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Uganda's Tourism Sector Sees a UGX3.8Tn Loss due to COVID-19 Effects 


By Rogers Wanambwa 

KIU, Main Campus – According to the Ministry of Tourism, Wildlife, and Antiquities, Uganda's tourism sector and the economy at large has lost UGX3.891Tn due to the Coronavirus pandemic.

This was revealed by the Permanent Secretary, Ministry of Tourism, Doreen Katusiime, while appearing before Parliament’s Tourism and Trade Committee which is investigating the impact of the second wave of Coronavirus on the tourism sector.

Further explaining, Katusiime noted that foreign visitors to Uganda plummeted by 69.3% as to 473,085 from 1,546,620 visitors reported in 2019. The tourist arrivals in 2020 dwindled to the levels of as far back as 2005.

“The foreign exchange earnings dropped threefold in the year 2020 from USD1.6bn approximately UGX5.655bn that Uganda earned from foreign tourists in 2019 to $500M equivalent to UGX1.767Tn in 2020,” said Katusiime.

She also notified the Committee that Uganda indicated a decline in hotel room occupancy rates from 51.9% in 2019 to an average of 20% in 2020. This implies that the need for agricultural produce and other services from host communities and local manufacturers was forfeited to a similar magnitude.

“We registered booking cancellation in over 90% of hotel facilities. This led to a loss of revenue amounting to $320.8M about UGX1.19Tn in addition to other business losses,” Katusiime added.

At least 70% of the workers in the tourism industry had lost their jobs and 91% of the tourism entities had downsized on the workforce by end of June 2020 due to the financial hit caused by the COVID-19 pandemic, this according to the Government.

Besides, signs of recovery have been reported with at least 30% jobs recovered by end of March 2021, while non-residents visits increased from 3,577 to 7,318 visitors.

As part of the recovery recommendations, the Ministry invited Parliament to revise the over 20 taxes, licenses and fees which presently are being levied on the sector.

“In the interim some of these interventions would enable the sector to recover faster. Extend the waiver of VAT on accommodation in Kampala to 30th June 2022,” said Katusiime.