Opportunities and Challenges in Tourism Development Roles of Local

Government Units in the Philippines1

Aser B. Javier, Ph.D. and Dulce B. Elazigue2

INTRODUCTION
Tourism as a product and service oriented industry, could generate widespread
benefits and impacts to the economy and society. It could contribute to the achievement
of Millennium Development Goals (MDGs) particularly those concerning poverty
alleviation, environmental conservation, and generation of employment opportunities for
women, indigenous communities and young people. Further, tourism could be a source of
revenue (foreign exchange earnings, tax revenue) to the government and because of its
multiplier effect, could provide opportunities for local economic development (LED).
The direct, upstream, and downstream industries involved in tourism activities have the
potential for creating sectoral linkages and economic opportunities in the localities.
The major subsectors prevalent in Philippine tourism include ecotourism; medical,
health and wellness and retirement; meetings, incentives, conventions and exhibitions
(MICE); adventure, outdoor and sports; amusement, entertainment and leisure; and
cultural and heritage tourism (Alvia and Libosada, Jr., 2009). In 2005, the Philippines
gross domestic product (GDP) at market prices was estimated at US$99 billion.
Tourisms direct contribution to GDP is around 2% and employment generated is around
1.5 million jobs. In 2006, there were over 3.49 million people directly and indirectly
employed in the tourism industry. From 2004 to 2007, the industry registered annual
average growth rates of 10.5% and 34.9% in terms of tourist arrivals and receipts,
respectively (Gutierrez, 2008). In 2007, travel and tourism contributed an estimated 3.8
million jobs across the economy (or around 8.8% of total employment).
In view of the socio-economic benefits that could accrue to communities, it is
imperative that communities capitalise on opportunities from tourism. One of the major
1

Paper presented to the 3rd Annual Conference of the Academic Network of Development Studies in Asia
(ANDA). Skills Development for New Dynamism in Asian Developing Countries under Globalization.
March 5-7, 2011 Symposion Hall, Nagoya University Japan. Japan Society for the Promotion of Science
(JSPS) and Nagoya University.
2

Dr Aser B. Javier is Associate Professor at the Institute of Development Management and Governance
and is currently Director of the Institute of Strategic Planning and Policy Studies of the College of Public
Affairs of the University of the Philippines Los Banos. Ms. Dulce B. Elazigue is University Researcher of
the Institute of Strategic Planning and Policy Studies of the College of Public Affairs of the University of
the Philippines Los Banos

authorities which provide the key roles to this success is that of local government units
(LGUs). LGUs could provide the ideal, authority, infrastructure, policy and planning
procedures to maximise the benefit for its communities. LGUs play a major role in a
communitys development, provide the links between the people and government,
address its communitys problems and concerns, enforce policies and hold influence over
its communities. The LGUs are also intermediaries in channelling the framework of
government into each individual community in order to create a beneficial outcome.
In the context of sustainable development, local governments also play important
roles on the success of its local tourism industry, as well as have a strong influence in
conserving its resources. Sustainable tourism development refers to the management of
all resources that meets the needs of tourists and host regions while protecting the
opportunities for the future, in such a way that economic, social and aesthetic needs can
be fulfilled while maintaining cultural integrity, essential ecological processes, biological
diversity and life support systems (Tourism Act of 2010). Vital to this approach is the
contribution of a full range of stakeholders and the community in planning and decision
making in order to determine the communitys long term interest. On this basis, the local
government can have a profound influence on the local tourism industry, and plays a part
in conserving the very asset on which its future depends.
Further, local governments institutional capacity to provide for tourism development
will be affected by a number of issues, including: individual capacities, resources
(financial and physical), community acceptance, and governance.

CONCEPTUAL FRAMEWORK
The role of local government is to promote the social, economic, environmental and
cultural wellbeing of their communities and their involvement in tourism must be
related to that. The LGUs have the mandate to craft their own tourism plan which sets out
the priorities over the medium to longer term and how the local authority intends to
contribute to community wellbeing. The plan must set out the following the community
outcomes as a result of tourism development, how these have been identified and how the
local authority will contribute to these. The Local Government Tourism Strategy may
contribute to economic development strategies and or regional as well as national tourism
strategies and serve as the basis of the role of LGUs (Figure 1).

