Tourism Villages: A Strategic Pathway to Poverty Alleviation

Abstract

Bantul Regency, situated within the Special Region of Yogyakarta Province, is endowed with rich natural and cultural resources, offering significant potential for development as community-based tourism destinations. In recent years, the establishment of tourism villages in this region has positively impacted the local economy, notably through increased tourist arrivals, the expansion of micro and small enterprises (MSMEs), and the rise of various community entrepreneurship initiatives. Nevertheless, poverty and unemployment, particularly in rural areas, persist as enduring structural challenges. Disparities in access to the economic benefits of tourism and the limited competitiveness of local business actors continue to impede inclusive development. This policy brief delineates strategies to mitigate poverty and unemployment by bolstering the rural economy in tourism village areas, utilizing Porter’s Five Forces framework. This model is applied to map the competitive forces and pressures confronting local enterprises, including the threat of new entrants, the bargaining power of suppliers and buyers, the threat of substitute products, and the intensity of industry rivalry. The analysis indicates that the weak bargaining position of local communities within the tourism ecosystem necessitates targeted and collaborative policy interventions. Key policy recommendations include fortifying local economic institutions such as village-owned enterprises (BUMDes) and cooperatives, safeguarding micro-scale businesses, developing community-based supply chains, and enhancing villagers’ skills and digital literacy. By cultivating a resilient and inclusive local enterprise ecosystem, these strategies are anticipated to generate new employment opportunities, augment household income, and sustainably reduce poverty levels in Bantul's tourism village areas.