultural centre, and ethnic minority markets.

- Cooperation with the private sector for marketing CBT products andmaintenance of community lodges and trekking trails.

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Lessons learned:

Pro-poor tourism projects often require

investments in small infrastructure, and whenpossible should be built by the intendedbeneficiaries themselves, with local contributions ofresources to the highest extent possible.

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Challenges

To enhance the understanding needed to givepriority to tourism development in nationaldevelopment strategies, policies, regulations,plans and the allocation of resources.

To develop tourism in a comprehensive andsustainable manner with a view to expanding itscontribution to socio-economic developmentand poverty reduction.

To facilitate the opportunities for poorcommunities to benefit from tourism andprovide necessary training.

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Recommendations

(1) To enhance the understanding needed to give

priority to tourism development in national developmentstrategies, policies, regulations, plans and the allocationof resources

(a) Improve national tourism statistics and indicators, including

indicators of the socio-economic, cultural and environmentalimpact;

(b) Undertake analytical studies on the socio-economic impact oftourism;

(c) Undertake case studies on tourism initiatives aimed at socio-

economic development and poverty reduction;(d) Undertake public relations programmes and media activities to

enhance awareness about the role of tourism in socio-economicdevelopment and poverty reduction.

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(2) To develop tourism in a comprehensive and sustainablemanner with a view to expanding its contribution to socio-economic development and poverty reduction

(a) Identify the potential contribution of tourism to theachievement of the Millennium Development Goals;

(b) Integrate tourism into national development plans witha clear definition of the role of tourism in socio-economic development and poverty reduction;

(c) Prepare tourism master plans which include effectivestrategies to spread the benefits of tourism to poorcommunities;

(d) Incorporate tourism into poverty reduction strategies.

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(3) To facilitate the opportunities for poorcommunities to benefit from tourism

(a) Foster and support micro, small and medium-sizedtourism-related enterprises;

(b) Organize collaborative actions by the Government,

the private sector and stakeholders to developentrepreneurial and employment opportunities for thepoor;

(c) Encourage the use of local resources and services in

tourism-related operations;(d) Promote local arts and crafts as well as local

entertainment to increase the income levels of hostcommunities and enhance the preservation of localculture;

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(e) Expand the role of mainstream tourism in povertyreduction;

(f) Ensure the involvement of all stakeholders in theplanning, development, management and promotion of

tourism;(g) Monitor and assess the impact of tourism initiatives on

the poor;(h) Improve the quality, capacity and skills of poor people

through training and upgrading the skills related to

tourism services;(i) Strengthen backward linkages to poor communities bydeveloping the capacity of local business organizationsand community associations to participate in localtourism development and operations;

(j) Encourage private entities in remote areas to develop

tourism infrastructure, not only for their own benefit butalso for the benefit of local communities;(k) Facilitate tourism-related micro and small-scale

enterprises with easier access to capital, includingthrough microfinancing and marketing schemes.

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Thank You