LDC Export Diversification, Employment Generation and the "Green Economy"

"Pro-poor" tourism is arguably one of the best green options for addressing LDC poverty, employment and economic diversification initiatives. Although often neglected as a serious policy option -- and consequently most of its potential still remains untapped -- tourism is the leading export for at least 11 LDCs, and the 2nd or 3rd largest export for another 11 or more. It is also a major source of new employment, especially for women, youth and the rural poor in general. While difficult to measure accurately, tourism's pro-poor impacts are directly related to the achieved level of inter- and intra-sectoral linkages. Taking export diversification, employment generation and the "green economy" in turn, the working paper analyzes feasible LDC alternatives, reaching the conclusion (within the limits of data availability) that -- in contrast with the current overemphasis on agriculture and manufacturing -- green tourism is demonstrably one of the areas of greatest current comparative advantage and development potential for the majority of LDCs, via its extensive upstream and downstream linkages/multiplier effects, employment-generating and poverty alleviation capacities, opportunities for export "test marketing" of new products, sustainability, and largely untapped export opportunities. An economy wide, primarily private-sector approach is an essential element for maximizing tourism benefits -- including its multiple linkages with agriculture and manufacturing -- together with a significant coordinating governmental role to minimize negative externalities. Unfortunately, there is no automatic guarantee that expanding tourism will significantly increase poverty alleviation or local employment generation: the necessary mechanisms must be explicitly included in tourism planning and implementation.