Figure 1. Interrelation between local and regional/national tourism strategy and

community outcomes (Adapted from Local Government New Zealand (2004).
Community
Outcomes
Contributes

to

Contributes

to

Local governments
contribution identified

Local Tourism Plan

Provides basis for local

Governments involvement

Economic
Development
Strategy

May be part of

Provides basis for local

Governments involvement

Regional/National
Tourism Strategy

RA 9593

TOURISM APPROACH TO LOCAL ECONOMIC DEVELOPMENT (LED)

The Philippine government sees the need to focus on tourism in order to capitalize on
the lost opportunities that could have been captured from it. As early as 2007, the DOT
has identified the development of tourism real estates, establishment and modernization
of tourist accommodation facilities as priority activities (Business World, 2007).
Republic Act (RA) 9593 also known as the Tourism Act of 2009 was enacted in May
12, 2009. The law is considered as the Omnibus Tourism Code. Its general provision
stated in Section 1 is to harness its potentials as an engine of socio-economic growth and
cultural affirmation to generate investment, foreign exchange and employment and to
continue to mold an enhanced sense of national pride for all Filipinos. The states
perspective of tourism, as with the rest of the other countrys experience and plans, is
seen through the direct contributions on job creation, foreign exchange generation and
stimulation of large and usually foreign investments.

This policy statement reflects the government perspective on tourism that has
remained largely unchanged since the creation of the DOT in 1973. The message has
been consistent for almost 40 years: tourism is a powerful economic growth engine for
the country with great potential to generate direct and indirect jobs, upgrade the levels of
investment, and facilitate foreign exchange movements. Thus, it was not surprising that
the policy framework of the 2004-2010 Medium Term Philippine Development Plan
(MTPDP) remains geared towards attracting more visitors, extending their length of stay,
and increasing the attractiveness of tourist products to encourage travelers to spend more
(Alampay, 2009 as cited by Javier, 2010).
The Tourism chapter of the MTPDP has a product market, destination, building
tourism priority zones and tourism infrastructure focus. Three priorities for product
market has been identified aggressive multichannel promotion of the short-haul
beachgoer and sightseeing/shopper, and domestic market segments, related products, and
destinations. These markets should receive between 60 and 70 percent of the promotional
budget; Niche-based tailored promotion of the short-haul recreation travellers and
ecotourists; and the strategic ambassadors backpacker and balikbayan segments, and
related products. These should receive between 20 and 30 percent of the promotional
budget focusing on rifle shot promotions aimed at specific niches such as golf, diving,
among others; and long-term tactical marketing to the long-haul markets and MICE
segments, and related products which should receive 20 to 30 percent of the promotion
budget in the long-term, focusing on non-media based campaigns (MTPDP, 2004-2010).
The MTPDP 2004-2010 and the RA 9593 puts premium in establishing the Tourism
Economic Zones (TEZs). This shall be the main vehicle for focused development at a
local level within the priority destinations together with the creation of a Tourism
Industrial and Economic Zone Authority (TIEZA) in place of the Philippine Tourism
Authority (PTA). The TIEZA shall designate the TEZs, upon recommendation of any
LGUs or private entity or through joint venture of private and public sectors (Chapter IV,
Section 60, and RA 9593).

POLICY AND INSTITUTIONAL LANDSCAPE OF LGUs ROLES

The formation of institutional structures and the implementation of tourism policies
and strategies require enabling legislation and regulatory framework. Below is a
discussion of the policy and institutional setting that govern the tourism industry in the
Philippines.
Republic Act No. 7160 of 1991- The Local Government Code
The Code (Section 17) provides for LGUs responsibility in basic services and
facilities that include tourism development and promotion programs, tourism facilities
and other tourist attractions, including the acquisition of equipment, regulation and

