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MIGRANT ENTREPRENEURS OR BUSINESS TOURISTS? Christian M. Rogerson School of Tourism and Hospitality, University of Johannesburg.

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Presentation on theme: "MIGRANT ENTREPRENEURS OR BUSINESS TOURISTS? Christian M. Rogerson School of Tourism and Hospitality, University of Johannesburg."— Presentation transcript:

1 MIGRANT ENTREPRENEURS OR BUSINESS TOURISTS? Christian M. Rogerson School of Tourism and Hospitality, University of Johannesburg

2 AIMS Aims are threefold First, is to begin a conversation about the nexus of writings and research around migrant entrepreneurs and business tourists in sub-Saharan Africa. Second, is to illustrate from research on Johannesburg and more especially from Maseru on the nature of these migrant entrepreneurs as business tourists. Three, is to draw attention to the disconnect in current policy space in South Africa which is increasingly negative towards migrant entrepreneurs and of policy towards business tourism.

3 ORGANIZATION Four uneven sections 1. Rethinking business tourism in the global South and especially Africa. 2. Conceptualising migrant entrepreneurs and linkages to business travel. 3. Empirical material from Maseru and Johannesburg. 4. Conclusion - reflect on current policy space towards migrant entrepreneurs

4 BUSINESS TOURISM Business tourism is an important segment of the international tourism economy. Davidson (1994) defines business tourism as concerned “with people travelling for purposes which are related to their work” and considers that “it represents one of the oldest forms of tourism”. Northern scholarship on business tourism centres on travel for work purposes which is viewed as including the categories of general business travel, meetings, exhibitions and incentive travel (MICE tourism). These practices of business tourism are considered a vital and expanding element of tourism in Western economies with many countries and cities competing aggressively to attract MICE tourism through providing convention and exhibition facilities as well encouraging a network of modern accommodation facilities which is geared to the needs of the business travellers. The sector is defined conventionally as including independent business trips and travelling for purposes of meeting, incentives, conferences and exhibitions – MICE tourism.

5 INTERNATIONAL SCHOLARSHIP ON BUSINESS TOURISM Despite the fact that over the past quarter-century strong growth was recorded in flows of business tourism, both domestically and internationally, such that it accounts for one-quarter of all tourism in some destinations, business tourism is under-represented in tourism scholarship (Celuch and Davidson 2009). Some growth is evident in past decade with notable international works on several themes Conference and exhibitions (Law 2000; Weber and Chon 2002; Weber and Ladkin) (2003), marketing of destinations for MICE tourism (Davidson and Rogers 2006) and venue selection and service quality issues (Ladkin 2006). Important contributions to advance agendas in business tourism from organisations such as ATLAS which inaugurated a Business Tourism Special Interest Group in 2004 (Celuch and Davidson 2009).

6 INTERNATIONAL SCHOLARSHIP ON BUSINESS TOURISM (2) Overall, Ladkin (2006) stresses the dynamic nature of international business tourism and of business tourism research highlighting issues of increased demand, changes in the business environment with new technologies, increased competition between locations, service quality issues and increasing relevance of considerations of safety and security of business travel in the context of international terrorism. In the developing world tourism scholarship on business tourism is minimal with most growth on rise of China as a MICE destination. Most neglected is business tourism in Africa.

7 BUSINESS TOURISM IN AFRICA The World Bank (2012: 20) observes that business tourism represents 25 per cent of international arrivals in sub-Saharan Africa. In addition, domestic business tourism – little documented – is growing in the context of Africa’s resurgent economies. Coles and Mitchell (2009: 3) argue that “Africa is the only continent where the number of business tourists consistently exceeds leisure tourists so business tourism is important because it is a large share of tourism activity”. In many parts of the continent business tourism is the leading element in the tourism economy. In particular throughout much of West Africa and Central Africa the majority of tourism revenues are from business tourism

8 TWO CIRCUITS OF AFRICAN BUSINESS TOURISM In undertanding business tourism in the global South it can be argued that there are two distinct segments or circuits of business tourism in contemporary Africa which are defined in terms of formal and informal economies.

9 FORMAL CIRCUIT OF AFRICAN BUSINESS TOURISM First, is a formal economy/circuit of business tourism which is organised around supply/demand for venues such as convention centres and upmarket business hotels. This formal economy of business tourism has international and domestic manifestations and is driven by factors that influence business tourism development in the global North. This formal circuit of business tourism is represented by building of convention centres, conference facilities and a network of hotels to cater for the formal African business tourism traveller – both domestic and international. It is characterised by inter-locality competition for conferences as countries and cities set up associations to bid for MICE tourism. Drivers of this circuit are little different from Northern business tourism.

