South African Geographical Journal, 2016

Vol. 98, No. 1, 154–168, http://dx.doi.org/10.1080/03736245.2014.977813

Towards a comprehensive model of community-based tourism

development
Oliver Mtapuria* and Andrea Giampiccolib
a
Master of Development Programme, University of Limpopo, Edupark, Webster Street, Fauna Park,
Polokwane 0787, South Africa; bHospitality and Tourism Department (Ritson Campus), Durban
University of Technology, P.O. Box 1334, Durban 4000, South Africa

Community-based tourism (CBT) offers both opportunities and challenges in the quest
for holistic community development. The evolution and development of CBT projects
can follow different trajectories. This conceptual paper’s main contribution is the
formulation of a comprehensive model of the development of CBT. The model
suggests that CBT projects can be initiated from within and outside the community by
the private, public and non-governmental sectors or a combination of these using a top-
down or bottom-up approach. It also posits that CBT projects can take a formal or
informal character depending on the conditions leading to their initiation. The paper
highlights the benefits and constraints to the scaling up or down of operations linked to
informality. It supports further research in analyzing the various aspects associated
with the shift from formality to the informality of CBT projects and vice versa and the
relationship with CBT development and holistic community development.
Keywords: community-based tourism; tourism; informal economy; tourism develop-
ment; community

Introduction
Community-based tourism (CBT) is promoted as a strategy to foster community
development in developing countries, with various examples in different parts of the world
(Baktygulov & Raeva, 2010, pp. 2, 3). However, this approach has been subject to
criticism and some scholars have pointed to a mismatch between theories and practical,
positive examples of CBT (Goodwin & Santilli, 2009; Mitchell & Muckosy, 2008;
Scheyvens, 2002, p. 72). Nonetheless, CBT’s potential is acknowledged (Moscardo, 2008,
p. 175) and the literature offers positive examples (López-Guzmán, Sánchez-Cañizares, &
Pavón, 2011, p. 72) with different levels of success in various parts of the world (Asker,
Boronyak, Carrard, & Paddon, 2010; Baktygulov & Raeva, 2010; Kontogeorgopoulos,
Churyen, & Duangsaeng, 2013; Mielke, 2012; Moeurn, Khim, & Sovanny, 2008;
Nyaupane, Morais, & Dowler, 2006, p. 1374). CBT offers both opportunities and
challenges; if not properly facilitated, it can inflict profound damage on communities
instead of serving as a development tool (Khanal & Babar, 2007, p. 7; see also Suansri,
2003, p. 7). Furthermore, Kontogeorgopoulos et al. (2013, p. 2) caution that the
measurement of success is subjective, controversial and ‘depends largely on one’s
perspective and expectations’. It therefore follows that CBT presents multifaceted and
different understandings (Mayaka, Croy, & Mayson, 2012, p. 397). Despite these diverse
understandings, it continues to be promoted around the world, especially in developing

*Corresponding author. Current address: Turfloop Graduate School of Leadership, University of

Limpopo, P.O. Box 759, Fauna Park 0787, South Africa. Email: simbaomtapuri@yahoo.com

q 2014 Society of South African Geographers

2 South African Geographical Journal 155

countries, as a means of both poverty reduction and community development. CBT is also
‘gaining popularity’ in fostering positive environmental and social impacts (Baktygulov &
Raeva, 2010, p. 3). Development agencies have used CBT extensively as a community
development tool especially in areas where other forms of economic development are
limited (Le, Weaver, & Lawton, 2012, p. 362).
Despite the rich body of literature on CBT, concern has been expressed that current CBT
models are ‘overly reliant on Western “experts” and development agencies and that far too
little attention has been paid to local and non-Western perspectives and knowledge’ (Le
et al., 2012, p. 362). Sammy (2008, p. 76; see also Wearing & McDonald, 2002, p. 200) is of
a similar view that current CBT planning approaches, while having changed from being top-
down to participatory, continue to advance Western notions of ‘tourism and tourists’
without appreciating and understanding the community’s perspective. This is true of
tourism development in developing countries, which promotes a type of tourism ‘rooted in a
Western economic rationality’ (Bianchi, 2002, p. 273). Thus, tourism is the preserve of
private companies and government (for protected areas) to whom profits accrue. This
contrasts with Community-Based Ecotourism (CBET), where enterprises are run and
managed by communities who benefit from the profits (Khanal & Babar, 2007, p. 2).1 Thus,
CBT refers to ‘tourism . . . managed and controlled by the community’ (Leksakundilok &
Hirsch, 2008, p. 214) and CBET is preferred as an alternative to mass tourism in countries
such as Lao People’s Democratic Republic and Cambodia (Khanal & Babar, 2007, p. 2).
Recognizing the potential and value of CBT as a tool for holistic community
development, this paper proposes innovative typologies of CBT development which
embrace both the formal and informal tourism sectors, and can be locally or externally
initiated, involving various internal and external entities with a focus on different markets
and developed at various scales. It also complements and enlarges (and partly builds on)
the CBT models proposed by Mtapuri and Giampiccoli (2013). In this context, the paper is
more comprehensive and inclusive of additional, pertinent CBT development factors and
conditions and hence becomes an extension, umbrella and complementing model of that
already proposed by Mtapuri and Giampiccoli (2013) without conflicting with it.

