Promotion of tourism as part of local economic development in the South Africa

Description of measures: New jobs and better living conditions for the local population

Title: Strengthening the regional tourism sector by establishing a tourism association in the community of Lukhanji
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: South Africa
Partners: Lukhanji local administration; Lukhanji Tourism Association

Logo Lukhanji Tourism Organizsation, South Africa

The tourism sector plays a significant part in the South African Government’s efforts to achieve growth and create new jobs (New Growth Path). Tourism has grown steadily in recent years, and experienced a year-on-year rise of 11% in visitor numbers in the first quarter of 2012 – a rate of growth far above the international average. Local and district authorities are also eager to strengthen the tourism industry as part of their support for local economic promotion. Through targeted investments and cooperation with the private sector, they are trying to create new job opportunities in tourism.

As part of the ‘Strengthening local governance’ programme, which GIZ is implementing in South Africa on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), support is also given to the tourism sector in various local authority areas.

This programme is working to improve conditions for effective local administration, in particular to strengthen the cooperation between the three governmental levels, civil society and the business sector. This should result in better public services being provided more quickly, while local democracy is improved and above all the local people benefit from sustainable development.


Local authorities and other local actors are able to benefit more effectively from the tourism sector. They are well placed to plan new projects and put them successfully into practice. Jobs are being created, which bring long term improvements to the living conditions of the local people.


The pilot community, Lukhanji, with around 200,000 inhabitants, is located in the centre of the Eastern Cape province and counts as one of the structurally weakest areas in the country. Agriculture and small businesses are among the more important contributors of the local economy. Only about a quarter of the local population are formally employed, most of them in the public sector. By far the majority are unemployed or work in the informal sector. Due to the insufficient investment in infrastructure, and the lack of incentives or a trained workforce, discourage many companies from settling in the region and creating new jobs. Many young and better educated workers move instead to the provincial centres of Port Elizabeth and East London, or to the economically stronger regions surrounding Johannesburg, Cape Town or Durban.

Local tourism plays a major part in the growth strategy of Lukhanji’s local government, and in its development efforts. The region contains many natural, historical and cultural attractions. These include nature reserves and private safari parks, an artificial reservoir offering diverse water sports, and historically significant sites that show the eventful history of South Africa. Moreover, Lukhanji is situated on a main road connecting the coast and the hinterland.

Despite these advantages, the region has so far failed to make better use of its tourist potential in order to stimulate the local economy by attracting more South African and international visitors. Due to the lack of cooperation between the local government and the private tourist businesses, there has been no consistent vision or marketing strategy for the local tourism sector.

At the same time, some 20 years after it ended, the former apartheid policy still has a strong impact on communal life, especially in smaller and peri-urban communities. Thus, the private sector is still largely dominated by white South Africans, whereas the local government mainly employs members of the black majority. This has significant repercussions, as regular exchanges are rare, and public-private partnerships have to overcome great political resistance. Cooperation and mutual understanding between companies and the local government are often hard to establish, although these are prerequisites if the local economy is to prosper.

The plan by local tourism providers, such as hoteliers, tour operators and museum managers, to create a local tourism association, the Lukhanji Tourism Organisation (LTO), was realised at the end of 2008. GIZ supported the development of the LTO from 2009 to 2011 as part of its ‘Strengthening local governance’ programme. GIZ’s assistance included financial support and the placement of two tourism experts to support the legal and institutional foundation of the organisation. The result was a binding partnership between the local authority and the tourism operators. The purpose of this cooperation was to formulate a common strategy and to agree measures for the consistent and growth-oriented marketing of the region as well as the improvement of the tourism infrastructure.

A key element in the cooperation between the public and the private sectors was the creation of a visitor information centre, where tourists can find accommodation as well as information on the local sights. The local government provided the necessary rooms, while the operative costs are covered by the monthly membership contributions of the newly formed association.

With the help of the information centre – which opened in 2010 and offers a comprehensive database of almost all the tourist businesses in the region, as well as new brochures, maps and travel guides – the marketing of tourism in Lukhanji has significantly improved in just a short period of time. The needs of the tourists can now be served in a more professional and efficient manner.

Results achieved so far

Since its launch in 2009, the local tourism association, LTO, has firmly established itself in the community. Nearly one hundred local tourism companies have already become members. The LTO offers services such as regular newsletters and events informing its members about recent developments in the community and in the tourism industry. It also provides consulting services on business development and marketing for emerging tourism companies.

The creation of the LTO has produced positive results at various levels. Representatives of the community and the tourism industry have come together to develop a shared vision for the region. Particularly encouraging is the fact that the partnership goes beyond mere lip service, and that the LTO receives financial support from the local government. Moreover, the local government holds a seat on the supervisory board of the association, so it is able to stay informed about the situation of local tourism. At the same time, the LTO is taken more seriously as an association, and it is able to communicate its requests and interests clearly to the local administration, for instance when it sees a need for investments in local infrastructure.

Staff of Tourism Information Center in Queenstown, Lukhanji community, South Africa © GIZ

The LTO makes an important contribution in terms of sensitising the population for the issues of local tourism. New employment opportunities are now created, as young people can take up internships and apprenticeships in the information centre, as well as with the associated hotels and restaurants.

Further information