Economic impacts of tourism on
indigenous enterprises in Namibia
Julia Jänis
26.4.2011
Contents of the presentation
1. What do we mean by economic impacts of
tourism?
2. Why does it matter with whom we co-operate
in a destination?
3. Examples of economic impacts on indigenous
tourism enterprises in Namibia
4. Where to find indigenous enterprises?
5. How can responsible choices in the global value
chain be used for marketing?
What do we mean by economic
impacts of tourism?
• Impacts on national economy
– Tax revenue
– Contribution to GDP
– Share of tourism in all export commodities
– Share of tourism in all employment opportunities
 Measured by quantitavive methods (TSAs,
SAMs etc.)
What do we mean by economic
impacts of tourism cont.
• Impacts on local and regional economy
– Tourism as a source of employment (youth women,
disadvantaged groups)
– Tourism and local supply chains
– Tourism and regional development
– Tourism and economic empowerment of the
disadvantaged /marginalised population groups
– Tourism and Local Economic Development (LED)
 Measured by quantitatvie and qualitative methods
Why does it matter with whom we cooperate in a destination?
Choice of local partners (accommodation providers, tour
operators, other service providers) may have a profound
economic, ecological,
social, cultural and political
significance in the destination
What choices are required
for responsible tourism?
Characteristics of foreign-owned or
privileged minority-owned service
providers
• Owners and managers often foreign or elite, other
staff local
• Vertical integration and large chains
• Possible leakage of revenue
• Profit created by low wages
• Tourism products reproduce stereotyped images
• Better competitiveness than local SMEs
Possible alternative provided by
indigenous service providers
• All staff local
• Co-operation with other tourism SMEs
• No leakage, revenue benefits large numbers of
people through extended family support
• Possibility to create new and innovative tourism
products based on local cultural diversity
• Possibility for more personal interaction between
tourist and the hosts
Potential challenges of indigenous
service providers
• Employment based on seasonal demand
• Low wages (competition, salary levels)
• Lack of customers due to poor marketing and lack of
credibility
• Employment and choice of
attractions based on
ethnic background
• Inadequate skills in
hospitality, financial
management, product development etc.
Case of Namibia
Economic impacts on indigenous
tourism enterprises in Namibia
• 94% of Namibian tourism enterprises owned
by white or foreigners
• Unemployment level 50%, in many areas 7080% (especially youth and women)
• 30% of Namibians live below poverty line
• Poverty associated with gender and regional
inequality, low education, youth
unemployment
Economic impacts on/of indigenous
tourism enterprises in Namibia cont.
• All revenue invested in Namibia
• SMEs offer home stays, visits to
small entrepreneurs,
communal conservancies,
community-based tourism
enterprises etc.
• Pro-poor supply chains
• Peer support and co-operation
Economic impacts on indigenous
tourism enterprises in Namibia cont.
• Economic empowerment leads to social
empowerment which is required to combat the
apartheid legacy
– Namibia has the highest income inequality in the
world
– Inferiority complex, lack of self esteem
– Lack of appreciation for local cultural heritage (arts
and crafts etc.)
Where to find indigenous enterprises?
• Marketing and advertising is a major challenge
 Lack of capital and skills
• Internet, NGOs, sponsored participation in tourism and
travel trade fairs
• Travel guides
• Brochures
• Co-operating private
partners
How can responsible choices in the global
value chain be used for marketing?
The value chain describes the full range of
activities that firms and workers do to bring a
product from its conception to its end use and
beyond. This includes activities such as design,
production, marketing, distribution and
support to the final consumer.
How can responsible choices in the global
value chain be used for marketing?
• Responsible choices build up a positive image
• Concrete benefits of responsible choices can be
explained (e.g. employment of youth or disabled,
pro-poor procurement, nature conservation)
• Groups or individuals in the value chain can be
included in the travel itineraries (e.g. visit to a
women’s group that makes and sells local crafts)
Final remarks
• The selection of local/foreign, black/white, large
firm/SME is first and foremost a political choice
• Other values can also determine the choice:
ecological, economic, cultural etc.
• Indigenous enterprises may not inherently be
more responsible; they too can be requested for
ethical and environmental principles
• SMEs cannot take the entire market share in
tourism
Final remarks cont.
• Responsible tourism promotes:
– Fair trade certified tourism enterprises
– Indigenous tourism enterprises (incl. SMEs and
CBTEs)
– Tourism enterprises committed to ecological and/or
pro-poor and/or sustainability principles
• In other words:
Tourism that strives to make a difference
THANK YOU!