Tourism Sector Needs Investment

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By Wezi Tjaronda WINDHOEK The recently launched Namibia Tourism Satellite Account will revolutionalise the way the tourism industry is looked at, the Federation of Namibia Tourism Associations (FENATA) has said. The account, which gives projections of the contribution the industry makes to the country’s economy, has given the association a tool for the sector to get loans from financial institutions, said Jackie Asheeke, FENATA Chief Executive Officer. She said the account, launched last week, was a tool to attract additional investment and raise awareness about the value of the sector. According to the account, Namibia’s travel and tourism industry accounts for N$6.8 billion, which is equivalent to 16 percent of total GDP. The sector in its totality also provides 71 777 jobs or 18 percent of total employment in Namibia. It also adds that despite the clear potential for tourism growth and the opportunities it offers to diversify and enrich the economy, the sector has seen low levels of government investment. “Nevertheless, there currently appears to be a deep-rooted mistrust of the industry and the modus operandi throughout government, as well as poor understanding at all levels of the extent to which travel and tourism contribute to the country’s economy. “Subsequently, the full scope of the industry as a catalyst for the development of other economic activities, such as agriculture, manufacturing and financial services, is also widely underestimated,” the account adds. With such information, Asheeke said, the sector will now go to the banks for innovative ways of financing, considering that tourism remains a key sector for economic and capital development. But to get to this stage, Asheeke said, the sector needs financiers. Lack of data has been a barrier for tourism establishments to access finance from the banks due to a lack of quantifiable data. “This has led to a lack of access to finance for the expansion of the tourism sector,” she said at the launch of the TSA last Thursday. She said tourism was not some poverty reduction programme but a business. Although tourism is the fastest growing industry worldwide, surpassing oil, its contribution to the national account in Namibia was not known until last week. “Now we have something with which we can go to the financiers,” she said. She added that when employees need money to buy into tourism establishments, they could now approach the banks. “It is proven, tourism is growing by 6.9 percent. We can go to the banks armed,” she said, adding, “There will now be no more polite handshakes and plastic smiles but serious considerations for funding.” Out of the 2 121 tourism enterprises in the country, which are registered by the Namibia Tourism Board (NTB), around two percent are owned by black people. Asheeke said this state of affairs should be changed in the sense that it should be broad based and benefit the majority of the population and not just the previously advantaged few. Now that there is an assessment of the industry, the FENATA CEO said, Namibian banks, most of which have their headquarters in South Africa, should devise innovative financing mechanisms in the form of soft loans for communities, for instance. To manage the money that is loaned to them however, Asheeke said, communities and people taking bank loans should be given counselling and advisory services on how to manage the funds The TSA has placed Namibia at number 13 as the world’s fastest growing tourism destination, which is also increasingly becoming visible. It says as the sector gains importance, it complements the country’s traditional economic sectors such as mining, agriculture, and finishing.