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Tourism struggles as international arrivals plunge 92% in Q3 – KBC | Kenya’s Watching

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Kenya’s tourism industry was handed a serous thumping last year as the latest figures from the Kenya National Bureau of Statistics (KNBS) reveal the true extent of damages caused by the coronavirus pandemic.

In the third quarter of 2020 ending September, arrivals through international airports declined to a paltry 34,701 compared to 453,881 registered during the same period in 2019, representing a 92.4% drop.

According to the statistics bureau, activities related to accommodation and food service were adversely affected as a result of the implementation of tougher COVID-19 containment measures.

This led to either complete closure of businesses in accommodation and food service sector or significantly scaled down operations,” KNBS said in its Quarterly Gross Domestic Product Report.

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During the period, the sector generated Kshs. 6.9 billion to the economy compared to Kshs. 16.4 billion registered during the same period in 2019, though a slight improvement when compared to Kshs. 2.2 billion in the second quarter of 2020.

The easing of COVID-19 containment measures by President Uhuru Kenyatta on 27th September perhaps came too late for the sector which was brought to a complete stop when Kenya closed its airspace to curtail further spread of the deadly respiratory disease.

On 25th March 2020, Kenya suspended all international flights, effectively freezing tourism activities which form a bulk of earnings from the sector.

The airspace restriction was only relaxed after four months on 1st August 2020 albeit with tougher health protocols.

KNBS states in its report, “Despite easing of the containment measures in the review period, the sector was struggling to overcome the effects of the restrictive measures earlier implemented.”

During the period under review, accommodation and Food Services sector contracted by 57.9% compared to 9.9% growth in the third quarter of 2019.

In May, the government announced a Kshs. 2 billion tourism stimulus package to be advanced by the Tourism Finance Corporation in order to help jump start the sector by providing soft loans to hoteliers and support renovation of facilities.

Plotting for recovery

With roll out of COVID-19 vaccines in key source markets in Europe, North America and Asia, operators in the sector are hoping for a strong recovery and a return to pre-covid activities.

According to the recent survey of hotels by the Central Bank of Kenya (CBK) which was conducted between 13th-15th January 2020, there was hope for recovery in the sector when compared to April and May last year.

According to CBK, 97% of the respondent hotels are now open, compared to 96% in November 2020 and 35% in April, with continued re-engagement of employees particularly during the festive season in December.

“Hotels did get a significant accommodation by the banking sector in terms of restructuring their loans and the expectation there is that it would help them maintain their workforce, maybe not at full salary but modest amount so that they can reopen stronger,” said CBK Governor, Dr. Patrick Njoroge.

Average bed occupancy improved to 26% in December 2020, compared to 11% in April when most of hotels closed due to lack of visitors.

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