Regional : VIE: Greater Mekong Subregion Sustainable Tourism Development Project

Industry and trade / Trade and services

Sustainable, culturally and environmentally sound, pro-poor tourism approach for the Greater Mekong Subregion (GMS) and the preservation of natural and cultural heritage. It will contribute to implementing the Greater Mekong Subregion - Tourism Sector Strategy (GMS-TSS).

Sustainable tourism development that creates livelihood opportunities for the poor. The project areas are: 9 in Lao PDR (Bokeo, Champassak, Houaphanh, Luang Namtha, Oudomxay, Saravanh, Savannakhet, Vientiane, and Xayaboury) five in Viet Nam (Bac Kan, Cao Bang, Quang Binh, Quang Tri, and Thua Tien Hue), which were selected for their tourism potential, poverty rates, and inclusion in a GMS-TSS priority zone.

For Lao PDR, the project is substantially complete and the outcome has been achieved. The project closing date has been extended to 31 December 2014 and the loan account closing is being processed.

For Viet Nam, the project is also substantially complete and the outcome has been achieved. The project closing date has been extended to 31 December 2014 and the loan account was closed on 15 June 2015.

The project is categorized as Effective Gender Mainstreaming. A Gender Action Plan (GAP) has been prepared to ensure that women and ethnic minorities benefit equally from it. Implementation of the GAP was reviewed in October 2011 (Lao PDR) and March 2013 (Viet Nam). The project was found to be on track in terms of participation rates for women and ethnic groups (about 41 - 54%). At some sites, men and women are already obtaining significant income equivalent to $5 - $50 per day per household from providing home stay accommodation and selling food, pottery, textiles, paper products, and other handicrafts to tourists.

Model sustainable tourism development projects protecting the environment and cultural heritage developed in 4 sites: Siphandone Wetland (Lao PDR), Vang Vieng town environmental improvement (Lao PDR), Phong Nha Ke Bang National Park (Viet Nam), Ethnic minority cultural Heritage development in Bac Kan (Viet Nam).

Pro-poor community-based and supply-chain tourism projects operational.

GMS tourism corridors developed.

Human resource capacity of public and private tourism stakeholders improved.

Efficient project implementation services are operational.

Output 1: Sustainable tourism development that protects the environment and cultural heritage.

For Lao PDR the tourism master plan prepared for Siphandone Wetlands guided complementary investments in infrastructure, tourism-related skills training, and activities to improve environmental management. Civil works for (i) Nakasang Access Road Improvements, (ii) Nakasang Tourist Information Center and Market, and (iii) Don Det-Don Khone Track Improvements and Tourism Infrastructure are complete and being used. Project initiatives have contributed to a sharp increase in tourist arrivals which is having a positive impact on local job creation. There are 47 permanent vendors occupying Nakasang Market's main block and approximately 150 additional vendors selling at the new fresh market behind it. Typical daily revenue per vendor ranges from about $20 to several hundred dollars. Owing to drainage and sidewalk improvements, 24 vendors have set up new roadside kiosks near the Nakasang river pier where 218 tourist boats operate. Civil works in Vang Vieng are also complete. Approximately 700 meters of main storm drains and 1,662 meters of side drains have been improved. Stormwater in the southern part of town is now channeled through a natural filter before it discharges into the Nam Xong River. Sidewalks with lighting have been extended by 2,984m. The project has installed 22 septic tanks for use by residences and enterprises situated along the river and supplied a new garbage truck to help Vang Vieng Urban Management Authority provide more reliable collection services to 11,910 residents (2,127 households). Project assistance to support preparation of an updated town master plan for Vang Vieng, construction of public amenities, and marketing and promotion have contributed to a substantial increase in tourist arrivals, accommodation establishments and employment. In Viet Nam, Phong Nha Ke Bang National Park. Development of the new nature circuit is complete at all planned sites. Support for training, capacity building, and equipment has helped improve tourism management in the park and expanded tourism-related livelihood opportunities for local residents. Annual visitor arrivals have increased from a baseline of 311,377 to 442,637 in 2012 (42%); daily spending by international tourists has risen by 72% to $70 per day; and the number of people directly employed by tourism has increased 37% to 457. More than half of tourism workers at all project sites are women. The Bac Kan Tourism Information and Cultural Exchange Center Bac is complete and open to visitors since Q4 2014. The center and adjacent boat landing serve as the main staging point and service area for visitors before entering the park via a shuttle bus or boat. This will help to reduce congestion inside the park and generate additional jobs and income for local tourist-boat operators and tour guides. The project has also provided training, equipment and other support to help local entrepreneurs improve service quality and expand village-based enterprises. These activities complement assistance provided by other development partners and are consistent with the Ba Bae Lake National Park Management Plan. Since project inception annual visitor arrivals have increased from a baseline of 50,000 to 92,560 in 2012 (85%); daily spending by international tourists has risen by 32% to $33 per day; and the number of people directly employed by tourism has increased 52% to 192.

