Will tourism advance Africa’s socio-economic narrative?
Over the past decade, the African continent has demonstrated a remarkable commitment to creating a repository of investment opportunities across all industries.
Tourism, for example, has peaked in Cape Verde, supporting its economy through hospitality efforts. Tourism contributes 24 percent of Mauritius’ GDP. In 2019, Ghana launched a viral campaign, The Year of Return, attracting globetrotters and foreigners looking to reconnect with their roots. The Year of Return popularized Ghana as a tourist destination with transatlantic business appeal, following a 5.5% contribution of the tourism industry to the country’s GDP in 2018.
Before the pandemic, hospitality report showed that Africa was the second fastest growing tourism region in the world, with a growth rate of 5.6% after Asia-Pacific, against a global average growth rate of 3.9%. Now with the number of trips per year declining due to the COVID-19 pandemic, conversations abound as to whether domestic tourism numbers will start to rise and how the African Continental Free Trade Area (AFTCA) will accelerate regional tourism progress.
AFTCA and the integration of local value chains
With a potential market of over 1.2 billion people and a gross domestic product (GDP) of $ 2.5 trillion in the 55 African Union member states, there is much to be expected from AFTCA, especially in the integration of African countries to stimulate demand and supply. for goods and services, as well as facilitating intra-continental migration.
The the movement of people and goods will enable commerce and create more attractive local opportunities. In Nigeria, a family investment company, Titles of heirs, further integrates its inventory to take advantage of these opportunities that arise across Africa. One example is its strategic investment in the hotel landscape – a sector dominated by the hotel industry but which is seeing the emergence of new players and product offerings intended to diversify and expand the sector. Digitally savvy consumers have fueled the culture of lifestyle and hospitality, driving the adoption of experiential packages in the hospitality industry. This cultural change strengthens competition and opens up opportunities for new entrants to the hotel market. One such example is Will have, a new digital platform redefining hospitality in Nigeria, allowing people to book accommodation, restaurants and experiences from their mobile devices. Launched by the hotel investment arm of Heirs Holdings and one of Africa’s leading hotel brands, Transcorp Hotels Plc –, it is the way of the company to stimulate interregional participation in the tourism and hotel sector.
Less reliance on international tourism provides an opportunity to explore basic recreational opportunities. Aura’s bold and focused approach is to capitalize on the existence of homes, create traction for under-represented small businesses, and showcase national heritage, through lifestyle and tourism experiences. organized. Its ambition is to involve thousands of partners – owners, hoteliers, restaurateurs and experienced providers to earn revenue by listing their properties or services on the platform, thereby increasing economic growth and development while improving the life. With Aura, more local businesses will be better placed to fit into value chains, which will lead to increased revenue sustainability.
Addressing access in regional tourism
According to the 2019 World Tourism Ranking, there were 69.9 million international tourist arrivals in Africa. This statistic, according to the 2019 World Tourism Ranking, positions Africa as a popular destination for non-African travel. However, much remains to be said about access to tourist destinations in Africa for Africans.
Interregional connectivity in Africa remains a challenge. A significant number of the African population still has difficulty obtaining visas. Enthusiastic tourists to Africa are exempt from the various experiences in neighboring countries. Countries are unable to promote their local travel destinations and tourism offerings to attract more regional travelers.
A solution to this situation will depend on political adjustments within which Africans can begin to move towards regional integration. Africa has long been a hub for flights to West Africa – especially to meet the challenge of ease and accessibility when traveling regionally. Currently, TAP Air Portugal connects African travelers with Lisbon, São Tomé and Príncipe and Cape Verde, explaining why more airlines need to expand their global route network operations in Africa. Alternatively, travelers sometimes have to travel to Europe to connect to another African country, with the same fate applicable to regional logistics, all of which have business implications.
Policy adjustments can also occur at the national level, as is the case in Ghana, when, for the Year of Return campaign, it waived some visa requirements and passed amendments to a 2002 law which allows people of African descent to apply for a right to remain in Ghana indefinitely.
Another solution to boost regional tourism is intra-African trade: through which regional organizations can facilitate transnational tourism exhibitions and involve Africans at the regional level on what their neighboring states have to offer. Such a move would weave a brighter future for a region that has repeatedly underscored the urgent need to address its continent-wide connectivity gap.
Sectoral diversification: a new reality for players in the hotel industry
After suffering a loss of more than $ 50 billion in revenue in the wake of a changing society affected by the Covid-19 pandemic, tourism industry players are facing a new reality: how to recover from these unprecedented losses, create more employment opportunities and celebrate the dynamism on the continent.
Responding to the shortfall in demand for international travel as a result of COVID-19, Transcorp Hotels has been able to identify and activate new products that meet local hospitality needs. Recently, it has launched several initiatives: a drive-in cinema, a laundry delivery service and food delivery, all with the aim of generating long-term returns and offering high-end consumer experiences. In addition, he launched Workspace by Transcorp Hotels – a business center for companies designed to stimulate business activities in a hospital environment.
Recovery path for tourism and hospitality in Africa
As African economies recover, new interventions in the tourism and hospitality sector will emerge to help cope with the impact of the pandemic and slowing growth. Digital products like Aura by Transcorp will increase efforts to move Africa towards an integrated market, as the continent has one of the fastest growing mobile phone penetration rates. Likewise, it will provide leisure opportunities for a young African population and a growing middle class.
The AFCTA deal is expected to boost intra-African trade by around 50% by 2030, less than a decade. Achieving this will require a perspective that encompasses local small and medium-sized businesses. Indeed, the best outcome for tourism industries in Africa will occur when key players diversify supply chains, establish regional value chains and drive the growth of local value-added products. The hope is that with an enabling environment like AFCTA, Africans can begin to adopt solutions developed to empower them socially and economically, just as regional economies stimulate growth and increase their capacities.
Dupe Olusola is the Managing Director / Managing Director of Transcorp Hotels Plc
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