1 RELEVANCE OF THE PROGRAMME The Eastern Cape Province is situated along the south-east coast of South Africa. It is bordered by the Western Cape (west), the Northern Cape (north-west), by the Free State and the Kingdom of Lesotho (north), and KwaZulu-Natal (north-east). It is home to a population of some 7 million people and it has chosen tourism as one of its key strategic drivers. The pilot project is located in the Wild Coast between the Umtamvuna and Kei Rivers (see Annex B). This region supports a population of approximately 1, 4 million (96 people/km2). 1.1 General Context There were a number of strategic reasons that led to the identification of the Wild Coast as a priority area for development intervention within the Eastern Cape. The most compelling was based on economic assessments done by Development Bank 1 of Southern Africa (DBSA) and others indicating significant agricultural and tourism potential in an area that had hitherto experienced significant neglect, the result of which was high levels of poverty. At the same time the South African Government had identified tourism development as a key sector for economic growth and development evidenced by the specific attention paid to positioning it within their Macroeconomic Strategy - GEAR. In this context Government recognised that it has 2 a key responsibility to create the necessary conditions / environment to open up opportunities for investment and development. Recent figures published in the Herald and Daily Dispatch news papers confirm this potential. They show that between 1998 and 2001 the Eastern Cape recorded the fastest growth of all provinces – 13.5% mainly due to the “substantial increase in the number of game farms (there are obvious tourism links here), as well as growth in wool, forestry, horticulture and agricultural exports generally”. Tourism however still needs to position itself to play a part in continuing to assist the province increase its overall contribution to national GDP which currently stands at 8.5%. The initial intent behind the SDI decisions on the Wild Coast would appear to still hold true in that from a socio-economic point of view, the Wild Coast is significantly underdeveloped relative to its inherent development potential and that previous political neglect is evidenced in the high rate of unemployment. 1.2 Specific Context The Programme has been set up to deliver specific programme objectives aligned to the policy context described above. The following defines the focus and the core issues impacting delivery. 1.2.1 Programme Objectives 1 Previously identified opportunities hitherto not yet achieved included the construction of a toll road from Port Edward to Port St. Johns, the development of eco-tourism incorporating Dwesa / Cwebe, and Mkambati Reserves, and the upgrading of a tourism areas around Coffee Bay, and Port St. Johns. 2 Governments ability to deliver on this responsibility within the Wild Coast Area, including managing the tensions between National and Provincial Government, remains a moot point. The pilot Programme has in essence two core strategic objectives. These are to: 1. Contribute to the implementation of the Government‟s growth, redistribution and employment strategy (GEAR)3 and 2. Unlock the economic potential by way of partnerships between the private sector and communities4. The overall purpose of the project being to increase the level of income and employment of previously disadvantaged communities (PDCs) through their improved participation in the tourism industry in the Wild Coast Pilot area. Towards meeting these core objectives this pilot project was set up to achieve the following programme objectives: 1. Tangible economic and social development that increased the level of income and employment of previously disadvantaged communities (PDCs)5 along the Wild Coast. 2. Establish a sustainable framework of co-operation between communities, private and public sectors in the Wild Coast area and ultimately to 3. Draw up guidelines for a national programme through the development of a model for replication all of which will be articulated around: i. Community business development ii. Resource management and environmental conservation iii. Skills development and environmental awareness iv. Policy and institutional support v. Marketing, promotions and public relations and the development of a national programme These programme objectives are without doubt relevant to the Eastern Cape and Wild Coast areas. They are also aligned to the goals of the EU and the majority of interest groups / stakeholders6 involved in tourism development. On the face of it the programme objectives are well aligned to the key problems that need to be addressed in the external environment in particular job creation and increased level of income. 3 GEAR is being implemented, in part, through the Government‟s implementation of Spatial Development Initiatives (SDIs) - Government has determined that tourism is the priority sector for the Wild Coast SDI. 4SDIs are partnerships with the private sector and communities, aimed at unlocking the inherent and under-utilised economic potential in specific areas – Government is still pursuing a growth-led economic policy that seeks to engage private sector in the investment process (Natal Mercury 13 February 2003). 