Tourism industry limps to recovery

Malawi is yet to resume  realising positive multiplier effects from the tourism sector three years after Covid-19 knocked it down, resulting in 30 000 jobs being cut.

Published data from the 2023 World Travel and Tourism Council (WTTC) Annual Research Key Highlights shows that the contribution of tourism to the gross domestic product (GDP) continues to decline from the time the sector caught Covid-19 cold in 2019, falling from seven percent to five percent in 2022.

Resultantly, the number of jobs created in the sector have also been declining from 586 000 in 2019 to about 496 200 in 2022.

The data further shows that international and domestic spending has also dropped.

In an interview yesterday, Malawi Tourism Council chairperson Justin Dzinkambani said although there has been some progress, the sector’s growth has been negatively affected by domestic shocks.

He said: “Our effects on declined growth came from the effects of Cyclone Freddy and other environmental disasters affecting tourism growth and marketing.

“Roads damages to tourism attractions and failure to reach those destination markets of importance may have affected Malawi badly in tourism attractions; hence, the decline in tourism business and job creation.”

Malawi had a stable increase in the number of international tourist arrivals, rising at an average rate of five percent annually from 2015 to 2019, according to Treasury data.

This was attributed to increased tourism marketing activities, a rise in cultural and arts festivals and revival in Malawi’s wildlife population.

Meanwhile, in the year ended December 31 2022, Malawi Stock Exchange-listed Sunbird Tourism plc posted a 307 percent increase in profit after-tax to K3.1 billion from last year’s K749 million on account of strong growth of local and international tourism industry from the impact of Covid-19.

However, Blantyre Hotels plc reported a loss of K290 million during the review period. This is on top of another loss of K751 million the previous year.

In 2020, international visitor arrivals dropped by 80 percent to 198 905 as a result of global travel restrictions due to the Covid-19 pandemic.

Domestic tourism has been sustaining the tourism sector’s viability during off-season periods when international tourism became non-existent, according to experts.

Minister of Tourism Vera Kumtukule said in a written response yesterday that they are banking on domestic tourism development and promotion, saying domestic tourism accounts for a large portion of a country’s tourism revenue.

She said some of the interventions include collaborating with tourism entrepreneurs to offer reasonable rates for domestic tourists and development of products and activities targeting locals.

Said Kamtukule: “There is also a comprehensive review of the tourism law. The current Tourism and Hotels Act was enacted in 1968 and focused predominantly on licensing of the accommodation.

“We are in the process of finalising the comprehensive review of the law to ensure that all emerging and evolving issues related to tourism development, promotion and regulation are efficiently legislated in line with Malawi 2063.”

She said the ministry will also engage in devolution of tourism to local councils to achieve inclusive tourism.

Meanwhile, Mozambique, South Africa, Zimbabwe, Zambia and Tanzania are also yet to recover to pre-Covid times with WTTC data showing that their economies’ contribution to GDP has also declined.

In the current financial year, Ministry of Finance and Economic Affairs has introduced several incentives to promote investments in the sector.

These include zero import duty, zero import excise and zero value-added tax on the importation of a number of goods.”