INTERNATIONAL CONFERENCE ON PRO POOR TOURISM: MECHANISMS AND MAINSTREAMING

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1 INTERNATIONAL CONFERENCE ON PRO POOR TOURISM: MECHANISMS AND MAINSTREAMING STRATEGIES TO CAPTURE BENEFITS OF TOURISM FOR MARGINALISED COMMUNITIES IN MELAKA HISTORIC CITY By Assoc. Prof. Dr. Zainab Khalifah, Assoc. Prof. Dr Amran Hamzah Nor Azina Dahlan Ahmad Tajuddin Kechik Universiti Teknologi Malaysia Introduction The Malaysian tourism industry has been growing very rapidly in terms of visitor arrivals and revenue generation in the past decade. It has performed extremely well in the Malaysian economy, over-taking some of the country s traditional exports, improving from fifth position in 1994 to second position presently in terms of foreign exchange earnings. The number of international tourists to Malaysia in 2004 is 15.7 million, generating a revenue of RM29 billion. Melaka known for its historical past and rich in heritage is a popular tourism destination among international and domestic tourists. Tourism is the second most important economic sector in the state, after manufacturing. Melaka was able to attract 4 million international and domestic tourists in 2004, mostly concentrating in the Melaka Historic City itself. Since tourism is a relatively important sector in Melaka, and eradicating urban poverty is also an important agenda of the state, this paper therefore seeks to explore how pro-poor tourism (PPT) initiatives can help to reduce poverty while boosting the tourism industry in the city of Melaka. This paper will therefore access pro-poor tourism initiatives in Melaka Historic City and propose preliminary strategies, which could be taken to further exploit the potential benefits of tourism to the affected marginalized communities. 1

2 The objectives of the paper are: To assess the extent to which current government infrastructure tourism projects and private sector initiatives support pro-poor tourism in Melaka Historic City To recommend PPT strategies and mechanisms that the government and other industry players can incorporate in the planning and implementation of tourism projects/programmes. Officially the incidence of urban poverty in Malaysia is almost negligible with official data indicating the urban poverty rate in 2002 as 2 percent (Goh, 2005). The 2 percent rate was based on households of five living under the official Poverty Line Income (PLI) of RM529 per month in Peninsular Malaysia, RM600 in Sarawak and RM690 in Sabah. However common sense will indicate that the present indicator as unrealistic since it is generally accepted that an urban household would require at least RM1,000 to RM1,200 to live adequately (Sulochana Nair in Goh, 2005). The government recognised this weakness and households with less than RM1,000 income per month are eligible for financial assistance and Kuala Lumpur City Hall consider households with less than RM1,500 per month as qualified to participate in its poverty alleviation programmes (Goh, 2005). While the government is coming up with the new PLI, using a conservative estimated PLI of RM1,000 and using the most recent available 1989/90 household income survey will reveal that 25.0 per cent of households would be considered as poor. Relating to the above facts and figures with this paper, it will be obvious that the present PLI would indicate the number of absolute poor urban household as negligible in the city of Melaka. Instead this paper will focus on relative poverty in the form of marginalised communities; communities which are often left out in the process of urban development and income level are often below the average. With tourism becoming an increasingly important economic sector in Malaysia as a whole, and specifically in Melaka, the possibility of tourism benefiting a wider section of the community is tremendous. However, in most cases, intervention is required to ensure a broad based growth that will also maximize tourism benefits to the marginalised communities. What is Pro-poor Tourism? Pro-poor tourism is an approach to tourism that increases net benefits to the poor (Ashley et. al, 2001). It is not a new kind of tourism product but merely to ensure that the poorer section of the community too will have their portion of the tourism economic pie. Generally, pro-poor tourism is still a relatively new phenomenon in Malaysia, although certain elements of pro-poor tourism may be observed in some of the tourism developments. Pro-poor tourism will result in pro- poor growth which will decrease inequality and the increasing gap between the rich and poor. This is of a particular concern in Malaysia where poverty is becoming more complex coupled with a deteriorating income distribution, where new approaches are required since previous ones have little impact on 2

