The Challenges for Tourism in a The Challenges for Tourism in a failing agricultural economy: the failing agricultural economy: the case of the Windward Islandscase of the Windward Islands

Patsy Lewis

Sir Arthur Lewis Institute for Social and Economic Studies, Mona, Jamaica

July 2003

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IntroductionIntroduction

Aim of presentation

Assess some of the challenges inherent in attempts to transform agricultural economies to services, with special emphasis on tourism.

Declining agriculture as context for increasing tourism’s intake

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IntroductionIntroduction

Focus of presentation:

Windward Islands – Dominica, St. Vincent, St. Lucia (banana producers) – who are experiencing a decline in the agricultural sector in the wake of the adverse WTO ruling on the EU’s banana regime.

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IntroductionIntroduction

Manifestation of declineMass exodus of farmers

Dominica (1990-2000) – 64% (from 6,675 to 2,410)

St. Vincent (1990-1997)-- 17%

St. Lucia 49%Declining income

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IntroductionIntroduction

What accounts for exodus?Efficiency programme introduced in banana

sectorFluctuating pricesGeneral instability

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IntroductionIntroduction

Impact of industry’s decline

High levels of unemployment (1995)

Dominica 23.1%

St. Lucia 16.2%

SVG 19.8Source: UN Development system for the Eastern

Caribbean, 2000.

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IntroductionIntroductionImpact of industry’s decline High levels of poverty, particularly in rural areas Dominica: 33% poor St. Lucia: 25.1% poor; 7.1% indigent St. Vincent: 37.5% individuals poor, 25.7 indigent

Concentration of poor in rural agricultural sector

Source: Kairi poverty reports for Caribbean Development Bank

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IntroductionIntroduction

Characterization of W.I. banana industrysmall farms, five acres and underLow productivityLow technology/mechanisationHigh costMiddle-aged farmers Primary school education

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IntroductionIntroductionGovernments’ approach to ailing agricultural

sector is to attempt to focus on developing a service economy

TourismServices Decline of agriculture presents specific

challenges for any development strategy, including one embracing tourism

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IntroductionIntroduction

Challenges of developing a tourism strategy to address problems of ailing agricultural sector

Absorbing displaced farmersIncreasing government’s earnings

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Windward Islands’ economiesWindward Islands’ economies

Agriculture’s contribution to WI economies

Employment

Agriculture (and fisheries): Dominica (1997) – 31.4% St. Lucia (1999) -- 21.7% SVG (1999) -- 24.8%

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Windward Islands’ economiesWindward Islands’ economies

Since those figures, however, there has been a general decline in agriculture’s contribution to employment: 2000-2001

Dominica – 11.4% dropSt. Lucia -- 24.37% dropSt. Vincent – 7.24% drop

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Windward Islands’ economiesWindward Islands’ economiesTourism (hotels and restaurants) Dominica (1997) – 3.8%St. Lucia (1999) – 9.5%SVG (1999) – 4.0%

Tourism is largest contributor to export earnings but figures less in employment

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Windward Islands’ economiesWindward Islands’ economies

Agriculture’s and tourism’s contributions to GDP – 1997

Agriculture Tourism

Dominica 20.3% 2.51%

St. Lucia 11% 11%

SVG 10.8% 2.57%Source: (UN Dev. Sys for the EC, 2000)

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Windward Islands’ economiesWindward Islands’ economiesPromotion of tourism as strategy has to take account

of:1. weaknesses that exist in the sector2. Attitudes among farmers toward the industryWeakness identified in OECS tourism sector (OECS

Human development Report, 2002): Vulnerability to external and natural shocks Over reliance on foreign airlines High import content leading to leakage

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Windward Islands’ economiesWindward Islands’ economiesWeaknesses in tourism cont’d Insufficient hotel rooms Lack of integrated approach to tourism that balances

economic growth and human and social development

Inefficiency in generating foreign exchange Weak backward and forward linkages with other

productive sectors Limited opportunities for meaningful participation

by nationals

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Attitudes among farmers Attitudes among farmers toward the industrytoward the industry

Data -- random survey of 450 farmers involved in banana production between late 1998 and early 1999:

210 from St. Lucia (produces over half of Windward Islands production);

121 from St. Vincent; and 119 from Dominica.

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Response to tourismResponse to tourism

‘Do you see employment in the tourism industry as a realistic alternative (for yourself) to banana production?’

 Little support across WI. Only 30.5% of entire sample Levels of rejection: Dominica -- 81.8% St. Vincent -- 73% St. Lucia -- 60.3%

1919Response to agricultural Response to agricultural

diversificationdiversification

Do you think agricultural diversification away from bananas is arealistic option?

