INTRODUCTION
Thus part of literature review provides definition of the important terms and concepts which used in this study thus focuses on ICT in tourism sectors, the conceptual frame work of this study also the researcher try to show the performance of tourism in SME's, the opportunity and challenges of tourism in Zanzibar and finally how the Government intervention to tourism in Zanzibar.
Definitions of the terms and Concepts
Small and Medium Sized Enterprises (SMEs)
Morrison (1996) argues that it is difficult to define the term SMEs because there are no universal criteria that can be used to determine the size of the business, as a result, Olomi (2009) noted that although the SMEs all over the world contribute a major role in social development, its definition varies from one country to another and even from one institution to another in the same country. An enterprise may be perceived as small in terms of physical facilities, production/service capacity, market share, and number of employee. Olomi (2009) cited that ,the United States Agency for International Development-USAID (1993) ,suggested that SMEs can be defined by considering combination of both qualitative and quantitative criteria and should include one among the aspects such as number of employee, capital investment, share capital, number of share holders, number of stakeholders, total asset, turnover, market share, geographical market coverage, organizational complexity, composition of management and degree of formalization.
In Tanzania, the SMEs Development Policy of 2002 classifies SMEs under the consideration of employment size and capital investment of the organization. A micro-enterprise is one with fewer than five employees, a small enterprise with 5-49 employees, a medium enterprise with 50-99 employees and a large enterprise with more than 100 employees. In contrast with the Capital investments the definition was based at the range from less than Tshs 5 million to over Tshs 800 million. For the purpose of this research, the Tanzania SMEs Development Policy of 2002 definition will be adopted because it is based on the local environment of Tanzania, where SMEs are characterized by family ownership and local area of operation, which is not the case to other countries. (http://www.tanzania.go.tz) This illustrated in the table below:-
Table: 1 CATEGORY OF SMEs IN TANZANIA
Category
Employees
Capital Investment in Machinery Tshs
Micro enterprise
1-4
Up to 5mil
Small enterprise
5-49
Above 5mil to 200mil
Medium enterprise
50-99
Above 200 to 800mil
Large enterprise
100+
Above 800mil
Source: (http://www.tanzania.go.tz)
Accordind to Zanzibar youth employment action plan.(2007), Zanzibar has a large informal sector operation where more than 80 percent of the workforce is believed to be engaged in. Majority of the establishments in the informal sector are micro, own account or employing less than 5 people. This situation is linked to low skills base as a result of limited opportunities for skills training, working capital and inadequate support for off-farm activities in rural areas. From a gender perspective,women have low participation rates and fewer skills than men. Women account for only 19 percent of total employees compared to 81 percent for men in this sector. This sector is dominated by private individuals through 1,541 registered businesses in 2002. Out of this number, only 6% employs more than 10 people while 79% of the industry employs less than 20 people and only 3% of registered industry employs more than 100 people (SME Policy, 2006). The potential is still there for more employment opportunities especially to out of school youths and those from different vocational training centers. The Zanzibar SME policy of 2006 is aiming at developing and creating conducive environment through participation of public and private sector for the purpose of increasing employment provision, income generation and poverty reduction. The policy and the MKUZA aim at increasing job opportunities through SMEs. SMEs are important to the national economic, but they are facing a number of problems, both administrative and financial and thus fail to contribute fully in employment creation.
Apart from the SMEs sector, Zanzibar has a small manufacturing (industrial sector). Manufacturing sector in general is at infant stage and has not been fully exploited to its maximum potential to increase its contribution to the economy and welfare of the people. There is a wide potential for investors to come in, invest in big industries and thereby generates employment o the youth. The importance of manufacturing sector in terms of employment creation and development of linkages with the rest of economy is well understood. Employment opportunities that exist in manufacturing take into consideration its linkages with agriculture, tourism, and trade. Other opportunities that could be generated include those from agro-processing, production of souvenirs, garage, transportation, and other new activities that will meet demands of tourism and trade. (mlywcd.org/)
Importance of Small and Medium Enterprises (SME's)
According to the Informal Sector Survey of 1991, micro enterprises operating in the informal sector alone consisted of more than 1.7 million businesses engaging about 3 million persons, that was, about 20% of the Tanzanian labour force (Toroka and Wenga 1997).
Since SMEs tend to be labour-intensive, they create employment at relatively low levels of investment per job created. At present, unemployment is a significant problem that Tanzania has to deal with. Estimates show that there are about 700,000 new entrants into the labour force every year. About 500,000 of these are school leavers with few marketable skills. The public sector employs only about 40,000 of the new entrants into the labour market, leaving about 660,000 to join the unemployed or the underemployed reserve. (SME's Development Policy,2002).
