Challenges remain but opportunities await – Kenya tourism in 2015

KENYA’S TOURISM SECTOR REELING FROM LATEST DOWNTURN IN ARRIVALS

(Posted 13th June 2015)

The latest data for the first five months of 2015, released yesterday by the Kenya Tourism Board, make grim reading and confirm the narratives told to this correspondent during repeated visits to the Kenya coast since early this year.

Tourist arrivals fell by another staggering 25 percent, down from the already much lower arrivals in 2014 and 2013, compounding the challenges faced in particular by Kenya’s coastal tourism and hospitality businesses.

Only 284.313 tourist arrivals were recorded between January and May this year, compared to 381.278 a year ago. In particular did the UK market show a downturn of 35 percent compared to 2014, attributed to crippling anti travel advisories issued by the British Foreign and Commonwealth Office. Business from the United States, generally perceived as of greater financial value since American visitors mainly visit the game parks compared to British visitors who seem to have largely frequented the coast resorts, is down by 22 percent, pushing revenue receipts down even further.

The Kenyan government has however at last owned up to the unprecedented crisis by increasing the tourism budget five-fold to 5.2 billion Kenya Shillings. This however is less than the initial budget estimates suggested, that figure standing at 6.8 billion Kenya Shillings before the parliamentary budget and appropriations committee trimmed it back by 300 million, as was reported here last week.

Sources close to the Kenya Tourism Board, as did key tourism industry private sector stakeholders, welcomed the rise in budget allocation. ‘What we now expect is that money to be released in full. In the past the minister made many announcement about how much money would come KTB’s way and then it either took ages or never happened. This has to change. Secondly, KTB must now show the ability to absorb this money and put it to good use. The appointment of Grayling has to show results and we are watching them because up to now all we heard was talk. Our friends at KTB should also not think that throwing money at CNN will solve our problems. It takes a lot more than that. We need to attend as many tourism trade fairs as possible and hit our old, new and emerging markets with direct sales missions. B2B contacts are key to reclaim market share for beach holidays and safaris.

In direct contact we stand the best chance to convince our partners abroad that it is safe to come to Kenya for safaris and even to our beaches. We must not deny that we have issues however. There is a perception out there that our government has been dealing with security issues in a very incompetent manner for too long. We need to take a leaf from Rwanda where national security is engrained in everything their government does. They continue to have increases in tourist arrivals because the perception out in the world is that the country is kept secure. We therefore need to change that perception in the market that Kenya is not or less secure. But that challenge rests with government to finally show competence and ability to stop these periodic attacks, none of which of course hit tourism directly but the indirect hits did enough damage to our businesses’ wrote a regular and very senior stakeholder from Nairobi when passing on the published data yesterday afternoon.

Other stakeholders however pointed out that comprehensive reactions to the report handed in to the government by the tourism recovery task force in March, are still awaited and that VAT on tourism services is yet to be lifted to make the country more competitive. ‘The budget is ok but we need to see VAT on tourism services go. It would lift a 16 percent surcharge tourists pay on park or conservancy entrance fees and other elements of the packages we offer. It is also time to reorganize the public tourism sector. We need our own minister who oversees tourism and wildlife at the least. And we must finally own up that the fragmentation of public sector authorities for the tourism industry under the existing tourism law is not sustainable. We need to bring all those under one roof, under one authority, where tourism marketing and promotion plays the first fiddle. If there is no fundamental change in the way the public sector is organized our task towards recovery is only made so much more difficult’.

Sentiments by the way heard many many times during regular visits and interaction with key private sector stakeholders and shared by this correspondent as probably the only way forward to accomplish a rapid recovery.

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