The impacts of the COVID-19 pandemic on female groups working in the Peruvian and Chilean informal tourism economy
By Dr. Rosa Codina and Dr Daniela Moreno Alarcon
Revised and edited by Dr Claire Bunyan
This report examines the impacts of COVID-19 on women working in the Peruvian and Chilean informal tourism industries, and related sectors. The aim of this study was to obtain an understanding of the nature and scope of the informal tourism economy in Peru and Chile, and to examine the experience of women working in the sector, with a particular emphasis on their experience of the pandemic.
The results of semi-structured interviews revealed that one of the key motivations for women’s employment in the informal tourism industry, was the degree of time flexibility offered by the sector. For some women in Peru, the informal economy had offered a way into full-time employment, whilst for women from lesser-known tourism destinations, their participation in the sector was mostly on a part-time basis and conditional on male approval.
In Chile, tourism was seen as a complementary activity to the subsistence economy that most women perform in rural areas. Tourism was also seen as a platform through which to disseminate Indigenous culture. In both Peru and Chile, one of the key barriers to formalisation was related to complex bureaucratic processes and associated costs. In Chile, most women working in the informal economy, especially Indigenous women, could not meet the required standards needed to accomplish formal certification since these did not align with Indigenous socio-cultural conditions.
In Peru and Chile, the pandemic abruptly stopped women’s main source of revenue. Most interviewed Peruvian women used the transferable skills acquired through work in the informal tourism sector to create alternative entrepreneurial opportunities, albeit earning reduced incomes. One of the main impacts for women living in rural Peru and Chile was the inability to attend artisanal trade fairs, which severely restricted their ability to sell and connect with other artisans. In both Peru and Chile, there was a stark lack of state support directed at women and the informal sector. Most state aid and funding schemes in both countries had been exclusively aimed at formal actors, whilst limited interventions had been developed for the tourism sector. There was scarce evidence of gender-sensitive policies and programmes designed to alleviate the challenges women were experiencing during the pandemic. This was also linked to a lack of sex-disaggregated data for the tourism sector.
Results of this study indicate a need for increased flexibility in the conditions to be met for formalisation. Tailor-made fiscal mechanisms for informal tourism actors are needed, whilst sex-disaggregated data on the nature of female employment in tourism and the informal sector is also necessary. In the long-term, gender equality should be integrated at all levels and phases of tourism development, particularly when designing and implementing any sort of tourism measure or policy.
1.1 Study aim and objectives
Tourism is firmly positioned in the 2030 Agenda for Sustainable Development (UNWTO, 2019) and has been identified by the United Nations General Assembly as a significant contributor to sustainable development (United Nations, 2012). Its importance as a driver for job creation, the promotion of local economic development, gender equality and more inclusive and peaceful societies is reflected in all the UN’s Sustainable Development Goals (SDGs) (Moreno, 2016; Moreno and Cole, 2019; UNWTO, 2019).
Nevertheless, according to the ILO (2001), work performance by women in tourism is dominated by high levels of informality, high staff turnover, long working hours, subcontracting, the prevalence of casual workers, and seasonal variations in employment. This implies that a greater number of women working in tourism are performing their jobs under unstable working conditions (Moreno and Cañada, 2018), reinforcing marginalisation across the occupational pyramid of tourism.
The social and economic crisis brought on by the COVID-19 pandemic has further evidenced structural inequalities related to race, gender, and age within tourism economies. Women have been disproportionately disadvantaged by the pandemic due to taking on a greater share of unpaid domestic and caring work, as well as losing jobs at a faster rate than men due to taking on more casual jobs (Cole, 2020). This has been particularly the case for women working within the informal tourism sector in Less Economically Developed Countries of the Global South (Odeku, 2020). In Latin American and Caribbean countries (LAC), where a feminisation of the tourism workforce occurs, the socio-economic impact of the pandemic has been particularly severe for women (Moreno, 2020).
Given the detrimental impacts of the pandemic on the global tourism industry and the disproportionate effect on female populations in the Global South, this study aims to examine how this crisis has affected women working in the informal tourism industries of Peru and Chile.
Based on this aim, the following objectives were established:
- Identify the underlying motivations and barriers for women’s participation in the informal tourism sector and the perceived benefits of staying in the informal sector
- Establish an understanding of the links between the formal and informal tourism sectors
- Critically assess the ways in which the pandemic has impacted the livelihoods of women working in the informal tourism sector in Peru and Chile
- Evaluate how the impacts of the pandemic have affected the achievement of the UN’s sustainable development goals 1, 5 and 16 in relation to the informal tourism economy
- Identify and evaluate state aid interventions during the pandemic, and the extent to which females working in the informal tourism sector have been able to access this help
- Provide recommendations for the development of policies, best practices, and strategies to integrate the informal tourism sector into wider economic social and cultural policy making.
The ILO definition of the informal economy (2002) excludes criminal activities such as the production and distribution of services and goods prohibited by law. According to the ILO (2002), informal actors produce and distribute legal goods and services, albeit their production and employment procedures remain unregistered, and may not adhere to legal norms.
In line with this definition, this study considers only legitimate activities encompassed within informal institutional boundaries as informal tourism economic phenomena. Therefore, this study does not consider any illegitimate and criminal activities which are “antisocial in intent” (De Soto, 2002, p.11) such as human trafficking, drug dealing, or illegal wildlife trade amongst others.
1.2 Tourism and the informal economy
The informal economy is a complex phenomenon which has attracted scholarly attention from diverse disciplines such as anthropology, sociology, economy and tourism studies (Çakmak et al, 2018; Williams, 2017). Whilst different fields of study and approaches have resulted in a range of definitions to describe the features of the informal sector (Çakmak et al, 2019; ILO, 2002), a set of common defining characteristics have been identified. These include the presence of unregulated trade, easy market entry and low levels of capital investment (Kermath and Thomas, 1992; Mead and Morrison, 1996; Williams, 2017). The International Labour Office (ILO, 2000, p.1) further notes of its members that “they are not captured in official statistical enumeration…and…evade government regulations; they are also, almost inevitably beyond formal systems of labour and social protection”.
In some destinations such as Peru and Indonesia, informal actors provide important tourism services (i.e., street vendors selling food, souvenirs, transportation, guiding services) and add to the appeal of a destination by selling products or services unique to the place, such as in the case of market vendors or individuals who pose for tourist photographs (Codina et al, 2020; Kermath and Thomas, 1992). Informal actors not only help build the unique character of some destinations by boosting vibrancy and novelty (for instance rickshaw drivers in Asia), but the income from their activities can significantly benefit formal and informal economies (Ketchen et al, 2014; Slocum et al, 2011).
