ComMark Tourism: From Projects to Enterprises: A concept for regional intervention 2010 - 2015

Southern Africa’s richness in cultural and natural heritage represents the basis for the development of tourism as a tool towards poverty alleviation. If well developed, regional tourism policies have the potential of catalysing sustainable livelihoods, social equity and economic development. Focusing on industry ownership and participation of existing stakeholder institutions, the programme will support the region to more effectively integrate the poor into tourism development through a) the development of an appropriate enabling environment, b) strengthening of various forms of tourism enterprises/partnerships and the mechanisms that enable them, and c) creating products able to target a diverse consumer base including the poor.

Programme activities will particularly target interventions with a regional scope and strengthen M4P linkages with generating markets. The main regional sector objectives include improving the investment climate, completing the unfinished transformation agenda, removing barriers on the creation and growth of community-private sector partnerships, and nurturing small and micro-firms (community-based), to support and enable their sustainable participation in the tourism growth agenda. As part of the overall work in tourism development, analysing and supporting key drivers of growth and competitiveness is critical to the agenda, as is the user-friendly dissemination of such findings to stakeholders across the region.

Background Information

Many values are found in a well-planned, sustainable form of tourism based on realistic market analyses. Such a form of tourism represents an attractive non-traditional export diversification opportunity that is a high employer and a good educator. It has the potential to bring high foreign exchange returns for relative low capital investment whilst also being an appealing private sector enterprise accessible to the poor in Africa. Tourism has the ability to be a develop-ment, empowerment and good-governance tool for a country and her people.

Tourism has proven to be a driver of growth and a source of new private sector investment (11% of total investments in 2007) in Southern Africa. Tourism has grown to over 15% of total regional exports and international tourism arrivals and receipts have grown at consistently more than 8% between 2000 and 2005. Tourism employs about 4 million people in Sub-Saharan countries and an estimated 10.6 million if indirect linkages and the informal sector are considered.

Africa’s natural and cultural assets are lasting comparative advantages that cannot be ‘grown’ or ‘manufactured’ elsewhere. There are proven environmentally sustainable benefits (e.g. national parks maintained through tourism) to developing tourism as well as contributing positively to good governance.

Southern Africa continues to be a preferred long-haul destination for Europe and the USA while recording large increases in arrival numbers from mainland China and the Middle East. With the exception of Zimbabwe (and to a lesser extent Madagascar), the region is well perceived as a tourism destination, with Mozambique forming an interesting ‘newly accepted’ destination.
Development assistance and large-scale conservation efforts in Southern Africa have contributed to the tourism agenda as a poverty reduction tool. Well-documented and good examples of poverty reduction through tourism initiatives exist: joint venture lodges, hunting concessions awarded to communities, and land rights allocated in national parks and leased as concessions by the community to private sector operators are just a few examples of successes found in various countries in the region. However, this has not prevented the general perception that tourism has failed its expectations around:

failed expectations

The perception prevails that ‘the poor’ are still not engaged in a meaningful way in tourism, that their involvement is passive as recipients of funds from commercial tourism ventures, that not enough tourism SMEs are owned and operated by indigenous Africans, and that the industry lacks local demand and is still a ‘white’ activity.

On top of these developments, the education levels in post-apartheid South Africa and Namibia and post-conflict Mozambique and Angola, and the generally improved education systems in Tanzania, Zambia, Lesotho and Swaziland, produce substantially more school-leavers looking for work than actual permanent jobs being created. Traditional industries such as mining, agriculture and fishing have reached their limits of employment creation, putting further pressure on service sectors like tourism to create jobs for the youth.

Need for a Regional Operating Framework

There are good joint venture agreements around lodges, equity deals and land-ownership, fair-trade and community-based marketing efforts, and national and local policies that are beneficial to the poor. But for tourism to deliver on its potential as a contributor to poverty alleviation, these initial country- and site-specific successes need to be up-scaled to allow joint-venture establishment outside of donor-funded project support, to ensure appropriate regulation and legislation is in place – covering not just access to (tourism) resources but also access to finance and knowledge by the poor – and to create products that target indigenous Africans as consumers which, in turn, enables decision-makers to address tourism development based on first-hand experience.

