Domestic tourism is a low-hanging fruit that Africa must pick
Tourism is a major contributor to the GDP of African economies. In 2019, the industry accounted for around 7% of Africa’s GDP and contributed $169 billion to its economy, about the size of the combined GDPs of Ivory Coast and Kenya. But Covid-19 changed all that.
In July 2020, the African Union estimated that Africa had lost nearly $55 billion in travel and tourism revenue and two million jobs in the first three months of the pandemic.
The International Monetary Fund (IMF) has predicted that the real GDP of African countries dependent on tourism will fall by 12% in 2020.
However, as Covid-19 restrictions ease, harnessing domestic tourism demand has offered some respite for the sector as a growing middle class and young population show more interest in travel.
The International Finance Corporation (IFC) says much of the world has had the benefit of captive national and regional audiences. But in Africa, domestic tourism has long been neglected. The sector must be oriented towards more diversified markets in order to have greater resilience in the future.
According to the World Travel & Tourism Council (WTTC), domestic tourism accounted for 55% of travel and tourism expenditure in Africa in 2019, below the contribution of local tourism in North America (83%), Europe (64 %) and Asia-Pacific (74 percent). Domestic tourism accounted for 73% of total global tourism spending in 2017.
Africa’s growing middle class and population of young, adventure-hungry travellers, and the recently launched African Continental Free Trade Area (AfCFTA), the world’s largest free trade area by number of participating countries , are among the pillars supporting the future growth of the domestic market. and regional tourism on the continent. This therefore requires a rethink of the strategy, particularly in terms of building a national customer base to match, or even exceed, the international base.
But a transition to domestic tourism requires building the capacity of service providers on harnessing digital technologies for product development and marketing.
There is also a need to improve professional standards for tourism service providers, including tour operators and tour guides. Likewise, there is a need to build sustainability into the recovery process — sustainable environmental, social and financial practices; diversification of national tourism products and national and regional tourism campaigns supported.
Travel costs also need to be reduced as this has been an obstacle. At the same time, building affordable hotels could go a long way in increasing affordability for local tourists. Africa needs hotels designed for this local market.
Most parts of Africa remain among the most expensive countries to develop hotels. Innovative technology and flexibility around branding standards will be key to reducing costs, as will the relaxation of import duties and more options around development professionals and entrepreneurs.
Hotels are becoming more and more flexible, but there is still a lot to be done to develop domestic tourism.