Most of these persons end up in the SME sector, and especially in the informal sector. Given that situation and the fact that Tanzania is characterised by low rate of capital formation, SMEs are the best option to address this problem. (SME's Development Policy,2002).
SMEs tend to be more effective in the utilisation of local resources using simple and affordable technology. SMEs play a fundamental role in utilising and adding value to local resources.
(SME's Development Policy,2002). In addition, development of SMEs facilitates distribution of economic activities within the economy and thus fosters equitable income distribution. Furthermore, SMEs technologies are easier to acquire, transfer and adopt. Also, SMEs are better positioned to satisfy limited demands brought about by small and localised markets due to their lower overheads and fixed costs. Moreover, SME owners tend to show greater resilience in the face of recessions by holding on to their businesses, as they are prepared to temporarily accept lower compensation. (www.tanzania.go.tz)
Information Communication Technology (ICT)
The literature shows that there is no universally accepted definition of ICT, because the concepts, methods and applications involved in ICT are constantly evolving on an almost daily basis.
Blurton (2002) as cited in Badnjevic and Padukova (2006) defines ICT is a diverse set of technological tools and resources used to communicate, and to create, disseminate, store, and manage information. Kumar (2001) claimed that ICT is the study, design, development, implementation, support, or management of computer-based information systems, particularly software applications and computer hardware. ICT deals with the use of electronic computers and computer software to convert, store, protect, process, transmit, and securely retrieve information.
The Adoption of ICTs by SMEs:
Obviously, ICTs are more than just computers or the Internet. Although there has been a tendency to focus on Internet technology, the study of technology effects in economy and business fields must also be closely considered. Today, ICTs must be conceived broadly to encompass the information that businesses create and use, as well as the wide spectrum of increasingly convergent and linked technologies that process that information. Therefore, ICTs can be viewed as a collective term for a wide range of software, hardware, telecommunications and information management techniques, applications and devices, and are used to create, produce, analyse, process, package,distribute, receive, retrieve, store and transform information (Porter and Millar, 1985; Brady et al.2002).As cited in Virginia Barba-S.et al (2007).
Nowadays, the widespread uses of ICTs are changing the way people or companies work. It is a feature of the technological advancements of this period in history where there has been immense innovation in information management and communication so that in many countries, information and knowledge are easily conveyed, accessed and used. Thus, the pace of technological change and what is available for use by firms has revolutionized how they interact and do business.
In particular, ICTs have a valuable potential for developing SMEs through more effective use and better integration of ICTs in business processes while assisting them to make more efficient decisions relevant to their performance. ICTs have the potential to generate a step change among SMEs and make them more competitive, innovative and generate growth.
Since SMEs play a role of increasing importance in the economy (especially when we consider their contribution to the generation of jobs as well as the social-economic development of the community where they are located) (Hartigan, 2005), As cited in Virginia Barba-S. et al (2007), it is then desirable that SMEs are stimulated into adopting new technologies more rapidly, and creating innovative products more competitively. It requires that SMEs have the right environment to prosper, form a skilled workforce and drive economic growth.
In recent years, large numbered SMEs have acquired direct access to computers or other types of digital technologies, primarily for individual task development. Yet now these computers are beginning to be connected to each other, and for the first time there is an opportunity for very large numbers of small companies to use computing and communication capabilities to help coordinate their work. Specialized products have been successfully developed and commercialized, and to some observers these applications herald a paradigm shift in technology usage and implications. On the other hand, the improvements in the costs and capabilities of ICTs are changing the ways in which certain kinds of communications and coordination can occur (Summut-Bonnii and McGee, 2002). As cited in Virginia Barba-S.et al (2007). Lowering the costs of coordination between firms may encourage more market transactions, and at the same time, closer coordination across firm boundaries. Moreover, new capabilities for communicating information faster, less expensively, and more selectively, may help to create a rapidly changing organization with highly decentralized networks of shifting projects teams (Roberts, 2000). As cited in Virginia Barba-S.et al (2007).
In addition, the sum of these changes is creating a pervasive feeling in business today that global interdependencies are becoming more critical. Thus, companies realize that they need to take advantage of ICT capabilities for improving their competitiveness and productivity (Ragaswamy and Lilien, 1997). As cited in Virginia Barba-S et al (2007).