The creation of meaningful involvement in tourism for the poor further needs to occur around the ever-increasing internationalisation of market linkages:

Market offers majority ‘multi-destination itineraries’ combining countries either overland or as fly-in tours (e.g. Livingstone & Okavango Delta, South Africa & Swaziland, Namibia & Cape Town).
Increasing levels of multi-country ownership of tour operators and site-specific enterprises (accommodation).
Transfrontier conservation areas function as (proposed) tourism hubs.
Well-funded regional conservation programmes prescribe tourism development objectives.
Increased regional mobility of residents.
Visitor access improvements through multi-country visas (piloted for WC2010) and work visas for tour guides in neighbouring countries.
Regional development, promotion and conservation initiatives like the SADC-initiated Regional Tourism Organisation of Southern Africa (RETOSA).
Tourism industry in generating markets sources regional products from suppliers to reduce transaction costs.

It can be argued that with a certain critical mass of ‘M4P’ initiatives in place in the region, and knowing that due to declining growth numbers in 2009, the buyer’s side of the tourism export system becomes of ever-increasing importance, regional players – both buyers and sellers – are the ones to champion pro-poor linkages in source markets when the M4P approach is rolled out onto a regional scale.

A regional approach in tourism does not mean (trying) to work in all SADC countries but aims at understanding different markets on local, national and regional level and creating linkages as defined by international tourism trends.

Objectives

Currently, pro-poor tourism is mainly project-driven, with associated opportunity costs and often parallel to existing institutional arrangements. The proposed ComMark Tourism intervention can ensure it is institutionalised in national and regional structures in five years, moving from project focus to enterprise focus.
ComMark Tourism identified a platform of diagnostic work and interventions, creating sufficient scope for a regional intervention that holds momentum beyond the proposed programme timeframe. It is based on identifying regional market characteristics and stakeholder institutions that are able to contribute to achieving the following measurable outcomes:

Tourism equity held by the poor as bankable asset increases by 500%.
Formal, full-time employment increases by 5%.
Formal, registered SME numbers increase by 5%.
Income-generating opportunities turned into SMME structures increase by 25% in rural areas.
Resource control/ownership favouring the poor formalised around 25 international recognised attractions.
Accreditation of pro-poor tourism enterprises unified in five SADC countries.
Tourism industry in generating market recognises and publishes accreditation of Southern African ventures that adhere to pro-poor principles (possible tourism exchange creation).
50 formalised community-private sector partnerships in tourism established covering embryonic, growth and mature markets across SADC.
Loan funds from commercial finance institutions comprise 20% of tourism start-ups.

Intervention Level

intervention levels The creation of a meaningful participation by the poor in tourism, linked to market demand, requires a programme intervention on three levels:
In addition, it is important to address these interventions in different market characteristics across the SADC region; each country, and even different regions within a country, has a different tourism system varying in size, resources, regulatory environment, destination facilities, etc. The destination status evolves but a currently workable division looks as follows:
Embryonic destinations: Characterised by low/extremely low visitor numbers and non-existent tourism structures or poorly resourced tourism support structures (Ministry, tourism authority) and often affected by a lack of, or even a negative, destination image.

In the region this primarily applies to the post conflict states of the DRC and Angola but in each country, local districts, provinces, municipal areas and regions can be found that fit the description.

Adolescent destinations (growth markets): These are characterised by a positive development in tourism arrival numbers as well as a growing number of enterprises and capacities. Three sub-categories exist: small tourism countries that are categorised by physical size (Mauritius) or a high degree of dependency on a single (South African) market like Swaziland and Lesotho. The third sub-category is destinations that lack continued growth and experience beyond 15 years in the international tourism market (new destination). These countries face challenges in the quality and quantity of the support structures for tourism. In the region, countries within this category are:

Small tourism countries - Mauritius, Malawi
New destinations - Madagascar, Mozambique, Tanzania, Zambia
Dependent destinations - Swaziland, Lesotho

Mature destinations: Mature destinations have a long track record of positive tourism development in arrival numbers and a diversified product portfolio, as well as diversified source markets and effective support structures for tourism. This applies primarily to South Africa, Namibia and Botswana.