Informality is a crucial phenomenon in the daily lives of people in the Global South (Çakmak and Cenesiz, 2020), where the informal and formal economies are dynamically linked to each other through production and distribution relations (such as sub-contracting arrangements) (Çakmak and Cenesiz, 2020). The distinction between formal and informal economic practices is further blurred in urban tourism spaces where informal actors routinely share spaces with formal actors and visitors. For instance, in Truong et al’s (2020) study of rickshaw drivers in Hanoi, the authors uncovered that many unregistered rickshaw drivers were sometimes hired by registered rickshaw companies, and similarly registered drivers also attracted tourists on their own outside of company work hours. Their findings confirm the results of earlier studies and suggests a dynamic shift between the informal and formal sectors rather than dualistically opposed segments (Truong et al, 2020; Chen, 2006).
Although informal economy issues in tourism have been progressively examined in more recent literature, existing research remains modest (Lv, 2020; Williams, 2020). The majority of tourism literature concentrates on the formal tourism economy, with limited studies examining the impacts of policies and crises on informal tourism actors (Rogerson, 2014). Similarly, national governments tend to prioritise the formal sector in policies and development efforts directed towards the tourism industry; with fewer financial and legal actions being offered to informal enterprises (Çakmak et al, 2018; Robson et al, 2009). Common government responses to the informal tourism sector often include prohibition, criminalisation (Vargas, 2016) and licensing (formalisation) (Henderson and Smith, 2009; Dao Truong et al, 2020).
In the Global South, the marginalised nature of informal tourism enterprises and the neglect of planners to address their needs has been confirmed in several studies (Dahles, 1998; Dahles and Bras, 1999; Dahles, 2001; Dahles and Keune, 2002; Hampton, 2003; Rogerson, 2018). Much of this stems from the erroneous notion that the informal sector and its participants are a temporary phenomenon which will dissipate with economic development (Rogerson, 2018). This contradicts the most recent evidence which suggests that the informal tourism sector should be viewed as a central feature of tourism in Global South contexts, as opposed to a set of deviant activities which will evaporate with modernisation (Rogerson, 2018; Timothy and Wall, 1997). Whereas it may be argued that informal actors have limited access to common pool resources, they possess important resources, attributes, skills and qualities that could be more efficiently exploited to enable them to further contribute to broader economic development goals (ibid).
Although recent studies on pro-poor tourism have contributed to a greater understanding of the informal tourism sector, research remains limited in scope, particularly in relation to the conditions faced by women working in the informal tourism economy (Hutchings et al, 2020). Given this knowledge gap in the tourism scholarship and the crisis faced by women in the informal tourism sector due to the COVID-19 pandemic, there is a pressing need to examine the role of this stakeholder group in tourism alongside the structural conditions they face.
1.3 The informal tourism economy from a gender perspective
The tourism sector employs a higher share of share of men (63%) than women (58%) in the informal workforce (ILO, 2018). However, this is largely related to the fact that men are over-represented in the workforce (ILO, 2018). In low-income countries, 92% of women are employed in informal jobs compared to 87% of men, whilst in lower middle-income countries this figure stands at 83% of women employed informally and 85% of men. Informal employment encompasses different forms such as wage employment in informal establishments, households, self-employment, unpaid contributory family work, or informal wage employment in formal establishments (OECD and ILO, 2019). In all regions, women constitute the majority of those informally employed as an unpaid family contribution (ILO, 2017).
Women are highly represented in the most vulnerable employment categories of the informal workforce. As such, women working in the informal economy are more vulnerable to the lack of labour protection and have less control over their working conditions (ILO, 2018). Furthermore, informal workers on average are paid lower wages than formal workers, and women are paid lower wages than men (ibid).
Globally, more women than men work in the sector (ILO, 2016; UNWTO, 2019) and yet women’s employment in tourism remains poorly understood. Research demonstrates that employment in tourism does not necessarily equate to decent work, strong career prospects or equal wages for women (ILO, 2001). Women working in tourism are also performing their jobs under unstable working conditions (Moreno and Cañada, 2018), reinforcing factors of marginalisation across the occupational pyramid of tourism. The gender pay gap in tourism is 14.7% (UNWTO, 2019) even though the sector employs a majority of female workers. This figure is also problematic in that it does not account for women employed in the informal economy.
There is a clear need to examine informal employment in tourism through a gender lens, but there is no data available on the informal tourism sector for most countries (UNWTO, 2019). The reasons behind this gap are not clear, but it is likely related to the fact that most tourist institutions and agencies tend to work exclusively with the formal sector. Thus, although women and other marginalised groups are known to have greater participation in the informal tourism economy, their experiences remain invisible.
Women in the informal tourism workforce tend to work in accommodation, street vending and handicraft production, with roles typically mirroring or extending women’s domestic work (Cave and Kilic, 2010; Del Alonso-Almeida, 2012; Andersen, 2015). These roles may be considered more culturally acceptable in contexts where women generally do not work outside of the home and also permit some home-based working, for example where women open their traditional homes as guest houses or restaurants (Baum, 2013; Newpane, 2020). Whilst employment in general is regarded as empowering for women, the informal tourism economy roles performed by women entail some challenging consequences. Firstly, the phenomenon of the double workload, well-understood and recognised in women’s employment globally, is especially pertinent for women in the informal tourism economy. Women performing childcare and other caring or domestic duties on top of paid work where their workplace is also their home is difficult to manage, with several competing demands to be met (Hutchings et al, 2016). On balance, employment is still considered a net positive for women, providing them with agency to at least partially renegotiate entrenched asocial and gender norms (Duffy et al, 2015).
A further disadvantage lies in geography: women based in rural areas are likely to have fewer educational opportunities, compounded by a lack of reliable infrastructure compared to urban settings (Hutchings et al, 2020). In caste-based societies or other contexts where economic participation is affected by ethnic origin, women of particular ethnicities may find themselves excluded from formal arrangements but able to participate informally (Trupp and Sunata, 2017). This is particularly true of street vendors, who are ubiquitous in LAC and contribute to a destination’s appeal, with implications for the formal and informal economies (ILO, 2017). However, street vendors are subjected to police harassment, demands for bribes, street violence and similar forms of abuse; women workers specifically also face sexual harassment (UN Women, 2020). This group is also forced to contend with inadequate urban infrastructural conditions, such as lack of safe drinking water, toilets, shelter, and storage space (ILO, 2011; 2017), as well as inadequate childcare.
