INTERNATIONAL CONFERENCE ON

PRO POOR TOURISM:

MECHANISMS AND MAINSTREAMING

STRATEGIES TO CAPTURE BENEFITS OF TOURISM FOR MARGINALISED

COMMUNITIES IN MELAKA HISTORIC CITY

By
Assoc. Prof. Dr. Zainab Khalifah,
Assoc. Prof. Dr Amran Hamzah
Nor Azina Dahlan
Ahmad Tajuddin Kechik

Universiti Teknologi Malaysia

Introduction

The Malaysian tourism industry has been growing very rapidly in terms of visitor arrivals
and revenue generation in the past decade. It has performed extremely well in the
Malaysian economy, over-taking some of the country’s traditional exports, improving from
fifth position in 1994 to second position presently in terms of foreign exchange earnings.
The number of international tourists to Malaysia in 2004 is 15.7 million, generating a
revenue of RM29 billion.

Melaka known for its historical past and rich in heritage is a popular tourism destination
among international and domestic tourists. Tourism is the second most important
economic sector in the state, after manufacturing. Melaka was able to attract 4 million
international and domestic tourists in 2004, mostly concentrating in the Melaka Historic
City itself.

Since tourism is a relatively important sector in Melaka, and eradicating urban poverty is
also an important agenda of the state, this paper therefore seeks to explore how pro-poor
tourism (PPT) initiatives can help to reduce poverty while boosting the tourism industry in
the city of Melaka. This paper will therefore access pro-poor tourism initiatives in Melaka
Historic City and propose preliminary strategies, which could be taken to further exploit
the potential benefits of tourism to the affected marginalized communities.

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The objectives of the paper are:
• To assess the extent to which current government infrastructure tourism projects
and private sector initiatives support pro-poor tourism in Melaka Historic City
• To recommend PPT strategies and mechanisms that the government and other
industry players can incorporate in the planning and implementation of tourism
projects/programmes.

Officially the incidence of urban poverty in Malaysia is almost negligible with official data
indicating the urban poverty rate in 2002 as 2 percent (Goh, 2005). The 2 percent rate
was based on households of five living under the official Poverty Line Income (PLI) of
RM529 per month in Peninsular Malaysia, RM600 in Sarawak and RM690 in Sabah.
However common sense will indicate that the present indicator as unrealistic since it is
generally accepted that an urban household would require at least RM1,000 to RM1,200 to
live adequately (Sulochana Nair in Goh, 2005). The government recognised this weakness
and households with less than RM1,000 income per month are eligible for financial
assistance and Kuala Lumpur City Hall consider households with less than RM1,500 per
month as qualified to participate in its poverty alleviation programmes (Goh, 2005). While
the government is coming up with the new PLI, using a conservative estimated PLI of
RM1,000 and using the most recent available 1989/90 household income survey will reveal
that 25.0 per cent of households would be considered as poor.

Relating to the above facts and figures with this paper, it will be obvious that the present
PLI would indicate the number of absolute poor urban household as negligible in the city of
Melaka. Instead this paper will focus on relative poverty in the form of marginalised
communities; communities which are often left out in the process of urban development
and income level are often below the average. With tourism becoming an increasingly
important economic sector in Malaysia as a whole, and specifically in Melaka, the
possibility of tourism benefiting a wider section of the community is tremendous. However,
in most cases, intervention is required to ensure a broad based growth that will also
maximize tourism benefits to the marginalised communities.

What is Pro-poor Tourism?

Pro-poor tourism is an approach to tourism that increases net benefits to the poor (Ashley
et. al, 2001). It is not a new kind of tourism product but merely to ensure that the poorer
section of the community too will have their portion of the tourism economic pie.
Generally, pro-poor tourism is still a relatively new phenomenon in Malaysia, although
certain elements of pro-poor tourism may be observed in some of the tourism
developments. Pro-poor tourism will result in pro- poor growth which will decrease
inequality and the increasing gap between the rich and poor. This is of a particular concern
in Malaysia where poverty is becoming more complex coupled with a deteriorating income
distribution, where new approaches are required since previous ones have little impact on

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poverty reduction (Yeang, 2005). This is further emphasized by the latest release of the
United Nations Human Development Report which indicates the worsening of income
inequality in Malaysia. The report further shows that the richest 10 percent controls 38.4
percent of the total income, while the poorest 10 percent controls only 1.7 percent of the
total income, and Malaysia performed the worst compared to the other Southeast Asian
countries. This is further emphasized by the Malaysian Prime Minister in his Opening
Speech in the Commonwealth Association of Planners Conference on 5th July 2004, he
said:

The growth of our cities will prove to be volatile and short-lived if we neglect the cities
poorest inhabitants or we ignore the cities’ environmental balance, with only the pursuit of
pure economic gains as our focus.

