Tourism suffers 'worst year' in recent history

Tourists interract with beach boys at one of the beaches in North Coast. Thousands of jobs have been lost because of slump in the sector.

Kenya’s tourism sector suffered its “worst year” in recent history in the face of terror attacks and other insecurity cases leading to a near stagnant international arrivals level.

Kenya National Bureau of Statistics (KNBS) indicates that tourism accounts for 12 per cent of Kenya’s economy, earning revenues averaging Sh103.13billion annually, and is second only to Agriculture.

The sector, however, crawled into 2014 with hopes of recovery from the negative effects of the 2013 election jitters and the global economic crisis but stakeholders now say international arrivals dropped even further this year. Figures released by the Government in September last year indicate earnings for 2012/2013 dropped by 7.4 per cent to Sh96 billion compared to the Sh103.9 billion recorded the previous financial year.

This was attributed to the uncertainties caused by the March 4 General Election. Stakeholders in the sector say the 2013/2014 performance is expected to be the worst ever due to increased insecurity, especially along the Coast. Several Western countries have issued travels advisory against the country.

For instance, Kenya’s traditional market, the UK, has had a travel advisory since 2007 when the country experienced the post-election violence. UK is the largest tourist source market for the country. Like the UK, other Western countries also issued a fresh advisory in July this year, advising their citizens to exercise “high degree of caution”.

Essential travel

The Foreign and Commonwealth Office advice to tourists against “all but essential travel” to Mombasa Island and within 5 Km of the Coast from Mtwapa creek in the north down to and including Tiwi in the south still remains in force.

Australia, France and the US issued similar travel advisories and scaled down the operations of their embassies. The beleaguered tourism sector, has also since August this year battled public perception after the World Health Organisation (WHO) classified Kenya as a “high risk destination” where people risk contracting Ebola.

All these factors have dealt a big blow to the tourism sector which is also faced with several challenges back home, including overburdening levies introduced by county governments. Estimates from Kenya Association of Hotelkeepers and Caterers (KAHC) indicate that along the Coast region, 22 hotels shut down this year while others cut down their operations, leading to massive job losses.

Stakeholders in the sector say these problems coupled with local issues such as poor infrastructure network, increased levies by county governments, inadequate marketing resources and overreliance on traditional markets have literally brought the sector to its knees.

“Our research indicates this was the worst year ever in our modern history. We lost between 10,000 and 12,000 direct and indirect jobs because of the slump in the sector. It is a multiplicity of issues that has brought us down,” said KAHC Coast branch Executive Officer Sam Ikwaye.

The ripple effects of the slump have also been felt in other sectors like food supplies, curio dealers, tour operators and even the beach operators. Reports also indicate that financial institutions especially in Malindi, Ukunda and Lamu are also feeling the heat owing to a drop in overseas remittances and decline in borrowing.

Chartered flights to the region have also dropped and currently receives 11 per week down, from 33 it used to receive especially during the peak season. “The insurance premiums for one tourist from Europe has shot up threefold due to the travel warnings, from £500 to £2000.

Going down

“The few chartered flights landing in Mombasa are on transit to Zanzibar; they drop an average of nine tourists,” said Ashnil Hotels Limited Sales and Marketing manager in charge of Coast, Paul Kurgat in a recent interview. “Hotels in Tsavo are doing less than 20 per cent, the Government has been complacent as other markets emerged. To say the least the sector in Mombasa is going down,” he added.

In Lamu, 30 restaurants have closed down as tourists moved out citing the effects of the curfew which Government has slapped on the area.

The curfew has affected the movement of tourists and Romantic Group of Hotels General Manager, Ms Keziah Mumbi, says close to 600 boat operators and curio shops have been forced to close down.

Romantic Group of Hotels, which operates Lamu Paradise, Petleys Inn and Sultan Palace, in June this year announced the reduction of its workforce from 80 to 15 after it closed down two of the three hotels.