How can the tourism industry support economic development?

1. The Political Economy of Destination PromotionAfrican tourism website networksJeroen van WijkRSM-Erasmus University (jwijk@rsm.nl)Conference “Imagination, Media Power and Reputation”, May 30-31st 2007, The Hague. RSM-Erasmus University and Hotelschool The Hague.

2. The Political Economy of Destination Promotion Main question How can the tourism industry support economic development? How can imagination, media power and reputation promote tourism destinations in developing countries and support economic development?

3. The Political Economy of Destination Promotion Analysis of tourism industry actors Two theoretical approaches • Global value chain analysis > Vertical (international) networks • Business systems approach > Horizontal (national) networks

4. The Political Economy of Destination Promotion (1) Global value chain (GVC) analysis Systemic approach, unit of analysis is: * not a company, a country, or a region, but * a network of companies embedded in internal and external governance systems Focus: * Who adds value where in the chain? * Who is leading actor in the chain? Normative questions: * How can chain revenues better be distributed over chain actors? * How can the chain’s negative impact on the natural system (‘earth’) be reduced?

5. Coordination The Political Economy of Destination Promotion Global value chain Consumer Brand, reputation & media Retail Manufac turer Trader “Ingredient branding” Supplier Supplier

7. Tourist Travel agency Tour operator Coordination Airline Hotel Destination branding Guide The Political Economy of Destination Promotion Global value chain Consumer Brand, reputation & media Retail Manufac turer Trader “Ingredient branding” Supplier Supplier

8. Tourist Travel agency Tour operator Airline Hotel Destination branding Guide The Political Economy of Destination Promotion Features tourism GVC • Consumption and production at same • time and location • Chain offers B2C contact opportunity • at every node • Tourists may shorten and coordinate • the chain the chain themselves • Destinations have opportunities in • branding, reputation, and media • Individual service suppliers • have those opportunities as • well

9. The Political Economy of Destination Promotion (2)African segmented business system Networks of: * African (indigenous) firms * Government authorities and para-statals * African minorities: Asians and Lebanese * African whites * Multinationals * Division urban/rural business

10. The Political Economy of Destination Promotion African business networks Set of social, i.e. not purely market exchange, relationships between companies (representatives) They * Share information about the transaction history of an agent * Enforce contracts informally * Interlink, they work on longer term or incomplete “contracts”. * Reproduce themselves, high barriers to entry * Often display ethnic or religious concentration, because these ties offer socialization frameworks. * May protect common interests Segmentation is reinforced by the Digital Divide

11. Tourist Travel agency Tour operator Airline Hotel Chain Guide The Political Economy of Destination Promotion The political economy of destination promotion The African model Which are opportunities for “functional upgrading” in the GVC, both for the destination and for individual suppliers? Who decides on the destination branding? Which type of tourism is promoted? Which region? And which supplier networks? Which are the opportunities for independent marketing by small tourism firms? Res taurant Local hotel Park Museum Artist

12. The Political Economy of Destination Promotion • Our research • Database of 468 tourism websites in Uganda, Rwanda, and Mozambique • Analyse network structure of website owners/registrants

13. The Political Economy of Destination Promotion Tourism portals Mozambique: No portals with hyperlinks; only 8 abroad (5 South Africa) Rwanda: 5 portals (4 foreign, 1 unknown) Uganda 7 portals (2 foreign)

14. The Political Economy of Destination Promotion Website ownership Mozambique N=135 Uganda Rwanda N=53 N=245

15. The Political Economy of Destination Promotion Geographic location tourism service suppliers Hyperlinks from 6 tourism portalsin Uganda

16. The Political Economy of Destination Promotion Conclusions 1. The Internet offers opportunities for functional upgrading African tourism destinations and individual firms. 2. Online destination promotion in 3 African countries is highly mediated by foreigners. 3. Rural tourism stakeholders (CBT, budget accommodation, local artisans) benefit most from foreign web owners in view of international marketing. Effective strategy to circumvent the digital divide, but limited opportunities and new dependency. 4. In Uganda, the native, urban tourism elites dominate tourism promotion, but their network excludes rural suppliers.