A wide range of strategies are required to capitalize the benefits of tourism for the poor.
Efforts are needed in capacity building, training, access to financial funds, marketing,
linkages with the private sector, and also policy and regulation which are pro-poor.
This requires working across different levels and stakeholders comprising of the
government, private sector, non-governmental organizations, community organizations
and the poor themselves, all having very different and critical roles to play.

Assessment of Pro- Poor Tourism in Melaka Historic City

Tourism is an important economic sector in Melaka and it is the second most important in
terms of its contribution to the state’s income. Table 1 shows the number of international
and domestic tourist arrivals in Melaka from 2001 to 2004.

Table 1: Number of International and Domestic Tourist Arrivals in Melaka (2001-

2004)
Year
Category
2001 2002 2003 2004
Domestic 1.48 1.80 2.86 2.99

International 1.02 1.20 0.74 1.01

Total 2.50 3.00 3.60 4.00

The state government has implemented a number of tourism infrastructure projects in its
effort to boost up the number of tourist arrivals, increasing their length of stay and to
maximise revenue from tourism. These various tourism projects in relationship with the
marginalised communities can be categorised as either circumstantial or deliberate.
Circumstantial is when tourism development is not targeted for the poor but the spill over

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 of the development benefits the poor. Deliberate is when the development is mainly aimed
for the poor.

Tables 2 and 3, briefly list the various government tourism projects and special events, the
agency responsible for the development, aim of the development and its benefits to the
marginalised communities. A scale, ranging from 1 for low benefit to 3 for high benefit is
used as an estimate to indicate the benefits received by the marginalised communities.

Table 2: Tourism Projects and its Benefit to Marginalised Communities

NO GOVERNMENT TOURISM AGENCY AIM/PURPOSE BENEFITS TO MARGINALISED
PROJECT COMMUNITIES
1 Melaka River Rehabilitation MOTOUR/MBMB To beautify & 2 ƒ Opportunities
revitalize available but
Melaka River as need
a tourist intervention.
attraction ƒ Potential future
benefit from boat
cruise.
2 Street Improvement Ministry Of To create safe 1 ƒ Gentrify and
Scheme along Jln. Housing And and conducive revitalize inner
Tokong/Jln. Tukang Besi/Jln. Local walking cities
Tukang Emas And Jln. Hang Government environment for ƒ Benefit elite
Jebat tourists businessmen
3 Development of Hang Tuah Ministry Of Revitalize 2 ƒ To provide
Mall based on the concept of Housing And shopping flagship tourism
Bukit Bintang Walk Local precinct product (State
Government icon product)
/MBMB ƒ Meant to house
petty traders but
the high rent
hinders their
participations
4 Restoration of 18 units of MBMB To visually 2 ƒ Still maintain
shop houses along Jalan enhance previous
Laksamana gateway to occupants
Melaka and to
attract tourist
users
5 Mini museum/gallery at PERZIM To showcase 1 ƒ Poor presentation
Portuguese and preserve ƒ Low tourist
Settlement/Kg.Chetti/Kg.Pali Melaka’s appeal
Heritage ƒ Superficial

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 ƒ No emotional
attachment
ƒ Lack Revenue
capture
mechanism
6 Conservation & restoration Muzium To showcase 3 ƒ Allows trinkets
of historical building, Antiquity cultural sellers to set up
national monuments Department diversity and stalls along
preserve Melaka popular tourist
heritage route
7 Restoration of Atlas Ice PERZIM ƒ Cultural
centre.
ƒ Business
incubator for
handicraft.
ƒ To supply
genuine
handicraft.
1. Low Benefit 2. Moderate Benefit 3. High Benefit

Table 3: Special Events and its Benefits to Marginalised Communities

NO SPECIAL TOURISM AGENCY AIM/PURPOSE BENEFITS TO
EVENTS MARGINALISED
COMMUNITIES
1 Jonker Walk : Involves ƒ Jonker Walk To introduce night life 2 Directly benefits food
the closures of Jalan Committee and activities as well sellers within the area
Hang Jebat (Jonker ƒ Chinese Chamber as the cultural
Street) on Friday, of Commerce ambience
Saturday and Sunday
evenings to be turned
into a ‘cultural night
market’
2 Seasonal/ Cultural/
Religious Events
Portuguese Settlement Portuguese To preserve religious 3 ƒ Commodification
San Pedro Fiesta Committee and cultural heritage of culture and high
Intrudo (Water direct benefit even
Festival) though seasonal
San Juang Fiesta ƒ Extend length of
(Light Festival) festival (no of days)
Christmas

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Kg Chetti Trustee Executive To preserve religious 1 Fail to capitalize the
Ponggol Festival and cultural heritage benefits of various
Hindu New Year events
Deepavali
1. Low Benefit 2. Moderate Benefit 3. High Benefit

The preliminary qualitative assessments show that opportunities do exist for marginalized
communities to benefit from tourism. However, due to their present situation, intervention
and assistance are required for them to fully exploit the benefits of tourism.

