Uhuru’s radical step to save Kenya’s ailing tourism sector

Sunday May 25 2014

Kenyan president Uhuru Kenyatta speaks at a

Kenyan president Uhuru Kenyatta speaks at a past event in this undated photo. He has taken drastic measures aimed at saving his country’s tourism sector from collapse. PHOTO | FILE 

By Charles Wokabi ,The Citizen Correspondent

Nairobi. Kenyans working in the private sector will from next month enjoy paid-up holidays anywhere in the country, as the government seeks to revive the tourism industry reeling from insecurity.

In a statement released from State House, Nairobi, President Uhuru Kenyatta said that from June 12, companies would be allowed to pay for their employees going on their annual leave and deduct such expenditure in their taxes.

“Through this measure, we shall directly give at least 25,000 Kenyans a chance to go for a week’s holiday every month at the expense of their employers, bringing over 300,000 additional Kenyan guests in our hotels throughout the country,” Mr Kenyatta said. This is part of a new raft of policy measures taken by the government to revamp tourism, which is on its knees following the issuance of travel advisories by major source markets due to high insecurity.

The steps were agreed upon during a crisis meeting held at State House, Nairobi, between the President and stakeholders to look into new ways of reviving a sector that is a key pillar to the economy.

The initiative is meant to reduce the impact of the travel advisories, while in the long run boosting local tourism.

Last week, British tour companies evacuated more than 300 visitors from Kenya following a warning by the UK Government of impending terrorist attacks.

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The government has also agreed to exempt all air-ticketing services by travel agents from Value Added Tax (VAT) to boost the country’s competitiveness as a preferred tourist destination in the region. The exemption takes effect from May 29. And the Kenya Revenue Authority was instructed to clear all outstanding income tax-related refunds owed to the tourism industry, also by May 29.

“We expect this measure to improve sector liquidity and cash-flow,” Mr Kenyatta said.

The President also directed that all budgetary resources earmarked for foreign visits at the National Government level be reallocated to domestic travel to further boost tourism sector recovery.

“Similarly, we urge Parliament and the Judiciary to do the same. We also urge the county governments to do the same,” said Mr Kenyatta.

The proposed changes will be factored into the Budget for the 2014/15 financial year set to be tabled in Parliament next month.

A decision was also reached to lift the ban restricting the public service from holding conferences and meetings in private hotels.

The industry has also agreed to give Kenyans better vacation packages than those offered to international visitors. Under the preferential treatment, Kenyans will pay about Sh5,200 daily per person on full-board.

The move is expected to trigger an increase in the number of Kenyan tourists, contributing to the country’s total bed occupancy.

Park fees will also be reduced from $90 to $80 for regional and international tourists, while local tourists will pay Sh1,000, down from Sh1,200.

The chairman of the Tourism Committee under Council of Governors, Mr John Mruttu, who is the Governor for Taita-Taveta, said the industry appreciated the measures being taken by the national government.

“I also welcome what has been agreed with the hotel owners, where hotels on the beach and in the parks will stop selling curios and other wares, leaving this business to small-scale traders,” he said.

The chairperson of the Kenya Tourism Federation, Ms Lucy Karume, urged the industry to maintain the image of the country as a preferred destination.

Tourism is one of Kenya’s top foreign exchange earners and a source of livelihood for millions of citizens. The others are tea and horticulture.

International arrivals fell by 30 per cent last year as the effects of travel advisories, insecurity and poor services began to bite.

A manager at Kibo Safari Camp at the Amboseli National Park, Mr Harry O. Sipul hailed the Government action describing it as a good shot to bolster tourism.

“In fact the President’s directive has come at the right time. This is what he should have done immediately he came into power. Now we expect an influx of tourists,” said Mr Sipul.

He urged the Kenya Wildlife Services (KWS) to move fast to implement the directive on gate charges at the national parks.

(NMG)