Opportunities for improving communities' welfare through growth of tourism in Uganda: the case of Murchison Falls National Park

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Published on March 3, 2014

Author: ThinkTankInitiative

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The rich and largely untapped Uganda’s tourism potential remains an important avenue for economic growth and welfare improvement of communities living around the national parks. Using qualitative data and global production network (GPN) methodology we examine how growth of tourism could improve the welfare of the communities living around the Murchison Falls National Park. GPN methodology focuses on analysis of various actors in a product value chain locally and internationally, their interactions with other actors and how each of the stakeholder benefits from the products revenue. For the local communities to benefit from tourism, the government should: - i) facilitate development of local people’s culture into tourism products, ii) build communities’ capacity to harness benefits presented by tourism and , iii) engage in an aggressive campaign to market tourism. Communities’ capacity to supply agricultural produce to hotels should also be enhanced.

EPRC POLICY BRIEF Issue No. 25 42 November 2014 JANUARY 2012 Opportunities for improving communities’ welfare through growth of tourism in Uganda: The Case of Murchison Falls National Park. Francis Mwaura and Michelle Christian Executive Summary The rich and largely untapped Uganda’s tourism potential remains an important avenue for economic growth and welfare improvement of communities living around the national parks. Using qualitative data and global production network (GPN) methodology we examine how growth of tourism could improve the welfare of the communities living around the Murchison Falls National Park. GPN methodology focuses on analysis of various actors in a product value chain locally and internationally, their interactions with other actors and how each of the stakeholder benefits from the products revenue. For the local communities to benefit from tourism, the government should: - i) facilitate development of local people’s culture into tourism products, ii) build communities’ capacity to harness benefits presented by tourism and , iii) engage in an aggressive campaign to market tourism. Communities’ capacity to supply agricultural produce to hotels should also be enhanced. contribution of tourism to gross domestic product (GDP) and employment in 2011 and the positive trend forecast of its performance in 2021. Table 1: Estimates and forecast of tourism’s contribution to the Ugandan economy, 2011 and 2021 Direct contribution to GDP Significance of Tourism to Uganda Tourism has been identified as one of the eight primary productive sectors that will facilitate the transformation of Uganda from a predominately subsistence society to a modern and prosperous economy in the next 30 years1. Prioritization of tourism as a major economic driver stems from the fact that the country holds potential for its development and the sector’s own capacity to spur economic growth2. Table 1 show the Total contribution to GDP Direct contribution to employment Total contribution to employment Visitors export 2011 2021 US$ % of US$ % of million total million total 682 3.2 1,198 3.1 1,628 181 7.6 2.7 2,887 250 7.4 2.6 447 6.6 625 6.4 743 14.6 1,282 13.3 Source : World Travel & Tourism Council , 20113 Tourism is important for developing countries as it is a source of employment; potential linkage with other sectors; provides opportunities for off-farm diversification in the rural areas; a foreign exchange Opportunities for improving communities’ welfare through growth of tourism in Uganda: The Case of Murchison Falls National Park. 1

EPRC POLICY BRIEF NO. 42, JANUARY 2014 earner; generates demand for assets (e.g. natural resources and culture); creates initial demand for goods and services, delivers consumers to the product rather than the other way around, is associated with infrastructural development in remote places; and offers relatively rapidly growing market opportunities in economic development4. In this study we apply global production network (GPN) methodology5 to examine the effect of production network arrangements and how tourism companies linkages impact (i) economic upgrading (increase in the value added of production) for firms and (ii) the welfare improvement (social-upgrading) of workers and local communities in the Murchison Falls National Park (MFNP). Local communities’ welfare is considered to mean opportunities for employment and/or business prospects for their products (agricultural produce, handcrafts etc.). Workers welfare included issues such as security of employment, better working conditions and salaries. Consultative meetings were held with management and workers of eight accommodation facilities that serve tourists around MFNP. Focus group discussions were held with local communities, each at three villages neigbouring MFNP. In 2012, MFNP received the highest number of tourists (60,803) with a large number of them (25,000) having travelled from beyond the EAC region to tour the park (Figure 1). Figure 1: Visitors to Uganda’s National Parks in 2012 Source:-Uganda Tourism Board, 2013 database Tourism global production network and distribution channels for MFNP, Actors of MFNP tourism GNP include the international air carriers, national tour operators and local accommodation and excursion facilities (Figure 2). Excursion facilities attracting tourists include game drives, sport fishing, boat trips and chimpanzee viewing. Most tourists destined for MFNP travel in coordinated guided tour trips, delivered through small elite group of tourism firms. The firms coordinate all of the travel and some even execute the accommodation services. Figure 2 MFNP Tourism global production networks and distribution channels Source Christain and Mwaura 20136 2 Opportunities for improving communities’ welfare through growth of tourism in Uganda: The Case of Murchison Falls National Park.