5The means to achieve this is to enable their improved participation in the tourism industry in the Wild Coast area. 6 What has become apparent is that there are potentially conflicting development philosophies / ideologies being driven within the programme. On the one hand an approach to set up the community as full owners of all facets of a tourism project, that is, a wholly community driven approach that then involves private sector. On the other the approach outlined in the financing agreement that advocates the use of a private sector driven approach that ensures optimum community involvement. As this is a pilot project, it should test various options to determine the circumstances under which, which option would be the most successful in achieving the objectives of the project. Such contrasts can therefore be viewed positively in that they can encourage diversity of enterprise models needed for a pilot project. 1.2.2 Legislative Framework Relevance is also measured against the backdrop of the existing policy framework in South Africa. Community empowerment is a common thread in a host of South African policy instruments on sustainable development and economic growth some of which are listed in Annex I.A Legislation apart the fundamental issue for effective delivery is the willingness and ability of all the relevant implementing agents to engage the Programme and drive the deliverables towards successful completion. 1.2.3 Relevance of projects overall objectives The intent of the South African government to sustainable economic growth and investment promotion specifically in under developed areas that have sound economic potential is well documented. This notion is underpinned by a willingness to engage and encourage private sector investment into areas where they have traditionally been excluded and / or discouraged from investing. This partnership approach, aimed at supplementing government resources and empowering PDCs thus enabling their transition into the mainstream economy is at the centre of the development philosophy that underpins this approach. The Wild Coast SDI, and by implication this pilot Programme has been set in motion to support this approach to development. The strategic intent therefore behind the development process is to: 1. Mobilise private sector resources for development and investment 2. Be guided by the basic human needs / expectations of communities affected by investment / developments and to optimise opportunities to empower them. 3. Support such investment by targeted and co-ordinated public sector funding / facilitation aimed at providing the physical and social infrastructure / services required to leverage development. 4. Develop the necessary institutional capacity at all levels necessary to ensure sustainability of the process7. 5. Achieve the same aims as were intended for the SDIs: i. Generate sustainable growth and development. ii. Unleash the economic potential inherent in those regions. iii. Generate long term employment for locals. iv. Maximise investment by the private sector. v. Create and exploit spin-off opportunities. vi. Encourage export-orientated growth (e.g. agricultural links). vii. Link provincial and local development strategies within a sound framework of national development priorities. viii. Promote the ideal of international competitiveness and regional co-operation. ix. Create a more diversified ownership base of development initiatives. 7 This presupposes close co-operation between three tiers of government, private sector players and the communities concerned. The relevance of the principles embedded in these objectives and their alignment to the needs in the Wild Coast area cannot be faulted. Having said that there have been severe criticisms of the SDI in terms of the manner in which it was implemented in the Province i.e. top down and its approach being to focus on large tourism investments as the most appropriate approach to be followed in the area. The MTR team has been led to believe that elements of this top down approach has continued, making the acceptance of the Support to the Wild Coast SDI Pilot Programme at 8 Provincial, District and Local level problematic . 1.2.4 Using Lessons Learnt The SDI process provided important lessons for the Programme. For example lessons on land tenure have been documented in work commissioned on using interim procedures to drive land-based developments (See Annex I.B and paper prepared by Karl Wiggishof and Margot Pienaar). Notwithstanding these interim procedures problems and delays around land have been experienced and are 9 discussed elsewhere in the report . Other than that there is little documented evidence of lessons from the SDI being used. The danger is that the Programme might pay to re-learn lessons that should already have been learnt and for which there are some defined solutions. An example of this is the training of Trusts. A training manual was developed within the Maputo Corridor SDI for the Makuleke and this should be used to inform the Programme which intends developing a trusts training manual. The MTR team accepts that the TOR / brief developed for the course developer requires as step one that work to date must be consulted. However the absence of references to known previous work might indicate that the lessons / critique of previous SDI work has yet to be actively used to inform this pilot project. Active pursuance of the programme objectives by all stakeholders against the background of lessons learnt and unfolding 10 changes is necessary because the intention