However, the intersection of gender and ethnicity is not always negative, and as such it is vital that any analysis is context-specific (Moreno and Cole, 2019). Considering the subject of female entrepreneurs in tourism without accounting for women working in the informal sector could encourage gender-harmful policymaking. Since women are more strongly disadvantaged by gender inequalities, they face major challenges when it comes to access to finance, technology, networking, tourist certifications, training and promotional support. The continued dearth of policy instruments designed to support women’s entrepreneurship and employment in the sector, including the formalisation of women’s labour , will likely lead to an expansion of informally employed women whose needs are poorly understood. This would also prove to be a net negative for tourism scholarship as a whole.
This study adopted a qualitative design using in-depth semi-structured interviews. Interviews with male and female informal tourism workers, government stakeholders, and NGO actors took place virtually between the months of January and February 2021. Eight individuals were interviewed for the Peruvian case study and five participants for the Chilean case (see table 1.4 for further participant details).
In the Peruvian case two of the interviewed women were from the town of Pisac (Cusco region), which in contrast to the rest of rural localities mentioned in this study, is a well-known destination with a mature tourism industry. The town is known for its daily informal handicraft market, which is largely dominated by Mestiza female traders. Most of these women consider themselves artisans and handicraft makers, although they also sell externally produced goods. In the Peruvian case, all interviewed women working in the informal tourism sector were artisans and handicraft makers, as these represent a large part of the informal tourism labour force in rural areas. Throughout the study the words ‘artisan’, ‘informal trader’ and ‘handicraft maker’ are used to refer to these women. The Chilean case study comprises interviews with men and women working in the tourism sector in a variety of roles. All names have been changed to protect the identity of participants.
All interviews were conducted through digital media platforms and were digitally recorded Following the transcription process, thematic data analysis followed established procedures of familiarisation, reduction, and reordering (Braun and Clarke, 2006).
2.1 Motivations and perceived benefits of informality
One of the key motivations underlying Peruvian women’s employment in the informal tourism sector was the degree of time flexibility offered by the sector. This was especially important to them given that women in rural Peru are still expected to meet a greater share of domestic responsibilities than their male counterparts, even if working full time (Codina, 2018). The need for flexible working hours is partially linked to patriarchal socio-cultural expectations, which if not met, may lead to women being ostracised from their own communities (ibid).
Most interviewed Peruvian female informal workers emphasised being able to take care of their children and associated household responsibilities, such as cooking, as one of the main advantages of working in the informal tourism sector. In Pisac, women sell their products in an informal outdoor handicraft market during the daytime, so they are usually able to bring their children to work with them. The nature of the job also means that family members can take turns to tend stalls:
Maria (female informal artisan): I studied to be a schoolteacher, but I never practised my profession because I had to take care of my children. Then I had my youngest daughter, and so it became more profitable to work here (Pisac handicraft market), I could take care of my children, and it was more profitable than being a teacher, and it was better for my children…it gave me flexibility.
Julieta (female artisan working in the informal tourism sector): Well, you’re free, right? You see how you use your time, and you have time for your children.
As mentioned by Maria, in the case of Pisac, one of the main motivations for women joining and staying in the informal tourism sector is related to the profit margin they can make in comparison to other professions or industries. It is not uncommon for Pisac women to have completed secondary education or University studies, but they often do not exercise their profession as the wages are lower than what they can make in the informal tourism sector. The profit margin combined with the flexible working conditions, and low-entry barriers offered by the informal tourism sector, made this an appealing option for Pisac women. Thus, in the case of Pisac, being part of the informal sector appears to be partially a choice for women, albeit a limited one since options to work in formal professions are restricted due to reduced financial compensation and the need to attend to domestic duties.
However, interviews revealed that this was not the case consistently in other parts of Peru where tourism is not an established industry. For Indigenous women in the San Martin and Amazon regions, participation in the informal tourism sector was largely related to a lack of formal education and little access to other employment opportunities as a result of structural inequalities (such as limited access to education, poverty, local patriarchal values and norms).
Similarly, women from less economically developed rural areas in the North of Peru appeared to participate in the informal tourism sector on a part-time basis, generally to supplement household income. These women also opted to sell handicrafts in the informal tourism market due to limited employment opportunities and low entry barriers. As noted by Daniel, most women working in the artisanal informal sector in the north of Peru do so as a part-time occupation:
Daniel (Ministry of Culture official): I think there is feminisation of artisanal activities not just because it is linked to tradition and cultural values or ‘feminine habitus’, the care of textiles, but also it has to do with the precariousness of the market. That means that it is mostly women with a lack of formal education that end up finding refuge in these activities because it gives them the possibility to earn their own revenue, right? But it never quite becomes their main source of income, for their household. The main source of income usually is generated by [the man] and he is the one who ends up going into education.
Unlike the women in Pisac, the female artisans in the North of Peru are generally not informal entrepreneurs, but rather work for third-party owned informal handicraft workshops. This also conditions some women to become dependent on intermediaries for sales and exports of their handicrafts, given that they lack access to resources and key social networks.
In the case of Pisac, women have become the main breadwinners and selling handicrafts, whether produced by themselves or third parties, has become a means of economic and psychological empowerment:
Maria (informal female handicraft seller): with this business of selling handicrafts, we have made money to live very well…I thank that business a lot because I’ve been able to buy my house and educate my children because of it. My older son is a professional person now.
Daniel (Ministry of Culture official): The artisanal sector is a refuge of inequities but that at the same time can be a significant source of autonomy, of self-confidence…I mean, it helps them to improve the verbalisation of their ideas, outside the home…and of course when it is well-established as an activity, then it becomes a means of economic empowerment.
Therefore, in the case of Peru, findings suggest that female participation in the informal tourism sector is not a temporary phenomenon, which solely provides cash incomes for marginalised groups. Although for many rural women, work in the informal tourism sector takes place as a result of economic hardship and a scarcity of employment options, for women working in mature tourism destinations, it can be a rational financial choice. In Pisac, women working in the informal tourism sector are rational economic actors who consider both benefits and costs when choosing to enter the informal sector. This also highlights the value that these women place on flexible working hours, independence, and freedom.
In the case of Chile, findings reflected that one of the main motivations for joining the informal tourism economy was to supplement household income. Tourism is a complementary activity to the subsistence economy performed by the vast majority of women in rural areas. This was the case for the Mapuche Indigenous women from the Kurarewe community who saw tourism as a complementary activity, as opposed to a full-time lucrative business opportunity:
Marisa (informal female artisan): For an Indigenous woman or a woman from a rural area who decides to work in tourism, they mainly do so as an alternative to their daily activities, to supplement what they do at home. If she takes care of her plot, cooks, or she’s an artisan, she will see in tourism an opportunity to make an extra income, but she doesn’t think of it as a profitable business to which she can give more of her time. Tourism has always been a supplementary activity in Indigenous communities.
