1. MAINSTREAMING TOURISM FOR RURAL POVERTY ALLEVIATION:
A CASE IN PENARIK, TERENGGANU, MALAYSIA
World Ecotourism Conference
8 – 11 July 2010
Kuala Lumpur Convention Centre
By:
Norhazliza Abd Halim
Phd candidate, University of Tasmania, Australia
Lecturer, Universiti Teknologi Malaysia

2. BACKGROUND
“ Tourism can be used way of addressing poverty, not as a panacea but as a useful tool of development and poverty alleviation especially in developing countries ”
(Christie, 2002; Jamieson, Goodwin, Edmunds, 2004)
Tourism’s potential for being pro-poor lies in four main areas:
Tourism is a diverse industry - increases the scope for wide participation
The customer comes to the product - provides considerable opportunities for linkages
Tourism is highly dependent upon natural capital - assets of the poor
Tourism can be more labour intensive - higher proportion of tourism benefits.
(Ashley, Roe and Goodwin, 2001)

3. KEY CONCEPTS Who is most affected by Rural Poverty?
Those who live in remote areas, have higher child/adult ratios, work in insecure and low-income jobs and belong to ethnic minorities.
Most rural poor are smallholder farmers who live in low-fertility regions and are dependent on uncertain rainfall. Their survival depends on subsistence crops, and sometimes on livestock.
(IFAD, 2001)
Approach to link tourism with poverty alleviation
Pro Poor Tourism: lead by Overseas Development Institute in late 1990s
“tourism that results in increased net benefits for the poor”
(Ashley, Roe, & Goodwin, 2001)
Sustainable Tourism for Eliminating Poverty (ST~EP): lead by UNWTO, supported by UNCTAD in 2002
“…will help to promote socially, economically and ecologically sustainable tourism, aimed at alleviating poverty and bringing jobs to the people…”
(UNWTO, 2002)

4. PPT / ST~EP 1 2 3 1999, Pro-poor tourism was put on the agenda …
It is not a new kind of tourism product but an approach to tourism which focuses on ‘tilting’ the cake at the micro, meso and macro levels towards the poor rather than expanding the cake.
(Sofield, De Lacy, Lipman & Daugherty, 2004)
A different way of doing business, not just philanthropy.
(Ashley, Nyathi, & Haysom, 2005)
Tourism could be pro poor
And it could be made more
pro poor
PPT is an approach that can
be applied to any tourism. It
is not a ‘niche` 1 2 3
(Source: Ashley & Harrison, 2006)
How tourism can alleviate the rural poverty?
(Especially in Malaysia context)

5. The Fact…
As many as 75% of the world’s poor live in rural areas (IFAD, 2001:15)
Poverty rates remain the highest in the predominantly rural areas of Malaysia % - based on Poverty Line Income (PLI) of RM657 per month (Government of Malaysia, 2006)
Top tourism destinations, particularly in developing countries, include national parks, wilderness areas, mountains, lakes, and cultural sites, most of which are generally rural.
As the 2nd largest economic contributor to the Malaysian economy, tourism has become the priority tool to energize the rural economy.
Pro-poor tourism is still a relatively new phenomenon in Malaysia, although certain elements of pro-poor tourism may be observed in the tourism developments.

6. The Challenge…
Pro-poor tourism remains predominantly at the micro level – current interventions cannot deliver impacts at a significant scale – tourism for poverty alleviation should be expanded and applicable in mainstream (mass) tourism.
The biggest challenge is to ‘mainstream’ PPT so that it is a business approach across the industry, rather than a niche market.
How to mainstreaming poverty alleviation through Tourism?
(In the context of Rural Poverty)

7. Why Mainstreaming ?…
PPT will contribute little to poverty alleviation unless it is mainstreamed (Roe, 2006)
Mainstreaming: ensure that sustainable tourism development is included in wider poverty alleviation programmes.
Include poverty alleviation measures within overall strategies for the sustainable development of tourism.
PPT should be on a big scale rather than a piecemeal micro enterprise approach like the traditional CBT, where all forms of potential work should be considered in assessing value chain benefits to the poor.