supervision of business concessions, and security services for such facilities. LGUs, as a
corporate entity (Section 15) are also vested corporate powers with full autonomy
(Section 22) in proprietary functions and management of their economic enterprises.
However, the condition that this provision is subject to the limitations provided in this
Code and other applicable laws negates the full autonomy.
The recent emphasis of the current administration towards the practice of the LGUs
as corporate entities became very favourable for the tourism industry. Tourism together
with agribusiness development was seen as the LGUs best bet for increasing local
revenues. These two sectors were identified by the initial four pilot LGU clusters where
the Local Governance Support Program-Local Economic Development (LGSP-LED)
operates. The LGSP-LED is an eight-year collaborative program of the Governments of
Canada and the Philippines implemented in partnership with the Department of Interior
and Local Government (DILG) and geared towards reducing poverty by strengthening
local governance and supporting sustainable LED (LGSP-LED, 2009).
In terms of structure, the Local Development Councils (LDCs) at the provincial, city,
and municipal level (Section 109) have the mandate to formulate socioeconomic
development plans and policies; public investment programs; local investment incentives
to promote the inflow and direction of private investment capital. At the same time, the
LDCs are the ones that appraise and prioritize socioeconomic development programs and
projects. The Sanggunian approves local development plans which are submitted to the
regional development council, which shall be integrated into the regional development
plan for submission to the National Economic and Development Authority, in accordance
with existing laws.
Also very recently, a Memorandum Circular (DILG-MC 2010-113) was issued by the
DILG encouraging provinces and cities for the creation of a Local Economic and
Investments Promotions Officer (LEIPO). The LEIPOs are tasked primarily to facilitate
the preparation, coordination, and execution of local economic and investment promotion
policies, projects, and activities of the provincial/city government. Tourism development
was identified by the LEIPOs as a good investment priority as planned in the initial rollout of the LEIPOs orientation on LED (Javier, 2010).

Republic Act No. 9593 - The Tourism Act of 2009

The Act provides for the development of a national tourism action plan for
implementation by national and local governments; enlisting the participation of local
communities, including indigenous peoples, non-government organizations (NGOs),
peoples organizations (POs) and the private sector. It also emphasizes capabilitybuilding of LGUs, in partnership with the private sector, in the management of local
tourism projects and initiatives, and the establishment of tourism enterprise zones (TEZs).

Local tourism development planning

LGUs, in consultation with stakeholders, are encouraged to utilize their powers under
the Local Government Code to ensure the preparation and implementation of a tourism
development plan, the enforcement of standards and the collection of statistical data for
tourism purposes. The plan should integrate zoning, land use, infrastructure development,
the national system of standards for tourism enterprises, heritage and environmental
protection imperatives in a manner that encourages sustainable tourism development
(Section 37).
Institutional arrangements
The Department of Tourism (DOT) shall be the primary planning, programming,
coordinating, implementing and regulatory government agency in the development and
promotion of the tourism industry. It shall monitor the LGUs compliance to national
standards in the licensing of tourism enterprises; and ensure the proper coordination,
integration, prioritization and implementation of local tourism development plans. It shall
provide technical assistance to LGUs in destination development, standard setting and
regulatory enforcement; preparation, implementation and monitoring of local tourism
development plans, gathering of statistical data, and enforcement of tourism laws and
regulations.
There are a number of activities where LGUs have to coordinate with DOT. These
include:
- integration and coordination of local and national plans for tourism development
- approval (by LGU resolution) of designating TEZ
- designation of a permanent position and performance of functions of a tourism
officer in every province, city or municipality where tourism is a significant
industry
- promulgation (also in consultation the private sector industries and other tourism
stakeholders) of rules and regulations on the operation of all tourism enterprises,
such as a national standard for licensing, accreditation and classification of
tourism enterprises
- establishment of tourist information and assistance centers at strategic locations
(province, city or municipality where tourism is a significant industry)
- provision to DOT of an inventory of all the resources available to the DOT for
use in the implementation of the Act
- periodic reporting to the DOT on the status of tourism plans and programs, tourist
arrivals, and tourism enterprises, among others, within their jurisdictions
- issuance of timely advisories on the safety or viability of travel to particular
places
- report to DOT of incentives provided by LGUs for tourism enterprises through,
among others, reductions in applicable real estate taxes and waivers of fees and
charges

