Accra, July 6, 2017//- Africa’s tourism sector has expanded significantly since the mid-1990s, with the number of tourist arrivals to the continent doubling from 24 million between 1995 and 1998, to 48 million between 2005 and 2008, and increasing to 56 million between 2011 and 2014.
The number is expected to triple by the close of this year.
In terms of growth, international tourist arrivals to Africa grew by an average of 6 per cent per year during the period under review, 1995–2014, according to the latest UNCTAD Economic Development in Africa Report 2017.
Data from the report titled – ‘Tourism for Transformative and Inclusive Growth’ noted that international tourist arrivals recorded particularly strong growth from 2002 up to the financial crisis in 2008/09. While the crisis led to a setback, arrivals soon recovered to a new peak in 2010, before they dropped in the wake of the Arab Spring.
Since then, arrivals have recovered but remain below the peak of 2010. Estimates for 2015 suggest that arrivals experienced another decrease, possibly linked to the Ebola outbreak and its impact on Africa.
As data coverage for 2015 is limited, the ability to quantify the magnitude of the decrease is still constrained. There is a high degree of heterogeneity in the relevance of tourism across subregions and countries in Africa.
Northern Africa has been the main tourist destination of the continent throughout the period under review. It received by far the highest number of arrivals, followed by Southern and Eastern Africa. In 2011–2014, the shares of international tourist arrivals reached 47 per cent, 22 per cent and 20 per cent respectively for each of these subregions, while Western and Middle Africa accounted for only 7 per cent and 4 per cent, respectively.
This distribution reflects the fact that the economies in Middle Africa depend mostly on mining and that services play a much smaller role in the subregion compared with all other subregions in Africa. It also suggests that tourism is more prominent in subregions with more developed infrastructure.
Considering individual countries, figures showed that during 2011–2014, Egypt (9.9 million), Morocco (9.8 million), South Africa (9.2 million) and Tunisia (6.8 million) recorded the highest average numbers of international tourist arrivals. These four countries accounted for 64 per cent of all international tourist arrivals to Africa during 2011–2014, highlighting the high degree of concentration of arrivals.
Increasing Revenues
Tourism in Africa has experienced not only strong growth in terms of arrivals but also in terms of expenditures and revenues. Inbound tourism expenditures on travel, that is international tourism receipts, recorded an annual average growth rate of 9 per cent from 1995 to 2014 in nominal terms.
It should be noted, however, that figures for the initial years of the period may have followed a different methodology from that used in subsequent years given the strong and sudden increase after 2002.
These receipts grew on average by 6 per cent per year in 1995–1998; growth then increased to 13 per cent per year in 2005–2008. With greater volatility following the financial crisis, receipts peaked in 2012 and recorded a yearly decline of 2 per cent per year in the period 2011–2014.
” As the samples used for 2013 and in particular 2014 are smaller, this decline must be interpreted with caution. Similar to arrivals, a decline in receipts is estimated for 2015″, the report stated.
The total value of tourism as an export sector is estimated by adding together international tourism receipts and inbound expenditures on international passenger transport services.
Data showed that tourism export revenues experienced a similar but even more pronounced growth trajectory (also recording an average yearly growth rate of 9 per cent). In the past two decades, tourism export revenues more than tripled, increasing from $14 billion between 1995 and 1998 to $41 billion between 2005 and 2008, and rising to $47 billion by 2011–2014.
Growth was particularly strong after 2002 and up to the financial crisis, and then experienced a decline before peaking in 2012. The decline thereafter needs to be considered with caution as data coverage is more limited.
For instance, there is no data available for Ethiopia in 2013 and 2014. In 2012, the contribution of Ethiopia to the continent’s total tourism export revenues, driven by its international passenger transport services, amounted to nearly 4 per cent, the UNCTAD report disclosed.
Regional Distribution of Tourism Receipts
The regional distribution of international tourism receipts and tourism export revenues is similar to that of arrivals. In 2011–2014, Northern Africa received on average 43 per cent of tourism export revenues, followed by Southern Africa (26 per cent) and Eastern Africa (20 per cent).
Comparing export revenues with arrivals indicates that Southern Africa obtains more export revenues per arrival than Northern Africa, indicating that an important share of the tourism product on offer in Southern Africa may be more upmarket than in Northern Africa.
For the continent, tourism export revenues per international tourist arrival increased, from an average of $580 in 1995–1998 to $850 in 2005–2008, and then stabilized at that level (in nominal terms); the level remained at $850 in 2011–2014.
From 1995 to 2014, Africa experienced strong export growth (11.8 per cent per year) driven by the recent and unprecedented commodity boom. With tourism export revenues growing strongly (8.9 per cent per year) but less than total exports, their share in total exports decreased during the same period, declining from an average of 9 per cent in 1995–1998 to 8 per cent in 2005–2008, and further to 7 per cent in 2011–2014.
The share of tourism export revenues varies greatly across subregions and countries. In 2011–2014, in Eastern Africa tourism export revenues accounted for 15 per cent of total export revenues, while in Middle Africa, for only 1 per cent.
At a country level, tourism was a vital and dominant export sector, accounting for 30 per cent or more of total exports, in Sao Tome and Principe (89 per cent), the Gambia (43 per cent), the Comoros (41 per cent), Seychelles (36 per cent), Ethiopia (30 per cent), Mauritius (30 per cent) and Rwanda (30 per cent). If focusing on services exports only, growth in tourism export revenues exceeded total services exports growth (8.3 per cent per year) between 1995 and 2015.
The sector is a crucial contributor to services exports in many African countries and particularly in Southern, Eastern and Northern Africa, reaching an average contribution to services exports in these subregions of 62 per cent, 45 per cent and 45 per cent, respectively, in 2011–2014.
For Africa as a whole, tourism export revenues accounted for 46 per cent of total services exports in 2011–2014, while in 2005–2008 when tourism experienced strong growth, it accounted for 53 per cent. The high contribution of tourism to services exports also reflects that tourism is a highly liberalized sector.
As an internationally traded service, inbound tourism has become a major trade category for many developing countries, and it is one of the main sources of foreign exchange income and a major component of exports.
As money is brought into a country by foreign visitors, and money is taken out by local citizens visiting foreign destinations as tourists (outbound tourism), the difference between inbound tourism expenditure and outbound tourism expenditure is known as the tourism trade balance with the rest of the world.
By Masahudu Ankiilu Kunateh, African Eye Report
