While the South African rand, and by default the Namibia dollar, has fallen roughly 20 percent against the United States dollar and other major currencies since October last year, thereby significantly increasing the cost of imported goods, the rapid devaluation does however provide a silver lining for the tourism industry which has become more affordable for international visitors from Europe and the United States.
According to the chairman of the Federation of Namibian Tourism Associations (Fenata), Ronald Motsang, the devaluation of the rand has resulted in a positive development for Namibian tourism. “We have seen an increase in tourism, particularly when looking at the increase in airport shuttles as well as bed-and-breakfast and lodge occupancy rates,” said Motsang. He added that this increase was specifically evident in terms of unplanned arrivals during December 2015 and January 2016.
Motsang noted that many tourists were making Namibia part of a regional tour that included South Africa and Botswana.
Gita Paetzold, chief executive officer of the Hospitality Association of Namibia (HAN), commented that tourists from Europe and the United States were able to get the same tourism packages for 25 percent to 30 percent less in January this year when compared to January 2015.
“The devaluation of the rand has made Namibia a more attractive tourist destination because it is now more affordable. Tour operators have definitely seen an increase, specially in forward booking and in general we hope to see a good year in 2016,” said Paetzold.
She added that the industry’s expected gains in 2016 would hopefully offset the slump experienced after the Ebola outbreak in West Africa, which affected the entire continent’s tourism figures.
“Many people out in the world do not regard Africa as many countries but instead see the continent as one big country,” Paetzold explained.
The rand ended a two-day run of gains against the dollar on Tuesday, drifting half a percent lower against the dollar after steadying early on Monday in cautious trade ahead of new US economic data. On Friday last week the rand traded at 15.3750 versus the dollar, firming slightly as investors returned to riskier assets after a string of positive US economic data and a bounce in commodity prices.
Some analysts feel the rand could strengthen further if the US employment report shows job gains but remains weak enough to discourage rate increases by the Federal Reserve in the near term. Higher US interest rates traditionally trigger an outflow of investments from emer-ging markets.