The increased importance attached by policy-makers to the anticipated
developmental effects of tourism in developing countries has been insufficiently
examined by academic researchers, particularly in the context of the contribution of
small firms in urban areas. This deficiency is addressed by providing a review of
existing research followed by an analysis of interviews with ninety tourism business
located within and outside the townships of Langa and Imizamo Yethu, Cape Town,
South Africa. The findings reveal tensions between the different actors involved in
township tourism. While the involvement of small, locally owned, businesses is
beneficial it is limited by conflicts of interest, lack of trust, limited social networks
and little attachment to the township locality. The discussion highlights the
complexity of tourism’s role in economic development which has significant
implications for local policy-makers.