Destination Development and
Institutionalization Strategies
In the OIC Member Countries
51
of the local economy lead to leakages in the tourism value chain.186 Any imports of equipment and
infrastructure for tourism consumption is a leakage to the local economy’s value creation. In addition to
leveraging foreign suppliers, further blockages or inefficiencies identified by players along the value chain
in a study by UNWTO include:
 Lack of qualified labor 187
 Access to finance 188
 Airport carrying capacity and infrastructure189
 Visa scheme for foreign visitors190
 Compliance with international service standards191
Once the local economy can strengthen and reduce these leakages by developing local production units,
the tourism value chain becomes more sustainable. To strengthen the tourism value chain, several key
steps can be taken:192 :
Table 6: Destination Development Interventions
Intervention type Description
Improve
communication
Develop coordination and communication between stakeholders
Upgrade products Provide better quality products and services; move to higher level of luxury
and service segments
Add value Diversify and expand current product and service offerings; reduce
transaction costs with technology
Reduce barrier to
entry
Develop micro-credit agencies, entrepreneurship support services
Strengthen
Innovation
Encourage investment in research
Increase local
linkages
Enhance financial support of local suppliers
Reduce leakages Develop competitive local production units and an ecosystem of products
and services to attract visitors
Source: DinarStandard Analysis
186 Aid for Trade and Value Chains in Tourism (1-52, Rep.). (n.d.). UNWTO. Retrieved from
187 The Tourism Sector in Mozambique: A Value Chain Analysis. (2006). 1, 1-90. Retrieved from
188 Schoen, C. Case Study on Tourism Value Chain Analysis in Da Nang, Vietnam. (2008, August). Hanoi. Retrieved from
189 Curta, N. C. (n.d.). Customize the Value Chain for Tourism Companies. QUAESTUS, 75-85. Retrieved fro
190 Steck, B. (2009). Tourism: More value for Zanzibar: tourism value chain analysis as a tool for destination management. SNV case study,
October 2009.
191 Verdugo, D. & Ashley, C. (2008). Creating pro-poor linkages around Rwandan tourism. SNV and ODI, May 2008. Retrieved from
192 Giuliani, E., Pietrobelli, C. & Rabelloti, R.(2005). Upgrading in Global Value Chains: Lessons from Latin American Clusters. World
Development 33, (4). 549–573