8. Why VCA ?… Value Chain Approach to Pro Poor Tourism
To identify:
Where the poor participate in the tourism economy and;
What opportunities exist for increasing the participation and
earnings of the poor, in different parts of the tourism chain
Value Chain Approach to Pro Poor Tourism
- VCA focuses on the inter-linkages between elements of the value chain,
and usually addresses both economic flows and governance issues
between levels.
Tourism and the local economy – building linkages.
Building linkages with the local economy is also known as PPT ( which is about doing business differently as well as communities can benefiting through tourism (Sofield, 2008).
Industries related to tourism can grow, become more competitive and contribute to a more dynamic economy.

9. 3 Pathways by which Tourism affects different poor people
Direct income from employment, Small and informal sector, non-labour income and non-economic livelihood effects
Indirect income from supply chains, from tourism staff spending their wages and other induced effects
Dynamic effects on the local and national economy
(i.e. human resource development, improved infrastructure ‘spill over’,
and tax)
(Source: Mann and Mitchell, 2006)
Area covered by VCA

10. Increased income of existing poor participants in tourism
A change in the operation of the value chain can benefit poor people in 3 different ways:
Increased access to the tourism value chain to more poor people, thus creating new entrants
Increased income of existing poor participants in tourism
Increased non-financial benefits to poor households
(Source: After Ashley, Goodwin, McNab, Chaves, Scott, 2006)

11. RESEARCH GOAL
Aimed to clarify how fostering linkages between private sector in tourism and other community activities as pro-poor tourism strategy through tourism value chain analysis and recommend directions to effectively apply tourism as a tool for rural poverty alleviation with the focus on a high-end resort and its linkages with the local community in several traditional fishing villages in Penarik, Terengganu, Malaysia.

12. RESEARCH OBJECTIVES
Understand the nature of the existing level of knowledge on tourism for poverty alleviation in rural area of Malaysia.
Identify the existing linkages (potentials and constraints) between tourism and local economic in Penarik, Terengganu.
Analyse the involvement of key stakeholder (roles and interactions) related factors enabling and constraining (potentials and constraints) in application of tourism as a tool for rural poverty alleviation in Penarik, Terengganu.

13. (Roles and Contribution)
DATA COLLECTION
TERRAPURI HERITAGE
VILLAGE
(The high-end resort)
PENARIK COMMUNITIES
(Local Linkages)
KEY STAKEHOLDERS
(Roles and Contribution)
Local craft, fishermen, farmers,
artisans, restaurants, retail
outlets, hawkers, vendors and
traders, local entrepreneurs,
local culture and heritage
product, tourism SMMEs
Variables:
Jobs
Direct jobs
Indirect jobs
Income
Basic salaries scheme
Add-ons (i.e: training)
Working conditions
Career options
Housekeeping
Dining room and Kitchen
Front Desk
Supervision
Security
Purchase of goods
and services
Furniture, decorative objects
housekeeping materials
Food and drinks
Guides
Transportation
Socio-economic condition
Occupations; Education level
Incidence of poverty
Financial Resources
Income; Type of earnings
Subsidiary / Funding from
Institutional
Tourism Acceptance and
expectation to gain from tourism
Linkages with tourism
Type of products
Earnings
Benefits
Ministry of Tourism, Tourism
Promotion Division, ECER (tourism)
Tourism Action Board (State),
State Economic Planning Unit,
Community leader, etc.
Roles
Government agencies
NGOs
Universities
Tourism Industry
Policies and Guidelines
Partnership
Capacity building
Funding
Marketing and promotion
Networking
Integration approach

14. Case Study… MALAYSIA PENARIK TERENGGANU
TERENGGANU located at the East Coast of Peninsular MALAYSIA
PENARIK – located at the northern of TERENGGANU

15. MALAYSIA at a glance…
The number of international tourists to Malaysia in 2008 is 22.0 million, compare to 20.9 million in generating a revenue of RM 49 billion (Tourism Malaysia, 2009)
Poverty in Malaysia – 3.6% in 2007 and 7.1% in rural area – poverty alleviation strategies include: macro economic strategies, capacity building, & social equity.

