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ECONOMICS OF ECOTOURISM IN OLD OYO NATIONAL PARK.

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CHAPTER ONE

                                                            INTRODUCTION

1.1 Background Information

Tourism is travel for recreational, leisure or business purposes. The World Tourism Organization (WTO) defines tourists as people travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes (WTO, 2009). Sylvie, (2005) stated that tourism is a way to invite visitors to explore the area under different angles.  This is also considered an important part of the national economic industry of a country. Tourism is a more general term that includes a variety of ways to educate and entertain tourists, in both natural and artificial settings.

Tourism in Nigeria centres largely on cultural events due to the country’s ample amount of ethnic groups, but also includes rain forest, savannah, waterfalls and other natural attractions (Achibong, 2004). Tourist sites in Nigeria include festivals and cultural celebrations (such as Durbar festival, Arugungu, Eyo, etc.), the nation’s national parks (such as Old Oyo, Yankari and Cross River National Parks), and other geographical sites (such as Aso Rock, Abuja).

The increase in human population and preferences for leisure activities often leads to an increase in demand for recreational use of public lands in many parts of the world (Bowler et al., 1999; Foot, 1990 and 2004; Nickerson, 2000). National Park, like other environmental resources and public goods used by humans, has benefit in many different ways. These environmental resources have many functions relating to ecological purposes. They also offer recreational resources to everyone who visits them. National Parks, which are offered as ecotourism sites, can enhance national income, and have economic impacts to society around its area (Nuva and Shamsudin 2009)and hence, can contribute to the national economic growth.

Ecotourism is a form of tourism that involves visiting natural area – in the remote wilderness or urban environments. According to the definition and principle of ecotourism established by the International Ecotourism Society (TIES) in 1990, ecotourism is responsible travel to natural areas that conserves the environment and improves the well-being of local people (TIES, 2015). Honey, (1999) expanded on the TIES definition by describing the seven characteristics of ecotourism, which are that it

  1. Involvestravels to natural destinations,
  2. Minimizes impact,
  • Builds environmental awareness,
  1. Provides direct financial benefits for conservation,
  2. Provides financial benefits and empowerment for local people,
  3. Respects local culture,
  • Supports human rights and democratic movements; such as:

conservation of biological diversity and cultural diversity through ecosystem protection; promotion of sustainable use of biodiversity by providing jobs to local populations; sharing of socio-economic benefits with local communities and indigenous people by having their informed consent and participation in the  management of ecotourism sites; tourism to unspoiled natural resources with minimal impact on the environment being a primary concern;minimization of tourism’s own environmental impact;affordability and lack of waste in the form of luxury;localculture, flora and fauna being the main attractions;local people benefit from this form of tourism economically, often more than mass tourism.

Ecotourism is responsible travel to fragile, pristine, and usually protected areas that strive to be of low impact and (often) small scale (as an alternative to mass tourism).Its purpose is to educate the traveller, provide funds for ecological conservation,have direct benefits on the economic development and political empowerment of local communities, and foster respect for different cultures and for human rights (Honey, 2008). Since the 1980s, ecotourism has been considered a critical endeavour by environmentalists, so that future generations may experience destinations relatively untouched by human intervention. It typically involves travel to destinations where flora, fauna, and cultural heritage are the primary attractions (Randall, 1987).