Literature review
Many of the features of CBT can be traced back to alternative development approaches of the
1970s (Giampiccoli & Mtapuri, 2012, p. 33; Karim, Mohammad, & Serafino, 2012).
Canada’s Northwest Territories Government was possibly the first government to advance a
CBT development strategy in its territory (Northwest Territories [NWT], 1983). Since that
time, there has been no common definition of CBT and no common understanding of what it
entails (Kontogeorgopoulos et al., 2013, p. 3). The different understandings of CBT have
facilitated criticism of this type of tourism (Mayaka et al., 2012, p. 398). Thus, various models
for, or associated with, CBT have been developed over time (see Baktygulov & Raeva, 2010;
Forstner, 2004; Giampiccoli & Mtapuri, 2012; Harris, 2009; Häusler & Strasdas, 2003;
Honggang, Sofield, & Jigang, 2009; Mtapuri & Giampiccoli, 2013; Naguran, 1999; Okazaki,
2008; Pinel, 1999; Simpson, 2008; Zapata, Hall, Lindo, & Vanderschaeghe, 2011).
It is difficult to trace a linear evolutionary pattern in the development of CBT models
precisely because the reasoning behind their construction is varied because many issues
still remain contested. For example, Ndlovu and Rogerson (2003, p. 125) consider isssues
of the ownership and management of the CBT ventures as debatable by reflecting on the
ambiguity of whether communities manage or own the ventures, or is it just about job
creation or community particiaption in decision-making. Other models of CBT (see for
156 O. Mtapuri and A. Giampiccoli 3