16. TERENGGANUat a glimpse…
Rich and well-known with cultural, natural and heritage tourism products.
Became ‘tourism hub’ for east coast Malaysia - ECER Master Plan identified tourism development as one of economic drivers, which PPT is central to the role of tourism in revitalising the rural economy and poverty alleviation.
Poverty in Terengganu – 10.5% in 2005 (2nd highest in peninsular Malaysia) – mostly in rural area.

17. PENARIK… villages by the sea
Has an area of 8,499.4 hectare – traditional fishing villages.
Highly sensitive coastline and wetland area encompasses Setiu lagoon – preserves various aquaculture wildlife (turtle, river terrapin, fireflies) and mangrove.

18. PENARIK is poor…
Lack of employment and other economic opportunities is a serious problem

19. PENARIK is rich…
It is blessed with tourist attractions – agricultural, natural, heritage, and cultural resources that are largely untapped or neglected

20. Major economic activities
Profile of the Poor …
Total population is 3,423; 97% Malay, 0.26% Chinese, and 0.02% India.
No. of poor: 350 (under RM657/ month)
Major economic activities
85% are fishermen
Others: farmers, and hawkers
Type of earning
More than 75% are based on daily earnings
Others are based on salary
Income
42% earn just above poverty line (RM657 – RM1,000)
10% below poverty line (under RM657)
48% earn much above the poverty line (above RM1,000)
Education level
65% have formal school level (mostly until secondary school)

21. Pro Poor Tourism Product…
Homestay
Experiencing the way of
village life
Ecotourism
Traditional performing art
- Makyong / Menora
Local SMEs products
- cracker, salted fish, songket etc.

22. Terrapuri Heritage Village…
Employ 90% (now 21 staff)
from the local communities
Since the building of the resort.
Tourists (arrange by the resort)
were taken to experience the way of
local life – help to boost the CBT product
A boutique resort - embraces ‘Terengganu Royal’ spirit - catering high end market segments
More than 90% of resort’s supplies
are purchase from the local farmers and
fishermen – actively support local products

23. VCA of Terrapuri Heritage Village…
The main chain will be assessed – Terrapuri Heritage Village (accomodation)
Another 4 sub-chain will be look through, which link with the resort – food and beverage, agriculture, excursions
and handicrafts
‘Poor’ defined as unskilled and semi-skilled people
TOURIST
Terrapuri Heritage Village
Staff
Food
Cultural & Handicraft
Restaurant
Stalls
Craft Shop
Entertainment & Performance
SUPPLY CHAIN
Excursion & Transport
Local Guide
Local Transport
Agricultural
Fish & Meat
Manufactured Goods

24. Findings from Pilot Study…
Most of the resort’s consumers are dominate by domestic tourist and high-end
mainstream holiday package tourists
Up to half of earnings of the poor come from food supply chain
Most of the local products from the farmers and fishermen supply to the resort –
local linkages exist
The resort as an example of mainstreaming provides ‘x’ benefits versus
comparison with home-stay (non-mainstreaming) provides ‘y’ benefits – how both
of this can work together.
Researcher identified 5 productive chains as holding competitive opportunities
for the community to link with the resort
Fruit and vegetable agriculture,
Fishing
Cultural activities
Artisan products
Local food

25. Pro Poor Tourism Issues…
Both tourism and development policy makers did not fully understand the role of tourism in rural poverty alleviation – PPT not addressed in most formal development plan.
Lack of infrastructure, of pro-poor value chains and of leadership (at regional and local level), ability to supply tourists with local products are small.
Tourism only been introduced to this research area in late 2003 with the opening of homestay programme (Kg. Rhu10) – a lot of tourism resources yet being neglected or untapped.
Difficulty in getting funding at initial stage, lack of capacity building, training, and credit.

26. CONCLUSION
Contribution to tourism - Pro-poor tourism has the potential of benefiting the poor, decreasing inequality and mainstream the linkage from a narrow focus on community to all kind of things where communities could benefit through tourism – Need all possible poverty alleviation tools.
Relevant to the Malaysian case – Very recently, tourism started to adopt tourism as a tool for reducing poverty – still need a thorough research as a model.
Very recently the Malaysian Government has moved to adopt PPT in part for CBET in its eastern provinces of Sabah and Sarawak, and has joined with other BIMP countries to implement a five year strategy for that purpose.

27. THANK YOU