The World Travel & Tourism Council predicts that the travel and tourism industry will be one of the world’s fastest growing sectors between 2011 and 2021, creating about 66 million jobs and accounting for 9.6% of GDP (up from 9.1%).
According to the World Tourism Organization (UNWTO), international tourist arrivals in developing countries are increasing and tourism is gaining importance as a driver of development, exports and jobs. Tourists increasingly look for cultural and natural attractions in rural areas, thereby increasing the scope for poverty reduction in developing countries due to their comparative advantage. The fact that two-thirds of the people suffering from extreme poverty live in rural areas reinforces the pro-poor potential according to the Rural Poverty Report 2011 by the International Fund for Agricultural Development. Tourism is labour intensive and presents employment opportunities for even low-skilled people. Considering the need for training and capacity building through domestic suppliers, and in cooperation with international and regional providers, tourism offers superior poverty reduction opportunities. In addition, UNWTO argues that more women and young people, who are proportionally more disadvantaged, find jobs within tourism. The figure below shows the tourism value chain along which employment can be generated, directly and indirectly.
At the same time, tourism does not represent a trouble-free means of economic development. The tourism sector is competitive and vulnerable to natural disasters and political instability; and poor communities do not automatically benefit from tourism as there are high ‘economic leakage’ rates as key industry players often prefer imported supplies and services.
To turn leakages into linkages, it is essential to consider different levels of intervention, namely producers, key buyers, support institutions and national policymakers. Equally, it is crucial that developing countries establish a ‘coherent policy framework, [develop] effective and efficient institutions and [stimulate] a proactive private sector in order to exploit their comparative advantage in tourism. In addition, a national tourism development strategy must inevitably address issues that extend beyond the sector and establish cross-sector linkages,’ says a 2011 United Nations Development Programme discussion paper on ‘Tourism and Poverty Reduction Strategies in the Integrated Framework for Least Developed Countries.’ A lack of suitable infrastructure and weak institutions need to be addressed, along with security and political stability, to increase a country’s attractiveness to investors and tourists.
Unfortunately tourism has not been given sufficient priority in international development cooperation. Due to its huge pro-poor potential it should be accorded more attention by national and international policymakers. The International Trade Centre (ITC) began implementing inclusive tourism projects in 2003 with the aim of integrating local producers, for example of agricultural or handicraft products, into promising tourism value chains, strengthening entrepreneurial capacities and generating employment.
For example, ITC launched an inclusive tourism project on Brazil’s Coconut Coast in 2003. This project embraces capacity building activities in organic agriculture, arts and crafts, the hotel business, computer science, English, environmental education, design, and apiculture, in collaboration with specialized partners. Furthermore, an organic waste processing plant was installed, providing balanced fertilizer at subsidized rates to 300 farmers.
Today, 70% of the 3,000 beneficiaries of the project have found employment (mostly in nine 5 star partner hotels) and the monthly income of 390 local women artisans has risen from US$ 40 to US$ 250. The proportion of the population earning less than one minimum salary has decreased from 40% to 28%.
The success of this and similar projects confirms the fact that tourism represents an important opportunity for developing countries in their fight against poverty.