example Giampiccoli & Mtapuri, 2012; Zapata et al., 2011) elaborate on CBT in relation
to global issues of development, while others (see for example Häusler & Strasdas, 2003)
oscillate towards practical use as usually reflected in CBT manuals. Okazaki’s (2008) CBT
model relates CBT to specific developmental issues such as the ‘ladder of participation’.
Given such a context, this article argues that CBT should not necessarily be seen in a linear
evolutionary pattern but is guided and informed by the aim and purpose of the model and
the specific issues it attempts to address. Nevertheless, if a trend is to be proposed, as a
possible general developmental trajectory of CBT models, it can be said that they have
shifted from a radical, hard and socially oriented perspective where CBT ‘primarily
utilizes marginalised sectors of society to attain social justice and equity’ (Jealous, 1998,
p. 10) to more neoliberal, soft and environmentally oriented approach (see Giampiccoli &
Mtapuri, 2012; Manyara & Jones, 2007, p. 642). This trend, however, as with other issues
related to CBT models, still needs to be interpreted with caution, given the plethora of
CBT models currently present.
Although CBT should be a fully community-embedded endogenous development
process, CBT projects initiated independently by communities are rare, especially in the
initial stages (Fernandes, 2011, p. 1021; Leksakundilok & Hirsch, 2008, p. 214). CBT
usually requires external support (Giampiccoli & Mtapuri, 2012, p. 35) with partners
providing marketing and assistance while not sharing ownership of the venture (Mtapuri &
Giampiccoli, 2013, p. 12). As such, CBT can be locally or externally initiated (the latter
being more likely). While various external entities, including the private sector, NGOs and
government can be the initial facilitators/proposers of a CBT development project
(Mtapuri & Giampiccoli, 2013, p. 5; Scheyvens, 2002, p. 176), the government should
play a central role in CBT development (Mtapuri & Giampiccoli, 2013, p. 5).
The CBT scale of development varies and it also targets different markets. While
‘CBT is generally small scale’ (Asker et al., 2010, p. 2), some scholars propose that it
should be scaled up. In the past, development practitioners advocated both small and ‘full-
blown commercial scale’ CBT (Jealous, 1998, p. 12). More recently, there have been
proposals to scale up CBT to become the mainstream tourism form (see Hamzah &
Khalifah, 2009, p. 2). Others have argued that specific typologies of CBT based on the
Community-Based Enterprise model have the potential to scale up operations (Calanog,
Reyes, & Eugenio, 2012, p. 184; see also Moeurn et al., 2008, p. 18 on the potential for
scaling up or replication of a positive CBT project in Cambodia; Mohamad & Hamzah,
2012). Furthermore, the scaling up of CBT should be done in such a way that these
initiatives bestow greater benefits, especially control of tourism ventures, on
disadvantaged community members. However, CBT ventures started by the poor with
very little capital outlay tend to be linked to informal tourism structures (Giampiccoli &
Mtapuri, 2012, p. 34). This is especially true in the initial stages of CBT development,
particularly where the community is the sole and independent initiator of a CBT project.
CBT markets can also change. Zapata et al. (2011, p. 740) propose that different CBT
approaches (bottom-up and top-down) present different market priorities, with bottom-up
CBT associated with the domestic/local market, while top-down CBT is associated with
the international market. Due to different market contexts, ‘ten years ago, community-
based tourism (CBT) projects in countries like Thailand and Indonesia were
predominantly visited by Western tourists. Nowadays, the majority of visitors to CBT
projects are increasingly urban domestic and regional tourists’ (Ministry of Hotels and
Tourism [MoHT], 2013, p. 10).
The various typologies of CBT ventures include informality. Thus, the main theme of
this paper is the relationship between CBT and the informal sector. This relationship is
4 South African Geographical Journal 157

posited on the basis of two premises: first, CBT links with the informal sector; and second,
the CBT itself, being informal. In addition, the likely partnership could also be formal or
informal, and have different typologies and strands. The literature presents cases that
resonate and are associated with all these issues.
The link between tourism and the informal economy is acknowledged, and practice
reveals that in many countries ‘tourism development is strongly based on the informal
sector’. It is important to note that this does not mean that this link is necessarily a positive
factor in poverty reduction or gender and children’s rights; therefore, the greater
formalisation of the sector should be encouraged (International Labour Organization
[ILO], 2011, pp. 8, 19, 22). Fundamental issues in the informal tourism sector include
deficiencies and disadvantageous employment and working conditions (ILO, 2011, p. 3).
Comprehensively addressing these issues should be a basic pre-condition for tourism
development. However, ‘To date, few policy makers have explicitly addressed the
opportunities and constraints faced by informal producers/workers in the context of global
integration and competition’ (ILO, 2011, p. 8). While the disadvantages of the informal
sector should always be recognised and properly addressed, the ILO (2011, p. 8) notes that
this sector provides jobs to workers with little or no training as well as temporary job
opportunities for students who may not wish to immediately enter the labour market.
It thus offers opportunities to people with various ‘social and capability disadvantages’
which other sectors do not provide.
The informal sector is often associated with CBT. For instance, the Ministry of
Environment and Tourism of Namibia’s (Ministry of Environment and Tourism, 1995)
CBT policy associates it with the informal sector and proposes a CBT programme that
facilitates constant dialogue with the informal sector, investors and government as part of
national tourism policy (legislation) development, including the appointment of a
Community Tourism Officer.
The CBT link to the informal economy is clearly expounded and supported by Zapata
et al. (2011, p. 741). Their case study of a CBT project initiated through a bottom-up
approach found that CBT with a close connection to the local informal economy benefits
the poorer strata of the population. In this context, ‘instead of being the multinationals
inducing the poor to consumption, it was the poor people working in the informal economy
who made a living by providing services and products to their neighbours’ (Zapata et al.,
2011, p. 741). In the same vein, Zapata et al. (2011, p. 741) posit that, irrespective whether
the approach is top-down or bottom-up, CBT is ‘an excellent catalyst to support rural
informal economies’.
The initiation and types of CPT are informal in many economies. For example, Suansri
(2003, p. 63; see also Asker et al., 2010, p. 19) observes that, in order to capacitate
informal organizations to manage CBT, once a decision has been made on the type of
tourism venture, a management structure should be adopted to guide both the community
and tourists on whether it will be a formal or informal organisation. Building on Peredo
and Chrisman’s (2006) notion of the community-based enterprise (CBE), Mtapuri and
Giampiccoli’s (2013, p. 3) study on CBT models proposes that
whether legal (formal), such as non-profit organizations, or trusts, or customary (informal)
such as a village community assembly or other forms of established customary organizations
with some form of management and a properly recognizable structure and management
procedures can be considered as CBEs.
In Jamaica, for example, the concept of CBT existed ‘for many years at an informal
level, where visitors sought a “home away from home” with Jamaican families’ (Tourism
158 O. Mtapuri and A. Giampiccoli 5