is to inform replicability of potentially ground breaking work in other areas of the country. For instance Caroline Ashley in her research on “Private Sector and Community Involvement in Tourism and Forestry Development on the Wild Coast” succinctly summarises some of the criticisms of the original SDI. 8 The top down approach started in the SDI‟s should have been remedied within the EU programme. Whilst the SDI did focus on developing medium to large tourism investments, it did not discount community driven approaches. Rather it was looking to nurture projects of scale. As a pilot project the EU programme should use both scenarios to inform approaches that would enhance replicability. Results to date provide limited opportunity to make such a call at this time. 9 Despite the lessons learnt the „system‟ does not seem able to provide the necessary support to overcome the problems. The truth behind this must be tempered by another lesson i.e. having the political and operational buy-in at strategic level which is a necessary prerequisite to obtain and sustain cooperation within government. 10 The Programme is being pushed towards legislation yet to be improved e.g. Community Land Rights Bill, which requires for example land holding in administrative areas. Delivery within existing legislation that also makes provision for delivery in future legislation is ground breaking and must inform this pilot programme. “The SDI approach has been widely criticised and many explanations given for its failure to deliver. The most common, detailed by provincial government staff and well argued in Kepe 2001 [Kepe et al 2001], and stated during several interviews, are: It sought to transplant a model for an urban industrial zone to an underdeveloped rural area. For example, the N2 highway wasn‟t commercially or physically appropriate in the geography of the Wild Coast. It pursued a top-down technocratic plan without adapting to local conditions, or garnering support from local institutions – such as Provincial Government. Thinking was removed from reality‟ (local development consultant, December 2001). Specifically, it sought fast-track, large scale approach to investment which is not suitable or commercially viable for the Wild Coast. For example, Provincial Government staff criticise the proposal at Port St Johns - for a high- tech computerised development with a golf course, and the planned R110 mn investment at Dwesa Cwebe – as a big bang high profile approach that risks giving away concessions for something that can‟t be done. Even if the money could be raised, they would be inappropriate for the Wild Coast. It tried to by-pass land issues, thus ignoring a key issue for communities, and failing to resolve a key source of uncertainty and risk for investors. As one official described it: „the question of land ownership was a major stumbling block… various people [investors] have turned back at the eleventh hour because the land situation wasn‟t clear. Enquiries with the Land Claims Commission were done at a late stage.‟ The underlying assumptions were wrong: that a small public investment would leverage in a large one, and that the private sector would fund infrastructural development. It was argued (by a leading Provincial Government analyst, October 2001) that expecting the private sector to build infrastructure „is only possible under special conditions – when the sums add up‟ (i.e. not in the Wild Coast)). The failure of the N2 highway proposal, which had reached an advanced stage of planning, is the key example – though this has now come back to the drawing board. It was incapacitated by institutional failings, management weakness, and competition within and between parts of government. During the DTI era, observers report there was „gross incompetence – things happened that shouldn‟t have‟. When DEAT took over, it reportedly did not have the capacity to deliver, provincial government was ignored, cross-departmental co-ordination was lacking. To make matters worse it caused disruption in the process. „DTI promised communities all sorts of things. Communities divided according to which consortium they favoured, according to the benefits they were promised‟. Kepe (2001) documents how it severely disrupted the livelihoods of those that invested in hanging on to land or other assets that they expected to be involved in the developments that never materialised. 1.2.5 Structural characteristics / linkages Notwithstanding the relevance of the objectives the key question that must be considered in this regard is this: Are all stakeholders focussed on and supportive of the same collective vision that is needed to achieve the objectives? The MTR team has noted that a visioning workshop was held between the 3 NGOs to agree on a collective vision for the Programme. The outcome was as follows: The Program vision is to inject life into the local economy by supporting and initiating the meaningful participation of communities in responsible tourism projects, which highlight and respect the environmental and cultural uniqueness of the Wild Coast A set of objectives were then set for the project and these are listed below: 1. Increase income levels and job opportunities in local communities through responsible tourism development and improved participation in existing initiatives 2. Improve skills levels of community members to maximise the employment of local labour 3. Improve the business capacity