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Government to lose Sh.170 billion revenue from tourism due to Covid-19

The  Kenya Government could lose more than Sh.170 billion in revenues from the tourism industry due to the corona virus (Covid-19) pandemic this year, the  Tourism   and  Wildlife Cabinet  Secretary (CS), Najib Balala has said.

According to  Balala, the industry that contributes about ten percent of the Gross Domestic Product (GDP) is as good as dead following the banning of international flights and containment measures in the country that have also affected domestic tourism.

“A lot of jobs have been lost and the economy has lost too. We used to generate US Dollars 1.6 billion (about Sh.170 billion) in revenue to the government, which is about 10 percent of the GDP, but now you can see the effects of the pandemic,” he said in Watamu, Kilifi County.

He implored upon stakeholders in the tourism and hospitality industries to embrace the domestic market, noting that the international tourism market could start being vibrant at the end of 2021.

“Today I am here in Watamu and you could feel the impact of lack of tourism. The restaurants and hotels are as good as dead,” Balala said  while urging the stakeholders to reconsider their pricing to attract domestic tourists.

“The stakeholders in the tourism industry must appreciate that domestic markets have different tastes and they are sensitive in pricing. The pricing must be right for the domestic market,” he noted.

He  said the pandemic could have come to open the eyes of the stakeholders to change their mind set and appreciate that the domestic market is valuable as it could cushion the sector in the event of international crises such as Covid-19 strike.

“International markets will come at the end of the year 2021. We need to change our mindsets. We need to appreciate that the domestic market is valuable. It has been valuable even before and we are lucky to have a strong domestic market.

“We are also optimistic that in the next one year we can work on the domestic market and I believe that can be attractive. However, the stakeholders in the tourism industry must appreciate that domestic markets have different tastes and they are sensitive in pricing,” he said.

He said his ministry had already developed the protocols for the reopening of the sector and was working with the World Tourism and Travel Council to have them certified in readiness for a roll out when the economy opens up.

The  CS said more than 120 million jobs had been lost globally with between 400 billion and 900 billion US Dollars in terms of revenue lost, the tourism industry being the worst hit.

“Tourism used to account for over 1.5 billion people travelling all over the world, but now 90 percent of the people are not travelling. This has adversely affected the global economy,” he said.

Balala  at the same time, said it was time for the aviation industry, which tourism largely depends on, to start operating for the tourism industry to thrive.

He urged owners of old hotel premises to take advantage of the Sh.3 billion hotel refurbishment fund that was recently announced by the Cabinet Secretary for The National Treasury and Planning to renovate their premises.

“The fund is meant for owners of old hotels to be given soft loans to refurbish their products, but the proposal is yet to go through Parliament so that there is a legal framework on how the money will be dished out,” he said.

By  Emmanuel Masha

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