Ebook the encyclopedia of ecotourism part 2

Section 5 Ecotourism Impacts P F J Eagles Department of Recreation and Leisure Studies, University of Waterloo, Waterloo, Ontario, Canada Arguably, all consideration of ecotourism is dependent on the[.]

Section 5

Ecotourism Impacts

P.F.J Eagles

Department of Recreation and Leisure Studies, University of Waterloo,

Waterloo, Ontario, Canada

Arguably, all consideration of ecotourism

is dependent on the data that are derived

from impact measurement The

determina-tion of the size, scale and impact of a

phenomenon requires the determination of

a measurement goal, a measurement device

and a methodology for measurement In

impact assessment, the size of the

phenom-enon to be measured is typically so large,

that a sample must be chosen Often, it is

desirable to choose an indicator to

repre-sent the larger phenomenon An indicator

is that which serves to indicate or give a

suggestion of something; an indication of.

The chapters in Section 5 each deal with

various aspects of the identification,

mea-surement and management of ecotourism

impacts

The chapters found in Section 5 use

many indicators to represent some larger

state One might question whether the

indi-cators chosen are the most appropriate In

addition, it is important to note whether

the proper measurement device and

methodology was applied The

understand-ing of data, indicators and impacts must be

carefully weighed It is important not to

simply accept impact conclusions based on

indicators without caution

Ercan Sirakaya, Tazim Jamal and

Hwan-Suk Choi tackle the substantial problem of

the determination of indicators in Chapter

26 They outline the development of the concept of indicators over time They iden-tify the characteristics that lead to the choice of better indicators They point out the stakeholder involvement in the devel-opment and application of indictors The role of monitoring and reporting is identi-fied The authors note that: ‘indicators have

to be selected so that they are robust, credi-ble, efficient (in time and cost for obtaining the data), and useful to decision makers’ The chapter makes the point that the data from indicators are only inputs to decision making The importance of the indicators

is dependent on the ability of the decision making structure to use the information in

an effective and competent manner

In the understanding of ecotourism, one key factor is its impact on people, commu-nities and environments The authors of three chapters in Section 5 have identified impacts on the more obvious categories of study: economics, socio-cultural relations and the physical/natural environment It is critical to recognize that all impact identifi-cation and determination is dependent on value judgements Who makes the judge-ments is a critical element of the decision process The process used to involve peo-ple and to make the judgements must be identified and must be clearly understood

by all who use the outcomes

© CAB International 2001 The Encyclopedia of Ecotourism

Paul Eagles, in a chapter in Section 8,

points out that all decisions are dependent

on information The better the information

available to the planner and manager, the

better the chance for a good decision Kreg

Lindberg, in Chapter 23, summarizes an

extensive literature on the economic

impact of ecotourism This chapter

identi-fies economic impact in three categories:

jobs, income and profit Lindberg is careful

to identify the methods used to measure

the impact and to clarify the extent to

which individual studies can be applied

elsewhere Interestingly, the chapter leads

the reader to conclude that the economic

impact of ecotourism, as important as it

is, is frequently underestimated,

under-reported and poorly calculated This

sug-gests that other social factors, possibly

environmental protection or community

development, are more important and

receive more emphasis in the political

decision making surrounding the

phenom-enon However, it is also clear that until

defensible economic impact estimates are

done for ecotourism, it will continue to be

treated by many in government and in the

business community as a niche activity

without substantial importance

In Chapter 24, Ralf Buckley tackles the

huge problem of summarizing the

exten-sive literature on environmental impact

Whereas it is relatively clear in economic

impact where the positive values lie,

typi-cally towards larger impact, it is not nearly

so clear where the positive values lie in

environmental impact Is it better to have

more or less of a species? How does one

know when ecological integrity is intact?

