Tourism to inject P6.5bn into economy

Tourists in Okavango. PIC THALEFANG CHARLES
Tourists in Okavango. PIC THALEFANG CHARLES

Travel and tourism activities are expected to grow by five percent in 2015 and directly contribute P6.5 billion into the national economy, figures released this week by international researchers show.

According to the World Travel and Tourism Council (WTTC) 2015 report, the direct contribution of travel and tourism to Gross Domestic Product (GDP) in 2014 was P6.2 billion up from P5.2 billion in 2013.

“This is forecast to rise by five percent to P6, 45 billion in 2015. This primarily reflects the economic activity generated by industries
such as hotels, travel agents, airlines and other passenger transportation services excluding commuter

“But, it also includes, for example, the activities of the restaurant and leisure industries directly supported,” said the researchers.

Over a 10-year period, the direct contribution of travel and tourism to GDP is expected to grow by 5.2 percent per annum to P10, 7 billion or 3.8 percent of GDP. The WTTC is the foremost research and statistics authority on tourism, conducting annual economic assessments on 184 countries.

Its annual Economic Impact Reports analyse current and historic performance of travel and tourism sectors in the selected countries, while providing projections for various indicators over a 10-year horizon.

For Botswana, the reports are critical, as local statistics bodies do not compute direct or indirect travel and tourism earnings, employment and/or economic impact in their researches.

According to the 2015 report, travel and tourism generated 32,000 jobs directly in 2014 constituting 4.6 of total formal employment.

This year, according to the researchers, the industry is expected to add another 500 jobs or a 2.6 percent growth to 32,500.

“The figures include employment by hotels, travel agents, airlines and other passenger transportation services excluding commuter services.

“It also includes, for example, the activities of the restaurant and leisure industries directly supported by tourists,” reads the report.

By 2025, the travel and tourism industry will account for 42,000 jobs directly, an increase of 2.6 percent per year over the next 10 years.

By 2025, international tourist arrivals are forecast to total 4.06 million from 2.7 million this year, generating expenditure of P16.7 billion, an increase of 4.7 percent per annum.

The bullish growth figures for the travel and tourism industry come after local operators last year predicted a gloomy 2015 due to the effects of the Ebola outbreak.

Operators reported that jobs and revenues were under threat in the tourism industry as Botswana felt the brunt of the Ebola outbreak in West Africa with tourists from USA and Europe unwittingly placing a blanket shun on the whole of Africa.

According to the Okavango Delta operators interviewed by BusinessWeek in November last year, arrivals have taken a knock in the second half of the year, while bookings for 2015 are estimated to have sunk by a sector average of between 30-50 percent.

On a global scale, the WTTC report says that travel and tourism generated US$7.6 trillion (P73 trillion) and 277 million jobs for the global economy in 2014.

For 2015, the reports says that the weakness and potential volatility of many currencies against the US dollar and a deep recession in Russia, a key outbound market, 
will slow outbound spending in line with slower world trade overall in 2015. “However, falling oil prices is expected to
 bring significant improvements for net oil importers in 2015, easing upward pressure on living costs, increasing disposable household incomes and domestic consumer spending, and lowering air fares,” reads the report.

 As a result, travel and tourism expansion is forecast to continue at a stronger rate than last year, with the total contribution to GDP expected to increase by 3.7 percent.

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