Comments

An interesting blog. This could end up very very complex which most countries would be unable to sustain without extensive consultancy support - which is dangerous

Joseph, By private developers, I mean both domestic and foreign. Many of the weak environment concerns rule against both. However, FDI can be better placed as it may arrive with capital, skilled labour as one of the fixed costs, a proven investment plan, current technology and market access. In addition, governments too often try to counter their bad investment environment with special concessions to attract FDI. On the other hand, domestic investors often have to face the extra challenge of acceptance in the close-knit societies of the PICs. All in all the real challenge in tourism, as other PIC economic development is one of market supply, rather than market demand. These concerns have to be worked through the political economy of the PICs where governments historically expect to directly engage, where state capitalism offers additional political gain and where a more liberal investment climate is politically risky. Short-term donors and associated consultancies consistently compound the problem by ignoring the cross-cutting political economy, institutional and governance constraints and demand quick, “silver bullet”, technical solutions that may impress donor and recipient capitals but ignore common capacity, including institutional capacity constraints. The deficits in institutions and poor governance you refer to, and the overall political economy of both recipient and donor perpetuate the PIC dependence on migration, remittances, aid and bureaucracy (“MIRAB”) and greatly lessen the probability, but the possibility of tourism and other economic development.

Brilliant stuff, Bruce - as usual.

Good points Steve. I know of your work in the area. When you say private developers I assume you refer to foreign investors? Indeed, the risk premium related to investing PICs is much higher than elsewhere and requires addressing. The deficits in institutions and poor governance is indeed a major constraint - in tourism and in development more broadly. There is a gulf between what the right policies and institutions are in theory and what has been able to be deployed in practice - not just in tourism. Is the problem that initiatives are poorly designed and that modes of development that have proven to be unsuccessful and benign are persisting? Or is it always convenient to point the finger at local institutions? Must the donors and multilateral institutions take some responsibility for this? Do the historical legacies have anything to do with this? PICS have competitiveness deficits as compared to SE Asian countries - can this be overcome? Access and air travel costs are comparatively very high but there seems little that can be done about this because of the binding constraints. Nevertheless, tourism is one of the comparative advantages that PICs have but if the expectations are to reach the heights of Bali or Thailand, they are probably unrealistic.

Indeed you raise many valid points - too impractical to offer a detailed discussion here. however, it has to be said that what happens in PICs is characteristic of the situation in other developing countries around the globe. FDI is a big driver of tourism development and consequently economic leakages are inevitable. In the absence of FDI, tourism product development would be stunted and the destination will be adrift from the global tourism supply chain. You are right that in general, Managers tend to be expatriates - there are many reasons for this. Some companies prefer expatriate managers for skills and experience based reasons, others do it because where the majority of employees are drawn from the same communities, having a manager with familial links can create enormous operational challenges. Tourism jobs tend to inherently low skilled and low paid around the globe. In many respects tourism is a reflection of globalisation and as geographer Stephen Britton argues, tourism takes PICs into a situation they have little control over. You are generally right in that the impacts of tourism are rarely of concern to the traveller -hedonism characterises much travel - the responsible tourism movement is trying to change this. Alas, out of mind out of sight - Bali is a case in point. The broader question is if not tourism, what then? Economic diversification for small island countries is immensely challenging. Donors and multilateral organisations are trying to change this but the constraints are so intractable. There is no easy fix and the inequalities and injustices evident in tourism in PICs are commonplace elsewhere. Not that this is a convenient excuse, it is the inescapable reality.

Sure tourism is labour intensive but mostly developers come from richer nation's investors and very little of the money spent remains in the local community. I recently visited Samoa and spoke to other tourists when I realised that so many of the locals are paid a pittance by their own standards. Why allow investors when the money just keeps on leaving the country? Most of the senior employees in the hotels weren't local workers. The local workers got the low paid low skilled jobs and there isn't much of a career path or even a job skills path. It's not that holidays in the Pacific are cheap - it's just the mindset that the impact on the local community and the environment is not a concern to the happy holiday maker. Where is the ethical arguments about investing in the PIC and the benefits to the host country?

I don't understand why anyone is paying attention to the comments of Ms du Plessis-Allan. What qualifications and experience does she have to warrant these responses? She's a commercial radio announcer paid to provoke - is that a position where her views are worthy of respect? By responding you are giving the lady unwarranted status which would delight her ratings-hungry employer. Debate the issue - but by hearing from those with credibility.

The development of tourism in the Pacific island countries is certainly possible but imperfect government policy too often makes it improbable. In the past 35 years, I don't think I've read a single paper on PIC tourism that has been able to make the connection between tourism potential and the realities that private developers face in investing in tourism development in the islands. Please see my blog of February 13, 2012 "Islanders in business? There could be more if the policies and institutions were right" and the now many private sector assessments of the Private Sector Development Initiative: http://www.adbpsdi.org/p/what-is-psdi.html

A useful piece Lisa, and looking forward to the next two. On MEL you might want to take a look at our recent summary of a discussion on a related topic: https://asiafoundation.org/2018/09/12/monitoring-evaluation-and-learning-in-adaptive-programming-expanding-the-state-of-the-art/ or at this blog summary from Arnaldo Pellini: https://arnaldopellini.org/2018/06/21/mle-or-mel-in-adaptive-programming/ or Chris Roche's take: https://oxfamblogs.org/fp2p/simplicity-accountability-and-relationships-three-ways-to-ensure-mel-supports-adaptive-management/ thanks, Sam

Hi Lisa, I agree. Not all programs claiming to be adaptive are using TWP and PEA analysis. Those who are using those tools are doing so at various degrees and levels. My experience shows that those who are using those tools more often are driven by the need to understand the 'local context', and I also believe that those programs are in the front this work in PNG.

Thanks, that is a short and fairly accurate summary.

The GDP measurement challenge continues, and seems to be getting worse. Is there intentional misleading or is it mere ineptitude? Has an update been published?