Rationalization of tourism areas, zones and spots

Under the Act, the Philippine Tourism Authority (PTA) is reorganized as the Tourism
Infrastructure and Enterprise Zone Authority (TIEZA). The TIEZA shall be a body
corporate which shall designate, regulate and supervise the TEZs as well as develop,
manage and supervise tourism infrastructure projects in the country. TEZ is an area
specifically defined or organized as a tourism area, zone or spot under any special or
general law, decree or presidential issuance (Section 32).
With respect to tourism zones, areas or spots not organized into TEZs, the DOT,
through appropriate arrangements, may transfer control over the same or portions thereof,
to another agency or office of the government, or to a LGU upon DOT approval. The
Department shall exercise supervisory powers over such agency, office or LGU in
accordance with the terms of the transfer or the development plan of the zone, area or
spot.
No TEZ shall be designated without a development plan duly approved by the TIEZA
and without the approval, by resolution, of the LGU concerned. LGUs which comprise,
overlap, embrace or include a TEZ in their territorial jurisdictions shall retain their basic
autonomy and identity in accordance with the Local Government Code.
Under the Act, The Philippine Conventions and Visitors Corporation (PCVC) are
reorganized as the Tourism Promotions Board (TPB). The Bureaus for Domestic and
International Tourism Promotions, and the Office of Tourism Information of the
Department, are absorbed into the Tourism Promotions Board. The DOT, the TPB and
the TIEZA shall prioritize promotion and development assistance for LGUs which
successfully adopt and implement their tourism development plans.
Funding schemes
The Act provides for the Tourism Development Fund to be disbursed and
administered by the DOT for the development, promotion and marketing of its tourism
and other projects. DOT may provide financial to LGUs for the preparation,
implementation and monitoring of their tourism development plans.
Tourism enterprises registered with the TIEZA shall further be ordered to pay back
taxes in the amount equivalent to the difference between the taxes that they should have
paid had they not availed of the incentives under the Act and the actual amount of taxes
being paid by them under the same incentive scheme. The back taxes to be collected shall
be computed up to three (3) years directly preceding the date of promulgation of the
decision or order finding that the tourism enterprise violated the terms of its accreditation.
The proceeds of these back taxes shall be distributed as follows: one-third to the National

Government; one-third to the LGUs concerned, to be shared by them equally in case of

more than one such LGU; and one-third to the TIEZA.
One unique feature of the RA 9593 is the shared governance of both national and
local governments in tourism development. The shared governance approach hopefully
will ensure the cooperation of each agency in performing n tourism development plans.
Shared Governance
The Act is also explicit in the delineation of the shared responsibilities between
national and local governments. It is the responsibility of both national local governments
to prepare and implement tourism development plans, enforcement of standards and
collection of data for tourism purposes. It is imperative to national governments to assist
the LGUs in planning and law enforcement. This means that tourism development is both
a responsibility of national and local governments.

Table 1. Summary of National-Local Roles and Tourism Shared Governance

Functions
National Government
Shared Governance
Local
Government
Tourism
(a) Formulate tourism
LGUs to ensure the
Formulate
Development policies, plans and projects for preparation
tourism plans
Planning
the development of
and implementation of a
and programs
tourism as an engine of socio- tourism development plan, the
economic and cultural growth; enforcement of standards and
the collection of statistical
data for tourism purposes. The
development plans shall
integrate zoning, land use,
infrastructure development,
the national system of
standards for tourism
enterprises, heritage and
environmental protection
imperatives that encourage
sustainable tourism
development.
(b) Supervise and coordinate
(ix) Investment
the implementation of tourism
support
policies, plans and project
services,
including
access to credit
financing;
(n) Ensure the proper
coordination, integration,
prioritization and
implementation of local

Tourism
Promotion

Tourism
Standards

tourism development plans

with that of the National
Government;
(e) Provide an integrated
market development program
to attract people to visit The
Philippines and enhance the
prestige of the country and the
Filipino people in the
international community;
(f ) Represent the government
in all domestic and
international conferences and
fora, and in all multilateral or
bilateral treaties and
international agreements
concerning tourism, and
ensure government
implementation;
(i) Support, advance and
promote the protection,
maintenance and preservation
of historical, cultural and
natural endowments, in
cooperation with appropriate
government agencies and the
private sector, and take
appropriate
measures against acts and
omissions contrary to these
objectives;
(k) Evaluate tourism
development projects for the
issuance of permits and the
grant of incentives by
appropriate government
agencies, establish a databank
of tourism areas and projects
for investment purposes, and
encourage private sector
investment and participation
in tourism activities and
projects;
(l) Formulate and promulgate,
in consultation with the
LGUs, the private sector
industries and other tourism
stakeholders, rules and

The DOT shall develop and

support training programs to
enhance the capability of
LGUs to monitor and
administer tourism activities,
and enforce tourism laws,
rules and
regulations in their respective
jurisdictions. Funding for such
programs shall be shared
equitably between the
Department and the LGUs
concerned.