How much soil erosion is bad? Professor

Buckley makes the important point that the

environmental impact of ecotourism must

consider the travel to and from the activity

destination So often only the impacts at

the visitation site are identified The

chap-ter points out that the consideration of

impacts goes well beyond the measurement

of impact The chapter concludes that often

the ‘lack of scientific knowledge is less of

an impediment than lack of management

funds or political support’

Professor Buckley’s chapter provides a

broad coverage of the current knowledge of the environmental impact of ecotourism But the chapter does not identify the

envi-ronmental impact of the lack of

eco-tourism The common assumption is that the environmental impact of outdoor recre-ation or ecotourism should use as its benchmark no human use or no human impact on the environment This is an invalid assumption, because typically in the absence of outdoor recreation or eco-tourism some other economic activity will take place in that environment If the site is not a national park catering to tourists, it will be supporting a logging industry, a grazing industry or some other resource-based economic activity Therefore, the environmental impact of ecotourism should

be compared with the most likely alterna-tive economic activity, not to some unreal-istic utopia without any use

Stephen Wearing, in Chapter 25, identi-fies the range of socio-cultural impacts that have been identified for local communities Wearing concentrates his comments on smaller, rural communities, typically occu-pied by peoples somewhat marginalized in the large social fabric Such people are very vulnerable to the social impacts of eco-tourism The biggest issues in socio-cultural impact identification are the assignment of value and the identity of the person who assigns the value In addition, the political climate that determines the decisions made after value identification is critical to the application of socio-cultural impact identification Therefore, so much

of socio-cultural impact application lies in the field of politics

Richard Butler looks to rural areas and the bases upon which their involvement in ecotourism is appropriate He deals in Chapter 27 with the landscape that con-tains a high degree of agricultural activity Professor Butler deals insightfully with the identification of value, and the determina-tion of the role of the rural people in the determination of value The identification

of the role of food provision for ecotourism and the resultant economic and social impact is a useful factor that is too often forgotten in ecotourism analysis The

chapter concludes with the important

statement that ecotourism in rural areas is:

just as crucial in terms of environmental

conservation and nature appreciation as

when it occurs in remote tropical or polar

areas, and in terms of fulfilling its role in

providing local economic benefits, is

infinitely more successful in a rural setting

than an unpopulated wilderness one

The chapters in Section 5 reveal that the

principles underlying impact

identifica-tion, indicator use, data needs, planning form and management functions are not unique to ecotourism All of these princi-ples are well known and well documented

in the relevant fields of management the-ory, economic theory and planning theory The identified information and impacts of ecotourism are found in the sociology, leisure studies and environmental studies literature, but the underlying principles are cross-disciplinary and outlined in a funda-mental fashion in other fields

Chapter 23

Economic Impacts

K Lindberg

School of Tourism and Hotel Management, Griffith University,

Gold Coast, Queensland, Australia

Introduction

The jobs generated by ecotourism provide

an important reason for interest in, and

support for, the phenomenon These jobs

often occur in areas relatively untouched

by traditional development efforts and

rep-resent tangible economic benefits from

nat-ural areas Several studies have assessed

the local employment benefits of

eco-tourism; not surprisingly, the level of

bene-fits varies widely as a result of differences

in the quality of the attraction, access and

other factors In some cases, the number of

jobs created will be low, but in rural

economies even a few jobs can make a big

difference

Aside from its contribution to

develop-ment generally, there are at least three

rea-sons why local job creation is important in

ecotourism First, it is equitable in so far as

conservation of an area for ecotourism may

reduce or eliminate traditional resource

use Second, the ecotourists, as consumers,

may support the importance of tourism

benefiting local residents (P.F.J Eagles, J.L

Ballantine and D.A Fennell, 1992,

unpub-lished) Third, when residents receive

ben-efits, the extractive pressure on natural

resources is lessened, and residents are

more likely to support tourism and

conser-vation, even to the point of protecting the

site against poaching or other

encroach-ment For example, Lindberg et al (1996)

found that ecotourism-related benefits were

an important basis for positive resident attitudes toward adjacent natural areas (see also Wunder, 1996, 1998) Conversely, if residents bear the costs without receiving benefits, they may turn against tourism and conservation, and may intentionally or unintentionally damage the site Whether ecotourism benefits lead to increased sup-port for conservation and, ultimately, to changes in resource use is dependent on a variety of circumstances (Brandon and Wells, 1992; Brandon, 1997)

