Business

Hotel sector’s $500m target growth threatened

Nigeria may lose €2.5bn EU aid due to rising security threats

The expectation that the hotel and hospitality sector will rake in $507 million into Nigeria’s economy in the next four years seems to be threatened.

Reports say the inability of the government to quickly resolve series of attacks and kidnapping in parts of the country, which made the United States and United Kingdom to issue a security alert on its citizens, has become an issue.

Following the alert, the International Tourism Organization (ITO) sent a warning to its affiliate groups to be wary of recommending some African countries to tourists, specifically naming Nigeria, along with Somalia and Libya, as those under watch.

But the government has quickly faulted the US security warning, which named 11 states in the country that its citizens should not go to without some precautionary measures.

This is even as an international business outfit, PricewaterhouseCoopers (PwC), had in its assessment report on tourism and hospitality in Nigeria expressed optimism that fs concerted efforts were made, the country’s economy will be enhanced by this sector.

It said the sector has the potential to add to the growth of the country’s economy in the nearest future.

“Hotel room revenue is expected to grow to 507 million dollars in 2020 from the 321 million dollars achieved in 2015, due to increases in both stay unit nights and average room rates.

“The hotel market in each country is affected by both the local and global economy, with some countries being more dependent on foreign visitors than the others, “the report stated.

Read also: PwC says Nigerian hotels can generate $507m growth in 4yrs

In the past five years, there has been a consistent growth in number of hotels in Nigeria, jumping from 45 to 60 per cent between 2010 and 2015, which has been despite challenges of the economy.

Also, form 1999 through 2002, the number of five-star hotels rose from 10 to 17, while privatisation of the sector, which saw government selling its equity holdings in major hotels attracted more investment in the sector.

Thus, by 2010, there was a quantum growth with private concerns attracting international hotel outfits into Nigeria.

The report also said that the tourism and hospitality businesses contributed to job-growth of about 10 per cent and still has potentials for further inputs in other sub-sectors of the economy.

According to the report, there are a number of new hotels under construction which led to a forecast of an additional 4,700 rooms to be added in Nigeria in the next five years.

The anticipated growth of revenue from the industry will be based on planned increases in both stay unit nights and average room rates.

However, the growth forecast will further depend on security and promotion of business modules to attract both tourists and foreign investors in the next five years.

By Emma Eke . . .

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Ripples Nigeria

We are an online newspaper, very passionate about Nigerian politics, business and their leaders. We dig deeper, without borders and without fears.
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Ripples Nigeria

We are an online newspaper, very passionate about Nigerian politics, business and their leaders. We dig deeper, without borders and without fears.
www.ripplesnigeria.com

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