of local community structures and individual community members 4. Improve environmental awareness of the affected communities, business organisations and government structures 5. Improve capacity of local, regional and provincial government structures to facilitate the ongoing process of community based tourism development after the Programme ends 6. To establish a more cohesive and effective management structure and policies for the natural areas which should be protected for conservation and tourism development reasons 7. The program is a structured learning experience aimed at addressing the problems hindering local economic development of PDCs in the tourism industry. It is essential that a framework / model are developed for roll-out to other regions of the country. Visioning is a necessary process and even now it seems there is a need to ensure all have the same vision for the Programme. However there needs to be careful management of such processes because although aligned to the overall programme goals and objectives there is always a danger of confusion or the creation of a new set of programme goals. The common denominator has been the synchronisation of these with the log-frame. Tourism is driven by a myriad of role players in the Eastern Cape. The Department of Economic Affairs, Environment and Tourism (DEAET) are directly responsible for Government‟s tourism programme in the Province. As a department it forms part of the provincial planning network that supports the Cabinet Committee and Provincial Legislature as regards the strategic direction for economic development in the province. Towards delivering on these responsibilities it has created links to its two key parastatal organisations, namely Eastern Cape Tourism Board (ECTB) and the Eastern Cape Development Corporation (ECDC). The operational approach suggests that DEAET drives the policy and planning agenda along with ECTB who in turn gives expression to this by way of managing the provinces tourism marketing function. The ECDC is the delivery agent charged with the responsibility to drive tourism development and investment in the province and to give impetus to the socio-economic imperative of growing tourism as one of the economic engines in the province. The district and municipal councils, responsible for the Integrated Planning Programmes (IDPs) at local level are informed by and linked to the provincial planning process. Our assessment suggests that there is disconnect between the Programme and the economic, developmental and spatial planning initiatives at provincial level. As stated, the provincial and local planning cycle(s)11 are responsible for the broader socio-economic prioritisation of effort and is aligned to political processes in the Eastern Cape. Whilst the role players accept and acknowledge the Programme, they have not as yet taken it on board in a serious and meaningful way. The notion of the Programme having been “parachuted” in from the national level creates operational tensions that diminish ownership and acceptance. This suggests that the Programme is somewhat isolated and operating in a vacuum from a provincial perspective12. The assessment undertaken by the MTR team suggests that this is one of the major shortcomings of the current Programme. We are of the opinion that collective buy-in from all stakeholders is lacking, the result of which is an inability to deliver within the time frames originally envisaged. Unless addressed, the intended delivery is unlikely to be a complete success. The approach at provincial level to secure buy in might include: 1. Engage the political structures to position the Programme at a political level via a Cabinet sub committee / relevant economic cluster. 2. Allow the cabinet process to allocate the responsibility / ownership to the relevant department. 3. Engage that Department in terms of formulating implementation plans. 4. Support them in securing relevant linkages at: a. Provincial Level b. District Level and c. Municipal Level 5. Support the Province to align with relevant Parastatals. 6. Ensure incorporation within the broader IDP process. 11 Integrated Development Plans (IDPs) are the means by which to engage municipal structures and inform provinces pf bottom up development initiatives. To date none of the projects from the Programme have been included in the IDPs which are a further requirement to overcome the land tenure issue. 12 This must be tempered by the fact that the composition of stakeholders has and continues to change constantly. Continuity is generally speaking critical to development. 1.2.6 Project Assumptions – Real or Flawed The assumptions listed in the log-frame include: National political stability Favourable economic environment Private sector encouraged Crime under control PDCs want to participate in tourism industry Private sector committed to training PDCs Communities support individual enterprises Implement relevant Cabinet legislation. At a global level, some of these assumptions are valid for this project. For example, national political stability and favourable economic environment are to be expected. Others are non-committal and although valid, they don‟t address the core issues that have determined the success of the project. The MTR team has concluded (in addition to the concerns raised in 2.2.4 and 2.2.5 above) that some of the assumptions that would have presumably been made ahead of implementation do not appear in the log-frame. These assumptions would reasonably include: 1. The project design was based on a sound assessment of the socio- economic realities and that an appropriate investment / development approach was defined, that is: i. The notion of private partnerships as a key driver was accepted and embedded OR ii. Tourism development and ownership was to be driven exclusively from a rural community business enterprise approach / philosophy OR iii. There would be a mixture of the two approaches and that these would be carefully managed to ensure one did not receive added attention at the expense of the other. 