Ecotourism Societyof Pakistan (ESP),(2007) explains Ecotourism as a travel activity that ensures direct financial support to local people where tourism activities are being generated and enjoyed.  It teaches travellers to respect local cultures of destinations where they are visiting.  It supports small stakeholders to ensure that money must not go out from the local economies. It discourages mass tourism, mass construction of hotels, tourism resorts and mass activities in fragile areas. For many countries, ecotourism is not simply a marginal activity to finance protection of the environment, but is a major industry of the national economy.  For example, in Costa Rica, Ecuador, Nepal, Kenya, Madagascar and Antarctica, ecotourism represents a significant portion of the gross domestic product and economic activity (Afolami, 2007;Eadington & Smith, 1992;Isaacs, 2000). The world travel and tourism council, (2009) in its research had stated that direct contribution of travel and tourism to GDP in Nigeria was expected to be NGN 465.8bn (1.1% of total GDP) in 2011, rising by 5.7% pa to NGN 813.6bn (1.1%) in 2021 (in constant 2011 prices). The total contribution, including its wider economic impacts was forecasted to rise by 6.4% pa from NGN 1,006.0bn (2.3% of GDP) in 2011 to NGN 1,875.8bn (2.5% by 2021). Also, it was expected to support directly 527,000 jobs (0.9% of total employment) in 2011, rising by 2.9% pa to 700,000 jobs (0.9%) by 2021. Travel and Tourism visitor exports were expected to have generated NGN 133.4bn (0.9% of total exports) in 2011, growing by 10.6% pa (in nominal terms) to NGN 164.9bn (1.6%) in 2021. The investment in Travel and Tourism was estimated at NGN 227.6bn or 5.0% of total investment in 2011. It should rise by 5.3% pa to reach NGN 382.3bn (or 3.5%) of total investment in 2021 (World Travel and Tourism Council, 2016).  Ecotourism was first introduced in Africa in the 1950s with the legalization of hunting. The need for recreational hunting zones led to the creation of protected areas, national parks, and game reserves,example Ngorongoro Conservation Area, Selous Game Reserve, and Mountain Kilimanjaro in Tanzania; Khute Game Reserve and Central Kalahari Game Reserve in Botswana; Tapanti National Park in Costa Rica; Royal Chit War National Park in Nepal; Mara Park Reserve in Kenya; and Yankari Game Reserve and Obudu Cattle Ranch in Nigeria (Miller, 2007).Today, we have eight National Parks in Nigeria, which are the Oban Hills, Gashaka-gumtiand the Obudu Cattle Ranch.  Others are Yankari, Kanji Lake, Old Oyo National Park, JosWildlife and Chad basin. These areas have become important revenue earning avenues with the establishment of lodging and tourist camp sites.

Travelling in an environmentally friendly way means that when touring a place, whether in a city or in the wild, you do your best to minimize your impact, travel responsibly and build respect.  Ecotourism creates jobs in food services, accommodation, transportation and other industries. Because it relies on healthy ecosystems, ecotourism provides a powerful incentive to protect the environment.  People who earn their living from ecotourism are more likely to protect local natural resources and support conservation efforts. The magnitude of benefits countries receive from nature tourism or ecotourism depends in large part on the scale of the country and the complexity of the country’s economy. Boo (1990), asserted that if tourism fails to meet economic expectations, other more damaging economic activities could be taken up.  A common ecotourism goal is the generation of economic benefits, whether they are profit for companies, jobs for communities, or revenues for parts.  However, some social experts revealed that the temptation to maintain only the biodiversity and ecosystem or to improve the environmental governance of the places for ecotourism without caring about people’s fundamental livelihoods or the ecotourism benefit dispersion would lead to an unremitting failure of ecotourism initiative in the district. Concurrently, it would make the environmental degradation (resources and wastes) possible in the ecotourism places. These experts express that to increase the environmental tax and efforts (budget and technology) in environmental governance is not the only key strategy to success (Vishwanatha and Chandrashekara, 2014).Ecotourism plays a particular important role because it can create jobs in remote regions that historically have benefited less from economic development programmes.  Even a smaller number of jobs may be significant in communities where populations are low and alternatives are few.  This economic benefit can increase political and financial support for conservation.  Protected areas and nature conservation generally provide many benefits to society including preservation of biodiversity, maintenance of watersheds etc.  Unfortunately, many of these benefits are intangible.  However, the benefits associated with recreation and tourism in protected areas tends to be tangible.  These can lead to increased support for the protected areas with which they are associated.  This is one reason why ecotourism is embraced as a means for enhancing conservation of natural resources.

Lindberg, (1996); Salvo and Giulio, (2003) have assessed the economic impacts of ecotourism. The level of benefits varies widely as a result of differences in the quality of the attractions assessed. In some cases, the number of jobs created may be low, but in rural areas even a few jobs can make a big difference. Still, ecotourism benefits should not be overvalued, or there may be a backlash as reality fails to live up to expectation. The impacts of ecotourism on any economic activity can be grouped into three categories: direct, indirect and induced (see fig 1.1). Direct impacts are those arising from the initial tourism spending, such as money spent at restaurant. The restaurant buys goods and services (inputs) from other businesses, thereby generating indirect impacts.  In addition, the restaurant employees spend part of their wages to buy various goods and services, thereby generating induced impacts.  Of course, if the restaurant purchases the goods and services from outside the region of interest, the money provides no direct impact to the region, it leaks away.

 

Import- Leakages
Wages (households)
Tourist Sector

E.g. Restaurant

Indirect

Impacts

Direct Impacts
Tourist Spending

 

 

 

 

 

Induced Impacts
Others example: Beverages/Food Processing

                                                                                                                                                                                                                                                                                                           

Fig. 1.1: Ecotourism’s Economic Impact

Source: Lindberg, 1996

By identifying the leakages, or conversely the linkage within the economy, the indirect and induced impacts of tourism can be estimated.  In addition, this information can be used to identify what goods are needed but are not being produced in the region, how much demand there is for such goods, and what the likely benefits of local production would be.