3 poverty reduction (Yeang, 2005). This is further emphasized by the latest release of the United Nations Human Development Report which indicates the worsening of income inequality in Malaysia. The report further shows that the richest 10 percent controls 38.4 percent of the total income, while the poorest 10 percent controls only 1.7 percent of the total income, and Malaysia performed the worst compared to the other Southeast Asian countries. This is further emphasized by the Malaysian Prime Minister in his Opening Speech in the Commonwealth Association of Planners Conference on 5th July 2004, he said: The growth of our cities will prove to be volatile and short-lived if we neglect the cities poorest inhabitants or we ignore the cities environmental balance, with only the pursuit of pure economic gains as our focus. A wide range of strategies are required to capitalize the benefits of tourism for the poor. Efforts are needed in capacity building, training, access to financial funds, marketing, linkages with the private sector, and also policy and regulation which are pro-poor. This requires working across different levels and stakeholders comprising of the government, private sector, non-governmental organizations, community organizations and the poor themselves, all having very different and critical roles to play. Assessment of Pro- Poor Tourism in Melaka Historic City Tourism is an important economic sector in Melaka and it is the second most important in terms of its contribution to the state s income. Table 1 shows the number of international and domestic tourist arrivals in Melaka from 2001 to Table 1: Number of International and Domestic Tourist Arrivals in Melaka ( ) Year Category Domestic International Total The state government has implemented a number of tourism infrastructure projects in its effort to boost up the number of tourist arrivals, increasing their length of stay and to maximise revenue from tourism. These various tourism projects in relationship with the marginalised communities can be categorised as either circumstantial or deliberate. Circumstantial is when tourism development is not targeted for the poor but the spill over 3

4 of the development benefits the poor. Deliberate is when the development is mainly aimed for the poor. Tables 2 and 3, briefly list the various government tourism projects and special events, the agency responsible for the development, aim of the development and its benefits to the marginalised communities. A scale, ranging from 1 for low benefit to 3 for high benefit is used as an estimate to indicate the benefits received by the marginalised communities. Table 2: Tourism Projects and its Benefit to Marginalised Communities NO GOVERNMENT TOURISM PROJECT AGENCY AIM/PURPOSE BENEFITS TO MARGINALISED COMMUNITIES 1 Melaka River Rehabilitation MOTOUR/MBMB To beautify & 2 Opportunities revitalize Melaka River as a tourist available but need intervention. attraction Potential future benefit from boat cruise. 2 Street Improvement Ministry Of To create safe 1 Gentrify and Scheme along Jln. Tokong/Jln. Tukang Besi/Jln. Housing And Local and conducive walking revitalize inner cities Tukang Emas And Jln. Hang Government environment for Benefit elite Jebat tourists businessmen 3 Development of Hang Tuah Ministry Of Revitalize 2 To provide Mall based on the concept of Bukit Bintang Walk Housing And Local Government shopping precinct flagship tourism product (State icon product) /MBMB Meant to house petty traders but the high rent hinders their participations 4 Restoration of 18 units of MBMB To visually 2 Still maintain shop houses along Jalan Laksamana enhance gateway to Melaka and to attract tourist users previous occupants 5 Mini museum/gallery at PERZIM To showcase 1 Poor presentation Portuguese and preserve Low tourist Settlement/Kg.Chetti/Kg.Pali Melaka s appeal Heritage Superficial 4

5 6 Conservation & restoration of historical building, national monuments Muzium Antiquity Department To showcase cultural diversity and preserve Melaka heritage 7 Restoration of Atlas Ice PERZIM Cultural centre. Business incubator for handicraft. To supply genuine handicraft. 1. Low Benefit 2. Moderate Benefit 3. High Benefit No emotional attachment Lack Revenue capture mechanism 3 Allows trinkets sellers to set up stalls along popular tourist route Table 3: Special Events and its Benefits to Marginalised Communities NO SPECIAL TOURISM EVENTS 1 Jonker Walk : Involves the closures of Jalan Hang Jebat (Jonker Street) on Friday, Saturday and Sunday evenings to be turned into a cultural night market 2 Seasonal/ Cultural/ Religious Events Portuguese Settlement San Pedro Fiesta Intrudo (Water Festival) San Juang Fiesta (Light Festival) Christmas AGENCY AIM/PURPOSE BENEFITS TO MARGINALISED COMMUNITIES Jonker Walk To introduce night life 2 Directly benefits food Committee and activities as well sellers within the area Chinese Chamber as the cultural of Commerce ambience Portuguese To preserve religious 3 Commodification Committee and cultural heritage of culture and high direct benefit even though seasonal Extend length of festival (no of days) 5