(Leenders and Wierenga, 2002; Prasad et al., 2001; Roberts, 2000). As cited in Virginia Barba,S et al(2007). it is important to take into account that to adopt ICT systems and elements and strategies, the benefits must outweigh investment and maintenance costs. Consequently, commercial issues and potential returns must drive adoption. Beyond a certain level of ICT adoption and diffusion, not all SMEs will necessarily catch up with large firms simply because ICT may not bring large benefits, and SMEs will stay with traditional business processes. Other aspects that should also be considered are the availability of ICT competencies within the firm as well as the availability and cost of appropriate interoperable small-firm systems, network infrastructure and ICT related support services. (www.wasmeinfo.org)
ICT and SME competitiveness
Flexibility is considered to be a major source of competitiveness for SMEs compared to larger enterprises. The use of ICT could now on the one hand increase the competitiveness of SMEs as they enable the creation of more flexible links with trading partners because of faster and more reliable communication channels. On the other hand ICTs could help bigger enterprises to increase their flexibility through a restructuring of the organisation which will enable them to adapt quicker to changing conditions. Therefore the competitive advantage of SMEs could also decline.
In general SMEs rely much more on informal information systems than larger enterprises. To get the relevant information that is needed for a rational decision is not costless especially as in SMEs usually there is only one decision maker - the owner/manager - who's personal resources (time, knowledge, capabilities) are restricted. However SMEs have the advantage of smaller internal coordination costs, as all decisions are made by one or few people (Blili and Raymond 1993, Müller-Falcke 2001).
External transaction costs are associated with the initiation, negotiation and enforcement of contracts. Especially the Internet helps to screen the enterprises' environment for relevant information and thereby get information about sellers and customers that were previously out of reach. However for the actual delivery of goods and the transmission of payments also other infrastructure like transport and a reliable banking system has to be in place.
With the use of ICT transaction costs could be lowered and therefore the economies of scale in exporting can be reduced. This will enable SMEs not only to stick to local markets but to expand regionally and internationally. On the other hand many SMEs that are located in rural areas, serve the local niche market and are protected against competition from bigger enterprises because of high transport and communication costs. Therefore ICT might also increase competition for these enterprises, so they either have to become more productive or to close down. (www.tanzaniagateway.org)
ICTs as a Business Tool
The use of Information, Communication and Technology (ICT) is very important in current business operations. Entrepreneurs need to understand the market situation before doing any business and the preferred types of products at particular time. This knowledge can be sought through ICT system. The use of media is important in advertising and promoting business inside and outside the country. The available public and private media institutions can be utilized to publicize the available potential of products and services undertaken by youth and others.(Zanzibar youth Employment Action Plan, 2007).
ICT allow users to participate in a rapidly changing world in which work and other activities are increasingly transformed by access to varied and developing technologies. By this, you could almost say ICT is technology's version of economic growth, to satisfy the needs and wants of the community over time. Organizations are forced to adjust and take advantage of the opportunities provided by ICT in order to stay competitive. Businesses that do not take advantage of the ICT will run the risk of losing customers and their competitive advantage (Sharma, 2002). Some of the functions that technology has impacted are information search, advertising, consumer buying patterns and behaviors (Hanson, 2000). On a global scale, all industries have been affected by the emergence and implementation of technological advances. All above, ICT can be employed to give users quick access to ideas and experiences from a wide range of people, communities and cultures. The positive impacts of ICT can be seen in the following aspects:
Economic impact: ICT, in conjunction with globalization and the information revolution have reshaped the workforce. By increasing the speed of international communication, ICT have enabled corporations to outsource jobs, both in the manufacturing as well as white-collar sector (Lippis, 2007).
Social Impacts: ICT has influenced societies on many levels. They have extended the reach of public administration, leading to a centralization of regional management into urban centre. They have led to new forms of employment in innovation and production of ICT and a demand for highly skilled specialists. However, ICT have also enabled professionals in certain industries to be replaced by unskilled workers, or even made entirely redundant.
Lifting productivity: Investing in ICT can have a powerful effect on productivity in almost every industry, driving innovation, cutting costs, and opening up new opportunities. ICT can boost profits, help small firms overcome limitations of size, and enable even tiny enterprises to establish a global presence. Nevertheless, to take full advantage of the opportunities of ICT, we need to develop the skills of our workforce at every level, from front-line staff to senior management.
In summary, ICT has the potential to change the tourism SMEs in improving the productivity at a lower cost and to raise the quality of information. It contributes to make the tourism penetration around the globe. In today's world, people want to find the appropriate tourist destination, booking and buying airline ticket, check in and getting boarding pass when they are sited at their home or working place. All these can be done with the support of ICT.
Tourism
Holloway (2004) defines Tourism as the business of providing for different types of visitor; overnight or longer stay and day visitors and includes accommodation, car parking, entertainment and attractions, food and drink. According to Beech and Chadwick(2006) , the mostly widely accepted modern definition of tourism is that given by the World Tourism organization( WTO) .That is the tourism is the activities of persons traveling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business or other purposes.