The World Tourism Organization [WTO] (2009) suggested that tourism is not much different from other productive sectors but has the following additional advantages in terms of its potential for poverty alleviation:

  1. High potential to maintain forward and backward linkages.
  2. Potential for growth in poor countries and areas with few other competitive exports.
  • It is relatively labour intensive and employs a high proportion of women.
  1. Tourism products can be built on natural resources and culture, which are assets that some of the poor have.

Other benefits include increased demand for local accommodation, food and beverage outlets. This leads to improved viability of both new and established hotels and guest houses.  Additional revenues for local business such as those related to souvenir shops. Ecotourism is also expected to increase market for local products such as locally grown food grains, vegetables and fruits.  Ecotourism is accepted as a means that can satisfy both local people in need of gainful economic activity as well as conservationists.  It provides a means of empowerment to disadvantaged groups such as many native people (including women) by opening an economic and management role for them. Ecotourism can contribute in other significant ways to poverty reduction. For instance, it can help communities to reclaim their cultural pride, sense of ownership and control over local development, reduce vulnerability through diversification and develop skills and entrepreneurial capacity (State of the Environment, 2008).  There arises the need to properly assess the recreational value of ecotourism to enable appropriate decision making for national development.

 

1.2 Statement of the Problem

Parks as reserved areas are ecologically rich in biodiversity and act as “sinks to greenhouse gases” that bring about global warming and climate change. The planet’s climate is naturally dynamic, always changing. However, human activities have worsened the situation by releasing greenhouse gases into the atmosphere, which cause the climate to change unpredictably. Specifically, carbon dioxide (CO2) is produced when fuels are used to generate energy or when forests are cut down and burned (Okojie and Amujo, 2011).  Ecotourism contributes to protection of forest, which is important for climate stabilization. Besides being a source of attraction to tourists who enjoy and appreciate it, forests play important role in providing essential ecological functions such as preserving the ecosystem, biodiversity conservation and protection against storm, flood and droughts. An important question this study dealt with was the level of awareness of respondents with respect to the benefits of ecotourism.

Human beings’ affinity for observing animals and their behaviour is often unprecedented. The uniqueness and abundance of wildlife in National Parks attract people to the area to observe the animals in their natural habitat. Individuals who have more money (disposable income) are often willing to visit parks and pay more to enjoy the natural environment of the park as well as spend more days in the park as tourists (Hökby &Söderqvist, 2003). Family size or family composition matters in recreation activities; people believe that having a large family size may make them spend more on recreation activities, forgetting the benefits accruable to this, and that young children are more lively when they visit park during picnic or festive periods, which often leaves an indelible experience with the children (Okojie, 2007). The levels of education may also create awareness and give individuals the opportunity to access information about the benefits of recreation activities. Ecotourism activities often take place in the national park, therefore individuals who live close to the park are expected to have low trip cost and derive more benefit than individuals from farther away, who might decide to do for the substitute site in order to have a reduced trip cost.This study hopes to investigate the relationship between tourists’ socio-economic characteristics, the existence of alternative sites and tourism demand.

Naturally, people get involved in the deforestation and degradation of these areas through alternative land use incursions such as farming, housing/building of factory, road construction, etc.  From time immemorial, man has had the notion that the forest is a renewable natural resource and hence, through ignorance and misconception he has regrettably stuck to the opinion that products of forests are inexhaustible.  These factors have caused the wanton destruction of forests – that provide recreation through ecotourism globally with little or no thought for regeneration (Okojie, 2007).Nigeria’s wildlife resource base has resultantly been considerably degraded. Degradation of Nigeria’s wildlife resource base is caused by:

  • Population explosion, human characteristics and attitude.
  • Over-exploitation of natural resources, resulting in loss of wild animal habitats.
  • Hunting pressure; and
  • Unfavourable or inconsistent government policy (Ojong, 2000).

There is also the notion that the relative economic returns from different land – use options have higher benefits and profits to the local communities than the revenue generated from mere charging of different levels of price for wildlife viewing (ecotourism) and other consumptive uses which they believe are being under – priced and do not have any benefit to the communities serving as host to the parks. This could be as a result of undervaluation of ecotourism. The study shall deal with a comparison of ecotourism values particularly as it concerns OONP with that of alternative land use (agriculture).