10 TWO CIRCUITS OF AFRICAN BUSINESS TOURISM: INFORMAL CIRCUIT Beyond formal business tourism there is a second circuit. This is an informal economy or circuit of low income business tourism which is much less documented. Timothy and Teye (1995) work is the exception. Importantly, this second circuit is taking new forms to that of conventional Northern business tourism. Key element of it is international cross border trading which occurs in several parts of sub-Saharan Africa

11 TWO CIRCUITS OF AFRICAN BUSINESS TOURISM: INFORMAL CIRCUIT (2) Scale of this trading within Africa is considerable and importantly it is inherently pro- poor. Informal business tourism is a domestic as well as a phenomenon of international tourism. The scale of domestic business tourism in sub-Saharan Africa is very significant in terms of total expenditure, and more so in terms of pro-poor impact as compared to the impacts of international business tourism

12 MIGRANT ENTREPRENEURSHIP Distinctions can be drawn between at least three major categories 1. Transnational Entrepreneurs 2. International Migrant Entrepreneurs 3. Domestic Migrant Entrepreneurs All three of these categories of contribute in different ways to business mobilities in sub-Saharan Africa

13 TRANSNATIONAL ENTREPRENEURS Characterised by four features. * They stay/reside in the host country. * They carry out business in at least two regions/countries and their business success depends on their contacts and associates in another country, usually the country of origin. * They typically belong to communities characterized by strong cultural relations and corresponding institutions (religion) which contributes to high level of trust and facilitate exchange of information. * Finally, with a presence in two or more locations these entrepreneurs can compare constantly different locations in terms of their suitably for business purposes.

14 TRANSNATIONAL ENTREPRENEURS This group of transnational entrepreneurs would be DRIVERS of (mainly) international business mobilities But they would not be classed as business tourists per se The concept of transnational entrepreneur has linkages therefore with business scholarship on “ethnic” or “ïmmigrant entrepreneurs”

15 BUSINESS TOURISTS AND MIGRANT ENTREPRENEURS If we ask the question who are Africa’s business tourists, then the answer is that a large share is accounted for by the groups of International Migrant Entrepreneurs Domestic Migrant Entrepreneurs These groups are distinguished from transnational migrant entrepreneurs by the fact that they reside in one country or region and carry out their business in another country or region.

16 BUSINESS TOURISTS AND MIGRANT ENTREPRENEURS They differ from transnational entrepreneurs most critically by the fact that they circulate between countries or between urban and rural localities such that their mobilities and different to those of transnational entrepreneurs. These forms of migrant entrepreneur can be coincident with formal or informal sector forms of business tourism. The evidence from Southern Africa is that the largest share of this migrant entrepreneurship is of informal sector variant

17 INTERNATIONAL MIGRANT ENTREPRENEURS The activities of international migrant entrepreneurs as business tourists are well-known and recognised South Africa is a major hub for regional tourists engaged in cross border trading This contains elements of both formal and informal sector business tourism. Johannesburg would be Africa’s capital for such forms of migrant entrepreneurship

18 DOMESTIC MIGRANT ENTREPRENEURS Much less well known and documented are the activities of domestic migrant entrepreneurs which can be again formal or informal sector. Domestic tourism is a growing phenomenenon in the context of Africa’s resurgent economies, especially rise of a middle class. In terms of informal sector domestic business tourism, much less research is available as compared to informal regional cross-border business traders in Africa. Coles and Mitchell (2009: 34) explain that “the domestic business tourism sector is a particular ‘blind spot’ in African tourism scholarship.

19 DOMESTIC MIGRANT ENTREPRENEURS Arguably, much domestic tourism taking place in the global South is, in reality, business tourism (Mitchell and Ashley 2010). A “trader from a peripheral town who comes to the capital city to buy goods to take home to sell is a business tourist” (Mitchell and Ashley, 2010: 8).

20 THE CASE OF LESOTHO Lesotho’s capital city, Maseru, has a small formal business tourism sector which is centred on major hotels in the city and mostly linked to servicing South African business travellers and international aid/development organisations. Beyond formal sector business tourism, Maseru is a vibrant hub for a low income informal variant of business tourism. Arguably, the nature and activities of informal business tourists in Lesotho challenges Northern or Western conception of business tourism. 50 interviews were undertaken with informal business travellers at transport termini and entry points into Maseru.

