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2015-08-18 | News

African tourism: the ‘multiplier’ effect

Big spenders: staff employed by the tourism sector in southern African tend to be spent their wages within their communities, keeping cash flowing in their local economy. This is a big boost for local development. Credit: Ana Gram - Shutterstock

For every one person employed by certain high-end tourism lodges in southern Africa, seven people benefit from the downstream flow of that income. Meanwhile, staff employed in these sorts of ventures help grow the local economy by spending their wages at community stores where they do their grocery shopping. Or they drive secondary employment through hiring people for child care or to tend their livestock while they work. Or they’re sending their children to school.

‘This is the multiplier effect of tourism in remote regions of the subcontinent,’ explains Dr Sue Snyman, an EfD research fellow associated with the University of Cape Town’s Environmental Policy Research Unit (EPRU).

Snyman, presenting the findings of her doctoral research at the ATLAS Africa tourism conference in Dar es Salaam in June this year, showed how the immediate benefits of a pay cheque can distribute economic benefits widely in a community where few other employment opportunities exist.

During a survey of 16 different eco-tourism lodges in six countries, Snyman found that staff were earning, on average, US$ 278 dollars per month, from which seven dependents usually benefitted directly. Meanwhile this money was kept in circulation within the local economy.

‘If you were to extrapolate the findings of the staff that I interviewed, to encompass all 683 people employed at the 16 different lodges where I did my interviews, that means that 4 781 people are downstream beneficiaries of those pay cheques.’

‘This has a huge economic impact.’

She also found that for every one tourism bed, 14 people benefitted indirectly from the associated employment, because of the cash remittances which staff sent home.

‘These wages are helping to build human capital in rural areas where there aren’t many other economic opportunities,’ she says. 

However, it’s still important for civil society organisations, the private sector, and government to invest in capacity building within these communities, so that they can become equal and well equipped partners in tourism ventures. This is key, particularly if tourism ventures want to bring local communities into partnership arrangements in running lodges and concessions.

‘If we want people to thrive in business like this, we need to be sure we don't try to get them to run before they can walk. People need to be trained in book keeping, management, and accounting. They need to understand the industry, for instance that if someone spends US$ 400 a night, that that isn’t a clean US$ 400 profit but that expenses need to be covered first.

‘People need to understand the role of marketing and communications. Many development projects in this sector don’t invest enough in this sort of development.’

Snyman also presented the closing keynote address at the ATLAS Africa tourism conference. Read more on the conference here

Dr Sue Snyman works with private tourism operator Wilderness Safaris in various capacities, and recently completed her doctorate through the EPRU. In addition to being an EPRU fellow, she is the vice-chair of the IUCNs Tourism and Protected areas Specialist Group.