Strategies and Mechanisms for Increasing the Benefits of Pro-Poor Tourism

Problems or issues encountered by marginalised communities are mostly related to the

policy and planning framework, barriers in participating in the tourism industry due to lack
of credit, business skills, and access to markets.

Table 4 summarised the various issues faced by marginalised communities, and the
respective strategies and mechanism being proposed.

Table 4: Pro-poor Tourism Issues, Strategies and Mechanism

NO ISSUES STRATEGIES MECHANISM
1 PPT not addressed in Incorporate PPT elements ƒ More focus on communication
most formal in formal development -group discussion / workshop.
development plan plan ƒ Encourage the establishment
of resident committee.
ƒ Implementation of agenda 21.
2 Planning process Emphasis on process of Replace current tools with
carried out using top decision making instead participatory techniques such as
down approach and of plan making visioning, scenario sketching,
local participation is aspiration analysis, consensus
superficial building, and conflict resolution
3 Planning process is Participatory approach. ƒ Develop indicators.
fragmented and sector Support community based ƒ Review should not only
based organization. measure economic benefits
but also accommodate social,
cultural and environment
impacts.
4 Implementation - Put in place review ƒ Consider all complexities on
Boosterist approach process and monitoring the ground.
with little room for ƒ Cooperation and coordination
consultation/feedback at all levels.

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5 Limited business Identify business Collaboration with the more
opportunities opportunities suitable for established industry players –
marginalised communities hotels, tour operators (MAH,
MATTA, MTGC) eg. through
community based association
6 Lack of capacity Increase marginalised Collaboration with Government
building & training communities’ basic and private sector.
understanding of the
tourism industry. Training
in business and
organizational skills
(management, marketing,
communication)
7 Lack of credit Identify and create funds Adopt loan conditions suitable
for micro and small- for the marginalised
enterprise tourism communities.
initiatives.

8 Negligible Business Establishing links with the ƒ Increase private sector

Partnerships private sector awareness and understanding
of CSR.
ƒ Create a win-win situation.
ƒ Incentives from government
for establishing such
partnerships.

Especially new in the Melaka’s context is for marginalised communities to establish strong
links with the private or business sector to ensure their dealings has commercial sense.
This calls for ‘doing business differently’, a shift from the traditional method of doing
business in the private sector. This corresponds to the present Corporate Social
Responsibility (CSR) discussions, where the focus has shifted from short-term ‘doing good’
to finding win-win situations in which companies can profit by doing good (Ashley &
Haysom, 2004). Moreover, CSR is very relevant to the tourism industry since corporate
reputation has the ability to influence demand. Ashley and Haysom (2004) provided a
comprehensive examples of ‘doing business differently’, a practical experience from PPT
Pilot Partners projects involving private companies in South Africa such as Spier Leisure,
Sun City and Wilderness Safaris. These partnerships vary from increasing procurement
from local SMEs, supporting the establishment of local enterprises, and community
partnerships in terms of equity or revenue sharing.

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Conclusion

Pro-poor tourism has the potential of benefiting the poor, decreasing inequality and
narrowing the gap between the rich and poor. This is especially relevant in the Malaysian
case where previous initiatives have minimal impact on poverty reduction and new
approaches are required especially in eradicating urban poverty. It is hoped that the new
role given to the Ministry of Housing and Local Government to eradicate urban poverty will
incorporate pro-poor tourism initiatives as a means to reduce urban poverty.

References

Ashley, C. and Haysom, G, (2004) From Philanthropy To A Different Way Of Doing

Business : Strategies And Challenges In Integrating Pro Poor Approaches Into
Tourism Business, paper presented at ATLAS Africa Conference , Pretoria, Africa.
Ashley, C., Roe,D. and Goodwin,H. (2001) , Pro Poor Tourism Strategies : Making Tourism
Work For The Poor : A review of experience , Pro Poor tourism Report No.1,
Overseas Development Insitute, The Russel Press, Nottingham.
Department for International Development, (April 1999), Sustainable Tourism and Poverty
Elimination Study, London
Goh Ban Lee (2005) Capacity Building for the Low Income Families – Key to Poverty
Alleviation, paper presented at the National Seminar on Urban Poor & Low Income
Families: Towards the Ninth Malaysia Plan, Kuala Lumpur, Malaysia
Nelson, J.G., Butler, R. and Wall, G. (1993) Tourism and Sustainable Development:
Monitoring, Planning, Managing, Department of Geography Publication Series.
University of Waterloo, Canada.
Yeang Soo Ching, News Sunday Times, 20th Feb. 2005