21 DOMESTIC BUSINESS TOURISM - LESOTHO Findings from recent work on Maseru illustrate the scale, characteristics and impacts of informal domestic business tourism Survey revealed that informal sector business tourists are small-scale migrant entrepreneurs travel who regularly between Maseru and other parts of the country for business purposes, albeit in different cycles. The demographic characteristics of these traders reveals a picture that informal sector domestic tourists as a group are primarily male and mainly concentrated in the working age cohort of 26-49 years (68 percent of the sample). 56 percent of travellers are visiting Maseru at least once a month and 80 percent once every three months. Importantly, the majority of these business tourists have limited or no formal education and without necessary qualifications to engage in formal work particularly in the urban environment - 60 percent of these business travellers have no formal education.

22 KEY FINDINGS Spatial differences exist in terms of purpose of business The nature of business undertaken by these invisible domestic tourists shows that the purpose of informal sector business tourists is radically different to that of the formal sector business traveller. Overall, five distinct clusters of business tourists can be discerned. First, are groups of farmers or herders who are bringing livestock (sheep and cattle) into Maseru for sale. For these business tourists the sale of their livestock is their main source of income. In addition to livestock selling the herders take the opportunity in Maseru to purchase veterinary supplies, animal feed and other necessary agricultural supplies, particularly of fertilizers and pesticides.

23 KEY FINDINGS A second group of domestic business tourists are the makers and sellers of traditional arts and crafts, including of woven distinctive Basotho hats, a popular souvenir for Lesotho’s long haul international tourists. These arts and craft producers bring in their products (woven hats and other traditional crafts) from rural districts for sale at informal markets in Maseru where they put up stalls to display their products and continue craft weaving whilst waiting for clients. The markets and sale of goods of this group of informal business tourists are linked critically therefore to the growth of the formal tourism economy in Lesotho

24 KEY FINDINGS Three, are the makers and sellers of traditional weapons which are sold only through informal markets in Maseru. These business tourists travel to Maseru in order to sell traditional weapons both to local residents and international tourists. The commercialisation of tradition is also represented by a fourth group of informal business tourists, namely of traditional doctors who are in Maseru to sell traditional medicines. In interviews it was disclosed that this type of business was in decline and not as profitable as formerly.

25 KEY FINDINGS The final cluster of informal business tourists are women- dominated shopper/traders. These business tourists are a domestic variant of the international cross-border shopper traders which are common across Southern Africa. The groups of domestic shoppers coming into Maseru mainly are travelling on a regular basis to buy fashionable clothes and other items that are not available in the small towns and rural villages of Lesotho.

26 KEY FINDINGS The majority of these purchases are made in Maseru from the group of Chinese-owned stores in the city. The symbiosis between shopper entrepreneurs and Chinese traders was made clear by the interviewee responses: “We buy clothes and other goods like kitchenware and blankets from the Chinese supermarkets so that we can go and sell them back home. We buy them at a reasonable price so we are able to make profits” (Shopper). “Although some people don’t like the Chinese (they call them foreigners who are invading Lesotho and killing local supermarkets) I love them because now I have a business. I do not make a lot of money but at least I am able to put food on the table and also take my kids to school. Chinese shops are very cheap and my clients love their products” (Shopper).

27 INFORMAL CIRCUIT: PRO-POOR IMPACTS Evidence from Maseru, Lesotho shows inherent pro-poor nature of informal domestic tourism It is pro-poor in terms of its participants It is pro-poor in terms of local impacts with expenditure of informal sector tourist occurring in informal accommodation, local restaurant/shebeens.

28 CONCLUSION This paper draws attention to the nexus between scholarship on migrant entrepreneurship on the one hand and business tourism in the developing world (particularly sub-Saharan Africa) on the other hand. It was argued that key differences exist in the nature of business tourism in developing Africa as compared to the global North which forces a rethinking of the Northern conceptions of business tourism. Africa has more business than leisure tourists and migrant entrepreneurs – domestic and international – are business tourists. In policy terms business tourism is an important focus for promotion both by national department of tourism and local tourism promotion – in South Africa the welcome mat is out for business tourists.

29 Conclusion By contrast the policy space relating to “migrant entrepreneurs” is increasingly hostile in South Africa. Attacks on foreign traders and the DTI Informal Sector Business strategy suggest potentially highly negative interventions to be enacted at national and local state to restrict migrant entrepreneurs. A policy contradiction/disconnect exists between tourism policies and DTI Given the current policy environment in South Africa it might be strategically useful to open further the policy conversation from the perspective of these entrepreneurs as business tourists.


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