In tourism, sector some small tour operators, hotels and inns, restaurants and travel agencies have been active in fostering cross-border Internet e-commerce. The Internet allows travellers direct access to travel recommendations, reviews and local tourism information, many of which was previously only distributed through the physical offices of (large) travel agencies. Small players with a Web page can now attract those preferring personalised (and possibly less expensive) services. Some small travel agencies, making the most of ICT, take advantage of direct on-line sales of (discounted) airline tickets and travel packages, while others, both small on-line and off-line agencies, have shifted towards selling leisure products entailing higher commissions, such as cruise packages. Since the Internet and many travel-related sites allow on-line customers to compare the price of air tickets and other travel services, small firms offering best/better prices can win price-sensitive travellers. (www.oecd.org)
ICT and Tourism
ICT and Tourism are contemporary information society has made Toursim a highly information-intensive industry as ICT has a potential impact on tourism business. The role of ICT in tourism industry cannot be underestimated and it is crucial driving force in the current information driven society. It has provided new tools and enabled new distribution channels, thus creating a new business environment. ICT tools have facilitated business transaction in the industry by networking with trading partners, distribution of product services and providing information to consumers across the globe. On the other hand consumers are also using online to obtain information and plan their trip and travel. Information is the key element in the tourism industry.ICT pervades almost all aspects of tourism and related industry. For instance, we depend upon it right from the scratch while identifying and developing tourisms site and destinations itself. The use of Geospatial Information Technologies in the recent years across the globe for varied purposes is popularly known and Tourism industry has not been an exception in availing its advantages. It can be used by tourist professionals to define the boundaries of the proposed tourist site as well its surrounding areas and the communities living in it. It can also get information on roads linking to the sites and availability of other utilities like water, power, market etc. Such technologies are also useful for site management and monitoring. The role of ICT tools in the industry for marketing, operation, and management of customer is widely known. Marketing techniques can be more innovative through ICT tools. (Shanker (2008))
Key factors for applying ICT in tourism
According to Shanker (2008), the key factor for applying ICT in tourism as follows-:
IT education and training for policy makers, managers and other players in the industry
Integration of various sectors like transport, lodge etc.
Technical Infrastructure
Human Infrastructure, which includes skilled people, vision and management.
Legal Infrastructure
Regulation of telecommunication providers
Subsides for Internet service providers
Legal framework for online advertisement or official endorsement for online marketing.
ICT culture
Create and sustain ICT environment
Maintenance and updation of websites
ICT training for all level of workers
Establish electronic linkages between all related sectors
(http://notes-master.blogspot.com/)
The Competitive Advantage
Porter (1985) views that a competitive advantage is an advantages over competitor gained by offering consumer greater value than competitors offer. His view on competitive advantages is at the heart of a firm's performance in competitive market. He argued that a firm's ability to outperform its competitors lay in its ability to translate its competitive strategy into competitive advantages.
Kotler and Armstrong (2008) suggested an advantage that firms has over its competitors, the way of building relationship with targeted customer, understanding their needs better than competitors do and deliver more customers value. That is it is the extent a company can differentiate and position itself as providing superior customer value.
The competitive advantage is a way of giving a company an edge over its rivals and an ability to generate greater value for the firm and its shareholders. The more sustainable the competitive advantage, the more difficult for competitors to neutralize the advantage (Walker et al, 2006)
PERFORMANCE OF TOURISM SME'S
Trade, Industry and Tourism
Zanzibar Povery Reduction Policy Report (2003) have the broad objective of this sector in order to create a competitive manufacturing and trading sector, which is geared towards for economic diversification in order to ultimately alleviate poverty. The sector is aimed to provide opportunity for further participation of the private sector. The fundamental goal is to equip and facilitate this sector in building its capacity, create better working environment and institute legal and institutional framework for the enhancement and expansion of its activities. The tools to be used are the National Trade policy, Promotion of Small and Medium Enterprises (SMEs) and Private Sector Involvement and Development. Zanzibar has a strong determination to develop tourism as an economic sector to provide foreign exchange earnings, creating employment opportunities, stimulate local economy and diversify the economy. The Government of Zanzibar firmly believes that tourism as a vital socio-economic development factor can participate effectively in empowering people of Zanzibar to successfully manage their life and has a say on the course of their development. This can be implemented through the Zanzibar National Tourism Policy and the Indicative Tourism Master Plan. The Tourism Policy emphasizes on responsible tourism, which adopt principle of ecotourism. It discourages any type of tourism that does not conserve and improve the environmental matters and welfare of local people.