2. The funding requirements needed for detailed facilitation in this complex environment and the four-year implementation time frame it was aligned with, was a direct outcome of assessing the realities and needs on the ground. We believe that four years might be too short and that this programme should have been phased over a number of periods13. 3. The tourism market / market potential had been assessed and that there was clarity in terms of the absorption capacity along the Wild Coast for the intended projects forming part of the Programme. In other words there was: i. Clear areas of focus agreed for the Wild Coast area – spatially and from a product point of view. 13 The rural livelihoods programme took 2 years to plan and is being implemented in just 2 municipal areas over a 9 year period of 3 x 3 year time frames. The GEF programme took 18 months to get sign off in the Province to locate it in an institution. ii. The rationale for the Programme to be designed around core 14 anchor areas was understood and accepted by all . iii. How and what significant benefits would accrue to PDCs over the longer term. 4. The setting up the Programme under the auspices of three appointed Non-Government Organisations (NGOs) was correct and each of the institutions had the requisite capacity to deliver on the predefined requirements. 5. The three NGOs and the management structures within the PMU had the combined capacity to deliver a programme in a complex environment over a 280km coastline crossing the boundaries of seven municipal areas15 and two district areas16. 6. The three tiers of government involved in the Programme had all bought into the process and assumed ownership to ensure collective delivery i.e.: i. Strategic guidance would be forthcoming from DEAT via the Project Steering Committee (PSC), the Province and the PMU in driving the process forward; ii. There would as a result be strong political leadership and effective management / oversight of the project. 7. The PMU and the NGOs would be able to integrate and coordinate all activities in a way that would ensure optimal delivery i.e.; i. Roles and responsibilities would be clear and accepted / understood by all, and ii. Effective project management would underpin the Programme delivery. The reality three years down the line is that these basic assumptions are probably flawed given that the Programme is being implemented in an overall operating and development environment that is extremely complex. One has therefore to question whether the design team and/or the person(s) responsible for developing the log- frame for this Programme fully appreciated these underlying issues or could foresee the difficulties that lay ahead for the Programme more especially around key issues relating to: 1. Governance responsibilities – significant energy required to work across three tiers 2. Institutional arrangements – definite tensions between different role players (National and Provincial) with different agendas 3. Policy and procedures impacting on implementation e.g. land tenure. 4. Community dynamics. 5. The tourism market itself. 14 The team was led to believe that the document “Development Plan for the Five Anchor Areas of the Wild Coast Spatial Development Initiative Programme - March 2001” that was developed during the 1st AWP was the framework plan to be implemented by the EU programme. The almost exclusive focus on the Horse and Hiking Trail is therefore somewhat confusing . 15 Mbizana; Quakeni; PSJ; Nyandeni; KSD; Mbashe; Mnuquma 16 OR Tambo; Amotole Clearly the “Annual Work Plan” processes whilst recognising some of these issues has hitherto not put in place specific actions to overcome the problems. 1.2.7 Developmental Rationale / Ideology The MTR team detected ideological differences in thinking about delivery of the tourism ventures within the Programme. This is partly as a result of operating within a complex and unfriendly investment environment and partly as a result of ideological differences driving the operations of the respective implementing agencies. The following issues are provided as framework guidelines that the team believes might direct thinking aimed at creating synergy between approaches that will ultimately provide improved opportunities for replication. 1. Responsible tourism has been identified as a key focus for tourism development on the Wild Coast. The concept presupposes a balance between economic development requirements, social dynamics and environmental management practices. The importance of the need to create employment, increase levels of income and address the social imperative means that the implementation of environmental management must be about the responsible use of resources, not their non-use. The implications being that in terms of this Programme, solutions to the problems of environmental management are to be developed within the process of tourism development and not outside of it. The call by PondoCrop and WWF for an integrated SEA up front to examine the cumulative environmental impacts rather than separate EIAs on a project by project basis would have been a more useful intervention. 