Product Development Co. Ltd, 2005). In the Caribbean, examples of informally initiated
and later formalized CBT processes include river tours in Dominica (Dixey, 2007a, p. 26)
and informal guiding in Trinidad and Tobago (Dixey, 2007b, p. 60). Therefore,
informality in CBT does not necessarily imply ‘failure’ to achieve positive economic and
social objectives. Jones’ (2008, p. 8) case study shows an upward trend in gross incomes
despite informality in the management structure; this bears testimony to the fact that the
CBTE model can function as an income generation tool.
As noted earlier, a CBT business model can be formal or informal depending on the
specific venture. Häusler and Strasdas (2003, p. 26; as previously proposed by Denman,
2001, p. 11) consider three main CBT models: Model 1: The whole community is involved
in the project. Model 2: Parts of the community or families are involved in the project.
Model 3: A joint venture between the community or some of its members and business
partner/s (Häusler & Strasdas, 2003, p. 5). Häusler and Strasdas (2003, p. 4) note that,
‘Due to its high level of participation, many NGOs prefer mainly Model 1, but experience
has shown that Model 3 is more successful.’ They also propose that community members’
level of involvement in CBT can vary greatly by location and they list the following
possible solutions, some of which include partnerships with external entities:
1. Local individuals selling produce and handicrafts to visitors directly or through
tourism businesses. This has often proved to be a good way of spreading the
benefits within a community.
2. Private tourism businesses (usually owned by outsiders) being granted a concession
to operate in the community, in return for a fee and/or a share of revenue.
3. Individuals, with links to the broader community, running their own small tourism
businesses in the informal sector. The level of success can vary and lack of skills
and tourism knowledge has often proved a weakness.
4. Communally owned and run enterprises. Sometimes, these suffer from lack of
organisation and incentives, but this can be overcome with time.
5. Joint ventures between the community and a private operator. This includes shared
ownership of, or tight contractual agreements concerning guesthouse and/or tour
operations.
Häusler and Strasdas (2003, p. 26) argue that, Model 3 could be a CBT closely
associated with (or part of) the informal sector. Calanog et al. (2012, p. 306) suggest
similar, but more detailed and comprehensive types of CBT business models (some of
which also represent partnership models), for example: a cooperative business, community
business, organizational business, private business, community-based, private sector
concessions, non-government organization (NGO)-private sector partnership, local
government unit (LGU)-led, academe-based, and family-based enterprise. Calanog et al.
(2012, p. 306) specifically associate the CBT Family-based Enterprise model with the
informal sector describing it as: ‘An informal enterprise, [in which] family-members
manage the business by themselves.’
Calanog et al. (2012, p. 304) posit that the community business model is based on
informal relationships between CBT business providers. This corroborates the notion that
in CBT, formal and informal agreements between entities (within or outside the
community) are common. Mielke’s (2012, p. 35; see also Selin, 1999, p. 264 on informal
grassroots community-based partnerships) study of a Brazilian CBT found that only one of
the 26 CBT projects investigated had a formal agreement in the form of a contract, while
the rest were run through informal relationships. Roe, Grieg-Gran, and Schalken (2001)
also found both formal and informal types of agreements in Namibia. Informality in CBT
6 South African Geographical Journal 159

