Thursday, May 3, 2018

Tourism sustains spot as TZ’s leading forex earner


By Halili Letea @hletea

Dar es Salaam. Tourism secto remains Tanzania’s largest foreign exchange earner since the fall of gold prices in the world market.

Tourism is still improving with revenue increasing by 14.3 per cent in the 12 months to February this year, according to a monthly economic review for March by the Bank of Tanzania (BoT).

Travel receipts rose to $2.4 billion in the year to February 2018 from $2.1 billion on account of increase in the number of tourist arrivals.

Stakeholders see a bright future this year due to improved bookings.

“We are in the low season and the group of 310 tourists arrived from Australia recently is the only major event which boosted our business,” said Tanzania Association of Tour Operators (Tato) chairman Wilbard Chambulo.

“However, looking at the bookings for the peak season which starts from June to October, our bookings are fine and I think this year is doing fine,” he added.

Tanzania is one of the countries with the best natural attractions in the world.

Gold exports had jumped to $2.08 billion in the year ending October 2012 after almost a decade of progress and overtake travel.

However, following the drop of both export volume and price in the world market, earnings decelerated to $1.75 billion in 2013 and stood at $1.35 billion in the year to October 2014, according to BoT. Gold exports value plunged further to $1.3 billion in January 2015.

Tourism potential

Recent reports indicate that Tanzania hosted 1,284,279 tourists in 2016, compared to 1,137,156 in 2015, which was an increase of 12 per cent.

Tanzania Tourist Board (TTB) managing director s Devota Mdachi was recently quoted as saying that the country is on course to achieve the 2-million-tourist target by 2020. She said the country hosted 1.3 million tourists in 2017, implying that it was a good indicator towards bringing in even more visitors. She further said her office will continue to open up and market the southern tourism circuit, which also includes promoting the Songwe Airport in south-western Tanzania’s region of Mbeya.

The country’s top five source of tourism markets include the United Kingdom, Kenya, the United States, Germany and Italy.

According to the World Bank, Tanzania tourism could hit $16 billion annually by 2025 if share benefits from the industry are equitably and evenly distributed to local participation but with quality.

The Breton Wood institution said in its 6th Tanzania Economic Update report christened Unlocking the potential of the tourism industry for Tanzanians that already tourism is a major contributor to the economy but the strategic industry can grow and create more high-paying jobs, and closer linkages with businesses and local communities.

The update proposed three strategic directions. The first is to diversify tourism activities from the current emphasis on high end tourism in the north around Arusha and Zanzibar where up to 90 per cent of tourism activities are currently concentrated.

The report recommended realising other opportunities, especially in the South, and developing attractions and activities that cater to tourists on more modest travel budgets, including more local and regional visitors.

The second direction is to further integrate local communities and small operators into tourism activities, through benefit-sharing processes. While such efforts already exist in Tanzania, they are still at a small scale and have had limited impact on the ground.

According to the report, best practices where training and linkages programs developed jointly by the private and public sectors have brought about higher quality standards while also increasing the participation of the local business community and workers in tourism activities.

The third direction is improving the quality of governance through implementation of a fair, business-friendly taxation system and the development of transparent redistribution mechanisms, including to local stakeholders.

The tourism industry is currently constrained by the imposition of multiple taxes and levies that discourage investors, particularly small investors and increases opportunities for rent seeking and corruption.