Pro-Poor Tourism - Expanding Opportunities for the Poor

Introduction
Reducing poverty requires pro-poor growth. Tourism, one of the worlds largest
industries, is already growing or significant in most poor countries. Certain characteristics of
tourism enhance its pro-poor potential. It can be: labour intensive; inclusive of women and the
informal sector; based on natural and cultural assets of the poor; and suitable for poor areas.
Harnessing tourism for pro-poor growth means capitalizing on these features, while reducing
negative impacts on the poor.
Tourism is a massive and growing industry already affecting millions of the poor, so a
marginal improvement could generate substantial benefits. Also, tourism has advantages over
other sectors in relation to poverty reduction. Tourism is a very diverse industry which increases
the scope for wide participation (e.g. informal sector). In tourism, the customer comes to the
product, offering opportunities to make additional sales (linkages). Tourism is more labourintensive than many other sectors, such as manufacturing, and employs a higher proportion of
women. Tourism products can be built on natural and cultural resources which are often some of
the few assets that the poor have. Tourism may have potential in countries and areas which have
few other competitive exports. Poverty reduction through PPT can therefore be significant at a
local or district level.
Pro-Poor tourism is set up in developing countries as a means to improve the local
economy for local people. It enhances the linkages between tourism businesses and poor people,
so that poverty is reduced and poor people are able to participate more effectively in tourism
development. The aims of pro-poor ranges from increasing local employment to involving local
people in the decision making process. Any type of company can be involved such as a small
lodge or a tour operator. The most important factor is not the type of company or the type of
tourism, but that poor people receive an increase in the net benefits from tourism.
Pro-Poor Tourism (PPT) is tourism that results in increased net benefits for poor people.
It enhances the linkages between tourism businesses and poor people, so that tourism's
contribution to poverty reduction is increased and poor people are able to participate more
effectively in product development. Links with many different types of 'the poor' need to be

considered: staff, neighbouring communities, land-holders, producers of food, fuel and other
suppliers, operators of micro tourism businesses, craft-makers, other users of tourism
infrastructure (roads) and resources (water) etc. There are many types of pro poor tourism
strategies, ranging from increasing local employment to building mechanisms for consultation.
Any type of company can be involved in pro-poor tourism - a small lodge, an urban hotel, a tour
operator, an infrastructure developer. The critical factor is not the type of company or the type of
tourism, but that an increase in the net benefits that go to poor people can be demonstrated.
PPT can be defined as tourism which provides net benefits for poor people. PPT is not a
specific tourism product or sector. It is not the same as eco-tourism or community-based tourism,
although these forms of tourism can be pro-poor; i.e. they can bring net benefits to the poor. Propoor tourism is an approach to tourism that increases net benefits to the poor. It is not a new kind
of tourism product but merely to ensure that the poorer section of the community too will have
their portion of the tourism economic pie. Generally, pro-poor tourism is still a relatively new
phenomenon, although certain elements of pro-poor tourism may be observed in some of the
tourism developments. Pro-poor tourism will result in pro- poor growth which will decrease
inequality and the increasing gap between the rich and poor.
Opportunities for Pro-Poor Tourism
The flavour of a destination is a function of the natural environment and the culture of the
people who live, and have lived there. The living culture of the people, the opportunity to engage
with local people who live and work in the destinations is an important part of the travel and
holiday experience for many tourists.
Benefits of pro-poor tourism may be economic, but they may also be social,
environmental or cultural. Pro-poor tourism is not a specific product or sector of tourism, but an
approach to the industry. Strategies for making tourism pro-poor focus specifically on unlocking
opportunities for the poor within tourism, rather than expanding the overall size of the sector.
Three core activities are needed: increasing access of the poor to economic benefits
(by expanding business and employment opportunities for the poor, providing training so they
are in a position to take up these opportunities and spreading income beyond individual earners
to the wider community); addressing the negative social and environmental impacts often

associated with tourism (such as lost access to land, coastal areas and other resources and social
disruption or exploitation); and policy/process reform (by creating a policy and planning
framework that removes some of the barriers to the poor, by promoting participation of the poor
in planning an decision-making processes surrounding tourism, and by encouraging partnerships
between the private sector and poor people in developing new tourism products.
Role of agencies in PPT
Government,