(xi) Tourism
facilities and
other tourist
attractions,
including the
acquisition of
equipment,
regulation and
supervision of
business
concessions,
and security
services for
such facilities;

regulations governing the

operation and activities of all
tourism enterprises, including
but not limited to a national
standard for licensing,
accreditation and
classification of tourism
enterprises, impose reasonable
penalties for violation of
accreditation policies and
recommend to the LGUs
concerned the suspension or
prohibition of operation of a
tourism enterprise;
(m)Monitor the LGUs
compliance to national
standards in the licensing
of tourism enterprises,
(o) Provide technical
assistance to LGUs in
destination development,
standard setting and
regulatory enforcement;
(p) Undertake continuing
research studies and survey to
analyze tourism economic
conditions and trends and
compile and integrate a
statistical databank;

The National Tourism Action Plan, 2004-2010

The Plan addresses:

Transportation and infrastructure - e.g., improving air/sea access to the

Philippines; liberalizing civil aviation; promoting seamless travel to and from
tourism gateways and satellite destinations; developing related infrastructure

Marketing and product development - enhancing the Philippines image as a safe,

secure and tourist-friendly destination; synchronizing public and private sectors
marketing and promotional efforts

Environment, social, cultural concerns - to conserve and protect the national,

physical, and ecological resources; research and development; advocacy and
capacity building for tourism stakeholders on protection and preservation of
natural and cultural resources

Investments and economics - encouraging investments in existing and new

tourism enterprises through tourism enterprise/economic zones, rationalization of

incentives for tourism projects and continued investment liberalization; promoting

greater involvement of local communities in tourism
Institution building and human resource development - institutionalizing publicprivate sector partnerships in the formulation, implementation and monitoring of
the NTAP

Related to the Action Plan is the Tourism Master Plan of the Philippines (1990
2010) which was formulated in 1990 which emphasizes tourism development on an
environmentally sustainable basis and social cohesion and cultural preservation at local
level. The strategies identified are: cluster development approach based on the
establishment of three main international gateways and associated satellite destinations; a
niche/mass market approach based on a diverse mix of special interests; a balance of
development between foreign and domestic tourism. Regional Tourism Plans were
envisioned to be blueprints for the development of the regional destinations and site
specific tourism master plans have also been formulated.
Executive Order No. 111 and the National Ecotourism Strategy
This EO was issued on 17 June 1999 to establish the guidelines for ecotourism
development in the Philippines, and thereby created a National Ecotourism Development
Council to make policy along with structures to review and approve ecotourism projects.
Prior to this EO, a joint DENR-DOT Memorandum Circular No. 98-02 provided the
guidelines for ecotourism for development of the Philippines and created the Ecotourism
Steering Committee which includes the Concerned Local Government Unit
representative.
Pursuant to EO111, the National Ecotourism Strategy (NES) was completed in April
2002 to promote an integrated approach for the protection of natural resources while at
the same time generating economic opportunities for local communities. Its preparation
was undertaken through a series of regional stakeholders consultation and national
planning workshops that emphasized a bottom-up and top-down approach for harnessing
ideas, information and experiences in developing the country's ecotourism sites.
Republic

Act

No.

7916

Special

Economic

Zone

Act

of

1995

This Act provides for the creation, operation, administration and coordination of
Special Economic Zones in the Philippines, creating for this purpose, the Philippine
Economic Zone Authority (PEZA). PEZA is the national investment promotion agency
and a government owned corporation, attached to the Department of Trade and Industry.
In 2002, the DOT entered into a Memorandum of Agreement (MOA) with PEZA that
will grant Special Economic Zone status to tourism development zones and tourism
estates upon registration with PEZA subject to the issuance of the required Presidential
Proclamation. The PEZA shall consider for registration tourist-oriented enterprises to be

located in PEZA-registered tourism development zones/tourism estates which are

enclosed by the DOT as enterprises that will be established and operated with foreign
tourists as primary clientele.
PEZA grants fiscal and non-fiscal incentives to developers of economic zones, export producers and IT service exporters. PEZA offers ready-to-occupy locations to
foreign investors who are export producers or IT service exporters in world class and
environment friendly Economic Zones and IT parks/buildings. Recently, tourism has
been included as a priority investment sector opening the way for the designation of
tourism economic zones.

