Namibian tourism up 13.2 percent from 2013

The latest FNB/Federation of Namibian Tourism Associations (FENATA) Travel Index states that Namibia’s tourism activities increased by 1.5 percent from the previous quarter on the back of higher seasonal demand as the industry moved towards its peak season in August.

The annualized growth was 13.2 percent higher than last year’s figure and although the industry continues to grow through 2014, the growth rate has begun decelerating. This coincided with a drop-off in tourists from Europe and America.

But fortunately for the industry, the increase in tourist numbers from Asia and Africa more than made up for the drop-off in American and European tourist numbers.

The FNB/FENATA Tourism Index also indicated that the local currency recovered some lost ground through the second quarter and thus travels from America and Europe were 3 percent more expensive due to foreign currency translation and a further 1 percent on account of tourism inflation.

The local tourism sector continued to adjust to an increasing competitive environment and thus elevated capital expenditure to remain competitive and ward off new entrants from international operators looking to enter the Namibian tourism market.

On the topic of business performance it was said that this moved sideways during the quarter and although there were more tourists, they did not spend as much as the previous quarter.

Revenues are expected to improve slightly in the third quarter on account of higher tourists numbers dampened by lower tourists spend. Hotel, lodge and activity operators pencilled in improved revenue expectations during the third quarter, while revenue expectations in the air charter and vehicle rental space was neutral on account of rising operational costs that compressed margins during the second quarter.

Capital expenditure peaked during the first quarter and has subsequently tapered off in the second quarter and is expected to move sideways in the third. The demand side issues dominated the second quarter, with fluctuating economic conditions and fewer group tours dampening demand for local tourism.

Source: New Era