Although this chapter focuses on eco-tourism in particular, it is worthwhile to

‘set the stage’ by describing the economic impact of tourism in general Tourism sta-tistics are of variable, and sometimes low, quality Nonetheless, the methods and quality of the data are improving, and available statistics provide at least a rough idea of tourism’s economic impacts Table 23.1 presents estimates from the World Travel and Tourism Council (WTTC) Tourism’s current impact is expected to grow over the next decade, with WTTC estimating that the industry will create over 5.5 million jobs per year during that period This growth will occur on top of significant recent growth in tourism, with

© CAB International 2001 The Encyclopedia of Ecotourism

World Tourism Organization (WTO)

esti-mates of growth in the decade from 1985 to

1994 as follows: Africa 89%, South

America 86%, Central America 91%, the

Caribbean 71%, East Asia and the Pacific

142%, and South Asia 48% (Mowforth and

Munt, 1998, p 93)

As these figures reflect, in the economic

impact arena most attention is paid to the

jobs, income and profit that ecotourism

generates; these will also be the primary

focus of this chapter Nonetheless, there are

important additional economic impacts,

both positive and negative, associated with

development of tourism in general and

eco-tourism in particular (economic,

environ-mental and socio-cultural impact groupings

can overlap at times, and the present focus

is on impacts typically classified into the

economic category)

Fiscal impacts (taxes, fees, expenditures)

Tourism not only generates government

revenue through business and other general

taxes, but also through industry-specific

channels, such as payment of occupancy

and departure taxes Conversely, tourism

generates fiscal costs in the form of, for

example, funding for infrastructure In an

evaluation of tourism in Belize, which is

heavily oriented toward ecotourism, Lindberg and Enriquez (1994) note that this revenue covers specific tourism-related costs, such as tourism promotion and maintenance of the airport, but also gener-ates net profits for the government (see also

Borden et al., 1996).

Of particular interest in the ecotourism context are fiscal impacts on protected areas This issue is treated more fully else-where (e.g Lindberg and Enriquez, 1994; Laarman and Gregersen, 1996; Lindberg, 1998; Van Sickle and Eagles, 1998) In brief, ecotourism has substantial potential

to financially contribute to the creation and maintenance of protected areas, and this potential has been increasingly realized during the past decade However, many areas still charge little or no fees, and at such sites ecotourism may cause a net neg-ative fiscal impact due to the costs involved in providing the ecotourism expe-rience

Reduced access to resources

Tourism utilizes various resources as inputs into the products and services provided to visitors In the case of ecotourism, one of these products is nature in a partially or totally preserved state Preservation of

nat-Table 23.1 WTTC economic impact estimates (1999).

Billions % of total Annual % Millions % of total

a 1999–2010 estimated, adjusted for inflation

ural areas often involves reduced local

access to resources, such as wood or

medi-cinal plants In so far as tourism is a partial

or sole rationale for preserving an area, it

also causes reduced access to resources

Inflation

Many destinations have experienced

increased prices for goods, services, and

land due to tourism development, and this

is a cost borne by residents of the area who

purchase these items

Effects on income distribution

In some cases, tourism development

exac-erbates existing income inequalities within

destination communities, while in others it

generates new financial elites

Revenue sharing

At some ecotourism destinations, residents

benefit from revenue-sharing programmes

that either provide cash payments or, more

commonly, funding for community projects

such as wells or schools For example,

Nepal’s Wildlife Conservation Act provides

for the distribution of 30–50% of protected

area fee revenue to surrounding

communi-ties (Brandon, 1996)

Whether the above impacts are good or bad

will depend on one’s perspective For

example, some may desire continuity in

local economic (and political)

relation-ships, while others may desire reductions

in income inequalities Persons wishing to

sell land would welcome increased land

prices, while those who wish to buy land

or to retain land they own (and on which

they may pay property taxes) would

oppose increased prices Likewise, tourism

is said to compete with other sectors,

notably agriculture, for land, labour and

finance The desirability of this

competi-tion depends on one’s perspective; workers

earning a higher wage or investors

receiv-ing a higher return from tourism may dis-agree with members of the community who lament the transition away from traditional agricultural activities

Leakage is often listed as a negative impact, but it is more appropriately viewed

as the absence of a positive impact Rather than causing economic harm, it simply does not provide the benefit of the foregone jobs Similarly, the instability and, in some cases, undesirability of tourism jobs is often seen as a negative impact, but can alterna-tively be viewed as the lack of positive impacts (stable, desirable employment) Regardless of how they are classified, these are important considerations in the devel-opment of tourism, whether ecotourism or otherwise Leakage is discussed further below, and Sinclair and Stabler (1997) and Weaver (1998) provide additional treat-ment of these issues