EMERGING ISSUES AND CHALLENGES

There is a wide array of concerns that LGUs could address in making decisions
towards developing the tourism industry (Table 1). While LGUs are in a strategic
position to plan and facilitate tourism development in their areas of jurisdiction, they are
also challenged by the realities of expanding roles and responsibilities, budget pressures,
prioritization given a constraint in resources, as well as governance issues. LGUs must
find ways to cope with these realities such as building networks, pursuing adequate
funding and enhancing local organizations.
In making decisions and actions, considerations include community needs (e.g., potential
for economic growth, employment, potential to increase the tax base of the LGU);
structural (statutory/legal procedures, experience and skills of decision makers); interpersonal relations (e.g., community pressure and/or conservation groups).

Table 1. Tourism decisions and action that could be taken by LGUs.

Concern
Decision/action
Supporting economic development of local/regional tourism
Information
products
Local/regional tourism promotion and operation of tourist offices
Supporting completion of local/regional tourism development plans
Planning
and strategies
Long term vision for tourism having regard for social, economic and
environmental factors
Local tourism development policy
Policies on zoning criteria, permissible development criteria, other
Controls
controls for tourism development
Providing guidelines and controls for facilitating tourism
development possibilities
Architectural and engineering designs of specific tourist facilities
Safety, health and environmental integrity requirements for tourism
developments
Development Development applications approvals for tourism-related land uses,
services and facilities
Varied or waived assessment criteria or standards regarding local
tourism developments
Specific licenses, permits or other consents to be granted for tourism
developments
Assessing the commitment, compatibility and intentions of
developer-operators
Determining future/present land use zones for incremental tourism
Land use
development
Determining specific suitable sites which show permissible
development of land for tourism
Infrastructure Infrastructure changes for enhancing the tourist experience and/or
visitor management
Recreational, open space and infrastructure plans in the local region
Establishing fees, taxes, rates etc. from tourism developments and
Funding
other visitor amenities
Funding consultancies, expert advice and research to address
tourism issues and development problems
Source: Richins (2000)

Some emerging issues are discussed below.

Conditional Provisions on Autonomy of LGUs

The Local Government Code bestows corporate powers to LGUs, but this is
conditional upon the limitations provided in the Code and other applicable laws, thus
negating the LGUs full autonomy power. DOT still exercises control in terms of
ownership of tourism facilities. TIEZA (formerly PTA) remains responsible for
infrastructure development.
DOT, being the lead agency in tourism development, laments the capability of the
LGUs in its regulatory mandate (as per Local Government Code), for example in
licensing of tourism businesses, generation and management of tourism-related data to
guide decision making in tourism development. On the other hand, the LGUs autonomy
in tourism development is constrained with the provisions of the Tourism Act where most
related activities at the local level have to be coordinated with DOT.
The powers of the LGUs under the Local Government Code pertaining to the
issuance of business permits, licenses and the like will not be diminished. However,
accreditation by DOT is required in the issuance of these licenses by LGUs. When an
enterprise fails to obtain or loses accreditation, the DOT shall notify the LGU concerned
so that it may take appropriate action in relation to an enterprises licenses and permits to
operate.
The new law maybe a wake-up call for the LGUs as far as exercising autonomy is
concerned but is a challenge in national-local coordination. In addition, it will be an
exercise in anticipatory local tourism planning.
Ecotourism Research and Information
Tourism knowledge base will help guide and facilitate the expansion of the sector.
This will help in identifying sites for tourism development; developing research agendas,
programmes and partnerships; and, improving the supply of data and information to all
partners and stakeholders. Community profiling of resources and skills will be necessary
if tourism is identified as a job creator.
Reliable research and statistics are a major weakness of the tourism industry.
Although there are actions to improve the quantity and quality of data collected by the
DOT and LGUs, there is still the need to develop a consistent and reliable database.
LGUs have an important role in generating this database which should include
characteristics of tourists from the different source markets (e.g., what they do, length of
stay, how much they spend); inventory of resources (e.g., how many hotels, rooms,
location, standards); utilization of resources (e.g., occupancy rates, bed nights sold in
different forms of paid accommodation by source market); profiles of main international

source markets (e.g., size of markets, motivations, travel patterns); more comprehensive
profile of domestic market.
Research-related activities that may be done at the local level include generation of
statistics on tourism, cost and benefit analysis, economic impact analysis as well as
analysis of impacts of policies (Figure 2).
In the Philippines, the most-often cited problems by tourists include garbage, peace
and order, heavy traffic, lack of information, and poverty (DOT in Cruz, 2000).
Other concerns include frequent occurrences of natural calamities and protection of
indigenous peoples rights to ancestral domains. These indicators are monitored at the
level of the tourist site or municipality, but the practicality of these indicators will be
contingent on primary data collection.