Interview findings revealed that the women in this community viewed their participation in the informal sector as an entrepreneurial activity which facilitated the promotion of their Indigenous culture. For these women, tourism was a platform through which to disseminate the value of their gastronomic and handicraft traditions, whilst concurrently earning much-needed income for their household. Thus, dissemination of their culture was one of the most important motivations for joining the informal tourism sector. This was also related to the fact that diffusion and promotion of Indigenous culture was mainly seen as women’s responsibility, whilst Indigenous men favoured work in the construction sector.
A further reason that women were eager to promote their cultural traditions through tourism was that most of them had been working as domestic workers outside the community from an early age. The women, now in their forties, had been eager to reinforce their sense of cultural pride since coming back to their communities, and found tourism to be a good vehicle to achieve this aim. As a result, Kurarewe women did not view their work in the informal tourism economy as informal work. They considered the word ‘informal’ to have negative connotations and, instead, framed their work as contributing to the dissemination of Indigenous knowledge.
2.2 Barriers and challenges of informality
Most of the women working in the Peruvian tourism informal economy live in rural or semi-rural areas, as tourism in Peru is largely focused on natural and cultural heritage attractions found in rural settings. Rural communities have historically experienced restricted access to education and training opportunities, as well as limited access to technological infrastructure (Codina, 2018). Such barriers are further compounded by gender and ethnicity given that rural women in Peru commonly face additional limitations when attempting to complete formal education (ibid).
These structural conditions compel women to find jobs with low entry barriers, such as those commonly found in the informal tourism sector. Informal handicraft production is an attractive proposition since it is an activity that may already be part of women’s daily lives and can be performed from home. Nevertheless, interviews revealed that Indigenous women still experienced gender-based barriers that often made it difficult for them to access training opportunities and expand their entrepreneurial capabilities. As pointed out by Gaby, an NGO manager working with female handicraft makers, Indigenous women who sought to access further training opportunities, could often face opposition from their own communities for seeking to increase their knowledge base. This complicated entry into the formal sector and may prevent these women from moving beyond informal trading opportunities:
Julieta (female handicraft trainer): It was very difficult at first because it is a very sexist culture…so to ask for these women to leave for one or two days to get some training, it was difficult to get the husbands’ approval…but slowly they got used to it because they saw that there was also a small income coming in…
Gaby (NGO manager): In some meetings women have mentioned that when they come up with an initiative to improve their lives, there’s always a ‘comment’…there’s a general discouragement from male counterparts in the community…comments like ‘why are you doing this?…‘why don’t you cook instead?’, ‘why don’t you take care of your children instead?’…they tell me ‘when we want to improve, we always find barriers, from the Mayor to the councillor’…
As noted by Gaby, women often encounter participation barriers in political spheres at a local level. Local political representation is often dominated by male leadership, which often excludes women from decision-making processes or/and complicates bureaucratic processes unnecessarily. Thus, the gender-based obstacles faced by women may manifest though tacit practices and ordinary everyday situations, rather than through open discrimination or aggression. Although these barriers are notable at a community level, they are also present at higher levels of government, as noted by an interviewee who reflected on his experience of working in the MINCETUR:
Manuel (Ex-MINCETUR high ranking official): There is still a greater percentage of male leadership, undoubtedly so…this is because of the machismo that clearly still exists in our society and the structural organisation of a lot of enterprises, right? If you look at the tourism guilds and you start looking at the presidents, and the boards of some of these guilds…you will see mostly men in leadership positions…I have seen situations in my position of government agent, in meetings and social acts, where the machista logic is still very present…
Added to gender barriers, Indigenous women particularly may also face additional obstacles related to culture and ethnicity. Language barriers represent a key issue for Indigenous women trying to develop formal enterprise. This is because much of the tourism related legislation and norms are seldom translated from Spanish to Indigenous languages. One interviewed former government official for the Peruvian Ministry of Tourism (MINCETUR) commented on the government’s reticence to translate legislation when she proposed translating some laws relating to the rights of artisans into the Amazonian Indigenous languages:
Susana (former MINCETUR official): I visited Yanesha Indigenous communities, when the “Law of the Artisan” was developed, which by the way has not been published even though it’s ready…. We translated the law into Awajun, Shipibo and Yanesha (Amazonian Indigenous languages). It was a challenge because everybody in the MINCETUR kept telling me “but these communities do not have written languages”, and I would say “yes, but we are not going to sing the laws to them, are we? We need to hand it to them in writing and then they will see whether they read them or what they do with them!
This quote reflects the state inefficiency in releasing legislative information of key interest to the public. It also denotes the assumptions often made by government officials regarding the capabilities and needs of Indigenous communities, such as that these lack the capacity or interest to read printed text. Similar comments regarding the failure of state institutions to facilitate readily available access to public documents, were made by Gaby, an NGO manager working with women in community-based tourism projects:
Gaby: there are many bureaucratic barriers relating to really simple things such as how to obtain information about how to create a tourism development plan. These documents are not made available to the population, and they should be because these are public documents. Even if they are publicly available, they are often incomprehensible to the average person…
Several interviewees also denoted that costs did represent a key barrier to formalisation, especially costs associated with bureaucratic procedures to join the formal sector. According to most interviewees, these costs were comparatively high in relation to the fluctuating amount of revenue informal tourism artisans made on a monthly basis:
Gaby (NGO manager): In terms of barriers to formality, first there is the issue of high cost and a high amount of revenue that stays within the tourism supply chain, so in the end only a small percentage stays within the actual enterprise…costs are associated with taxes and bureaucratic processes. So, this already demotivates them to become formal, because if they do, the percentage from sales they keep is less than 20%.
Julieta (informal female artisan): It’s a cost and for handicrafts, we earn money on a day-to-day basis but it’s not constant… If you are registered with all these state entities, you need an accountant to take care of all the paperwork, right? So, all of that is a cost.
The costs associated with being part of the formal sector were mentioned in conjunction with complex and lengthy bureaucratic processes, as one of the main limitations to formalisation. Additionally, the lack of easy access to public information, the complex language used in tourism development state documents, as well as the lack of assistance from state actors, further de-motivated informal traders from formalisation.
Several interviewees were critical of the existing governance systems and blamed the inefficiency of the state at different levels (local, regional, national) for poor implementation of plans and policies which ultimately leave large segments of the population, and their needs, unattended. Duplicity of functions, corruption, and lack of collaboration between different Ministries were repeatedly mentioned by interviewees as incapacitating efficient governance. Such circumstances make the sustainable development and implementation of plans and policies extremely difficult.
In the case of Chile, interview data uncovered that informal female entrepreneurs were afraid to participate in the formal sector due to the complex and expensive procedures associated with formalisation. Women in rural areas preferred to start their business ideas off in the informal economy, as a way to test out the success of their ventures without having to incur as many risks. The complexity characterising the formalisation process was mainly linked to the lengthy bureaucratic process, and the difficulty of meeting standards needed to obtain official state certifications for tourism businesses.
