Windhoek-Finance Minister Calle Schlettwein’s proposal that Air Namibia quit its direct route between Namibia and Frankfurt to save costs, which Treasury has put at N$30 million annually, has received mixed reactions from industry players, with some saying the move could negatively affect the local tourism industry.
The tourism industry is one of the major contributors to Namibia’s Gross Domestic Product (GDP), in fact it is the second largest contributor after mining.
In an interview with New Era yesterday on the latest developments, Minister of Environment and Tourism Pohamba Shifeta said he was not privy to the details of Schlettwein’s proposal, but believed such a decision would negatively affect the tourism industry.
He suggested that government think of ways to turn around Air Namibia’s ailing fortunes and run the airline on a commercial basis, rather than cutting the Frankfurt route. He felt that government needs to think more broadly about the potential effects and to rather not negate Air Namibia’s international presence.
He said Air Namibia is part of the country’s global promotional strategy, noting that the airline has an office in Germany and argued that there were more benefits than losses, as such losses would not be permanent once the airline has the right leadership in place.
“We need to think on how to run Air Namibia on a commercial basis and competitive principles. You need to have the right board… to appoint the right management. That’s what we need to have. We cannot sacrifice that part (Frankfurt route).
“Imagine what will happen to Namibia Airports Company. I have a feeling if we have to take that road it means Air Namibia will cease internationally,” he said and further argued that the amount and chain of challenges, such as job losses, would exceed the losses currently being experienced by the airline.
Consequently, he felt there was no benefit in abandoning the Frankfurt route, as the hospitality and tourism industry would be negatively affected.
He further anticipated that Namibia could lose in the range of N$1.5 billion annually as a result.
Shifeta said in terms of foreign tourists arriving in Namibia, German nationals are the majority. “That is the only route that connects Namibia… to the outside world” over which we have 100 percent control, he said. “Imagine something happens in South Africa and we have already cut the Frankfurt route. This means the whole chain of problems will come, because we will not have any people coming. These German tourists stay longer in Namibia. They go to the rural areas and leave money there. So, even service providers will be affected,” he reasoned.
Shifeta felt that if the Frankfurt route were abandoned, Namibia would no longer enjoy its competitive advantage.
A 2015 tourism statistics report shows that Germany was among the top ten countries that dominated the tourism market in Namibia, with German tourists in Namibia staying on average for between 25 and 19 days.
Pohamba said he did not see the details of the finance minister’s proposal to cut the route, but said if Namibia were to do away with that route it would negatively affect the tourism industry, and would likely result in job losses.
The Environment Ministry’s director for tourism, Sem Shikongo, shared the minister’s sentiments, saying Namibia’s tourism advantage, importantly includes the number of German tourists arriving here, and if such a market were suddenly removed it would be quickly gobbled up competitors.
“Our source market is Germany. If we lose our niche to Air Namibia in that space would we really be about to regain that competitive advantage once things return to normal? What does it mean for us if we pull out of that route, since most of our tourists come out of Germany?” he asked.
Shikongo said having Air Namibia serving the Frankfurt route was crucial, as it contributes significantly to the Namibia Tourism Board (NTB)’s marketing efforts by making its own promotions.
“We can either find other ways of censuring Air Namibia, or making it profitable and efficient, instead of cutting it off completely. Cutting it off completely will mean we have to increase our budget to NTB for marketing.”