6 Kg Chetti Ponggol Festival Hindu New Year Deepavali Trustee Executive To preserve religious and cultural heritage 1. Low Benefit 2. Moderate Benefit 3. High Benefit 1 Fail to capitalize the benefits of various events The preliminary qualitative assessments show that opportunities do exist for marginalized communities to benefit from tourism. However, due to their present situation, intervention and assistance are required for them to fully exploit the benefits of tourism. Strategies and Mechanisms for Increasing the Benefits of Pro-Poor Tourism Problems or issues encountered by marginalised communities are mostly related to the policy and planning framework, barriers in participating in the tourism industry due to lack of credit, business skills, and access to markets. Table 4 summarised the various issues faced by marginalised communities, and the respective strategies and mechanism being proposed. Table 4: Pro-poor Tourism Issues, Strategies and Mechanism NO ISSUES STRATEGIES MECHANISM 1 PPT not addressed in most formal development plan 2 Planning process carried out using top down approach and local participation is superficial 3 Planning process is fragmented and sector based 4 Implementation - Boosterist approach with little room for consultation/feedback Incorporate PPT elements in formal development plan Emphasis on process of decision making instead of plan making Participatory approach. Support community based organization. Put in place review process and monitoring More focus on communication -group discussion / workshop. Encourage the establishment of resident committee. Implementation of agenda 21. Replace current tools with participatory techniques such as visioning, scenario sketching, aspiration analysis, consensus building, and conflict resolution Develop indicators. Review should not only measure economic benefits but also accommodate social, cultural and environment impacts. Consider all complexities on the ground. Cooperation and coordination at all levels. 6

7 5 Limited business opportunities Identify business opportunities suitable for marginalised communities 6 Lack of capacity Increase marginalised building & training communities basic understanding of the tourism industry. Training in business and organizational skills (management, marketing, communication) 7 Lack of credit Identify and create funds for micro and smallenterprise tourism initiatives. Collaboration with the more established industry players hotels, tour operators (MAH, MATTA, MTGC) eg. through community based association Collaboration with Government and private sector. Adopt loan conditions suitable for the marginalised communities. 8 Negligible Business Partnerships Establishing links with the private sector Increase private sector awareness and understanding of CSR. Create a win-win situation. Incentives from government for establishing such partnerships. Especially new in the Melaka s context is for marginalised communities to establish strong links with the private or business sector to ensure their dealings has commercial sense. This calls for doing business differently, a shift from the traditional method of doing business in the private sector. This corresponds to the present Corporate Social Responsibility (CSR) discussions, where the focus has shifted from short-term doing good to finding win-win situations in which companies can profit by doing good (Ashley & Haysom, 2004). Moreover, CSR is very relevant to the tourism industry since corporate reputation has the ability to influence demand. Ashley and Haysom (2004) provided a comprehensive examples of doing business differently, a practical experience from PPT Pilot Partners projects involving private companies in South Africa such as Spier Leisure, Sun City and Wilderness Safaris. These partnerships vary from increasing procurement from local SMEs, supporting the establishment of local enterprises, and community partnerships in terms of equity or revenue sharing. 7

8 Conclusion Pro-poor tourism has the potential of benefiting the poor, decreasing inequality and narrowing the gap between the rich and poor. This is especially relevant in the Malaysian case where previous initiatives have minimal impact on poverty reduction and new approaches are required especially in eradicating urban poverty. It is hoped that the new role given to the Ministry of Housing and Local Government to eradicate urban poverty will incorporate pro-poor tourism initiatives as a means to reduce urban poverty. References Ashley, C. and Haysom, G, (2004) From Philanthropy To A Different Way Of Doing Business : Strategies And Challenges In Integrating Pro Poor Approaches Into Tourism Business, paper presented at ATLAS Africa Conference, Pretoria, Africa. Ashley, C., Roe,D. and Goodwin,H. (2001), Pro Poor Tourism Strategies : Making Tourism Work For The Poor : A review of experience, Pro Poor tourism Report No.1, Overseas Development Insitute, The Russel Press, Nottingham. Department for International Development, (April 1999), Sustainable Tourism and Poverty Elimination Study, London Goh Ban Lee (2005) Capacity Building for the Low Income Families Key to Poverty Alleviation, paper presented at the National Seminar on Urban Poor & Low Income Families: Towards the Ninth Malaysia Plan, Kuala Lumpur, Malaysia Nelson, J.G., Butler, R. and Wall, G. (1993) Tourism and Sustainable Development: Monitoring, Planning, Managing, Department of Geography Publication Series. University of Waterloo, Canada. Yeang Soo Ching, News Sunday Times, 20th Feb