partnerships seems very common despite the fact that it has been argued that roles and
responsibilities between partners should be formally clarified to enhance cooperation and
obviate misunderstandings (Mirete-Mumm & Tuffin, 2007, p. 61).
Besides the factor of formality or informality, many different types of partnerships are
possible. Selin (1999) outlines the variety of possible partnerships and proposes various
typologies for sustainable tourism development based on geographical scale in relation to
legal basis, locus of control, organisational diversity and size, and time frame. In terms of
geographical scale and time frame, Selin (1999, p. 269) proposes that tourism partnerships
with a short time horizon are ad hoc, either to solve a problem or take advantage of an
opportunity and as such take on a temporary and informal nature, while those with a longer
term horizon are ‘institutionalised in their legal form and structure as well as their
decision-making practices’.
Different types of partnerships are therefore very important to govern the balance of
both benefits and power between the actors. Extrapolating from Mtapuri and Giampiccoli
(2013), it can be deduced that partnerships can be of two kinds and involve various
entities: external and internal. An external partnership refers to a situation where the
partnership does not include the CBT venture itself that is external to it, but can include
various other services and products linked to it such as marketing, quality control and
skills development. On the other hand, an internal partnership occurs when, besides the
specific agreement, the CBT venture itself is part of the partnership. In terms of the entities
involved in the facilitation process, the partners can be from the private sector, NGOs, and
government entities alone or in unison. It is inconsequential that the specific partner(s)
involved in the initial facilitation process can (or cannot) be the same partner(s) involved
in later stages of the partnership.
A number of typologies have been proposed within a wide conceptualization of
partnership models in CBT: a partnership between the community and the state; a lease
agreement between the community and the private sector; and a joint venture between the
community and the private sector (Naguran, 1999, p. 50). Roe et al. (2001, p. 1) propose a
more detailed list of possible partnership agreements:
. A company enters into an agreement with a community to develop a new enterprise
on conservancy land;
. A company with an existing facility on communal land that becomes registered as a
conservancy enters into an agreement to share the benefits with the local community
in recognition of the changing land and resource rights;
. A company enters into a ‘good neighbours’ agreement with a community living next
to or near an existing private enterprise;
. A company leases hunting rights from a community;
. A company enters into an agreement with a community to utilize an existing
community-based facility;
. A company enters into an agreement with a community to develop a new
community-based facility;
. A company enters into an agreement with a community to ‘buy in’ services or
products – usually to complement an accommodation facility; and
. A company enters into an agreement with a community to develop and market its
products.
It can be observed that partnerships can include various functions related to CBT
development such as marketing and market access; capacity building and skills develop-
ment and possibly quality assessment (see also Mtapuri & Giampiccoli, 2013, p. 11).
160 O. Mtapuri and A. Giampiccoli 7

We impose a caveat that the initiator of the partnership should also be considered
relevant. As such, partnerships can be initiated by the community or by the external
entities. Hamzah and Khalifah (2009, p. 3) rightly suggest (by giving examples) that CBT
projects can be initiated as follows: government-initiated CBT; NGO-initiated CBT;
industry-initiated CBT and community-initiated CBT. At the same time, facilitation of the
community towards CBT development can emanate from various actors (the private
sector, NGOs, Government entities) with government entities being the most relevant
(Mtapuri & Giampiccoli, 2013, p. 5).
Giampiccoli and Mtapuri (2012, p. 37) propose the concept of community-based
partnership tourism (CBPT) and argue that either the community or the external entity can
initiate the partnership. The CBT is often externally initiated. For example, in Kyrgyzstan,
‘Community-based tourism (CBT) was introduced [ . . . ] by the Swiss Association for
International Cooperation, Helvetas, and was well supported by local communities’
(Baktygulov & Raeva, 2010, p. 2). Other cases present more diverse processes.
A case in point is the Wild Coast in South Africa, where a local community
approached a local NGO to help it start a tourism development project (Russell & Kuiper,
2003, p. 159). In this case, the local community took the initiative. The private sector was
involved in this local initiative; for example, when the horse trail enterprise was operating,
the community requested PondoCROP (a local NGO) to identify a private investor to
assess the feasibility of a catch/tag-and-release fly-fishing operation (Russell & Kuiper,
2003, p. 156). The subsequent involvement of an international entity in another (initially
conceptualized as consequential and similar) CBT project introduced the opposite of what
was expected, as the new approach favoured a private sector-driven model which
thereafter involved the community instead of the other way round (see ECODES,
Consortium, 2003, p. 9).
Partnerships are not neutral in their role in community development and
empowerment. Each partnership model prioritizes and/or favours specific actors and
therefore offers both advantages and disadvantages to the affected communities (see
Giampiccoli & Mtapuri, 2012, p. 39).
Building on theories of diffusions and dependency and linking them with the formal
and informal sectors (also based on Oppermann, 1993), Giampiccoli and Mtapuri (2012,
p. 33) observe that ‘the formal tourism economy will expand, marginalizing the informal
sector and small companies, but benefiting larger companies with high capital and human
and technological resources’ (see also Lea, 1998). Enclave forms of tourism development
have been cited as one of the main reasons for the increase in poverty amongst the local
population in countries such as Mombasa, where local residents are relegated to selling
souvenirs on the streets while the real tourism ventures are controlled by foreign investors.
Akama and Kieti (2007, p. 743) note that ‘Exclusion of local people from these core
business areas significantly aggravates the gap between the “fewer” rich and the
“majority” poor.’

