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KIU Business Desk: Hotel Industry in Africa Takes Major Hit due to COVID-19


KIU, Western Campus – The Hotel Industry in Africa is set to face a slowdown of up to 40%, after hundreds of planned construction projects have been shelved due to the COVID-19 pandemic, according to a BBC report.

Accommodation groups had planned to build 408 hotels, with around 78,000 rooms but these have now been reduced to 90 new hotels.

The BBC quotes analysis by the research group W Hospitality, which says that even half of the projected 90 new hotel projects will be delayed.

This is likely to have further negative effects on the hotel industry in Uganda and the entire economy, according to the Dean of the School of Business and Management at KIU western Campus, Micheal Manyange.

“The Hotel industry brings in a lot of foreign currency as most hotel residents are international visitors and tourists,” Manyange says.

“So, the slowing down of hotel construction projects means that we shall have fewer rooms available for visitors and therefore, less revenue and foreign currency coming in,” he adds.

However, despite this dark forecast, there is still hope on the horizon because of concerted efforts to provide relief packages for various businesses to return to normal when the lockdown is finally lifted, Manyange says.

For example, he says, construction projects around Ishaka town continue to go on because hotel owners have hope that business will return to normal when the lockdown is lifted.

The Private Sector Foundation of Uganda (PSFU) on June 9 announced an $8.3 million (31 billion shillings) commitment from the Mastercard Foundation to finance the COVID-19 Economic Recovery and Resilience Response Program.

Part of this money will be used to support at least 200 qualifying enterprises whose operations have been affected by COVID-19, to survive and thrive in new and existing local and international markets, according to a statement on their website.

Hotel groups and owners are some of the potential beneficiaries from this fund and when the dust from the COVID-19 storm settles, they will be seeking to return their enterprises to normal business.

Picture credit: PML Daily