2. The community driven approach has been successful in the area more especially in Amabiba and Ufudu. There is an argument that the pilot project should test the various models in the context that benefit flows in such projects are by definition based on smaller community-based activities that deliver smaller social benefits all of which are difficult and time consuming to establish, manage and market. The notion of establishing some larger key anchor projects that provide a core economic activity around which smaller projects can flourish should be implemented and measured in terms of impact. 3. The community driven approach is laudable. It must however be recognised that benefit flows will be by definition based on smaller community-based activities that deliver social benefits all of which are difficult and time consuming to establish, manage and market. The notion of establishing some key anchor projects that provide a core economic activity around which smaller projects can flourish should not be ignored. 4. If tourism is regarded as the important economic driver that is capable of delivering meaningful social impacts, then the scale of tourism development also needs to be significant. If not it is unlikely that the Programme will be able to reduce environmental impacts by way of co-management agreements or any other means. 5. It is important to understand the “catch 22 syndrome” associated with tourism development along the Wild Coast. Significant tourism development also requires significant infrastructure development which can only be warranted if the returns from tourism are also significant. This in turn might mitigate against a community driven approach on the Wild Coast. In other words: a. Infrastructure investment will only be warranted if reasonable returns are made; b. Development needs to be of a scale to justify the cost of infrastructure; c. Community driven tourism on its own will not drive viability at a regional level; d. The net result is a need for larger development areas that require larger infrastructure to be developed and to drive specific tourism programmes linked to support for community tourism. Having said that local government would need to buy-in to the provision of infrastructure. In stating this, it is not suggested that tourism development should emulate that seen along the Kwazulu Natal South Coast. In addition, one cannot ignore the fact that the topography of the Wild Coast isolates some coastal communities. This isolation may make it difficult for benefits of anchor projects to flow into these communities, while smaller community-based projects will bring some relief. It is clear that a balance is called for. In the case of Amadiba the project went ahead because it made little sense to sit back and wait for infrastructure, a reality which would affect the likes of developing Mkambati. In this regard, the project has yet to test different models of tourism development and as such, has seemingly not recognised the fact that this is a pilot project. This is despite the fact that several options were recognised in the “Development Plan for the Five Anchor Areas of the Wild Coast Spatial Development Initiative Programme - March 2001” developed at the start of the Programme. The fact is that this Programme is trying to do two difficult things. One to create tourist flows in an area has limited traditional tourism interest (i.e. a destination) and secondly a type of tourism that benefits people who have traditionally not participated in the sector (PDCs / equity ownership). 6. With regard to land tenure, it is recognised that land rights are central to the opportunity and power that enable constructive negotiations around development projects. Failure to address this will limit opportunities17 for communities to share benefits of any real significance. In particular: 17 The land issue has impacted not only on green field development but also on brown field development. Even where efforts are being made to resuscitate / refurbish existing tourism plant such as camp sites on the old trails the process to secure access is continually delayed by departmental obstacles / blockages / delays. DLA in East London have indicated that the interim procedures available can / will facilitate movement. However experience to date from an implementation / delivery perspective has been different. a. Land rights and the right to negotiate resource use agreements must be given to communities; b. Investors need security of tenure if they are to invest; c. Investors also need a legal entity with whom to engage; d. Government support for infrastructure development is a pre- requisite. Given that the greater portion of enterprise development is to be rolled out in the coming year, attention must be given to detailing the various tourism development models with concomitant indications of approaches to achieve them and defining the benefits that flow from them. Clearly DEAT, the EU and the PMU need to provide the necessary leadership to ensure that there is a collective vision shared by all stakeholders in the Province and on the Programme.