General CBT development model and the informal/formal dichotomy

Figure 1 shows a general model including the various development options and CBT
trajectories, representing various specific typologies of CBT ventures (see some examples
in this paper’s literature review section and Mtapuri & Giampiccoli, 2013). It shows that
the origins of a CBT venture can either be local (emanating from within or outside the
community) or external to the community. It also shows that various entities could be
involved in initiating the CBT project (such as the government, the private sector, NGOs
8 South African Geographical Journal 161

Origin Local Local External to the

(within community) (but outside community) community

Entity involved
/facilitator Government/public Non-Governmental Community-
Private sector based
entities Organizations
Organisations

Bottom-up approach
Development Top-down approach
(Facilitation)
approach

Partnership type Formal Informal

No partnership

Partnership Kind Internal External

CBT venture types

Formal Informal

Market Domestic International

Scale
Micro/small scale Scaling-up

Figure 1. A model of possible trajectories of CBT projects.

or CBOs) in order to carve a specific niche or depending on the socio-economic

imperatives as well as the motive for the involvement in CBT. Approaches to the initiation
of the CBT project could be either top-down or bottom-up. The types of partnerships could
be formal or informal and the partnership could be internal or external. Figure 1 also shows
162 O. Mtapuri and A. Giampiccoli 9

that a CBT venture itself could be formal or informal, focusing on either the domestic or
international market, while the scale could range from micro/small to ambitions of scaling
up, once again depending on the motive for involvement in CBT. The models are not
exhaustive as the possible options and trajectories of CBTs are virtually infinite; each
situation presents different conditions, needs and, therefore, possibilities. The various
options for CBT development presented here include general groups or categories (based
on origin, the entities involved and so on) which form the basis of the analysis of CBT
development. Again, the aim of these general models is not to be exhaustive, but to
highlight key, specific CBT development options and trajectories as well as the
possibilities of CBT development. The paper also argues that while a single model of CBT
development seems unrealistic, the different options should in principle remain within the
specific main aim of CBT – to facilitate holistic individual/community development
including empowerment, social justice, skills/education and so on. Thus, the focus is
matters of formality/informality in CBT development, specifically the types of CBT
ventures and partnerships articulated in the literature review section of this paper.
It should be borne in mind that the categories in the diagram are not rigid or mutually
exclusive, but can be presented together. The dashed bold double arrow line at the bottom
of the figure indicates that, within each category or level, it is possible to move from one
condition/status to another. For example, a CBT could be initiated by more than one entity
(whether local or external) in the presence of both formal and informal conditions and
target both domestic and international markets. It follows that a range of CBT
development trajectories is possible following the mix of categories set out in this paper.
While Figure 1 merely lists the various types/categories of CBT development, the various
associations between categories can be interlinked in different ways.
A few general examples of CBT development models are provided, focusing on CBT
origins, venture type and scale (bearing in mind that formality and informality could also
co-exist).
. Within community ! informal (remain informal), usually small scale but scaling-
up is possible
. Within community ! informal ! formal (small scale)
. Within community ! informal ! formal (scaling-up)
. External to community ! Formal (small scale) ! formal (scaling-up)
. External to community ! Formal (small scale) remain small scale
The bottom-up approach should be prioritized, with the external partner facilitating
community planning. ‘The concept of a “bottom-up” policy approach reflects a principle
for local communities to set their own goals and make decisions about their resources in
the future . . . ’ (Theerapappisit, 2012, pp. 269, 287).
The move from informal to formal structures in a CBT project should enhance
community empowerment by, for example, increasing the community’s bargaining power
with external partners (Mirete-Mumm & Tuffin, 2007, p. 62). It is also interesting that a
reverse process from formal to informal can also occur, in which case a formal, established
organization is dissolved and replaced by an informal agreement among independent CBT
operators, where ‘Small community-based independent lodge operators, boat and cottage
owners, etc. complement each other’s services through informal arrangements’ (Calanog
et al., 2012, p. 304).
In relation to the scaling-up of projects, it has been argued that ‘Many of the most
successful CBE [community-based ecotourism] projects appear to have started small and
simple and gradually expanded’ (Sproule, 1996, p. 239).
10 South African Geographical Journal 163