the

private

sector,

non-governmental

organisations,

community

organisations and the poor themselves all have critical and very different roles to play in PPT.
The private sector can be directly involved in pro-poor partnerships. At a minimum, private
operators should participate in product and market development to ensure commercial realism.
There is much that only governments can do, so a leading role for government in PPT is a great
advantage. At a minimum, there needs to be a policy environment that facilitates PPT. The poor
themselves are critical to PPT, but they often also need to be organised at the community level in
order to engage effectively in tourism. It is often invaluable to have a fourth party to catalyse and
support PPT efforts of others this is often, though not always, a role for a non-governmental
organisation. Donors, through their role in supporting tourism plans, and the sustainable
tourism agenda, can also promote PPT.
Pro-poor Tourism Issues
1 PPT is not addressed in most formal development plan.
2 Planning process carried out using top down approach and local participation is
superficial
3 Planning process is fragmented and sector based
4 Problems associated with implementation
5 Limited business opportunities
6 Lack of capacity building & training.
8 Negligible Business Partnerships
Principles underlying PPT

A balanced approach - Pro-poor strategies need to be complemented by the development

of wider tourism infrastructure. A balanced approach is critical if competitive products,

transport systems or marketing do not exist, the industry will decline and so will any propoor strategy;

Universal application - Pro-poor principles apply to any tourism segment, though

specific strategies will vary between, for example, mass tourism and wildlife tourism;

Focus on expanding benefits - not just minimizing costs to the poor;

Draw on lessons from other sectors (such as small enterprise, good governance, and
poverty analysis) and apply these to tourism;

Do not expect all the poor to benefit equally - particularly the poorest 20 per cent. Some
will lose;

Participation poor people must participate in tourism decisions if their livelihood

priorities are to be reflected in the way tourism is developed.

A holistic livelihoods approach the range of livelihood concerns of the poor
economic, social, and environmental, short-term and long-term need to be recognised.

Focusing simply on cash or jobs is inadequate.

Distribution promoting PPT requires some analysis of the distribution of both benefits

and costs and how to influence it.

Flexibility blue-print approaches are unlikely to maximize benefits to the poor. The
pace or scale of development may need to be adapted; appropriate strategies and positive

impacts will take time to develop; situations are widely divergent.

Commercial realism ways to enhance impacts on the poor within the constraints of
commercial viability need to be sought.

Learning as much is untested, learning from experience is essential. PPT also needs to
draw on lessons from poverty analysis, environmental management, good governance
and small enterprise development. Learn by doing the effectiveness of pro-poor
strategies is not proven, but we won't know what can be done to reduce poverty through
tourism until more concerted efforts are made.

Benefits of PPT
A wide range of strategies are required to capitalize the benefits of tourism for the poor.
Efforts are needed in capacity building, training, access to financial funds, marketing, linkages
with the private sector, and also policy and regulation which are pro-poor. This requires working

across different levels and stakeholders comprising of the government, private sector, nongovernmental organizations, community organizations and the poor themselves, all having very
different and critical roles to play.
Strategies for pro- poor tourism can be divided into those that generated three different
types of local benefit: economic benefits, other livelihood benefits (such as physical, social or
cultural improvements), and less tangible benefits of participation and involvement. Each of
these can be further disaggregated into specific types of strategies.
Strategies focused on economic benefits include:

Expansion of employment and local wages: via commitments to local jobs, training up
locals for employment

Expansion of business opportunities for the poor. These may be businesses/entrepreneurs

that sell inputs such as food, fuel, or building materials to tourism operations. Or they
may be businesses that offer products directly to tourists, such as guiding, crafts, tea
shops etc. Support can vary from marketing and technical support (e.g. by nearby
mainstream operators), to shifts in procurement strategy, or direct financial and training
inputs.

Development of collective community income. This may be from equity dividends, lease
fee, revenue share, or donations, usually established in partnership with tourism operators
or government institutions.

In general, staff wages are a massive boost to those few that get them, small earnings help many
more to make ends meet, and collective income can benefit the majority, but can often be
misused. Thus all three types are important for reaching different poor families. Strategies to
create these benefits need to tackle many obstacles to economic participation, including lack of
skills, low understanding of tourism, poor product quality and limited market access.
Strategies to enhance other (non-cash) livelihood benefits generally focus on:

Capacity building, training and empowerment

Mitigation of the environmental impact of tourism on the poor and management of

competing demands for access to natural resources between tourism and local people

Address competing use of natural resources

Improved social and cultural impacts of tourism

Improved access to services and infrastructure: health care, radio access, security, water
supplies, transport.