The debate over leakage also raises a more general issue, that of the motivation and reference point for evaluating eco-tourism, or general tourism It is true that tourism typically involves high levels of leakage, but that does not necessarily mean

it is undesirable as a development strategy Appropriate questions in this context are: (i) whether leakages can be reduced and, if

so, at what expense; and (ii) given current

or reduced leakages, combined with other benefits and costs, whether tourism remains more desirable than alternative development options

Though the diverse impacts of tourism are increasingly being recognized, the tra-ditional impacts of jobs and income (from employment, rather than from revenue-sharing programmes) tend to be the most discussed and researched, and they will be the focus of the remainder of this chapter The present focus is on concepts and meth-ods for estimating impacts Tools for enhancing impacts are discussed elsewhere (e.g Butler, Chapter 27, this volume; Lindberg, 1998) To the extent possible, ecotourism-based examples and applica-tions will be used However, examples and applications from general tourism or other sectors will be used when necessary to illustrate techniques and principles In

addition, though issues and examples

rele-vant to both developed and developing

countries are presented, the discussion is

weighted toward the latter

Expenditure, Linkage and Leakage: a

Basic Description of Ecotourism’s

Money Flows

An understanding of ecotourism’s

contri-bution to economic development requires

an understanding of the ecotourism

‘indus-try’ Ecotourism is, of course, tremendously

variegated; it can encompass everything

from paying travel agents thousands of

dol-lars for trips to the furthest reaches of the

globe to simply walking to a nearby park

However, to simplify matters, it is useful to

think of ecotourism as comprising three

components The first is the outbound

operator that sells tours directly to

interna-tional tourists in the source country The

second is the inbound (ground) operator

that actually organizes and leads the trip in

the destination country The third is the

attraction that is being visited

Consider the example of an American

tourist wishing to visit Amboseli National

Park in Kenya She might buy a tour from a

US outbound operator, which in turn has

arranged for an inbound operator to lead

the trip in Kenya The inbound operator

will in turn purchase admission to the

park, which is managed by the Kenya

Wildlife Service Alternatively, the tourist

may choose to arrange the trip directly

with an inbound operator, either to save

money or because she is already in Kenya

Or, she might forgo using an operator in

favour of travelling to the park by herself

Many observers voice the concern that

much of the trip cost, and thus the

eco-nomic benefit, remains with outbound

operators and source-country airlines To

some extent, this is simply due to the

nature of the tourism industry; substantial

funds are spent on marketing, commissions

and transport before tourists even reach the

destination For example, Sorensen (1991)

presents a case study of Overseas Adventure

Travel (OAT), an outbound operator in

Massachusetts, USA In 1989, OAT sales totalled US$4,525,000 (all figures are rounded), of which US$1,400,000 was for air transport and US$3,027,000 for land tours The land tours cost US$1,962,000 to supply, with a resulting gross profit from this product of US$1,065,000 (approxi-mately 86% of the total company gross profit) Much of this gross profit remained

in the USA through allocation to salaries and related (US$714,000), sales and mar-keting (US$496,000) and administrative/ general (US$264,000) Using preliminary

1990 budget figures, the major sales and marketing budget items were media adver-tising (6% of sales and marketing budget), catalogue and other sales tools (43%), postage (10%), telephone (6%), and travel agent commission (18%) Though the pro-portion of total sales revenue actually spent ‘in country’ at destinations is not estimated, the revenue allocated to land tours represents less than half of total sales

Similarly, Brown et al (1995) estimate

that 40% of foreign visitor expenditure for trips to the Hwange and Mana Pools National Parks in Zimbabwe is lost to the country because of international air travel costs Noland (1988) in Lindberg (1991) provides a breakdown of trip costs for a Mountain Travel African trek Of the US$4105 trip price, US$150 (4%) was profit, US$1125 (27%) went to administra-tion and commissions, US$350 (9%) went

to the trip leader, US$350 (9%) paid for hotels, and US$2130 (52%) went to field costs, such as the inbound operator and park entrance fees In this case, more than half of the trip cost was spent in country for field costs and hotels However, airfare

is not included in the price, and inclusion may reduce the in-country proportion to less than half The catalogue alone for one nature tourism operator cost US$350,000 to produce When divided by the number of clients who booked tours, the average cost came to US$116.67 per tourist