The tourism certification standards appeared to have been mainly developed with the tourist’s needs in mind. Whilst tourist safety is undoubtedly paramount, standards of cleanliness and safety measures were extremely difficult to meet for Indigenous communities in isolated rural areas, with high levels of poverty and limited state assistance. Most importantly, some governmental requirements compromised Indigenous cultural heritage, potentially diminishing the cultural authenticity of the tourist experience. For instance, the certification standards related to Mapuche hospitality providers do not allow Indigenous women to cook for tourists in their traditional huts (Rucas). This is because sanitary regulations dictate that floors must be paved, and the huts must meet a set infrastructural requirements which traditional Mapuche huts cannot meet:
Marisa (female informal artisan): By law, you can’t have a restaurant in a Ruca nowadays because you need to have paved floors, you need to have a lot of things there because of hygiene rules…so you have to find another way, most have the kitchen somewhere else so they can meet the standards, and then they take the food to tourists in the Ruca.
Similarly, certification standards do not consider the unique value of intangible cultural heritage, for instance the ancestral techniques used in the manufacturing of Mapuche handicrafts. Instead, certification standards focus on the quality of the materials used and given that Mapuche handicrafts are foremost elaborated by women working in informal settings, these handicrafts do not meet the state quality certification standards. This in turn is impacting the Mapuche handicraft value chain in relation to access to materials, the need to upgrade materials, and the commercialisation of Indigenous artifacts. For instance, one interviewed accommodation owner mentioned she did not sell handicrafts made by Mapuche women in the informal sector, to avoid being fined due to these artifacts not meeting official government quality standards. She did this despite being aware that these handicrafts had unique cultural value. This reflects the need for tailor-made certification standards that align with Indigenous traditions, values, and structural conditions.
Even though the Chilean state is reinforcing programmes to support entrepreneurs, most of these are heavily focused on the formal economy. For instance, one of the requirements to establish a formal enterprise is to have at least five or six individuals in a group. In Indigenous networks, such as the Kurarewe community, they do not fill this minimum size requirement given that they are usually small family enterprises and have low levels of sales. Further to this, as was the case in Peru, interview findings revealed that informal traders often stayed in the informal sector due to fear and ignorance of the system. Fear was linked to possibly losing state benefits if they formalised their businesses, and losing profits due to high tax costs:
Teresa (female artisan trainer): I have also seen a lot of fear of formalisation because they fear they will lose social benefits from the state. They tell you ‘if I become formal, I will become visible in the tax system and the state will assume I’m selling, that will mean I will lose the bursary for my daughter’…I think there’s also fear of becoming part of the tax system…a fear of losing money or paying too many taxes. So finally, there’s fear due to ignorance as well.
However, one interviewee noted that informal tourism actors in Chile were starting to group together to help each other with the formalisation process. Informal artisans and other tourism-related informal actors recognised the importance of formalisation for their businesses to prosper in the long run:
Teresa (female artisan trainer): There are many informal traders that have started to group together out of necessity…that’s when they quickly realise that they need to be part of the formal sector if they want to enter a commercial system…I have seen many associations that naturally are created for a common goal which is to perpetuate the trade, receive orders, and start selling their products in Chile and abroad.
Thus, working as a group proved more viable than attempting formalisation on an individual basis.
Although there are key differences in the scope and scale of the informal sector between Peru and Chile, actors in the informal tourism industry and associated sectors appear to face similar barriers. Lack of knowledge of the processes and procedures needed for formalisation, limited state support with the formalisation process, as well as inflexible conditions which do not align to the socio-economic circumstances experienced by informal actors, dissuade many informal traders from expanding into the formal sector. Indigenous women in the informal tourism economy may also be further deterred from seeking formalisation out of a fear of state intervention in — and subsequent commodification of — cultural heritage. This ultimately limits their entrepreneurial growth and profits, whilst limiting their rights and protection under law.
2.3 Links to the formal sector
Links to government institutions
Interviewed Peruvian state actors did acknowledge the issues confronting informal tourism actors and although still viewed the informal sector mainly as problematic for the competitiveness of the tourism industry, they recognised that formalisation of the sector could only take place with further collaboration from the state. Government stakeholders also recognised the key role played by tourism-related guilds in further addressing the needs of the informal sector. Although tourism-related guilds represent formal enterprises, they are part of a sector that is largely informal and thus cannot ignore the issues confronting informal actors.
The disconnect between state entities and the informal sector became even more evident when discussing the state of female participation in the informal tourism sector. Although government actors recognised the key role played by women in the tourism and artisan sector, evidence suggests that to date, there is a lack of sex-disaggregated data regarding female labour. Similarly, although it is estimated that women make up around 76% of the Peruvian tourism sector (Baum, 2013), interview data suggested a scarcity of gender-responsive policies directed at the informal sector or/and the tourism industry; even though state actors are aware of the gender barriers faced by women in Peru:
Manuel (former MINCETUR high ranking officer): I mean in all my time working in the MINCETUR, in these last 20 years, I don’t remember the development of any programme specifically targeting women.
In the case of Chile, institutions and tourism experts evidenced a reticence to acknowledge the presence of informality within the tourism sector, or to address gender-related issues associated with the sector. As an example, when SERNATUR (the Chilean governmental institution in charge of national tourism management) was told about this research, their response was “we don’t work with the informal sector”. Tourism for women in the informal economy is considered a casual activity that comes and goes; therefore, women are thought to have minor engagement with the sector although data shows 53% of individuals employed in the Chilean tourism sector are women (Baum, 2013). This is in opposition to the Peruvian case where women in the informal tourism economy are known to play a key role in the sector (Codina, 2018; Del Pozo Loayza, 2018). Many state interventions in tourism and related sectors are limited to the provision of funds or donations of equipment, but there is limited vision as to how these may be used for sustainable development. For instance, one interviewed artisan trainer lamented the lack of training provided by the state in one intervention meant to encourage artisan cheese production:
Teresa (female artisan trainer): Many years ago, I went to visit a group of artisans who lived out in the mountains. The SERCOTEC (State Technical Cooperation Service) had financed a project for the manufacturing of artisanal cheeses. They had amazing cheese making facilities, an exquisite space, but they were closed! They were using that space as a storage space…and this is because in the end, there are many schemes of this sort, where they donate machinery, ovens etc… but they do not train people in how to use these…it’s like having a Mercedes but not knowing how to drive it.