Yes: half the sample (51.4%)Significant relationship between country response and support for diversificationSt. Lucia – 63%St. Vincent– 52%Dominica 33%

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Explaining responsesExplaining responses

TourismWomen -- more resistance than men:20.8% of female sample supporting it as opposed to 32.7% of men (strong statistical relationship)

Agricultural Diversification•Men and women showed similar levels of support for diversification although support was lower among women (52% as opposed to 47%)

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Explaining responsesExplaining responses Farmer is not/interested/equipped/educated/doesn’t

see a role for himself in the industry – main reason in all

Banana industry provides better earning potential and employment opportunities than tourism is the second most important reason for Dominica and the third for St. Vincent and St. Lucia

Farmer’s too old -- St. Vincent and St. Lucia Tourism holds few opportunities for rural people St.

Vincent and Dominica

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Explaining responsesExplaining responses

Tourism is vulnerable/not viable was the second most popular reason for St. Lucian’s rejection of the industry(22.4%)

7.3% of Dominicans rejected it on this basis

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Explaining responsesExplaining responsesPossible explanations for resistance to the

industryunderdeveloped state of the industry in

Dominica and St. Vincent Resistance to change which goes beyond

changing jobs reflected in:

– farmer’s transformation from Independent producer to wage labourer.

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Explaining responsesExplaining responses

rejection of a different way of life and the likelihood of different types of social relationships than they have experienced as independent agricultural producers.

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Challenges for tourismChallenges for tourismChallenges given farmers’ response:Forge greater linkages with agriculture –

high food import billIncrease tourism’s contribution to GDPEnsure broader distribution of sector’s

earningsIncrease local population’s stake in the

industry

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Models of TourismModels of Tourism

Models of tourism available

Cruise ship

All inclusive mass tourism

‘Sun-lust’

Special interest

Eco-tourism

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Models of Tourism SegmentationModels of Tourism Segmentation

Special interest tourismAgro-tourismCommunity-based tourismHealth tourismAdventure tourismHeritage/cultural

Eco-tourism closely related to all of above

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Models of Tourism SegmentationModels of Tourism Segmentation

Agri-tourismTreating agricultural production as a

tourism product – already begun but limitedIntegrating with community tourismincreasing industry’s sourcing of food

locally -- Reduce high food import bill

Eco-tourism -- Dominica

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Models of TourismModels of Tourism

Mass Tourism: All inclusivesadopting an ‘all-inclusive’ rather than the

exclusive approach of the ‘all-inclusives’ in order to increase spread of earnings –

Features of the model:Shielding of tourists from ills of society –

high poverty, low-employment, reflected in high levels of tourist harassment

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Models of TourismModels of TourismTendency to marginalize groups already

involved in the industry – vendors, taxi operators, small hoteliers

Possibilities for the marginalisation of entire communities leading to potential conflicts.

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Models of TourismModels of TourismLimitations of the all-inclusive model in small

societies Special relation of population to the sea -- free

access to beaches Small physical space making it more difficult to

shield tourists Problems of conflict over land utilization –

agriculture vs. tourism. Greater and more obvious impact of

unemployment and poverty

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Challenges to agricultural Challenges to agricultural diversificationdiversification

Agricultural diversification provides a real possibility for giving displaced

banana farmers a stake in the tourism industryChallenges of agricultural diversification strategy --

relying on displaced banana farmers to be motor of diversification strategy

Continued limited access to resources Absence of support structures available to banana

producers

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Challenges to agricultural Challenges to agricultural diversificationdiversification

Continued issues of quality and cost competitiveness -- vital to national market as it is to export agriculture.

In other words, hotels are unlikely to rely on low-quality, high-cost, irregular suppliers.

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Challenges to agricultural Challenges to agricultural diversificationdiversification

Possible strategies for overcoming these difficulties

partnership between agricultural sector -- hotels and farmers.

easier access to credits and farming support

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ConclusionsConclusions Tourism is unlikely to and should not be perceived

as displacing agriculture. Agriculture remains the mainstay of Windward

Islands’ economies, especially given their social structure – small urban centers, large rural farming communities

It has played a role in alleviating rural poverty and in generating economic stability given its role in supporting significant sections of the labour force.

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ConclusionsConclusionsGovernment must work to revitalize

agriculture while diversifying the economies by strengthening tourism and manufacture.

The banana industry has the potential to be explosive because of its role in the lives of so many – St. Lucia 1990s, Dominica 2002

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ConclusionsConclusions Finally, tourism plans should involve local

communities, taking into account their reservations and perceptions. As P.E. Murphy notes: “Tourism … relies on the goodwill and cooperation of local people because they are part of its product. Where development and planning do not fit in with local aspirations and capacity, resistance and hostility can … destroy the industry’s potential altogether.” (Tourism: A Community Approach, 1985:153. Quoted in Dallen Timothy, ‘Participatory Planning: A View of Tourism in Indonesia’, Annals of Tourism, vol. 26 (2), p. 373)