In order to understand the issue of leak-age, and the associated concept of multipli-ers, a brief description of economic flows is provided here Tourism’s economic contri-bution depends not only on how much

comes into the region of interest (a country,

a state/province/county, or a local

commu-nity), but also on how much of what comes

in stays in the region, thereby producing

multiplier effects The impacts of tourism,

or any economic activity, can be grouped

into three categories: direct, indirect and

induced Direct impacts are those arising

from the initial tourism spending, such as

money spent at a restaurant The restaurant

buys goods and services (inputs) from

other businesses, thereby generating

indi-rect impacts In addition, the restaurant

employees spend part of their wages to buy

various goods and services, thereby

gener-ating induced impacts Of course, if the

restaurant purchases the goods and

ser-vices from outside the region, then the

money provides no indirect impact to the

region, and leaks away Figure 23.1 is a

simplified illustration of some of these

impacts and leakages

A consistent finding of economic impact

studies, particularly in developing

coun-tries, is the high level of leakage Much of the initial tourist expenditure leaves the destination country, and especially the des-tination site itself, to pay for imported goods and services used in the tourism industry The following examples are esti-mates of the percentage of tourism spend-ing leakspend-ing away from destination country economies (Smith and Jenner, 1992; Brown

et al., 1995; Brandon, 1996; Sinclair and

Stabler, 1997, p 141; Lindberg, 1998; Mowforth and Munt, 1998, p 194; and ref-erences cited within these sources):

• 70% for the average Caribbean country (up to 90% in the Bahamas, as low as 37% in Jamaica),

• 70% in Nepal,

• 60% in Thailand,

• 55% for the typical developing country,

• 55% in The Gambia,

• 53% for Zimbabwe,

• 45% in Costa Rica,

• 45% in St Lucia

Fig 23.1 Impacts and leakages.

More than 90% of tourism spending is

thought to leak away from communities

near most nature tourism sites For

exam-ple, Baez and Fernandez (1992) estimate

that less than 6% of the income generated

by tourism at Tortuguero National Park in

Costa Rica accrues to the local

communi-ties Similar figures have been estimated

for the Annapurna region of Nepal (Panos,

1997) and lower figures for whale-watching

in Baja California, Mexico (Dedina and

Young, 1997) In Tangkoko DuaSudara in

Indonesia, the benefit distribution is: 47%

to the major tour company, 44% to hotels,

and only 7% to guides (of which the head

reserve guard gets 20%) Guides and food

are usually brought from the provincial

capital, so few benefits are retained at the

village level (Kinnaird and O’Brien, 1996,

p 70) Box 23.1 provides a further example

of linkages and leakages at a lodge in

Zimbabwe

The wide variation in leakage estimates across sites is partly a result of differing assumptions, definitions and methods used However, it also is affected by the size and sophistication of the economy being evaluated (and thus also by its geo-graphic scope), the type of tourists and tourism development, and the policies and efforts of individual tourism businesses Smaller economies generally will have more leakage because a lower diversity of goods and services is produced in them than in large economies

The issue of leakage is very complex, and comparisons across sites and types of trips can be misleading In addition, the ultimate level of local economic benefit depends not only on the level of leakage, but also on the amount of spending It is conventional wisdom that small-scale tourism development involves less leakage than does large-scale tourism, and there is

Box 23.1 Mana Pools Lodge.

Brown et al (1995) estimate the distribution of revenues for trips involving the Mana Pools Lodge in Zimbabwe The following figures show how revenues from a typical Harare–Mana Pools–Harare trip costing US$700 are used to purchase various local/national and international inputs (trip cost does not include international airfare to Harare) The leakage column shows the percentage of payment for each item that leaks away from the Zimbabwean economy

Leakage as %

Of the total leakage, slightly more than half, in dollar terms, results from commissions

a Though not specified in the report, this presumably represents staff travel