Kenya – after a downturn there is always another upturn


(Posted 29th March 2015)

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Some of the younger generation of tourism stakeholders must be forgiven if they think that Kenya is at present faced with an unprecedented crisis for the sector, compounded by hostile anti-travel advisories.

While way back in time there were few such anti-travel advisories in place, after all the Internet with its information super highway wasn’t in place yet to spread such malice at an instant’s notice across the world, did tourism face periodic challenges of downturns which then as now caused doom and gloom among stakeholders, until things got better again.

It takes a long memory to remember those hard times, and the alternating good times and it was of no surprise when veteran hotelier Chris Modigell, one of Kenya’s most respected individuals in the sector, dug deep and sent some newspaper clippings of 14 years ago and another of nearly 30 years ago, to draw parallels with what is happening today. He, as a member of the Tourism Recovery Task Force, together with some other individuals like David Stogdale and Jake Grieves-Cook – equally respected individuals with a similarly long institutional memory – will no doubt remember the sector’s efforts to get the ear of government in 2001, as was the case in 1992 and in 1982.

It perhaps is a reminder that the tourism sector’s fortunes have always been moving like the tide, down at one time and up again at another, with but one certainty that the cycles repeat itself over and over and the biblical 7 years of drought and hardship are followed by 7 years of rich pickings and good fortunes.

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Even more intriguing was Chris’ second newspaper clipping, dating back into 1986, in which a drive towards an increase in domestic tourism was proposed. However, that was not the big thing in that article but the low season rates quoted, which, considering the exchange rates in 1986, equate to just over 50 US Dollars per person per day, about the same what Kenyans and expats pay today, nearly 30 years later.

Now which industry has over the past 30 years kept their tariffs at the same level, considering inflation and all, apart perhaps from airfares after deregulation started to take root.

It is a sharp reminder that the challenges the tourism industry faces are not just rooted in anti-travel advisories and the perception about Kenya as a destination, but hotels and resorts also face the uphill task to raise rates, along with service standards to generate the cashflow needed to regularly refurbish, renovate, modernize and where demand permits, expand.

Different times, same challenges and, sadly, few solutions which have been put into place, not back then and certainly not right now. Agreed, Malindi’s airport was expanded but it still lacking a long enough runway for larger aircraft which would permit nonstop flights to that part of the Kenya coast. Scheduled airlines still only land far and few between in Mombasa and with the charters falling away is the need for such services today as great as it was in 2001. Rebranding a tired product was a challenge 15 years ago and remained a challenge for today’s generation of hoteliers. High interest rates then prevented investments and again, today is no different. Visa fees, no surprise there, were an issue then as they are now and notably was it only for a few months in 2008 that those were halved to stimulate demand for travel to Kenya. Infrastructure was high on the agenda in 2001 but todate is no second bridge to the Northern mainland in place to cater for the sharp rise in traffic, does Mombasa not have a national convention centre nor was the bypass to the South coast built, and utility costs continue to remain high with often irregular services, then and still today. And then there was the issue of marketing the country and getting a big enough budget from government, again an unresolved issue which has lingered on for the past 15 years and in fact much longer, for sure as long as I remember and that is nearly 40 years.

A target of 2 million tourists was set in 2001, to be reached by 2004 and when the 2014 statistics are finally out we will all be able to see by what margin Kenya will miss this figure some 15 years later.

The one lesson which can be drawn from this all is that many challenges have not changed and that proposed solutions were ignored by successive governments, a root cause for the situation today. The other lesson is that after a severe downturn there has in the past always been a sharp rise in arrivals again, giving hope to the sector that better days will follow. Policy makers must ensure that these cycles are better managed and that the downturns are rather turned into a slowdown than a drop while growth should look primarily not at sheer numbers but at the average spend of a tourist, focusing on higher revenues rather than embracing mass tourism.

I want to take the opportunity to thank the many readers in Kenya, and in Uganda for that matter, who in recent days sent in their opinions about the latest advisories, in Uganda by the US Embassy and in Kenya by the British government, which is apparently using any means to gain votes as they fight for their dear life to remain in office for another term. While there were voices of dissent over my linking the apparently failed attempt to bring relations between Britain and Kenya back into calmer waters, and the refusal by Kenya to grant British troops an extension for their training unless they are subjected to Kenyan laws, others overwhelmingly agreed that all these issues are linked and interconnected and that the timing of the renewed warnings, like two years ago ahead of Easter by the Americans, is a pointer that this was after all intended as some form of perverse punishment, denials by White Hall and from the British High Commission in Nairobi notwithstanding. I am heading back to Kenya in April again, if for nothing else to show solidarity and be living proof that there is nothing dangerous about visiting Kenya and travelling across the country. And when I am done and my reports are filed I will very likely say: ‘Quod erat demonstrandum’.