The Namibia Economist

Less from tourism to GDP

As developed countries continue to be affected by global jitters, Klaus Schade, an independent economist said that Namibia can expect a decline in the contribution by the tourism industry to the 2012 GDP.
He said “although tourists from neighboring countries such as South Africa and Angola might still come to Namibia despite the prevailing global economic uncertainties, tourist numbers from Europe, the USA and other developed countries might decline or the visitors will have less money to spend.”
Schade said that as the economic unrest continues, the tourists will either stay for a shorter period of time in the country or cut down on their expenditure.
“Tourists might prefer to do self drives instead of tour operators, camping instead of lodges, self catering instead of dining in restaurants amongst other cutbacks,” he said.
Shade said that with the European Soccer Cup underway and as well as the Olympic games which will take places during the main European holiday season, this could divert potential visitors to Namibia.

But as a slight comfort, he mentions the recent depreciation of the Namibia Dollar as a positive factor saying that it will help stretch tourists’s holiday buck.
“The NAD has weakened against the USD, British Pound and Euro compared to a year ago and hence tourists from these countries get more NAD for their local currency which increases their disposable income in NAD,” said Schade.
Commenting on the cost of travel, he said that although the petrol price increment has affected transportation costs depending on the distance, the oil price has dropped and resulted in the announced price drop for petrol and diesel yet the fuel prices are still about a dollar higher then a year ago.
“Therefore higher fuel prices might not affect overall spending patterns of tourists as they already come with a certain expenditure budget.”
Meanwhile Schade said that there is a need to diversify the tourism industry to ensure a steady contribution to GDP and look at other ways to explore the possibilities of attracting conference and business tourists to the country.
He said that although such an initiative will requires investments into, for instance, a state of the art international convention centre, business tourists spend more money per day than conventional tourists and are not bound by major holiday seasons.”This could help keep a steady inflow of tourists in the country regardless of the ongoing global economic crisis. This can also help us fill low seasons, we need to ensure that we do not outprice ourselves and take into account the purchasing power of our visitors.”
Schade stressed the need for the country to market itself in other countries as well as to make tourists feel more welcome and at home so that these visitors will recommend the country to their friends.
“The tourism industry is a major contributor to employment creation since it is labour intensive. We need to invest in skills development in the hospitality and tourism sector in order to provide first class services.”
Schade said there is a need to showcase more Namibian products “from traditional food and drinks to  culture and crafts in order to make our country a unique and unmistakeable tourist destination.”

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