Figure 2. Research-related activities essential for tourism development.

Source: DOT-JICA 2007

Certification and Accreditation

Certification is a valid instrument to motivate local stakeholders to develop structures
to encourage and support improvement of business units, working to a standard that will
give them peer recognition, staff morale, and other aspects which make firms more
competitive. The label of this certification is considered as added value that leads to
acceptance in the marketplace.

The Philippines has only around 338 hotel and resort establishments with 27,466
rooms available for tourists nationwide. Around 37% is concentrated in Metro Manila. Of
the better quality hotels and resorts accredited by the DOT, 20% are internationally
managed. In terms of the total number of hotels and resorts recognized by the DOT, this
percentage is only 5% (Pantig and Smith 2005).
The DOT accredits establishments (using de luxe, first class, standard and economy
ratings) on a voluntary basis in order to assure quality services. The monitoring system of
DOTs accreditation needs to be enforced as tourists complain of the inability of
establishments to meet accreditation level.
With the new Tourism Act, primary tourism enterprises shall be periodically required
to obtain accreditation from the Department as to the quality of their facilities and
standard of services. These include travel and tour services; land, sea and air transport
services exclusively for tourist use; accommodation establishments; convention and
exhibition organizers; tourism estate management services). For secondary tourism
enterprises (those not mentioned above), accreditation shall be voluntary. The DOT may
delegate the enforcement of the system of accreditation to LGUs that have adopted and
successfully implemented their tourism development plans. The system of accreditation
is based primarily on levels of operating quality and efficiency. Tourism facilities or
establishments can already secure their licenses from the local government units but prior
accreditation from the DOT is required. This again reinforces the regulatory role of DOT.
Other challenges in certification and accreditation relate to the process and costs
involved in application, implementation by tourism firms, and operation of a program
(Font, nd). Although certification, e.g. of quality in hotels has started to include
environmental concerns, consideration of socio-cultural issues remains to be addressed.
LGU funding and exercise of corporate powers
To address budget pressures, LGUs need to improve capability for
income
generation, e.g., revenue-earning businesses. The context of public entrepreneurship has
to be embedded in LED approach for tourism development. Legitimately vested with
corporate powers, the challenge therefore, for LGUs and local chief executives (LCE) is
how to establish a business climate and harness local entrepreneurial competencies.

EXAMPLES OF GOOD PRACTICES AT THE LOCAL LEVEL

LGUs should build its commitment to tourism in terms of awareness raising, planning
and relationships. Host communities must be among the primary beneficiaries of tourism
activity at the local level. Local people should develop a strong sense of ownership of
tourism resources in their area. Strategies or models adopted by various localities could

be examined to learn lessons from these experiences and help in designing options
appropriate to specific situations or circumstances. Some of these are discussed below:
Central Philippines An illustration of institutional set-up for tourism
The Central Philippines tourism program adopts an institutional mechanism as shown
in Figure 3. Governed by elected officials, LGUs are the direct interface between the
local residents and government. LGUs can initiate tourism-related development projects.
Provincial Tourism Offices (PTOs) and Municipal Tourism Offices (MTOs) are LGU
units that have direct involvement in tourism. The local government tourism office (TO)
primarily functions as a tourism promotion unit that coordinates or organizes events,
represents the area at tourism road shows/fairs, and produces relevant materials. However,
as tourism is a new industry for many LGUs, few have established tourism units with
appropriately qualified personnel.
Private sector participation is through the Provincial/Municipal/Barangay Tourism
Councils. Provincial or municipal/city tourism councils are private entities, the
memberships of which usually comprise 60% private entities and 40% government
representatives. These councils help organize the local tourism industry into a cohesive
organization that promotes the growth of the sector and the area. Barangay Tourism
Councils, with the same set-up as provincial or municipal tourism councils, focus on the
tourism affairs and concerns of the barangay or village. Tourism councils are composed
of influential people in the locality such as local politicians, relatives of politicians, civic
organizations, and businessmen.