Such strategies can often begin by reducing negative impacts such as cultural intrusion, or lost
access to land or coast. But more can be done to then address these issues positively, in
consultation with the poor. Opportunities to increase local access to services and infrastructure
often arise when these are being developed for the needs of tourists, but with some consultation
and adaptation could also serve the needs of residents. Strategies for capacity-building may be
directly linked to creating boosting cash income, but may also be of more long-term indirect
value, such as building management capacity of local institutions.
Strategies focused on less tangible benefits of participation and involvement can create:

More supportive policy and planning framework that enables participation by the poor

Increased participation by the poor in decision-making: i.e. ensuring that local people are
consulted and have a say in tourism decision making by government and the private
sector

Pro-poor partnerships with the private sector

At the minimum: increased flow of information and communication: meetings, report

backs, sharing news and plans. This is not participation but lays the basis for further
dialogue.

Implementing these strategies may involve lobbying for policy reform, involving the poor in
local planning initiatives, amplifying their voice through producer associations, and developing
formal and informal links between the poor and private operators.

Following table summarizes this typology of PPT strategies

Increase economic benefits

1. Boost local employment,

wages
2. Boost local enterprise
opportunities
3. Create collective income
sources fees, revenue
shares

Enhance non-financial
livelihood impacts

1. Capacity building, training

2. Mitigate environmental
impacts
3. Address competing use of
natural resources
4. Improve social, cultural
impacts
5. Increase local access to
infrastructure and services

Enhance participation and

involvement

1. Create more supportive

policy/planning framework
2. Increase participation of the
poor in decision-making
3. Build pro-poor partnerships
with private sector
4. Increase flows of
information, communication

PPT Strategies
1. Put poverty issues on the tourism agenda
A first step is to recognise that enhancing poverty impacts of tourism is different from
commercial, environmental, or ethical concerns. PPT can be incorporated as an additional
objective, but this requires pro-active and strategic intervention.
2. Enhance economic opportunities and a wide range of impacts
Incorporate wider concerns of the poor into decision making. Reducing competition for
natural resources, minimizing trade-offs with other livelihood activities, using tourism to create
physical infrastructure that benefits the poor and addressing cultural disruption will often be
particularly important
3. A multi-level approach
Pro-poor interventions can and should be taken at three different levels:
Destination level this is where pro-active practical partnerships can be developed
between operators, residents, NGOs, and local authorities, to maximize benefits.
National policy level policy reform may be needed on a range of tourism issues
(planning, licensing, training) and non-tourism issues (land tenure, business incentives,
infrastructure, land-use planning).
International level to encourage responsible consumer and business behaviour, and to
enhance commercial codes of conduct.

4. Work through partnerships, including business

National and local governments, private enterprises, industry associations, NGOs,
community organizations, consumers, and donors all have a role to play. Changing the attitudes
of tourists is also essential if PPT is to be commercially viable and sustainable.
5. Incorporate PPT approaches into mainstream tourism
PPT strategies are dependent on the health of the overall industry, so need to be
complemented by more conventional support, such as in infrastructure development and
marketing. While avoiding marginalizing PPT, it is also important to assess which tourism
segments are particularly relevant to the poor. For example, domestic tourists are important
customers, they should not be neglected.
6. Reform decision-making systems
The most important step is to enhance participation by the poor in decision-making
process. Systems are needed that allow local livelihood priorities to influence tourism
development. Three different ways of doing this can be identified:

Strengthen rights at local level, so that local people have market power and make

their own decisions over developments.

Develop more participatory planning.
Use planning gain and other incentives to encourage private investors to enhance
local benefits.

These approaches require implementation capacity among governmental and nongovernmental institutions within the destination, and also require a supportive national policy
framework.
Conclusion
PPT is not a specific product or sector of tourism, but an overall approach. Rather than
aiming to expand the size of the sector, PPT strategies aim to unlock opportunities for
economic gain, other livelihood benefits, or engagement in decision-making for the poor. Propoor tourism has the potential of benefiting the poor, decreasing inequality and narrowing the
gap between the rich and poor. This is especially relevant in a country like India where previous
initiatives have minimal impact on poverty reduction and new approaches are required especially
in eradicating urban poverty.
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