Output 2: Pro-poor community-based tourism (CBT) and supply-chain tourism demonstration projects are operational.

In Lao PDR assistance to establish tourism-related supply chain demonstration projects and develop community-operated tourist sites has been successful. For example, in 2012 the Ban Yor weaving and pottery production group (44 members, 79% women) generated approximately $19,600 in revenue. Similarly, 27 members (70% women) of the Pachao Singkham Temple community-managed tourist site earned $9,300 in 2012. Participation in the pilot subproject to promote organic vegetable farming in Oudomxay has increased from 3 to 33 families and members currently produce 6,000 kilograms of organic vegetables per-month with an estimated turnover of $3,750. In comparison, the various CBT programs (mainly trekking and homestay) supported by the project have been less successful. This is attributed to less demand than anticipated and the need for more involvement of tour operators in product development and marketing. The project has provided assistance to 15 community-operated tourist sites, 17 tourism-related supply chain demonstration projects, and 20 CBT tour products.

In Viet Nam the project has expanded CBT support to seven villages. Progress is satisfactory in regard to the development of community-based tourism (CBT) attractions and work on promoting tourism-related supply chains is progressing. Areas of assistance found most useful by village-based beneficiaries include support for infrastructure, equipment, and training. The most successful CBT site is Pac Ngoi Village in Bac Kan Province, which in 2012 received 11,500 visitors and generated approximately $300,000 for 53 entrepreneurs/tourism workers. Benefits at other sites are more modest but steadily increasing as they become better known by tour operators and independent tourists.

Output 3: GMS transportation corridors are developed into subregional tourism corridors

Strategies to encourage tourists to stay longer and spend more along the North-South (NSEC) and East-West Economic Corridors (EWEC) are being implemented and planned small tourism-related facilities were recently completed in Lao PDR Among project sites that are operating, the Luang Namtha Night Market is most successful. It generated about $460,000 in revenue for 63 permanent vendors in 2011. Lao Bao Visitor Information Center is complete and open. The 2,000m2 multipurpose facility includes a tourist information center for the East-West Corridor (EWEC); new immigration terminal; and streamlined services for entry and exit of tourist vehicles to accommodate the rapidly increasing number of visitors passing through Lao Bao Border Gate. The main types of training and capacity building activities implemented under output 3 include tourism awareness seminars; hotel and guesthouse management training; awareness seminars on prevention of HIV/AIDS and other potential negative impacts of tourism; and support for local authorities and tourism associations to participate in regional meetings on tourism development in the EWEC.

Output 4: Human resource capacity of public and private tourism stakeholders is improved. (Lao PDR) About 300 trainers have been trained in small-scale hospitality management and tourism planning and management. Other key accomplishments include development of Lao PDR's tourism web-based knowledge center (www.stdplaos.com) establishment of a tourism educator's network, and publication of 21 Lao language textbooks and manuals. In Viet Nam, a comprehensive train-the-trainers program targeting public tourism officials and small-scale tourism and hospitality operators began in December 2011. The target of training 60 small-scale tourism and hospitality master trainers and 240 sustainable tourism planning and management master trainers from the public sector has been exceeded. Master trainers produced several training manuals and provided cascade training for 800 tourism managers and operators of tourism-related enterprises (53% women). Tourism workers employed by guesthouses, souvenir shops, restaurants, and tour companies were the main recipients of this training.

Efforts have been made to minimize and, where possible, avoid land acquisiton and resettlement (LAR). However, minimal LAR with relatively small impacts was required, including relocating a few businesses, (temporary and permanent), and using public land for the construction of small markets, parking lots, covered bus stops, river landings and stairs, cultural and interpretation centers, refreshment stands, walkways, footbridges, toilets with water supply, ticket booths, lodges, prayer pavilions, and signage. In accordance with ADB's Involuntary Resettlement Policy (1995), Handbook on Resettlement, and later the 2009 Safeguards Policy Statement, resettlement frameworks for each participating country and resettlement plans for the subprojects in the Siphandone Wetland (Lao PDR) and Phong Nga Khe Bang (Viet Nam) were prepared based on an inventory of losses and socioeconomic surveys, including focus-group discussions with affected people and provincial authorities.

