- July 29th, 2011
- in Yachting
Developing Tourism in Developing Countries
In May this year, I had the privilege of being invited to attend the 2011 Fourth United Nations Conference on Least Developed Countries in Istanbul, to discuss the topic of sustainability and tourism. As chairman of OBM International, I was representingthe tourism development industry, offering the unique vision and understanding of an international brand with its roots in the islands of the Caribbean; hence, sensitive to the impact of development on small economies. With tourism being so critical to the economy of the BVI and the Caribbean as a whole, it is valuable to get a better understanding of the “big picture,” to hear about other parts of the world where the industry has a major role to play.
Since the Least Developed Country (LDC) concept was initiated in the 1960s, only three have graduated to “developing” country status. Botswana in 1994, Cape Verde in 2007, and most recently, the Maldives in January 2011, have all been elevated thanks to the growth of their tourism industries. Today, the term LDC still applies to 48 countries; 33 of these are in Africa, and only one, Haiti, is in the Americas. These nations exhibit the lowest indicators of socioeconomic development and the lowest human development index ratings in the world, and all have a per capita income of $905 or less per year.
The conference brought together a group of executives and government leaders from developed, emerging and LDC economies to analyse and discuss LDC tourism development aspirations. It’s widely acknowledged that the tourism industry has the potential to be a serious catalyst in the reduction of poverty. Sustainable tourism development can empower underprivileged communities and offer a real economic escape. Evidence of this is now apparent in 20 of the 48 LDCs, where tourism is currently the primary or secondary source of earnings, and it’s further demonstrated by steady growth of the industry in at least 10 of the others.
The development of international tourism in LDCs has proven to be one of the key drivers in helping countries to promote productivity, sustainability and inclusion—all of which are needed to generate foreign revenue and create employment. Roughly $2.3 billion was spent daily in tourism activities worldwide in 2010, and the 11 percent average annual growth rate for tourism income in the LDCs is far higher than the global norm. This inflow of foreign currency provides jobs that help individuals to learn skills and become educated through training.
The World Tourism Organization had estimated that by 2010, 75 million international tourists would arrive daily to Africa and 416 million to Asia, giving the LDCs in these regions the opportunity to utilise the inflow of tourism dollars to raise standards of living. Following the same patterns as Asia, Africa is currently forecast to be the fastest-growing international tourism market in the world, with its initial baselines so low and with so much scope for uplift. This provides a platform to citizens to start their own local tourism enterprises and, in particular, to empower the women of these regions to benefit from widespread socioeconomic improvements.
It’s critical that any tourism development must be undertaken in a truly sustainable manner. It must respect unspoilt environments and local populations, and integrate local cultures into the tourism experience. It must provide opportunities for enterprising local communities, and back these up with training to empower potential entrepreneurs. It’s important to ensure that the supply of goods and services in tourism enterprises are coming from local sources, to utilise local and nationwide resources, to minimize “leakages,” to maintain the monetary income in the local region. The multiplier effect of the tourism dollar is a powerful economic tool for a community, but too often the multiplier is weakened by leakages as a result of the lack of local resources in emerging or remote markets, as in the islands of the Caribbean.
Having a structured sustainable tourism development plan, with support from the local government, is the key to success. One of the major challenges is that LDC governments have traditionally suffered from short-term visions rather than structured, long-term plans. Thus, governments often need assistance in preparation of a framework for development, by establishing a country-wide development plan that is proactive and gives potential investors a road map, along with a set of rules and guidelines that are tangible and offer a level of security and confidence for the developer, the government and the community.
Studies show that there is a lower-than-expected risk in investing in an LDC. While the process may be complex, evidence shows that rates of return on direct foreign investment in LDCs can be significantly higher than on investment in developed, or even other developing countries.
It was interesting to see many parallel issues discussed in the development of tourism in the emerging markets and the tourism product in the Caribbean and the BVI in particular. Tourism has the potential to be a key driver to each of these economies, but the success is dependent upon having the sustainable tourism development plan (STDP) with a defined target market, goals and objectives agreed by the government and the community as a whole, appropriate policies and legislation in place and related education programmes specific to the industry and associated entrepreneurial opportunities. This STDP must be truly sustainable in terms of respect to the local culture, the global climate, the environment and the economic benefits, both to the local community and the investor. The STDP must promote tourism growth models with initiatives and goals that are fully understood. A pro-poor tourism approach begins with efficient institutions that can develop stable support programs and increase community participation.