Why Tanzania’s travel trade is a tiny drop in global tourism ocean

23Jan 2018
The Guardian
Why Tanzania’s travel trade is a tiny drop in global tourism ocean

When compared to global figures and the number of arrivals in Africa, the less than two million tourists Tanzania currently hosts annually is a tiny drop in the ocean of travel trade in the world.

In terms of earnings and foreign exchange generated from the lucrative industry, the country still leaves a lot to be desired despite having abundant attractions to make it a force to reckon with in the business and being home of unique tourism resources.

 

In the latest review of the economy, the Bank of Tanzania (BoT) says foreign exchange earnings from travel trade that mainly comprises receipts from tourism rose to about US$2.16 billion in the year ending November 2017 from around US$2.1 billion in November 2016.

 

The December Monthly Economic Review (MER) attributes the less than three per cent forex earnings surge to the increase in the number of tourist arrivals. In total, international travel and tourism generated US$7.6 trillion (10.2 per cent of global GDP) in 2016, which is almost 3,520 times what Tanzania generated from the industry during the year ending November 2017.

 

According to results of the 2016 Tanzania Tourism Sector Survey (TTSS), released in October 2017, the number of international tourist arrivals increased by 12.9 per cent to 1,284,279 from 1,137,182 visitors recorded in 2015. Consequently, the county’s tourism earnings increased by 12.1 per cent to US$2,131.6 million in 2016 from US$1,902 million recorded in 2015.

 

In a report on the impact of the sector on the national economy, the World Travel & Tourism Council (WTTC) says visitor exports, generated about US$2.44 billion, 21.4 per cent of total exports in 2016. This was forecast to grow by two per cent in 2017, and grow by 6.9 per cent annually, from 2017-2027, to US$2.84 billion in 2027, which is still very small compared to current global receipts.

 

“In 2016, Tanzania generated (about) US$2.44 billion in visitor exports. In 2017, this is expected to grow by two per cent, and the country is expected to attract 1,446,000 international tourist arrivals,” WTTC notes in the report.

 

This 2017 arrivals forecast is about 914 times less what the World Tourism Organisation (UNWTO) has said was the number of tourists in the world last year. The UN agency says in the new World Tourism Barometer that international tourist arrivals grew by a remarkable seven per cent in 2017 to reach a total of 1,322 million.

 

Africa reached a record 62 million international arrivals in 2017, translating to a growth of eight per cent. UNWTO says arrivals in Sub-Saharan Africa increased by five per cent while North Africa enjoyed a strong recovery with a 13 per cent growth in arrivals.

 

“Based on data reported by destinations around the world, it is estimated that international tourist arrivals (overnight visitors) worldwide increased seven per cent in 2017. This is well above the sustained and consistent trend of four per cent or higher growth since 2010 and represents the strongest results in seven years,” the agency notes in a January 15 press release.

“In many destinations, 2017 was characterized by sustained growth, with the global economic upturn partly contributing to the strong performance. UNWTO expects the strong momentum to continue in 2018, with a projected rate of 4-5 per cent in international arrivals,” reads the statement.

“This is slightly above the 2010-2020 increase projection of 3.8 per cent average by UNWTO in its Tourism Towards 2030 long-term forecast. Africa is expected to grow by 5-7 per cent ahead of its counterparts, Asia and the Pacific by 5-6 per cent, the Middle East by 4-6 per cent, both Europe and the Americas by 3.5-4.5 per cent respectively,” it adds.

In 2016, the industry direct contribution to GDP growth globally was 3.1 per cent. It supported six million net additional jobs in the sector and accounted for 6.6 per cent of total global exports and almost 30 per cent of total global service exports.

 

In Tanzania, WTTC says the direct contribution of travel and tourism to GDP was 4.7 per cent to total national output in 2016 and forecast it to rise by 3.7 per cent in 2017. According to the council, total contribution to GDP was 13.3 per cent in 2016 while contribution to employment, including indirect jobs supported by the industry was 11.6 per cent.

 

Tabling the 2017/18 budget estimates of the Ministry of Natural Resources and Tourism, immediate former minister Prof Jumanne Maghembe said in 2016/17 the tourism sector contributed to 17.5 per cent to Tanzania’s GDP and 25 per cent foreign currency earning. During the same period, 500,000 people were directly employed in the industry and one million people were self-employed.

 

In another report titled “Tourism for Sustainable Development in Least Developed Countries”, UNWTO says the industry is central to trade development in least developed countries (LDCs). According to it, the industry represents seven per cent of total export of goods and services among the LDCs.

 

The report argues that despite tourism’s positive contribution to trade, it is often difficult to direct trade-related technical assistance towards the sector because tourism and trade tend to fall under different ministries.

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