(Zanzibar Economic Bulletin, 2009) Tourism in Zanzibar continues to be a major contributor to National GDP with indications that this contribution will continue to increase as the industry grows still. The service sector to which tourism is thought to contribute greatly saw its share of GDP increased to 51 % in 2007 exceeding 43.5 percent recorded in 2006. (www.snvworld.org)
Since the inception of the ZIPA in 1991, the investment process has been very positive and progressive. Statistics shows that by the end of 2002, ZIPA has approved about 242 projects with a total proposed investment value of USD 403 million. Tourism sector takes the lion share with 70% of total projects with proposed capital of USD 313.8 million, nevertheless it is still a new industry, struggling to improve its standards. In 1985, the number of tourists who visited Zanzibar was 19,368; while the number of tourists has reached now ranges between 85,000 and 100,000 annually. In 2001 Zanzibar earned approximately US$ 46 million in forex from international tourism, this accounts for approximately 15% of the GDP. This contribution is projected to increase to around $ 116 million and 21% of the GDP by 2012. (www.acra.it/)
Contribution to GDP
Tourism already makes a significant contribution to the economy of Zanzibar. It is provisionally estimated that the sector accounted for about 14% of GDP in 2001, with 12% for Tanzania as a whole. This contribution is projected to increase to around 21% by 2012.(Indicative tourism master plan ,2003)
Foreign Exchange Earnings
Indicative tourism master plan (2003), according to the preliminary results of the International Visitor Exit Survey Zanzibar earned some $46 million from the spending of International tourists in 2001. To this must be added an allowance for the spending of tourists traveling to Zanzibar on internal flights (who are not presently covered by the official statistics). This raises total visitor expenditure to $55 million in 2001. Allowing for the imports from foreign countries that are utilized by the tourism sector, net foreign exchange earnings from tourism are estimated at $46 million in 2001. This figure is projected to increase to some $116 million by 2012. Even allowing for leakages on imports, it is clear that tourism is a most important sources of foreign exchange, and helps considerably to offset the trade deficit which widened from $51 million in 1997 to $86 million in 2000, reducing to an estimated $50 million in 2001.( Indicative tourism master plan final report,2003)
Contribution to Employment
According to (Indicative tourism master plan final report,2003) there exists no official data on the employment generated by the tourism sector, it is estimated that currently some 5,800 persons are directly employed by the tourism industry in Zanzibar, of whom approximately 4,400 persons (76%) are employed in the hotel/guest houses sub-sector. The remainder is employed in tourist restaurants, tourist shops, ground tour operators, airlines (state-owned and private), the Commission for Tourism and other tourism-related government departments or as tour guides. In addition to those directly employed in the tourism sector, there are many more-perhaps, as many again, who derive part or all of their employment from supplying goods or services to hotels, restaurants, etc, or who otherwise benefit from the spending of persons who are directly or indirectly employed in tourism. Thus, total tourism-generated employment in Zanzibar could presently be in the order of 37,000 jobs or full-time job equivalents. This number should further increase to around 48,000 jobs by 2021, if, as is hoped, the tourism sector returns to a path of sustained growth. Indeed, Zanzibar Vision 2020 envisages that as much as 50% of all jobs in the modern sector could be provided in tourism and the free zones by 2020. (www.zanzibartourism.net/)
Zanzibar Growth Strategy (2007) has accorded tourism as one among the three lead sectors of the economy. In recent years the economic growth in Zanzibar has been driven by the increasing contribution and growth of the service sector, (including tourism) which represents up to 43 percent of GDP (2006).According to Zanzibar Youth Employment Action Plan(2007),arque the employment in tourism sector they believed to employ 56,000 people most of them in hotel operations of which 60% are Zanzibari youth. They are mostly engaged in building of the hotel and other infrastructure as well as in services such as tour guiding, transportation and hotel services. The potential is still there, and the government hopes more people especially youth with further be employed in this sector (mlywcd.org/)
Contribution to Government Revenues
The tourism sector makes a substantial contribution to government revenues through the wide range of fees, licenses and taxes levied on the sector. While precise figures are not yet available, it is estimated that for 2001 receipts from the tourism sector amounted to some Tsh. 8 billion, representing almost one-fifth of total government revenues in that year. By 2012, this contribution could increase to Tshs 21 billion. A strong case can be made for returning a certain fixed percentage of these revenues to the ZCT for tourism development and promotion. (Indicative tourism master plan final report,2003)
Investment
Since the mid-1980s, a total of some $57 million has been invested in hotel and tourism projects facilities by the Zanzibar Investment Promotion Agency (ZIPA), plus a further $6.6 million in 214 smaller tourism projects facilitated by the Commission for Tourism. (www.zanzibartourism.net/)
OPPORTUNITY AND CHALLENGES OF TOURISM IN ZANZIBAR
Assistance for Small and Medium-Sized Tourism Enterprises (SME's)