Ecotourism has immense potentialin the quest for poverty alleviation.  A  World Tourism Organization (2009) initiated study concluded that in developing countries particularly in the least developed countries, ecotourism is almost universally acclaimed as the leading source of economic growth, foreign exchange, investment and job creation. Foreign exchange earnings fromecotourism have helped to narrow trade and foreign exchange deficits.  Ecotourism contribute significantly to eleven (11) of the twelve (12) countries that together account for 80% of the world’s poor. The world travel and tourism council in its research had stated that direct contribution of travel and tourism to GDP in Nigeria was NGN 11.7bn (4.8% of total GDP) in third quarter of 2016.In addition, tax revenue from ecotourism is an important economic benefit at national and local levels. Taxes provide valuable financial resources for developing infrastructure, tourist attractions and other public facilities and services and tourism marketing and training required for developing ecotourism, as well as to help finance poverty alleviation programmes by governments (World Travel and Tourism Council, 2016). Furthermore, ecotourism related revenues and levies also help to finance community needs. In spite of these contributions, deliberate efforts have not been made by government to effectively harness resources for the development of recreation facilities (WTO, 2009).The citizenry equally ignore the significant contribution of ecotourism by decimating the biodiversity that constitute the ecological niche represented by national parks. Moreover, degradation through deforestation continues to be emphasized. This may be partly due to ignorance on the part of the government and the populace on the value of such recreation facilities. Assessing economic value of ecotourism therefore becomes very pertinent. Although, past related studies have estimated the ecotourism benefits (Hein, 2011); the elasticity of demand for ecotourism with respect to price/recreation cost and income of the tourists (Hökby &Söderqvist, 2003); the importance of international ecotourism relative to domestic ecotourism (Menkhaus & Douglas, 1996); the value of environmental goods-rainforest protection as a separate study(Okojie, 2007), but this study is envisioned to do a holistic valuation of ecotourism in Old Oyo National Park.

This study was able to find answers to the following research questions:

  1. What is the level of respondents’ awareness with respect to the benefits of ecotourism?
  2. Is there any relationship between the socio – economic characteristics,degree of perception of the site tothe tourist; substitute sites and tourism demand?
  • Is there significant difference between the profits from tourism and alternative land use in the study area?
  1. What are the present and future tourism values of recreational areas such as Old Oyo National Park (OONP)?

 

 

 

1.3 Objectives of the Study

The broad objective of the study is to determine the economic value of ecotourism in Old Oyo National Park (OONP).

The specific objectives are to:

  1. ascertain the level of respondents’ awareness to the benefits of ecotourism
  2. describe the socio-economic characteristics and the level of satisfaction of tourists to the OONP
  • estimate the expected on-daysite recreation demand
  1. estimate the welfare benefit tourist derive from recreation at the OONP
  2. estimate the current total recreation value of OONP
  3. compare the recreation value of OONP with that of Agriculture.
  • make recommendations for policy formulation with respect to recreation and National Parks establishment and maintenance for national development

 

1.4 Research Hypothesis.

This study is to be guided by the following hypothesis:

Ho:  The demand for ecotourism is not significantly affected by the socio-economic characteristics, site perception degree and substitute sites of tourists.

 

1.5 Justification of the Study

Tisdell, (2013) opined that often environmental goods that include parks are treated as free goods when they are in fact relatively scarce. He concluded that environmental goods should have a price attached to their use reflecting their social value. It has however not been the case as many have continued to look at development and improvements in environmental quality as competitive rather than complementary process. In this competition, many ecological niches that were supposed to be preserved for recreation have been sacrificed for other developmental purposes.

There has equally been the problem of not properly understanding the correlation between recreation and enhanced productivity at work on one hand and improve health on the other.  These  if understood will go a long way in promoting sustainable economic development so needed in ensuring that the present national plan of making Nigeria among the 20 most developed countries in 2020 is realized.  There is therefore the need to quantify the monetary value of recreational facilities and assess the benefits derived from these environmental facilities.  This study is set to achieve this with the hope of incorporating them into decision making process.

The economic importance of ecotourism needs to be re-emphasized through studies like this for establishment and maintenance of recreational parks.  As economic valuations of recreations services are hardly done, policy makers find it difficult to understand the importance of these areas and the need to mobilize resources for their further establishment and protection.

Although studies have been done on rainforest or ecotourism value in Costa Rica, Madagascar, Jordan, Portugal, etc.; (Amer & Said, 2006; Isabel & Isabel, 2005; Maille & Mendelsohn, 1993 and Menkhaus & Lober, 1996), not many have been done in Nigeria. In his valuation of the Environmental goods – Rainforest Protection; (Okojie, 2007) used Contingent Valuation Method (CVM) and not the Travel Cost Method (TCM);therefore the need to apply another analytical tool – Travel Cost Method (TCM) to enrich the available literature on this emerging discipline of Economics arises.

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