Poor infrastructure and visa restrictions hamper tourism growth in Africa

Continent must be promoted the right way. Elias Aad- Vice President- Government Solutions Lead, Mastercard Advisors, gave an address at the Global Business Travel Association Conference held at Magaliesberg, South Africa.

In emerging markets tourism grew from 30 percent in 1980 to 45 percent in 2015 and is expected to reach 57 percent by 2030,” says Elias Aad- Vice President- Government Solutions Lead, Mastercard Advisors.

He was addressing delegates at the Global Business Travel Association Conference held at Magaliesberg, South Africa, this week.

Mastercard has been invited to discuss how innovation in corporate payments is transforming travel programs.

Africa has not enjoyed the same growth rate, and although the continent offers a range of benefits, the sector remains largely an untapped opportunity. This is largely due to challenges facing the sector, including security concerns.

Attendants included other African countries alongside tour operators, travel agents, hotels, airlines and some of the key private sector players.

“A set of challenges were identified and we broadly agreed that focusing on tackling them together, as industry leaders and the public sector, would make tangible differences to not only each of the African countries independently but also for the continent as a whole,” says Aad.

Matters such as current travel visa restrictions that prevented Africans to explore their own Continent were discussed.

The ministers highlighted the complexity behind removing visas, especially considering that there are a number of factors, including security that needs to be considered. However, removing travel restrictions particularly at an inter-African level – would boost the sector significantly, it was agreed in unison.

*Poor and lack of infrastructure thereof, was pointed out. Whether air, road or water, this makes it complicated to travel from one African State to the other. Another issue is the cost of traveling, it has become expensive and as such technology has been punted as the long term benefit on tourism.

*Going cashless must be a priority for African economies

With 94 percent of retail transactions still in cash, there is a real need to displace cash given the countless benefits for consumers to shift behaviour. Additionally, benefits will benefit the sector and overall economy. Focus should be placed on:

-Safety: Digital payments is far safer, and although in Africa the need still remains to have some cash available, it is important to develop a wider acceptance network that includes hotels but also tourist hot spots.

-Customer experience: COMESA (Common Market for Eastern and Southern Africa) has launched a program called from Cape Town to Cairo, providing travelers with a full itinerary to travel from, to and in-between these cities.

The initiative is helping to take the pain out of having to carry multiple currencies when travelling. The collaboration highlights the importance of similar initiatives and a closer relationship between countries.

-Increased tourism spending: Hospitality providers and retailers benefit from higher footfall and greater purchase power from consumers given the ease of paying for goods digitally.

-Contribution to GDP growth: A Moody’s study showed that increased use of electronic payments added 0.8 percent to the GDP across emerging markets and 0.3 percent for developed markets. This was driven by higher potential tax revenue; lower cash handling costs; guaranteed payment for merchants; a reduction in the grey economy due to lower unreported cash transactions and greater financial inclusion.

Harnessing public, private partnerships:

This level of collaboration is critical to enabling innovation, technology adoption and driving efficiencies and transparency.

The use of data:

Using data to understand travelers’ spending behaviors’, their habits as well as their preferences has the power to increase the number of customers and the spend, and provide the traveler with a seamless experience.

Mastercard is leading the way in data analytics, with products and services that combine the power of data and insights.

For instance, Tourism Insight Platform provides data on spend as well as natural language processing sourced from social media and search engines like Instagram, Google and Amadeus.

Continues Aad:” Our success has led us to discussions with the African ministers and Tourism authorities where we unpacked and showcased how we can assist cities differentiate themselves to attract travellers and ensure that the continent is being promoted in the right way.

More than ever, such tools are required as destination marketing organisations (DMOs) budgets shrink, the need to be more effective in this more competitive environment is essential.”

During the 2017 World Tourism Conference held in Rwanda, ministers and leaders discussed varied topics to try and mitigate problems that continue to beset travel and tourism in the Continent.



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