EPRC POLICY BRIEF NO. 42, JANUARY 2014 Hotels facilities improvements at MFNP Accommodation facilities serving tourists include lodges, budget camps and transit hotels. Four of the accommodation facilities (Paraa, Chobe, Nile Safari and Red Chilli) upgraded their functions to providing travel and destination logistics to tourists within Uganda. While companies managing Sambiya River Lodge and Budongo Eco Lodge were initially involved in providing travel and destination logistic before they upgraded their function to include hotels. homestay tourism) that could add-value to the MFNP. A total of 473 workers were reported to be working for the hotels sampled, with 26 percent being women. Terms of engagement for most employees were favourable (permanent) see Figure 3. However, the wage rates especially for the low-middle skilled positions were low ranging from UGX 60,000 (US$24) to UGX400,000 (US$161) per month. Most hotels, except for those in Masindi, provided housing accommodation on-site, food while working, gave paid leave, and paid medical bills, although at low levels. Figure 3: Category of worker designations among sampled hotels at MFNP Investments in improving the hotels facilities and increasing the beds capacities were ongoing. Three main factors supporting improvement of the accommodation facilities include: (i) a concession granted by the Uganda Wildlife Authority (UWA); (ii) financial capital and prior business experience; and (iii) distribution access to national and foreign tour operators. All facilities operating within the MFNP are concessions granted by the UWA who are mandated by law to manage all the wildlife estates in the country. Welfare improvement for the local communities and workers The presence of the MFNP provides opportunities for the locals to improve their welfare through employment and supply of agricultural produce; handcrafts; and other services including cultural products like dances to the tourism sector. Other tourism based opportunities available for the locals to harness include establishing of accommodation facilities (e.g. hotels, bandas), performing some role (e.g. tour guiding) and developing tourism products (e.g. cultural and food carnivals, and Source: Author calculations 2014 Local communities are beneficiaries only of resources and revenue sharing initiatives that are offered by the park. Under resource sharing, locals are allowed to undertake bee farming within the park. Funds collected through gate entry fees are shared between UWA and the local communities with each receiving 80 and 20 percent respectively. Through the revenue sharing initiatives, development projects including schools, dispensaries and boreholes have been established. The study was unable to establish the number of projects undertaken under the revenue sharing initiatives; and the specific amount allocated to projects, the amount available for sharing for parks for 5 years is shown in Figure 4. The Remaining Challenges The local communities have been unable to harness the benefits of the presence of MFNP and join its network of service providers. Moreover no targeted efforts have been muscled towards the enhancement of the local communities’ capacity to harness the Opportunities for improving communities’ welfare through growth of tourism in Uganda: The Case of Murchison Falls National Park. 3

EPRC POLICY BRIEF NO. 42, JANUARY 2014 Recent Policy Briefs Figure 4: Revenue sharing among communities around National Park “Options for Improving Girls’ Access to Secondary Education in Uganda” Mildred Barungi, Ibrahim Kasirye, and Gemma Ahaibwe Issue No. 41 January 2014 “Maximizing Benefits from Oil Extraction in Uganda.” Joseph Mawejje and Lawrence Bategeka No. 40 December 2013 “Community expectations and environmental aspects in Uganda’s oil and gas sector.” Joseph Mawejje and Lawrence Bategeka No. 39 December 2013 About the Authors Francis Mwaura is a Research Fellow at the Economic Policy Research Centre, Kampala, Uganda Michelle Christian works with the Department of Sociology, Duke University, USA. Source: Ministry of Tourism, Wildlife and Heritage, 20122 opportunities availed by the park from government or other development agencies. Local communities reported absence of agricultural produce marketing opportunities in the hotels serving tourists. Hotels’ management on their part acknowledged procuring the foodstuff in Kampala and Masindi as they regularly require large consignments of quality products which the locals are unable to offer. Employment opportunities for the communities living adjacent to the hotels was observed to be very low, with only two people working in the hospitality facilities among three villages where 82 participated in the focus group discussion. Endnotes The views expressed in this publication are those of the authors and do not necessarily represent the views of the Economic Policy Research Centre (EPRC) or its management. Copyright © 2014 Economic Policy Research Centre 4 1 Government of Uganda (2010) National Development Plan 2010/112014/15. Kampala: Government of Uganda. 2 Ministry of Tourism, Wildlife and Heritage (MTWH) (2012). Ministerial Policy Statement FY 2011/2012. Kampala: MTWA. 3 World Travel and Tourism Council (WTTC), (2011) Travel and Tourism Economic Impact: Uganda. WTTC www.wttc.org 4 Mwaura, F. M. and Ssekitoleko, S. (2012). ‘Review of Uganda’s tourism The Economic Policy Research Centre (EPRC) is an autonomous not-for-profit organization established in 1993 with a mission to foster sustainable growth and development in Uganda through advancement of research –based knowledge and policy analysis. Learn more at: www. eprc.or.ug TWITTER: @EPRC_official www.facebook.com/EPRCUganda eprcuganda.blogspot.com Conclusion and policy recommendations Presence of the MFNP has provided an opportunity for development of the tourism infrastructure and services which should consequently provide local communities with employment opportunities and a market for their agricultural and tourism products. Local communities lack skills and ability to harness tourism benefits through provision of services and goods hence unable to capture the gains of MFNP. Government and other development agencies should build capacity for local community to participate in MFPN tourism network. Intervention include providing skills that would empower locals engage in offering simple tourism services e.g. tour guiding, food, music, handcrafts and other tradition and archaeological products. Government should pursue development of the homestay tourism. Local community skills and capacity to supply agricultural produce should be enhanced. Agriculture enhancement is through provision of irrigation facilities and formation of marketing groups among farmers. There is a need for the government to engage in aggressive marketing of MFNP as a tourism attraction to boost returns from the existing and proposed tourism products. sector for economic and social upgrading’. EPRC Research Series No. 91. Kampala 5 Rossi, A. (2013) Does economic upgrading lead to social upgrading in global production networks: evidence from Morocco. World Development 46:223-233 6 Christian, M. and Mwaura, F. (2013) Economic and social upgrading in tourism global production networks: findings from Uganda. Capturing the Gains Network Working Paper No. 19 February 2013. Address: Economic Policy Research Centre Plot 51, Pool Road, Makerere University Campus P.O. Box 7841, Kampala, Uganda Tel: +256-414-541023/4 Fax: +256-414-541022 Email: eprc@eprc.or.ug Opportunities for improving communities’ welfare through growth of tourism in Uganda: The Case of Murchison Falls National Park.

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