It is important to recognise that the scaling-up of CBT projects follows a product life
cycle:
Initially CBT projects are small scale, low density and operated by the community with the
assistance from well meaning outsiders such as NGOs. Initially, the communities are
contented with the availability of jobs brought about by the CBT projects. As the CBT project
matures, however, the challenges for the community also increase. Inevitably, tour operators
will begin to show interest and will extend their corporation to form partnerships with the
local community. Without the necessary skills and expertise to cope with the increasing
number of tourist arrivals and changing tourist demand, local communities have the tendency
of becoming over reliant on the tour operators. At the same time, CBT projects will have to
move up the value chain and their long term viability will depend on how well the key
stakeholders cope with new expectations. (Hamzah & Khalifah, 2009, p. 4)
Thus, the scaling-up process should constantly assess, upgrade/update and adapt the
CBT working model to ensure self-reliance and long-term sustainability. The actors’
ingenuity and innovation will sustain the projects as viable entities for the common good
of current and future generations.
As a CBT initiative matures, the adoption of a sophisticated business model is essential in
weaning the project from government or donor reliance as well as to scale up the project. This
is crucial in ensuring the long term economic sustainability of CBT projects. (Hamzah &
Khalifah, 2009, p. 4)
CBT is no different from other types of business, thus it ‘should be treated like any
other business’ (Mielke, 2012, p. 31). In all businesses, growth, liquidity, solvency,
profitability and sustainability are key elements for survival, besides the social imperatives
of job creation and social responsibility as well as caring for the environment.
An investment incentive that encourages the move from informal to formal community
involvement in tourism is proposed in the Policy on Community Involvement in Tourism of
the Government of The Republic of The Union of Myanmar:
In designing investment incentives and facilitating soft loans for tourism development (e.g.
from banks or donors), it will be ensured that the specific needs of small-scale, community and
informal sector enterprises are being taken into account. A long-term goal is to enable
community members to move out of the informal into the formal sector, thus gaining access to
loans from the formal banking sector. The Myanmar Government is encouraged to create
favorable conditions to work with communities by giving them market power and by allowing
the private sector higher investment security and greater incentives for partnerships. (MoHT,
2013, p. 12)
While partnerships enhance the success of CBT projects (Sproule, 1996, p. 235), the
partnership with the private sector should be properly managed and delineated as it could
work against holistic community development if not properly done. Thus, partnerships,
whether informal or formal, should have two specific characteristics: first, the partnership
should be ‘temporary’ but long term in cases where it is deliberately directed towards
capacitating and empowering the community to gain greater independence and bargaining
power in relation to external entities (Mtapuri & Giampiccoli, 2013, p. 8); and second, the
CBT venture itself should not be part of a partnership (Mtapuri & Giampiccoli, 2013,
p. 11).
In the tourism industry, the balance between the formal and informal sectors should be
carefully assessed, analysed and judged in order to identify the pros and cons. For
example, Gartner and Cukier’s (2012, p. 558) study in Malawi found that
Better employment conditions in lodges may be explained by the formality of lodge
employment, the stability of lodge businesses, and closer regulation of tourism lodges by the
Malawi Ministry of Tourism Wildlife and Culture. Based on the qualitative evidence, those
164 O. Mtapuri and A. Giampiccoli 11