Interviews also revealed that in Chile, women are prevented from moving towards the formal sector due to fear, distrust of state institutions, as well as inexperience of dealing with bureaucratic processes. Women working in the informal tourism sector do not know how to deal with taxes, standards, and credentials. As a result, many prefer to remain invisible to state institutions even if this meant preventing the growth of their businesses, since formalisation implies having to confront a regulatory system that often works against the nature of their services and products, which are rooted in cultural heritage.
In both the cases of Chile and Peru, it appears there is no intention from institutions to further integrate the informal economy into policymaking. The current policies do not identify the main causes leading women to work in the informal tourism economy and associated sectors. Tourism policies and strategies are integrating neither the informal economy nor gender issues. This brings into light the absence of gender-responsive tourism programming focused on the informal tourism economy.
Links to the private sector
As previously mentioned, informal tourism actors routinely interact and work alongside the formal economy. The line between the formal and informal sector is sometimes blurred as it is common for informal female actors to sporadically participate in the formal economy through special events such as ‘ferias’ (trade fairs).
Handicraft ‘ferias’ are organised by local or national authorities and although the artisans who participate in them are registered as such, they often do not work in the formal sector most of the year. This is the case for artisan women in the North of Peru who rely on ferias for key sales and for expanding their social network with the formal sector. Ferias are usually attended by formal actors from different industries, and thus provide a key space for female artisans to interact with formal producers who may, later, sell their products on a wider commercial scale. However, as noted by Daniel, this can also lead to overdependence on private sector intermediaries, due to these having access to wider networks and further knowledge of digital technologies.
Daniel (Ministry of Culture official): the reason why they depend so much on ferias is because they don’t have other places to sell, they don’t really have other ways to sell…this is also why they end up becoming so dependent on intermediaries both for exports and for local sales…they don’t have access to direct selling points….
In the case of Pisac the exploitative relations that tourism may foster between informal traders and formal actors, such as tour guides, are more evident. As is common in many destinations, some formal tourism businesses pay the guides a commission in exchange for directing tourists to their shops (Codina et al, 2020). Informal handicraft sellers refuse to pay guides commission in exchange for sales, and as a result, end up with a lower share of local tourist spending. This arguably creates unequal exchange relations between informal traders and private sector intermediaries, further discouraging female informal traders from joining the formal sector.
In the case of Chile, the tourism informal economy is linked to the formal sector mainly through the help of foundations funded through NGOs, the state, or the private sector, that act as intermediaries selling female produced handicrafts. Some study participants expressed concerns about the paternal nature of foundations — a phenomenon well-documented in the cultural heritage literature (Azuela and Cogco, 2016; Rosselló and Cosmelli, 2021). They suggested that the foundations might assume responsibility for the entire handicraft production process and in so doing exclude the very women they purport to assist. Studies suggest that in the long-term these third-party initiatives do not bring about lasting structural change in the informal economy (Moagi et al, 2021; Grobar, 2019).
In both Chile and Peru, it seems that informal female tourism actors rely on private sector intermediaries to reach a wider consumer set and maximise their product sales. These relationships may sometimes lead to dependency and manipulation and may encourage informal actors to stay in the shadow of informality due to fear and over-reliance on third parties for income.
2.4 Impacts of COVID-19
The tourism industry was one of the sectors worst hit by the COVID-19 pandemic on a global scale (Gössling et al, 2020). In a country like Peru, where most of the economic revenue from tourism is generated by international tourists (World Bank, 2019), economic and social impacts were devastating. The Peruvian state did not provide any targeted financial assistance or programmes for informal enterprises. Instead, the state provided two economic aid bonuses targeted at families living below the poverty threshold, emergency food bundles and ‘JUNTOS’ (conditional cash transfer) targeted at vulnerable groups (Andina, 2020; CARE, 2021).
Lending and funding programmes were implemented for the tourism and handicraft industries through the ‘Turismo Emprende’ (translated to ‘Enterprise Tourism’) funding scheme and similar credit schemes facilitated by diverse government ministries. However, these schemes were almost exclusively directed towards formal tourism-related enterprises, and thus did not have a significant impact on informal entrepreneurs. Although the criteria to participate in some of these schemes were modified to enable the inclusion of a wider set of participants, the complex application process and need for formalisation evidence still excluded many female informal traders. Most of these competitions, asked participants to hold a RUC (operating licence) and to evidence a certain number of sales, which was difficult to meet for many informal traders with limited assets.
Although some of the interviewed women participated in ‘Turismo Emprende’, a distinctive distrust of state entities was present amongst most participants, which discouraged several women from applying to these state-funded competitions. Partly this was linked to long-standing distrust of national and local authorities as a result of repeated corruption scandals involving political figures at a national and local level. These issues were further complicated by a lack of coordination and collaboration between Ministries. As noted by a former MINCETUR official, ministries seldom share information and resources, which at times led to some individuals being missed from funding schemes. Thus, funding and lending schemes for informal traders were insufficient in scope, whilst the administration and delivery of these programmes presented several deficiencies which significantly limited the number of beneficiaries.
Given the importance of tourism for many informal female entrepreneurs in Pisac, several women had taken out bank loans to invest in merchandise. With the arrival of the pandemic and the abrupt halt in earnings, many female traders were also facing mounting pressures to repay their loans and were being charged increasingly higher interest rates due to missed payments.
Pisac informal handicraft market traders also faced added pressures from public authorities who used the pandemic and confinement measures to attempt to permanently remove market traders from the space of the plaza (see figure 2.4). This particularly affected women, given that most market traders are female. Such measures made women fear for their livelihoods on a long-term basis.
For the rest of interviewed Peruvian female informal artisans, the pandemic also abruptly stopped their sole source of revenue, particularly their access to handicraft tradeshows known as ‘ferias’, which for most was their main selling venue. Established contracts with NGOs selling female manufactured handicrafts also eventually stopped for many female artisans. Aside from the economic consequences this situation had on female artisans, it adversely impacted their social connectedness.
Handicraft making workshops, training workshops, and ‘ferias’ provided many women with the opportunity to connect with other women and build networks outside their own households or communities. Access to social networks is essential in the artisanal sector which relies on personal relations for sales, but it also has mental health implications for women who sometimes rely on these connections for emotional and social support.
In most cases, women also had to cope with a significant increase in domestic responsibilities, including taking care of sick and elderly family/and or community members. As noted in several interviews, both in urban and rural areas, women are largely in charge of organising and managing community support initiatives:
Susana (former MINCETUR official): without a doubt women have a heavier domestic burden… they are the ones in charge of ensuring their communities and households get fed, and that takes time away from them. In fact, all around Lima, where you see all the soup kitchens to ensure communities get fed, which is basic, this is led by women. So, that means they have much less time dedicated to artisanal production.
Maria (informal female artisan): I take care of my parents, they live with me, and my mother has her parents with her too, so I have them as well in my house…yes, I have more domestic chores because I’m home most of the time.
