23 March 2014

Ethiopia: Only Competition Can Put Ethiopian Tourism On the Road to Success

If historical records are to be used as instruments of analysis, there is little in the form of connective threads between tourism and the Revolutionary Democrats. Available accounts show that they have been rather hesitant towards the sector and its potential contribution to the nation's economy.

This is despite the popular perception that the sector has a huge amount to offer to growth, as well as job creation. No doubt that the popular perception relates to the rich cultural, traditional, historical and topographic resources the nation is blessed with, which, if properly used, could leverage a considerable tourist influx and economic returns.

As much as the ruling EPRDFites ought to defy many popular presumptions, on all fronts, from economy to history, they certainly were adamant in getting onboard the populist analysis of historical resource availability. It seemed that they wanted to undertake the stocktaking assignment in their own way.

Showcasing their hesitance is the fact that all of the medium-term plans designed before the latest - the Growth & Transformation Plan (GTP) - dedicate little attention to cultural development. There are no detailed targets for the sector in both the Sustainable Development & Poverty Reduction Program (SDPRP) - a three-year intervention - or the Plan for Accelerated & Sustained Development to End Poverty (PASDEP) - a five-year framework. What could be found in both the documents are sectoral wish lists mentioned in broader terms.

A simple comparison of the incumbent with that of the 43 years of Monarchical regime and the 17 years of Military dictatorship shows that the latest emphasis is much less. In all of the four medium-term plans of the Imperial era and the three plans of the pseudo-socialist dictatorship, cultural development was provided with sizable policy attention and capital investment allocation.

Of course, this does not mean that the implementation was as impressive as the plan. It rather was limited to a few symbolic investments, which, more often than not, were largely used for propaganda purposes. But, at least the policy attention was visibly significant, regardless of the politics.

To the dismay of naysayers, nevertheless, the accounts of the ruling EPRDFites are changing fast. If one is to go by the latest decisions, including the establishment of the high-level tourism council, it is clear that the long overdue passivity of the ruling EPRDFites is, slowly but surely, coming to an end. It signals that the long overdue stocktaking has displayed a positive result.

In launching the council, led by Prime Minister Hailemariam Desalegn, the EPRDFites have shown the world that they are ready to exploit the untapped potential of Ethiopia's tourism, in a different way than it has been for decades. In the words of Hailemariam, the time has arrived to "fundamentally transform the tourism sector".

Sure, the global trend shows that the time indeed is ripe for such an action. This, of course, is not taking into consideration the opportunities forgone by the policy dilly-dallying.

Evidence shows that the global tourism sector has recovered well from its historic deceleration, which resulted from the global financial crisis and the overstretched Eurozone recession. Average growth of tourist numbers and expenditure, in the years between 2008 and 2013, has been 5.6pc, according to the World Tourism Organisation (WTO). A large proportion of this growth has been contributed by emerging and developing countries.

Africa is making up its fair share of the growth, even if it is yet to reach its optimal potential. At 8.3pc, the growth of tourism visits and expenditure to Africa in the five years up to 2013 has been way far higher than the global average. Latest researches show that the continent could achieve a lot more than this if governments were to put in place policies to make their nations more attractive to tourists.

By and large, Ethiopia, under the leadership of the ruling EPRDFites, have proved to be a politically stable place. Asides from occasional happenings, the risk portfolio of the nation is very low, in both aggregate and individual terms.

Complementing these positive aspects is the latest rapid growth of the nation. Cognisant to the huge pumping-in of public investment, the nation that has been considered the poster child of famine and conflict has become associated with high returns on investment and economic success.

As much as the EPRDFites could be proud of their achievements in the overall economy, however, they could not boast about their specific accomplishments in the tourism sector. By and large, the sector continues to be at the recipient end of the economic matrix.

Monopolistic trends top the challenges that hinder the growth of the tourism sector. It all starts with the flight experiences that a tourist can enjoy.

Ethiopian, the national flag carrier, is the lone player that tenders large-scale local commercial flight services. This privilege of the airline is stipulated by law. Tourists, therefore, have no option in terms of adjusting their local flight experience along with their budget and preferences.

This monopolistic trend has started to diffuse in the whole value chain. Lately, service providers in the sector have started to stretch themselves all along the value chain. It has become common to see names of companies and public enterprises providing services as varied as flight arrangement to touring and lodging.

What is resulting from the increasing monopolistic trend is not only a lack of options. Additionally, jobs are getting lost and business entry has become all the more challenging.

Small businesses are getting wiped out of the value chain. Hence, an increasing proportion of the returns from the sector, estimated to have reached the 300 million dollar mark, in 2013, is being absorbed by a few, oligopolistic businesses.

Many of the tourist destinations of the nation are still not served with basic utilities, including clean water supply, electricity and asphalt roads. This, even by the accounts of adventurous tourists, significantly limits accessibility and connectivity.

What is even more unfortunate is the fact that tourists will have to wait to get back to their nations before they can enjoy the instant sharing of their experiences through a broadband connection, since Ethiopia could only provide them with a scanty Internet service, albeit limited to urban centres.

Skill is also a huge challenge for the tourism sector. Paucity of skilled manpower is so severe that the sector relies on self-taught people. Since skilled labour is in considerable deficit, service providers are seen scrambling for the few experienced minds.

Even worse, a glance at the various tourist experience review websites shows that the service mentality of service providers need significant improvement. Tourists are seen complaining about problems relating to the punctuality, honesty, helpfulness and personal hygiene of people in the sector. No doubt that the cost of these complaints is real and huge.

Any plan by the ruling EPRDFites to transform the tourism sector ought to, therefore, attend these fundamental problems. Anything that settles for less would only be a lip service. Policies meant to bring transformation in the sector ought to also end monopoly, improve access, build the skills base and transform the mentality of service providers.

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