employed in the tourism lodges possessed a relatively stable, formal, and regulated
employment when compared with other types of informal tourism employment, such as
artisans, tour guides, and transportation workers [ . . . ] Based on the evidence provided in this
study, lodge owners in the case study area are meeting the minimum employment conditions
(such as wages and vacation allowances), and in many cases are even exceeding them through
their informal provision of fringe benefits such as school fees, healthcare expenses, funeral
funds, and personal loans to their employees.
Nonetheless, the authors indicate that ‘However, the adherence of lodge owners to
minimum wage standards offers no reassurances that lodge employees are having their
poverty reduced’ as the related, minimum wage in Malawi is ‘well below the absolute and
extreme poverty line’ (Gartner & Cukier, 2012, p. 558).
The formality and informality of situations and conditions could be seen as a mixed
blessing, in that entry in the informal sector can be the entry point into the formal
economy, and serve to ‘employ’ the unskilled, women and disadvantaged members of the
community. On the other hand, the informal sector is known to keep people in a poverty
trap as working conditions/rights, wages and so on are minimal or non-existent (see ILO,
2011). The issue is therefore facilitation of the formalization of CBT businesses in general
by nurturing them for growth and sustainability, instead of keeping the business marginal
(and often informal).

Discussion
This paper has shown that there is great variety in CBT development processes and the
associated potential for CBT ventures to create jobs and generate incomes. Thus, CBT can
be a viable and promising tool to alleviate poverty, enhance community development and
preserve the environment. As noted earlier, the decision to remain small or scale up
depends on the entities involved in CBT, as does the decision to remain formal or
informal. The advantages of remaining small include a flat management structure, no
obligation to report to a higher office, the venture’s freedom to decide which product to
sell and its positioning in the market, the ability to personalize the service by being closer
to the customer and obviating the need for brokers and the fact that a venture can open and
close shop as they wish. Importantly, control remains with the individual or community
which bears all the costs and enjoys the profits (if any). Using marketing jargon, a venture
can determine the nature of the 4Ps, namely the Product to be sold, the Place (Market),
Price and Promotion (how one markets the product). These factors also apply in the case of
informality where taxes are not paid and legislation such as labour laws are not complied
with. The disadvantages of remaining small/informal include remaining survivalist/
subsistence, and exclusion from key markets, including the inability to access formal
credit and so forth.
Given the extent of informality in the tourism sector, government’s role is critical in
supporting CBT ventures due to the vulnerability of poor communities and the need for
social and economic inclusion, as well as marketing on a global scale. Informal traders
suffer many constraints, including poor skills to negotiate with sophisticated and shrewd
domestic and international tourists, poor marketing capabilities, poor packaging and
advertising of their products, poor costing and accounting skills, and fierce competition
from other local and global locations. There are opportunities that CBT ventures can take
advantage of such as generating their own jobs, low entry costs, self-reliance and
sustenance, preservation of the environment and entering the global market.
Graduation from informal to formal is necessary if it enables access to markets and
formal banking facilities such as loans and credit. The decision to remain informal or join
12 South African Geographical Journal 165

the formal sector rests with the owners of CBT enterprises. Factors to consider when
formalizing an informal enterprise include trading licences, labour laws, tax implications,
record keeping, ownership type (sole trading, partnership, company (private/public)) and
associated capital requirements. On reflection, some of these factors militate against
formalization.

Conclusion
This paper has shown that CBT projects can be initiated from within and outside the
community. Entities which can initiate these projects can hail from the private, public and
non-governmental sectors and a combination of these, depending on their motive for
involvement in CBT. The approaches that can be followed in the initiation phase can be
either top-down or bottom-up, with each approach offering pros and cons depending on the
type of partnership that emanates from the relationship. The model posited in this paper
also shows that CBT projects can assume a formal or informal character depending on how
they were initiated and that movement from one status to another (formality to informality
and vice versa) cannot be ruled out. Scaling up or down (perhaps informality) creates both
constraints and opportunities. CBT models have been constructed in such a way as to serve
a specific purpose, and therefore are multi-faceted, and the model posited here expounds
on one facet namely formality/informality. The model presented in this paper is its major
contribution.
As CBT can be either formal or informal, more research should be conducted to
analyse the various aspects associated with the shift from formality to informality and vice
versa and the relationship with CBT development and holistic community development.

Note
1. CBET and CBT share similar social characteristics, but CBET places greater emphasis on
environmental issues.

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