AN ANALYSIS OF THE BENEFITS OF THE GROWTH IN TOURISM TO THE LOCAL COMMUNITIES IN THE PANORAMA REGION, MPUMALANGA PROVINCE by NGWAKO PHILEMON MONAKHISI submitted in accordance with the requirements for the degree of DOCTOR OF LITERATURE AND PHILOSOPHY in the subject DEVELOPMENT STUDIES at the UNIVERSITY OF SOUTH AFRICA PROMOTER: PROFESSOR FC DE BEER FEBRUARY 2008 1 DECLARATION Student Number 5653959 I declare that AN ANALYSIS OF THE BENEFITS OF THE GROWTH IN TOURISM TO THE LOCAL COMMUNITIES IN THE PANORAMA REGION, MPUMALANGA PROVINCE is my own work and that all the sources that I have used have been indicated and acknowledged by means of complete references. ___________________________________ ________ NGWAKO PHILEMON MONAKHISI DATE 2 DEDICATION This study is dedicated to my wife and children, Masedi and Olerato, brothers, parents, former colleagues at Khaiso High School and current ones in the Department of Foreign Affairs. 3 ACKNOWLEDGEMENTS I humbly wish to acknowledge the roles and contributions of the following in the process of producing this study: Professor FC de Beer, my Promoter, a brilliant and selfless person, for guidance and support. Ms Leanne Brown, the Subject Librarian, University of South Africa, for patience and dedication. The Department of Foreign Affairs, for financial support for the duration of this study and the Financial Aid Bureau, University of South Africa, for technical financial support. Mr Cas Coetzee, Department of Psychology, University of South Africa, for statistical analysis and Ms RA Scheepers, Department of English Studies, University of South Africa, for language editing. Messrs Amos Mdluli, Managing Director of Phumulani Lodge, a humble servant of the community, and Sibuyi, Managing Director and Owner of Mthunzi Lodge, Hazyview, and Ms Marinda Marais, Regional Social Ecologist at the Mpumalanga Tourism and Parks Agency, for granting the interviews. The traditional leaders and communities of Panorama region, Mpumalanga Province, for cooperation and botho/ubuntu. 4 ABBREVIATIONS ABSA Amalgamated Banks of South Africa ASGISA Accelerated and Shared Growth Initiative of South Africa BEE Black Economic Empowerment CAGR Compound Annual Growth Rate CBO Community-based Organisation DBSA Development Bank of Southern Africa DFID Department for International Development, UK EPWG Expanded Public Works Programme FDS Foreign Direct Spend FEDHASA Federated Hospitality Association of South Africa ICT Information and Communication Technology IDC Industrial Development Corporation IDPs Integrated Development Plans ISRDS Integrated Sustainable Rural Development Strategy LED Local Economic Development LEDA Local Economic Development Agency MDGs Millennium Development Goals MERS Micro-Economic Reform Strategy MIG Municipal Infrastructure Grant MTPA Mpumalanga Tourism and Parks Agency MTSF Medium Term Strategic Framework NQF National Qualifications Framework NSDP National Spatial Development Perspective NSDS National Skills Development Strategy NSF National Skills Fund ODI Overseas Development Institute PATIIs Priority Areas of Tourism Infrastructure Investment 5 PGDS Provincial Growth and Development Strategies RDP Reconstruction and Development Programme SADC Southern African Development Community SANParks South African National Parks SAQA South African Qualifications Authority SARS Severe Acute Respiratory Syndrome SATOUR South African Tourism Board SDI Spatial Development Initiative SETA Sector Education and Training Authority SMEDP Small Medium Enterprise Development Programme SMME Small, Micro and Medium-sized Enterprises SPSS Statistical Package for Social Sciences TBCSA Tourism Business Council of South Africa TEP Tourism Enterprise Programme TFDS Total Foreign Direct Spend THETA Tourism, Hospitality and Sport Education and Training Authority UK United Kingdom (of Great Britain and Northern Ireland) UNEP United Nations Environmental Programme USA United States of America UNTWO United Nations World Tourism Organisation WSSD World Summit on Sustainable Development WTO World Trade Organisation 6 SUMMARY In recent decades tourism has asserted its importance as the biggest employer and foreign exchange earner in both the developing and developed countries. Consequently, there has been increasing attention to tourism development as a strategy to stimulate economic growth, local economic development and poverty alleviation, especially in the developing countries. This study was undertaken with the objective of determining the direct benefits of the growth in tourism to the local communities in the vicinity of protected areas in South Africa’s Mpumalanga Province. The tourism sector is strategically located within the economic mainstream as it links easily with other sectors of the economy such as agriculture, hospitality, transport and entertainment. It has added advantages, including the fact that the tourist product is consumed at the destination. This offers local communities opportunities in job creation, skills development, economic empowerment and social development. The study found that meaningful involvement of local communities in the tourism industry through ownership of tourism-related enterprises was almost non-existent. There were no meaningful linkages between the industry and the local communities other than the communities’ supply of unskilled labour. There were also no programmes aimed at harnessing the phenomenal growth in South Africa’s tourism for the economic empowerment of local communities. The economic empowerment of local communities need not be achieved through the ownership of tourism-related enterprises only, but may also include shareholding, outsourcing, affirmative procurement and social responsibility programmes by the industry. 7 The continued marginalisation of the local communities by the tourism industry was attributed to unsatisfactory progress with the industry’s transformation. The launch of the Tourism Black Economic Empowerment Charter and Scorecard in 2005 provided impetus for the transformation of South Africa’s tourism industry. However, more work still needs to be done in the identified areas of ownership and control of tourism-related businesses, distribution of tourism benefits and the development of tourism-related skills and entrepreneurial culture in local communities. The role of the private sector in stimulating community involvement in tourism is particularly important. The private sector is singled out because of government policy that tourism development would be regulated by government and be private-sector driven. Furthermore, the private sector has the capacity and the resources to mobilise, not only to improve the attractiveness and marketing of a destination and the overall management of the tourism industry, but also to build thriving local communities. KEY WORDS access to land, black economic empowerment, capacity building, community involvement, community-based tourism, development strategy, entrepreneurship, local economic development, marketing, Mpumalanga Province, ownership, Panorama region, poverty, pro-poor tourism, public- private partnership, socio-economic development, sustainable tourism development, Tourism Charter, tourism development, tourism growth, tourism- related enterprises, tourist product, training, transformation. 8 TABLE OF CONTENTS Title Page ..........................................................................................................................1 Declaration .......................................................................................................................2 Dedication ........................................................................................................................3 Acknowledgements ........................................................................................................4 Abbreviations ..................................................................................................................5 Summary ...........................................................................................................................7 Key words .........................................................................................................................8 Table of contents .............................................................................................................9 List of Annexures ..........................................................................................................14 List of Tables ..................................................................................................................14 List of Maps ....................................................................................................................15 List of Graphs ................................................................................................................15 CHAPTER 1 OUTLINE OF THE RESEARCH PROJECT .............................................................16 1.1 Introduction .......................................................................................................16 1.2 Background to and motivation for the study ...............................................20 1.3 The research problem .......................................................................................25 1.4 Objectives of the study ....................................................................................26 1.5 Scope and limitations of the study ................................................................32