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

1. The Challenges for Tourism in a failing agricultural economy: the case of the Windward Islands Patsy Lewis Sir Arthur Lewis Institute for Social and Economic Studies, Mona, Jamaica July 2003

2. 2Introduction 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

3. 3Introduction 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.

4. 4Introduction Manifestation of decline • Mass exodus of farmers Dominica (1990-2000) – 64% (from 6,675 to 2,410) St. Vincent (1990-1997)-- 17% St. Lucia 49% • Declining income

5. 5Introduction What accounts for exodus? • Efficiency programme introduced in banana sector • Fluctuating prices • General instability

6. 6Introduction Impact of industry’s decline High levels of unemployment (1995) Dominica 23.1% St. Lucia 16.2% SVG 19.8 Source: UN Development system for the Eastern Caribbean, 2000.

7. 7Introduction Impact 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

8. 8Introduction Characterization of W.I. banana industry • small farms, five acres and under • Low productivity • Low technology/mechanisation • High cost • Middle-aged farmers • Primary school education

9. 9Introduction Governments’ approach to ailing agricultural sector is to attempt to focus on developing a service economy • Tourism • Services Decline of agriculture presents specific challenges for any development strategy, including one embracing tourism

10. 10Introduction Challenges of developing a tourism strategy to address problems of ailing agricultural sector • Absorbing displaced farmers • Increasing government’s earnings

11. 11Windward 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%

12. 12Windward Islands’ economies Since those figures, however, there has been a general decline in agriculture’s contribution to employment: 2000-2001 • Dominica – 11.4% drop • St. Lucia -- 24.37% drop • St. Vincent – 7.24% drop

13. 13Windward Islands’ economies • Tourism (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

14. 14Windward 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)

15. 15Windward Islands’ economies Promotion of tourism as strategy has to take account of: 1. weaknesses that exist in the sector 2. Attitudes among farmers toward the industry Weakness 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

16. 16Windward Islands’ economies Weaknesses 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

17. 17Attitudes among farmers toward 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.

18. 18Response 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%

19. 19Response to agricultural diversification Do you think agricultural diversification away from bananas is a realistic option? Yes: half the sample (51.4%) Significant relationship between country response and support for diversification St. Lucia – 63% St. Vincent– 52% Dominica 33%

20. 20Explaining responses • Tourism • Women -- 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%)

21. 21Explaining 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

22. 22Explaining 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

23. 23Explaining responses Possible explanations for resistance to the industry • underdeveloped 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.

24. 24Explaining 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.

25. 25Challenges for tourism Challenges given farmers’ response: • Forge greater linkages with agriculture – high food import bill • Increase tourism’s contribution to GDP • Ensure broader distribution of sector’s earnings • Increase local population’s stake in the industry

26. 26Models of Tourism Models of tourism available Cruise ship All inclusive mass tourism ‘Sun-lust’ Special interest Eco-tourism

27. 27Models of Tourism Segmentation Special interest tourism • Agro-tourism • Community-based tourism • Health tourism • Adventure tourism • Heritage/cultural Eco-tourism closely related to all of above

28. 28Models of Tourism Segmentation Agri-tourism • Treating agricultural production as a tourism product – already begun but limited • Integrating with community tourism • increasing industry’s sourcing of food locally -- Reduce high food import bill Eco-tourism -- Dominica

29. 29Models of Tourism Mass Tourism: All inclusives • adopting 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

30. 30Models of Tourism • Tendency to marginalize groups already involved in the industry – vendors, taxi operators, small hoteliers • Possibilities for the marginalisation of entire communities leading to potential conflicts.

31. 31Models of Tourism Limitations 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

32. 32Challenges to agricultural diversification Agricultural diversification • provides a real possibility for giving displaced banana farmers a stake in the tourism industry Challenges 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

33. 33 Challenges to agricultural diversification • 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.

34. 34 Challenges to agricultural diversification Possible strategies for overcoming these difficulties • partnership between agricultural sector -- hotels and farmers. • easier access to credits and farming support

35. 35Conclusions • 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.

36. 36Conclusions • Government 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

37. 37Conclusions • 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)