A surge in the cost of borrowing and limited lines of credit has affected the tourism industry’s ability to refurbish its products, a government official said.
Zimbabwe is endowed with natural attractions and is home to one of the Seven Wonders of the World, the majestic Victoria Falls, which adds to the country’s allure.
However, stakeholders in the sector have admitted that despite having such attractions, limited lines of credit remain a stumbling block to the growth of the sector, making the country lose out on potential revenue.
“The industry has not been able to refurbish products due to limited lines of credit and high cost of borrowing,” Tourism minister Nqobizitha Mangaliso Ndhlovu said in an interview with Standard Business.
“As such, the product is lagging behind when compared to other products within the region.
“In terms of support services such as feeder roads to, and within attractions, the government is implementing the road rehabilitation programme, however, there is still a lot of work to be done in this regard.
“Similarly, there is need to continue probing the ease of doing business in the country to make it more efficient and less costly.
“There is also need to continue aggressive marketing of the destination.
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“The sector has been on a rebound while the government has been implementing a slew of strategies to ensure a quick recovery of one of the leading foreign currency-generating sectors.”
Ndhlovu said although many initiatives have been implemented in order to improve the destination image and competitiveness, the country still needs to improve in terms of tourism product offering and support services.
“In terms of support services such as feeder roads to and within attractions, the government is implementing the road rehabilitation programme, however, there is still a lot of work to be done in this regard,” he said.
“Similarly, there is need to continue probing the ease of doing business in the country to make it more efficient and less costly.
“There is also need to continue aggressive marketing of the destination.”
According to the industry’s experts, the sector is vulnerable to non-productive taxation that essentially discriminates against travellers and/or travel companies in relation to goods and services similarly offered in other sectors.
In August last year, revenue into Zimbabwe’s tourism industry rose by 121% to US$337,5 million during the first half of this year, compared to US$152,8 million during the same period in the prior year.
Before the advent of Covid-19, in 2019, Zimbabwe’s annual tourism receipts were US$1,24 billion, a peak at the time.
With restrictions on domestic and foreign travel owing to the Covid-19 pandemic, annual tourism receipts fell to US$359 million in 2020 and US$397 million in 2021.
However, Ndhlovu said the tourism industry needs to continuously engage in infrastructure development in order to remain competitive.
“Nation branding is key for the destination to be competitive; we need to continuously collaborate and benchmark with other destinations to improve on our tourism offerings,” he added.
“The tourism sector needs to continuously improve on tourism infrastructure so as to remain competitive through affordable lines of credit.
“There is a need to streamline our licensing regime and maintain ongoing engagement with tourism players to reassure prospective investors of opportunities available in Zimbabwe.
“We have to develop new tourism products as the sector firms up new international and regional trends such as the rise in travel for the millennials post-Covid-19 pandemic.”