(Jamieson W et al, 2004) Small and medium-sized enterprises (SME) face a number of obstacles both in terms of their original establishment as well as in their ongoing operations There must be recognition that the small-scale tourism related businesses can have an important impact on poverty reduction. In many countries there is a lack of access to technical expertise and credit at reasonable interest rates due to which many new businesses find it difficult to obtain the necessary capital to start. Governments should support the creation of tourism oriented small and medium-sized enterprises. Policies should be designed to assist the poor in the development of enterprises or in some cases support the development of an enterprise with employment of the poor as its central focus. What are required are micro-credit funds to be used by both the formal and informal sectors. Guiding enterprises, bicycle rental operations, small restaurants, retail operations meeting the diverse needs of the tourist, the creation of small transportation outfits and providing accommodation are a few examples of SMEs that can be created. The accommodation business provides several opportunities for poverty reduction. Initially development can be in the form of a homestay where a portion of a dwelling is rehabilitated to meet the accommodation needs of tourists. This can be expanded
possibly into a stand-alone small-scale inn or lodge. Very often the capital outlay is minimal, but there is a clear need for technical expertise and access to small amounts of money to finance construction and the purchase of equipment. Governments should be concerned with providing capacity building, helping in the development of business plans, providing credit through its own funds and most importantly providing advice to small-scale enterprises. (www.haroldgoodwin.info)
Olomi D (2006) A host of problems make it difficult for SMEs to exploit the existing potentials for further employment and wealth creation. One of the most serious impediments is the limited capacity of people who start and operate the businesses, in terms of the attitudes, motivation, exposure, skills and experiences. This capacity limitation exacerbates the effects of other problems including a cumbersome regulatory framework, limited access to finance and working premises. At the same time, services related to entrepreneurship development are underdeveloped and not readily available or affordable to SMEs. The institutions and associations supporting SMEs are weak, fragmented uncoordinated. Their services are quite basic, mainly focusing on helping the poor eke out a living. There are hardly any initiatives for targeted, comprehensive and sustained support specifically to facilitate upward mobility of micro and small enterprises. As a result of the above situation, a majority of small enterprises have permanently remained micro and informal, limiting their access to markets and some support services, quality of jobs created by them, their capacity to pay taxes and eventually poverty reduction at the grass root level. This situation is likely to worsen as competition intensifies with the ongoing globalisation. (www.tzonline.org )
Local People Benefits
According to the Zanzibar tourism policy statement (n/d),the development of tourism in Zanzibar will contribute to the quality of local people lives through the following strategies:
Putting in consideration that tourism development is for interest and enjoyment of the resident population as well as visitors.
Emphasizing that beaches in Zanzibar is in public ownership. Prior and traditional right of use and access are recognized.
Giving first priority for compensation and direct continuous benefits from tourism to those residents who are displaced by tourism, traditional users and those living near tourist sites for example, seaweed farmer moved to another area, fishermen excluded from and islet allocated to a developer, and communities on the boundary of any reserved area.
Giving first preference to local residents for all jobs opportunities connected with tourism sectors.
Setting up community funds on a voluntary basis with stakeholders to channel benefits from tourism development to local villages, with strict systems and parameters guarantee transparency.
Creating a mechanism for technical assistance for local businesses: what visitors like how to run a local business etc.
Encouraging the industrialization and/or the creation of arts and crafts items in Zanzibar, using locally available materials and not from outside of Zanzibar (www.zanzibartourism.net/)
Minimizing Leakage
Also according to the (Zanzibar tourism policy statement (n/d)),it explain the term leakage means loss of income when the basic tourist required products come from outside Zanzibar and are imported. By their availability,visitors will be encouraged to consume locally goods and services where possible, rather than imports that hurt the valuable foreign currency reserves. Businesses will be encouraged to maximize "local content" i.e production by Zanzibar of services and items sold to tourists. It means that to ensure the business in Zanzibar will be encouraged to maximize "local content" as a vital means to minimizing leakage through the following strategies:-
Working with Ministry of Trade/Industry to continue program matching producers and hotel industry (furniture, fabrics/sewing, kitchen serving dishes, decoration as well as souvenir).
Establishing quota controls on the number of charter flights in any one year and quotas according to any one source market and all payments by tourists are made outside Zanzibar will be taxed assuming competitive market value of service provided.