As expected, one household lost about 900 square meters of land to the subproject in Phong Nga Khe Bang National Park, and the subproject in the Siphadone Wetland temporarily affected 47 stall owners and require three businesses to be relocated. Affected people were compensated for their losses at full replacement cost at current market prices and provided with transition allowances and rehabilitation. Additional support was extended to the poor and vulnerable and female-headed households.

Resettlement plans were updated during implementation with assistance of international and national social development specialists. The resettlement plan for the Siphandone Wetlands project has been implemented and restoration of living standards and livelihoods is satisfactory according to the May 2010 independent monitor's report on resettlement. For the Phong Nha Ke Bang project in Viet Nam, the updated resettlement plan determined 1 family with 8 members would be affected by loss of 11.5% of productive assets (agricultural land acquisition, without physical displacement). The family has been compensated for the land at market rates by the Quang Binh PPC and provided with training and access to employment at the newly developed boatlanding in Chay Lap village.

An ethnic groups/minorities development framework (EGMDF) has been prepared for the regional Sustainable Tourism Development Project (the Project) in the Lao People's Democratic Republic (Lao PDR) and Viet Nam. The purpose of the EGMDF is to (i) guide the assessment of potential impacts on ethnic minorities during the feasibility study for each

subproject; (ii) assist the preparation of specific actions or the development of an ethnic minority development plan to address these impacts; and (iii) help improve the distribution of tourism benefits among different groups of beneficiaries, especially the smaller ethnic groups. The EGMDF is based on (i) provincial and household surveys; (ii) four sample subprojects for output 1;(iii) consultations with ethnic minorities, government officials, and other key stakeholders; (iv) the

previous gender equity and ethnic diversity action plan for the Greater Mekong Subregion Mekong Tourism Development Project (Lao PDR); 1 and (v) secondary sources and past Asian Development Bank (ADB) projects.

Viet Nam had a population of 85.3 million in 2007, of which ethnic minorities account for 14%. There are 54 officially recognized ethnic groups. About 53 ethnic minorities and 100 subgroups live in the northern and central mountains and the lowland river deltas of Viet Nam. In 2004, about 39% of all those living in poverty were from ethnic minorities. About 61% of all ethnic minority people are poor (86% in 1993), compared with only 14% of the majority Kinh and Chinese (56% in 1993) Ethnic minorities are generally poorer and more disadvantaged than the Kinh and Chinese and have limited access to education and health care services.

Tourism potential is often the greatest in areas where smaller ethnic groups reside. Tourism development brings a number of direct and indirect opportunities for ethnic minorities including (i) income generation and poverty alleviation, (ii) locally led planning and development, (iii) revitalized cultural industries and practices, (iv) better transport and communication, (v)

increased disposable income for better education and health services, and (vi) better communication with authorities.

Tourism development also has the potential to threaten local cultures and norms. Ethnic groups/minorities often face constraints that prevent them from accessing the opportunities brought about by tourism growth, such as remote villages and limited mobility, market access, education, and familiarity with majority languages. Women from small ethnic groups face additional risks and increased demand on their time from tourism development (e.g., increasing the risk of girls dropping out of school). Efforts to conserve and share ethnic culture with tourists and younger generations carry the risk of depicting minorities as exotic or backwards. The Project addresses these constraints and risks in its design.

Country-specific ethnic groups/minorities development frameworks for the Project are based on Lao and Vietnamese regulations and ADB's Policy on Indigenous Peoples (1998). ADB's policy aims to protect ethnic minorities from the adverse impacts of development and to ensure that all ethnic groups benefit from development projects and programs.

The EGMDF ensures that all ethnic groups/minorities share proportionately in project benefits and experience limited adverse effects. The implementation arrangements and estimated costs of the EGMDF are integrated into the overall arrangements and budget of the Project. During project implementation, demonstration subprojects will be prepared to include a socioeconomic and demographic profile of target communities by ethnicity. Using ADB's checklist on indigenous peoples, the potential effects of subprojects will be assessed for all ethnic groups. Potential impacts will be identified and measures to mitigate them will be incorporated into the detailed design for each subproject.