As noted by Susana, these conditions justified the need for the development of economic aid and mental health support programmes specifically targeted at women, given that they face unique barriers and challenges which put them at greater risk of isolation, poverty, and mental health issues during the pandemic:
Susana (former MINCETUR official): And yes, it needs to be differentiated (state aid programmes) for women…these are women that face bigger access barriers to even be able to move out of their homes. Because, who takes care of older people? Women. Who takes care of children? Women. Now that children are at home, what are women doing? They are the ones in charge of helping children with online classes…So, there are many justified reasons for which we should boost programmes for women.
Susana further stressed the mental health issues faced by women during the pandemic and the pressing need for the development of further mental health initiatives from the state to support women during these vulnerable times. Despite these challenges, interviews revealed that women in the Peruvian informal tourism sector still found different coping strategies and mechanisms to survive throughout the pandemic.
Notably, women in Pisac appeared to have used some of the transferable skills learned during their time working in informal tourism (i.e., creativity, negotiation and sales skills, entrepreneurial vision), to develop alternative entrepreneurial initiatives. Most women were used to developing new products and services for a dynamic tourism industry with constantly shifting market demands and trends. Thus, it may be argued that women’s experience of working in the informal tourism sector made them more adaptable and resilient, and in doing so, better prepared them for the uncertain circumstances presented by the pandemic. For instance, Maria, a former informal handicraft seller, engaged in several ad-hoc ventures:
Maria (informal female artisan): Due to the pandemic I opened my own liquor store from home…we all participate in it; my children also help…now in Pisac there are more liquor stores than bodegas (small grocery stores) … I even do deliveries, what else did I do during the pandemic? I bought chickens, raised them, and then sold them off, I also did chicken soup and sold it from home…. I mostly sold soup to my family and friends…Really, I did everything! I also sold honey…
Interviewed women in Pisac emphasised they were driven to find alternate ways to earn an income outside of tourism, since they had become used to financial independence:
Maria (informal female artisan): Listen, we are independent, we don’t want to have to ask our husbands for money, right? Maybe I only needed 10 soles [approximately £2.00] so I could buy stuff for myself, and I wasn’t going to ask my husband…
Nevertheless, for most women, the alternative income opportunities they developed did not provide significant revenue, especially when compared to their previous tourism-related income. For most female informal traders, these alternative occupations represented subsistence activities that were not always successful. For the rest of interviewed women in other regions of Peru from communities with non-tourism-centred economies, the degree of adaptation was different from that of women in Pisac. The argument could be made that they did not develop the same transferable skills as Pisac female informal traders, given that they did not work in the informal tourism sector on a full-time basis. Most of these women live in rural areas and for many, the pandemic necessitated reverting to traditional subsistence activities, such as agriculture.
In the case of Chile, women in the Kurarewe community did not receive any tourists since the start of the pandemic. This particularly affected those women who relied on the sale of food and/or ran semi-formal tourist visits to their traditional homes. As was the case with Peruvian Indigenous women, they cultivated their land as a way to survive food shortages brought on by income reduction. Congruent with the situation in Peru, due to lockdown restrictions, women working in handicraft were not able to participate in ‘ferias’, the most important events of the year for selling handicrafts. Consequently, this also impacted their ability to meet with colleagues and build new partnerships. The pandemic also affected women’s ability to buy raw materials for handicraft production in urban centres. This was chiefly related to confinement restrictions which restricted women to their homes, and thus constrained their mobility whilst concurrently increasing their domestic and care responsibilities.
Chilean women working in the informal tourism economy also reported having problems in accessing the financial aid provided by the government to overcome the socio-economic impacts of COVID-19. This was similarly related to the fact that most relief aid and funding schemes were largely directed at formal actors, and the fact that beneficiaries had to visit urban centres in order to claim funds.
Interview findings also revealed that there was a feeling amongst informal actors, that the pandemic was going to aggravate the issue of certifications, with standards becoming more difficult to meet post-pandemic. Thereby, Indigenous women working in the informal tourism sector feared they would have to face further barriers if they tried to formalise their businesses.
A positive consequence of the pandemic was described by women who had been caring for grandchildren and consequently learned to use new technologies for selling thanks to the assistance of young people.
In both Peru and Chile, there was a stark lack of state support directed at women and the informal sector. Most state aid and funding schemes appear to have been exclusively aimed at formal actors, whilst limited interventions have been developed for the tourism sector. There is scarce evidence of gender-sensitive policies and programs accounting for the barriers women are experiencing during the pandemic, such as increased domestic and caring responsibilities. A lack of sex-disaggregated data for the tourism sector further undermines women’s experiences and needs.
2.4 Sustainable development goals and the informal tourism sector
SDG 1: Tourism sector poverty alleviation
Whilst the tourism industries of Peru and Chile were one of the worst hit sectors of the economy due to the closing of borders and confinement measures, findings disclose that informal traders were disproportionately affected by the impacts of the pandemic. Both in the case of Chile and Peru, informal tourism actors abruptly lost their main income source and had not able to benefit from targeted economic aid from the state at any point since the start of the pandemic. Neither the Peruvian nor Chilean governments developed economic relief measures directly targeted at informal workers. Fiscal measures to alleviate the detrimental economic impacts of the pandemic were not responsive to the needs of informal traders nor female workers. Funding and credit schemes in both countries were almost exclusively directed towards formal enterprises who could prove they had been trading as such before the start of the pandemic.
Government entities did not develop sufficient gender-responsive policies and measures to respond to increased pressures faced by the female population that puts them at greater risk of economic insolvency compared to male counterparts. Without targeted state support, women in the Peruvian and Chilean informal tourism sector and related industries are likely to suffer from higher incidences of poverty as a result of the pandemic. This will undoubtedly have lasting socio-economic consequences for future generations and is likely to increase the feminisation of poverty in Chile and Peru for decades.
SDG 5: Gender equality and empowerment of all women and girls
Although interview data showed that some women were economically empowered through tourism by earning their own wages, most were still expected to maintain their domestic and care roles. This arguably limited their social and economic empowerment, given that women had a “double workload” (Bell, 2006, p. 1181) which consequently also limited the extent to which they could pursue training/educational opportunities, and ultimately develop their businesses. Patriarchal power structures and in some cases, tacit demotivating comments from male family members were also found to limit women’s entrepreneurial growth.
Gender-based inequalities were also unsurfaced within governmental entities at different levels. Lack of female representation was evident at a local and national level, whilst several interviewed state actors reflected on the lack of gender-sensitive policies within the tourism and handicraft sectors. This was congruently linked to limited data on gender-related issues in tourism, evidenced by a lack of sex-disaggregated data on the nature of female employment in the informal and formal tourism sectors.
