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2. Tourism and Poverty Alleviation 3 Public Disclosure Authorized Public Disclosure Authorized Version 3.0 January 20, 2011 Public Disclosure Authorized Public Disclosure Authorized Africa Region Tourism Strategy The Africa Region Tourism Strategy: Transformation through Tourism has been many years in the making. A team led by Demba Ba, Iain Christie, and Shaun Mann prepared the initial ground work for a tourism program in the Africa Region’s Finance and Private Sector Development Department (AFTFP). More recently, Hannah Messerli has led the team responsible for this strategy under the direction of the Africa Region’s Vice President, Obiageli Katryn Ezekwesili, Africa Region Chief Economist, Shanta Devarajan, and AFTFP Director, Marilou Jane Uy with guidance from AFTFP’s Lead Economist, Vincent Palmade. Louise Twining-Ward, Iain Christie, Eneida Fernandes, and Andres Garcia worked intensively on this document which has also benefitted from the comments of colleagues in the department as well as across The Bank Group. Special appreciation is extended to this work’s thoughtful peer reviewers: Jonathan Mitchell (Head of Program, Overseas Development Institute, UK), Phil English (Lead Economist), Yaw Nyarko (Professor of Economics and Head of NYU Africa House), David Bridgeman (Manager, CICIG). This work, and the nearly two years of research behind it, have been made possible with the support of the Trust Fund for Trade and Development, a multi donor trust fund financed by Sweden’s International Development Agency and the UK’s Department for International Development. Appreciation is extended to all who have contributed to the development of the strategy and who are committed to Africa harnessing tourism for growth and improved livelihoods in the future. Page ii Africa Region Tourism Strategy AFRICA REGION TOURISM STRATEGY Foreword Tourism has proven itself as a vehicle for economic growth and job creation all over the world. It is an under- developed opportunity in Africa. The Africa Region Tourism Strategy provides a framework to help African countries take advantage of their natural and cultural tourism assets to build economically productive and sustainable tourism sectors. The case for World Bank involvement is strong. Although travel and tourism is primarily a private sector activity, it requires effective, coordinated public sector support in order to be sustainable. The failure to adequately plan and manage tourism can result in adverse environmental and social outcomes; it can reduce the economic benefits of tourism for resident communities. Conversely, sustainable tourism sectors have been proven to contribute to poverty alleviation through job creation and private investment and by being a catalyst for broad investment climate reforms, basic skills development, and improved country image. Thailand, Indonesia, Mexico, Morocco, Tunisia, Mauritius, South Africa, Tanzania, and Cape Verde show how tourism can be a powerful and transformative development tool; The World Bank often played an important supportive role in these countries. A deep-rooted scepticism of economic and social benefits of tourism remains, however. This strategy acknowledges the risks, dispels the myths, and lays out an achievable framework for sustainable tourism in Africa. The demand for assistance from African countries is high and increases each year. Yet in 2009, when 78% of Poverty Reduction Strategy Papers (PRSPs) stressed or prioritized tourism, only 30% of Country Assistance Strategies (CASs) identified tourism as a priority. The World Bank has the experience and ability to respond. For this level of involvement, an agreed-on strategy and framework is now imperative. The Africa Region Tourism Strategy is closely linked to The World Bank’s Africa Region Strategy, Africa’s Future and the World Bank’s Role in it and to the Africa Finance and Private Sector Development Strategy, New Jobs for Africa. The Tourism Strategy builds on the 2001 study, Tourism in Africa,1 and on lessons learned from the more than 300 World Bank tourism-related projects that have taken place in 86 countries since the 1960s. The strategy also draws upon pre-existing interdisciplinary work and rigorous tourism sector research2 conducted over the past 18 months by internal and external experts in conjunction with the forthcoming Africa Flagship Competitiveness Report. The strategy’s vision is Transformation through Tourism: Harnessing tourism for growth and improved livelihoods. The strategy relies on four pillars: policy reforms, capacity building, private sector linkages, and product competitiveness. Working closely with client countries, implementation of the Africa Region Tourism Strategy will focus interventions on these four areas in order to address the persistent constraints to the growth of tourism in Africa. Combined, these interventions will enable high-demand tourism products to compete in the global marketplace. The approach is region-wide; it engages staff across The Bank’s Africa Region. Implementation will be led by AFTFP. The World Bank Group support to the Africa tourism sector is currently US$120 million. It could reach $500 million by 2015, generating as many as 300,000 direct formal jobs.3 This document has been developed primarily as an internal World Bank document. Additional strategy communication materials are available for download from www.worldbank.org/afr/tourism. Page iii Africa Region Tourism Strategy AFRICA REGION TOURISM STRATEGY Table of Contents Part One: The Case for Tourism in Africa ...................................................................................................... 1 Why Now? ....................................................................................................................................................... 1 Why Tourism? ................................................................................................................................................. 1 Why should The World Bank Engage in Tourism in Africa? ......................................................................... 4 What is the Opportunity? ................................................................................................................................. 7 What are the Constraints to Growth? ............................................................................................................... 9 Part Two: The Africa Region Tourism Strategy Framework ..................................................................... 12 Strategy Vision .............................................................................................................................................. 12 1. Policy Reform ............................................................................................................................................ 13 2. Capacity Building ...................................................................................................................................... 14 3. Private Sector Linkages ............................................................................................................................. 14 4. Product Competitiveness ........................................................................................................................... 15 Part Three: Implementing the Strategy ......................................................................................................... 16 Knowledge Platform ...................................................................................................................................... 16 Advisory Services .......................................................................................................................................... 17 Lending Operations ........................................................................................................................................ 18 Scaling-Up Tourism Operations .................................................................................................................... 19 Adapting Solutions to Different Countries .................................................................................................... 19 Working Together to Make it Happen ........................................................................................................... 22 Conclusion ..................................................................................................................................................... 23 The Evidence Base: Background Research ................................................................................................... 24 Endnotes ......................................................................................................................................................... 25 Page iv Africa Region Tourism Strategy Part One: The Case for Tourism in Africa Why Now? Africa is on the move. There are new grounds for optimism for the economic future of Sub Saharan Africa (SSA).4 Real GDP rose 4.9% per year from 2000 to 2008.5 Inter-regional cooperation is increasing. Armed conflicts have declined, democracy is on the rise, macroeconomic conditions have improved the climate for business.6 There are long-term opportunities for growth. McKinsey’s 2010 study, Lions on the Move, 7 suggests that across Africa, new economic partnerships are being forged, foreign investment is on the rise, and access to international capital is increasing. Growth in GDP per capita has resulted in the emergence of a new middle- class
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