Reserving certain activities such as tour operations and tour guiding for Zanzibari's
Encouraging and rewarding a programme matching producers and the hotel industry in various areas (furniture, fabrics/sewing, kitchen serving dishes,decoration as well as arts and crafts and souvenirs. (www.zanzibartourism.net/)
Challenges for Zanzibar Tourism
According to the Steck B,et al (2010) in value chain analysis summary report it explain in detail about the tourism in Zanzibar,therefore the challenges that faces the tourism as follow-:
Infrastructure: This includes access; the limited number of airlines servicing Zanzibar, and internal services such as transport and utilities (water and electricity).
Degeneration of Stone Town: Unique buildings of cultural values re-main without proper maintenance, and the increasing use of drugs among the youths in Stone Town and beaches which has become a security threat to tourists.
Banking and Financial Services: There are still limited international banking facilities to cater for the growing tourism activities, including insurance services and a financial assistance programme for both domestic and foreign investors.
Extreme Seasonality Pettern: of tourist arrivals in Zanzibar. The low season is centred on the month of May (the rainy season), with tourist arrivals peaking in August and December/January (European summer and Christmas holidays).
Over- reliance on a small number of originating markets: with approximately 70% of tourist arrivals from Europe and 43% from Italy alone, there is a risk of that should these key markets be affected by external events, such as an economic downturn or political events, a high majority of arrivals will be lost. Risk should bespread to avoid such a scenario. (www.snvworld.org)
GOVERNMENT INTERVENTION TO TOURISM IN ZANZIBAR
Tourism, Growth and Poverty Alleviation
(Steck B,et al (2010)) the Revolutionary Government of Zanzibar (RGoZ) is currently undertaking a review of the Zanzibar Strategy for Growth and Poverty Reduction (MKUZA) with a view to establishing an updated strategy (2010). Tourism is a vital source for economic growth and potential for poverty reduction in Zanzibar. It is striking that all actions mentioned in the current MKUZA document are geared towards growth within the tourism sector, despite the recognition within earlier MKUZA documents that growth alone does not ensure poverty reduction. In addition, the challenges which are highlighted within the current MKUZA report are listed as: quality issues with regard to products and services and capacity for growth development. A mainstreaming of the UNWTO mechanisms for tourism revenue to add to poverty reduction is required within the structure and implementation of the next MKUZA strategy to ensure that growth from tourism equates into poverty reduction as intended by the strategy. (www.snvworld.org)
Sustainable Pro-poor Tourism (SPPT) in Zanzibar
Tourism that results in increased net benefits for poor people. It is stressed that this is not a niche of tourism but that any form of tourism can be made to be pro-poor. "The critical factor is not the type of company or the type of tourism, but that an increase in the net benefits that go to poor people can be demonstrated." Demonstrating an increase through actual measurement of the benefits of tourism to the poor has long been debated and the many differing measurements of the dynamic and complex linkages have made quantifying such effects open to interpretation and contextual debate. Mitchell and Ashley (2009) as cited in Steck B et al (2010).
Their are four broad types of linkages:
Long term dynamic effects - infrastructure or institutions arising as a result of tourism activity,
Direct effects - profit for SMEs operated by poor, salaries for the poor etc.,
Induced effects - trickle down from non-poor households, income from the tourism economy being spent within the non-tourism economy, some of which may accrue to 'the poor'.
Indirect effects - through non-tourist sectors, income to the economy from tourism outside of direct employment, products and services supplied to the tourism sector.
Challenges for Sustainable Pro Poor Tourism in Zanzibar
According to the Steck B,et al (2010) the challenges for sustainable pro poor tourism in Zanzibar as follow-:
Business environment does not favour small industry: SMEs and small restaurants operating independent of hotels are not able to achieve economies of scale due to high, complex tax structures and the formalisation of informal sectors not viable. This causes a significant barrier to entry for 'the poor' with the informal sector in particular not able to formalise.
Zanzibaris have very limited access to employment in the tourism sector due to limited training facilities: The existing institutions do not meet the demand of trainees. The Zanzibar Institute for Tourism and Development (ZITOD) currently offers basic training in tourism skills which does not meet the sector's requirements. The Jambiani Tourism Institute offers high quality training but on a small scale. The additional issue of low school attendance and low levels of basic skills such as English language and Mathematics is also a concern for the 'trainability' of students from Zanzibar. The industry will inevitably give preference to potential employees with these basic skills.
Limited accommodation supply by Zanzibaris: Most high quality accommodation units are owned and managed by foreigners.