Nevertheless, some women working in the informal tourism sector showed increased economic resilience through the pandemic. This was chiefly linked to the ways in which they were able to maximise the transferable skills developed by working in tourism to create new entrepreneurial opportunities for themselves.
Therefore, the results of this study highlight the need for governments to acknowledge the existing unequal gender power relations embedded in local communities when planning tourism development (Ferguson and Moreno, 2013; Codina, 2018). Gender equality should also be integrated in the development of existing and future tourism policies and interventions, to create a more inclusive, sustainable, and resilient industry (Moreno and Cole, 2019; UNWTO, 2019). Similarly, the involvement of women in designing and implementing tourism measures is essential to achieve a truly sustainable tourism industry.
SDG 16: Peaceful and inclusive societies: accountable institutions at all levels
The findings of this study highlight the need for governmental institutions at all levels to work alongside informal sector actors, and women, to create a more inclusive and fair tourism industry for all. Interview findings revealed that female informal actors are still dependent on private sector intermediaries for access to tourists, training opportunities, and help with digital technologies. This can sometimes lead to exploitative relationships as highlighted by the case of tour guides in Pisac.
Study findings thus suggest that state institutions must increase efforts to gather evidence on the structural inequalities affecting the inclusive participation of women and informal actors in tourism. Although in the case of Peru, there is acknowledgement of the scope and scale of the informal sector within tourism, there is limited evidence of efforts being made to integrate informal actors into wider policy-making. In Chile, no such recognition of the sector was evident. Due to a lack of knowledge and understanding of informal actors’ experiences, state stakeholders are also unable to recognise some of the strengths and skills that informal entrepreneurs possess. These skills could be further harnessed to integrate informal actors into the formal sector, through mutually beneficial, collaborative, rather than retaliatory mechanisms. For this to take place, further studies on the participation of women in the informal tourism sector, both from a theoretical and practical point of view, are urgently needed.
3.0 Implications for policy and practice
Although the tourism sector is known for its ability to adapt and recover from crises, the COVID-19 pandemic has produced unprecedented circumstances, requiring the development of new approaches to accelerate recovery. The pandemic has stressed the need for multi-tiered responses and robust partnerships to address the immediate and long-term impacts of COVID-19 on host communities globally. At the same time, the current crisis provides an opportunity to transform tourism into a more inclusive, sustainable, and resilient global industry. For this goal to be realised, and for tourism to align with all sustainable development goals, gender equality must be at the centre of post-pandemic tourism recovery programs.
This study highlighted the particularly problematic relationship between the pressure on female informal tourism actors to formalise and their desire to safeguard their cultural heritage. The imposition of government quality standards on Indigenous handicraft is not conducive to the production of authentic artefacts which honour cultural tradition and as such attract higher retail prices. This standardisation of cultural heritage, which in the case of Peru and Chile is considered the province of women, serves only to discourage artisans from engaging with government support.
The pandemic is likely to exacerbate the existing tension between the safeguarding of traditional craft and the need for women artisans to earn the larger wages promised by government-endorsed formalisation. Without gender-responsive policy instruments to account for this tension, there is a risk that women’s engaging with the formalisation process is detrimental to the preservation of cultural heritage or else that women refuse altogether.
To this end, gender-responsive fiscal policies are urgently needed to support women working in the Chilean and Peruvian informal tourism industries and related sectors. Such measures could include financial aid and direct cash transfers for informal workers, credit lines and financial support measures for women wishing to establish, formalise or expand their tourism enterprises, fringe benefits, subsidies for childcare to facilitate women’s return to work, and further mentoring and training support for informal workers who wish to formalise their businesses. Based on primary findings which highlighted the pressures women are facing during the current crisis, further funding for mental health services that address the specific needs and concerns of women and girls is also needed.
In the long-term, gender equality should be integrated at all levels and phases of tourism development in Peru and Chile, particularly when designing and implementing any sort of tourism measure or policy. For gender-responsive policies to be realised, further sex-disaggregated data on the nature of female employment in tourism and the informal sector is urgently needed. At present, there is virtually no data related to the quality and participation of women in tourism employment, and thus their needs remain unaddressed in wider policy developments.
Similarly, the needs of other vulnerable groups, such as informal workers, which make up a large part of the tourism workforce in the Global South, must be further incorporated into wider policy development in assistance mechanisms. Short and medium term direct financial state assistance is especially needed during the current crisis for informal tourism workers whose livelihoods rely on tourism. Additionally, both the Peruvian and Chilean states must aim to promote increased flexibility in the conditions to be met for formalisation. The creation of tailor-made fiscal mechanisms for informal actors working in rural tourism economies could be one approach to encourage formalisation. This could include further state help with bureaucratic procedures, simplification of some of the conditions to be met to obtain certifications, transparent access to formalisation guidelines, and discounted tax rates to account for tourism’s highly seasonal earnings.
Furthermore, COVID-19 has accelerated the digitalisation process and has evidenced the digital divide within and between countries. Vulnerable groups such as informal workers, and rural actors in Peru and Chile, are particularly impacted by this divide. State interventions should aim to improve digital literacy amongst these groups. This includes training on how to improve use of digital platforms and tools to streamline their operations, widen their commercial reach, and decrease dependency on third-party intermediaries for the sale and marketing of their products and services.
Lastly, the Peruvian and Chilean states should foster partnerships with host communities. Current tourism development policies and programmes reflect a centralised, top-down approach to tourism governance. These frequently do not reflect the needs and realities of rural communities, particularly those of actors on the margin, such as women and the informal sector. This approach to tourism development further deters informal actors from formalisation. Therefore, the Peruvian and Chilean states must promote collaborative approaches to tourism planning and governance. These collaborative mechanisms should foster trust-building and dialogue amongst all stakeholders (informal and formal tourism stakeholders, state institutions, NGOs, host community residents), a shared understanding of goals and beliefs, immediate, intermediate and long-term desired outcomes, as well as local leadership support.
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We would like to express our sincere gratitude to all the participants who agreed to take part in this project. Particular thanks go to the women in Chile and Peru who agreed to share their experiences of the covid-19 pandemic and the informal tourism sector with the authors. We would also like to thank Pablo Rosselló de las Casas, Sissi Hamann, and Alejandra Szczepaniak from the British council offices in Buenos Aires, Lima, and Santiago for facilitating access to interview participants.
This project is undertaken by the PEC International Council and supported by the British Council. The PEC International Council is a network of leading policy and creative economy practitioners from across the world. The group is convened by The British Council and is an international advisory body to the Creative Industries Policy and Evidence Centre (PEC), which is led by Nesta. This project was also supported by Oxford Brookes University.