Restart: Zimbabwe holds a unique position in the region as it used to be a well-established, flourishing tourism destination. However, the current political and economic challenges require it to be classified separately.

For evolution to a destination level that is beneficial for a country and her people, stakeholders will need to understand the challenges and bottlenecks of each destination type.

Proposed Programme Components

To achieve the objectives, support is needed to (continue to) implement the following interventions:

Creation of viable tourism partnership models	In co-operation with the Ministry of Environment & Tourism in Namibia, ComMark manages a PMU that oversees the development of 12 community-private sector lodges and accommodation in urban settings. A variety of partnership models is being tested and replication from central government budget is envisaged, which includes diversification into non-accommodation products. Destination areas targeted include ‘secondary’ tourism sites that hold value for embryonic markets across the region. In co-operation with the Ministry of Tourism and the Tourism Authority in Mozambique, community guidelines will be developed as part of the investment approval structure for tourism development in the country. Around Inhambane, ComMark will model scenarios of tourism levy introduction and appropriate benefit distribution structures aiding communities living within communal property structures (public beach).
Creation of management models around proclaimed heritage sites	In co-operation with the African World Heritage Fund, ComMark will evaluate 10 proclaimed World Heritage Sites across SADC, varying in type and location, to identify strengths and weaknesses of management systems and the ability of sustainable tourism utilisation to contribute to the conservation of the site, as well as creating benefits through enterprise development for local residents like guide services (association), information/visitor centres, museums or accommodation based on concession rights.
Recognition of accreditation by source markets	In co-operation with Fair Trade in Tourism South Africa, ComMark will design a regional accreditation structure that allows international companies to adhere to a single label of ‘fair’ tourism operation which will be accepted by national tourism authorities and supported through incentives (tax breaks, trade fair participation, websites, etc.), as well as being recognised by major industry organisations in Europe and the USA.
Value chain diversification & appropriate incentives	In co-operation with the Momella Foundation in Tanzania, ComMark will assist in the diversification of the tourism value chain in the northern Tanzania safari circuit. A joint-venture lodge development, outsourcing of guide services to registered SMEs, fresh produce supply and outsourcing of craft production to formalised producer groups are to be achieved, documented and replicated in other growth markets.
A self-sustaining support structure for tourism brokerage	In co-operation with the Gauteng Provincial Government in South Africa, ComMark will design and support a tourism development system around Dinokeng aimed at creating a management structure for tourism in an area with high population numbers, challenging basic service delivery (people have no access to water and electricity but are expected to support game reserve development) and close to the metropolitan area of Pretoria, which will find its replication in areas such as Lusaka, Maputo, Lilongwe and Dar es Salaam.
SMME access to finance and mentorship programme	In co-operation with the Federation of Namibian Tourism Associations, First National Bank and Bank Windhoek, and the Development Bank of Namibia, ComMark will facilitate the design of an SMME finance and mentorship programme for tourism enterprises to be replicated with financial institutions across the region.
Others?

Implementation

The design of the programme deliberately identifies partners with a clear mandate to ensure achievement of the outcomes. ComMark will continue its activities aimed at developing a regional tourism practice and assisting with the building of a pipeline of products and services forming a virtual ‘Regional Tourism House’.

ComMark Tourism aims to use its (expanded) technical expertise to continue the programme elements listed but will require additional support to meet the objectives around analyses capturing and knowledge dissemination. This is an imporant element as it will steer the acquisition of additonal intervention opportunities related to actual demand and create a position of strength in linking tourism development in SADC to tourist source markets overlooked to date.

July 2009

Tourism-future.pdf