Inability of suppliers of Local Goods to meet the quality required for the general operation of tourism sector businesses: This largely refers to food and beverages, but also includes handicrafts, clothes and soft furnishings. Most products come from the mainland or are imported from India, Kenya, and South Africa among others. (www.snvworld.org)
Empirical Literature Review
Jennifer et al (2003) have examined the way ICT and internet have gradually changed the tourism industry in China. They have used the existing theoretical framework on ICT and e- tourism developments in other parts of the world namely Europe and America to examine their impact of ICT applications in the tourism industry cotemporary China. There has been tremendous development at the destinations levels in the recent years. Internet and Intranet have been extensively employed by the (DMO) which has integrated the functioning process and made the system more efficient. (www. dkc.engo)
The emerge of the new media technology such as internet, world wide web, e-commerce, e-business that provide a wide range of online business activities reshaped the tourism into new form as e-tourism. E-tourism allows business to reach a global audience. According to the In Africa for example the tourism handcrafts industries are realizing their ability to deliver their product information directly to consumers. Tourist Lodges hotels and governments across the continent now maintain sophisticated websites advertising their unique features handling booking order and promoting specials to interested consumers Secondly, opportunities created by e-tourism and its predecessor technologies is that ICTs can create digital market places to manage supply chains and automate transaction increasing efficiency and opening previously closed markets to firms in developing countries. Thirdly e-tourism improving the culture of business. There are now better intra- firm communications cost savings procedures and reductions in the inventory costs leading to better management .Thus, ICT are the backbone of the capital accumulation. They are connected with new business opportunities increased trade and investment although they are risks involved sometimes. It suggests a positive relationship between ICT development and economic growth. (Karmer and Derick, 1992) as cited in Shanker (2008)
Nielinger (2003) in this study investigating the ICT-utilization of small and medium Enterprises (SMEs) in Tanzania. From his study, he found that ICT is under-utilized and most of the SMEs use mobile phone as a newly available and cheapest technology to improve their business situation with respect to basic telecommunication services. However, the ICT applications such as World Wide Web and internet utilization highlights the dominance of email usage in Internet communications and email traffic suggests that computer based communications increasingly play an important role in business, especially to serve the customers, who receive almost 30% of all emails sent. (www.ourtanzania.com)
Conceptual Framework
The Tourism SMEs awareness of the ICT use is very crucial aspect. The firm before adopting the ICT there is a need to analyze from the resources possessed, the capabilities development, the competencies attained and the competitive advantage either if they are sustained or not. The tourism SMEs require the ongoing commitment, involvement and should be well prepared with the adoption of the ICT. The adoption of ICT is a competitive advantage to tourism SMEs as the result of both global forces and internal demands of the tourism SMEs. As the tourism SMEs want to be well known globally, it becomes imperative to use intensively the ICT. The ICT application is also significant when the tourism SMEs want to facilitate the operational and administrative functions. The pre-requisite in order the ICT to take effort accordingly depends on the use to create enabling environment such as the competitive business environment and readiness to use the ICT. The competitive environment is the only approach that will ensure that ICT services and system give the SMEs a competitive edge.
In fact, the ICT is a new hybrid sector and it is a complex in terms of its uses, coast, knowledge and skills. It is not a matter of ICT creating opportunities and change but requires a lot of expertise, a lot of money and very advanced skills. The tourism industry should be well equipped with the competent Human Resources in the knowledge of ICT and overall Management. Those competent personnel should be willingly to have continuous learning as ICT has the tendency of changing so fast sometimes faster than individuals can cope or change. The access to the tourism SMEs to obtained sustainable competitive advantage is associated with the access of the new information, reducing production costs, business transaction costs and supports the customers' (tourist) satisfaction. The customers can be satisfied to their tourism needs and wants easily with minimum cost in terms of money or time at online basses. Generally, ICT is important in decision making process. It assists in storing and retrieving data quickly; assist in providing timely data that is tracking the problem when it occurs and ability to present information in different formats.
Summary
In generally thus parts of literature review covered the definition of the terms and concept thus focuses on ICT in tourism sectors, the classification and categories of SME's in Tanzania ICT and SME's competitiveness, ICT as a business tools, ICT and tourism, the key factor for applying ICT in tourism, The performance of tourism in SME's, The opportunity and challenges of tourism in Zanzibar and finally the government intervention to tourism in Zanzibar.
In conclusions Tourism organizations can use ICTs for building awareness and promotion through newsletters, pop-ups and search engine optimization strategies. Regardless of size they can build and maintain web sites, either internally or through partners. ICTs enable tourism organizations to have a global presence and partnerships around the world in an efficient and cost effective manner enabling small firms to build their virtual size. Until recently Global Distribution Systems (GDS) were the only widely spread electronic distribution channel, despite being limited to the distribution of scheduled airlines, city hotel chains and large car rental companies. The Internet enables all types of organizations to distribute products directly to consumers and to link with emerging intermediaries Expedia expanding their value chain and promote their products through a combination of systems and partners (Buhalis and Licata 2002; O'Connor 2003; Kärcher 1997).