Figure 3. Local government institutional arrangements for tourism, Central

Philippines

Legend: --------- liaison arrangement; _______ hierarchical arrangement

Source: DPT-JBIC 2007

There are other tourism associations with homogenous organization or varied

representations organized in the different areas of Central Philippines. However, the
levels of involvement and organizational sophistication vary greatly between areas.
PCCI Biztour5 Program
Another notable practice is the tourism program called Biztour5 launched by the
Philippine Chamber of Commerce and Industry (PCCI) in 2006 to augment the
governments efforts in promoting tourism development. The Biztour5 Program aims to
achieve Five As through the development of business and investment opportunities
along the 5As. The 5As forming the tourism supply chain refer to: arrival (prearrival
marketing, air/sea/land transport, air/sea ports); access (roads, terminals, & related
infrastructure); accommodation (hotels, lodging, & restaurants); attractions (natural &
manmade), and activities (rest, recreation, & education). The scheme allows LGUs to
work in cooperation with their neighbouring areas to cover whichever component, or A,
a particular place is lacking (Alvia and Libosada, 2009).
Tourism Award
The Philippines has instituted tourism industry awards, which are cooperative
projects of government and the tourism industry. For instance, the Kalakbay Award,
given every two years, recognizes the best hotels, resorts, travel agencies, tour operators,
tourism frontline workers, local tourism councils and ecotourism products.
Environmental practices form part of the criteria for selection of best hotels and resorts,
but the weights assigned to them are quite low.
New Zealands Postcards from Home
The local government tourism strategy of New Zealand could also be considered.
Referred to as Postcards from Home, the strategy recognizes the role for local
authorities in ensuring that their communities benefit from tourism. Local government
leads, enables and works in partnership with other stakeholders to ensure a successful and
sustainable tourism sector. Options reflect local needs for structuring Regional Tourism
Organisations and other local marketing activities. Postcards from Home noted the very
wide range of roles which local authorities can play in tourism including: owner of
tourism facilities/services, operator of tourism facilities/services, funder of tourism
marketing/services, community facilitator, planners of infrastructure, services and
facilities, regulator, and/or providers of infrastructure, services and facilities. Local
government will lead, enable and work in partnership with other stakeholders to ensure a
successful and sustainable tourism sector.

Public-private partnership
Tourism should be integrated with the local economy, participation of communities
from the planning to implementation and management should be encouraged. Publicprivate partnership and external investments should be promoted. Examples of strong
private-public partnership in tourism development should be emulated as in the case of
Olango Bay in Cebu, and Panglao Craft Village at Panglao Island Tourism Estate in
Bohol. To enhance revenue generation from tourism, LGUs should consider
environmental costs equitably through direct and indirect contributions, fees, and charges.
The Mt. Pinatubo Tourism Project for example, helped establish a cooperative that serve
guided tours to Mt. Pinatubo's Crater Lake. Tourists pay user fees, which are used for
conservation of the trekking route and maintenance of public facilities and created
livelihood for the cultural community.

CONCLUSION
The foregoing discussion provided us the big picture on opportunities and challenges
of stakeholders roles in tourism development particularly the national and local actors
and institutions.
Internal to the LGU is the challenge of what the key offices enabling roles will be
considering the relationship with national government. This is particularly evident in
what the local legislative council policies and the executive offices programs will be in
support of tourism businesses and balancing call for sustainable development. These are
in the areas of leading investments in the local tourism areas, developing strategies based
on a better understanding of tourism needs, the need for increase dialogue with business,
evidence based decisions, specially on the negative impacts of tourism, shift in ad-hoc to
anticipatory management, and last is the thinking of a whole of government approach
to tourism development in general or harnessing governmental and private bodies
towards local tourism goals.
Internal to national government is the challenge of what key offices enabling roles
will be in considering its relationship with the LGUs. This is particularly evident in what
coordination mechanisms is to be adopted specially in enforcement and compliance to
tourism standards and in building competencies in tourism development planning. These
are in the areas of making sure that tourism development plans are translated in major
local policies and embedded in LGU budgets, coordination in marketing local tourism
areas at various promotional levels, and assistance in aftercare services for tourism
business retention, expansion and diversification.

This brings us to a conclusion that both national and local roles in tourism
development are anchored on its enabling (planning, promotions, research and business
assistance) and regulatory (enforcement, compliance and conservation) roles and its
delicate balance.
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