Zimbabwe hoteliers count the cost of chaos | Fin24
 
  • Load Shedding

    Find the latest load shedding schedules for Joburg, Durban, Cape Town, and other cities.

  • Power Cuts

    Wednesday's load shedding has been blamed, in part, on a broken conveyor belt at Medupi.

  • Fin24’s newsletter

    Sign up to receive Fin24's top news in your inbox every morning.

Loading...

Zimbabwe hoteliers count the cost of chaos

Oct 08 2019 21:50
Memory Mataranyika 
 A school boy looks at a burning barricade during

A school boy looks at a burning barricade during a shutdown demonstration on January 14, 2019 in Bulawayo after the president announced a more than hundred percent hike in fuel prices. ZINYANGE AUNTONY/AFP/Getty Images)

Related Articles

Another fuel and energy price hike - no end in sight for weary Zim consumers

Zim ban on mobile money challenged in court

Zimbabwe: Claims of forced labour at diamond mine a 'shameless lie'

 

Zimbabwean hoteliers are counting the losses from business disruptions caused by demonstrations earlier this year, with African Sun - which operates hotels in Victoria Falls and Harare - saying foreign occupancy levels are down 19%.

Zimbabweans staged violent demonstrations in January after the government hiked fuel prices. Government sent in security forces to crack down on the protests, which resulted in multiple deaths. Police again stopped anti-government protests by the opposition Movement for Democratic Change (MDC) in August this year.

Alex Makamure, chair of African Sun, said on Friday that violent demonstrations and stayaways had led to cancellations and deferred bookings. Local occupancy levels for the group’s hotels were 10 percentage points lower for the six months to the end of June.

"The first quarter was impacted by the violent demonstrations and stayaways, which led to cancellations and deferred bookings.

"Resultantly, occupancies dropped to 45% in the period under review compared to 55% in the 2018 comparable period," said Makamure.

This was in addition to other economic challenges that hobbled the tourism industry, including policy reforms that gave rise to currency changes, high inflation rates, and an escalation in electricity load shedding, as well as reduced aggregate demand across all sectors.

Despite a drop in occupancy - which closed at just 45% - African Sun did post a revenue increase to ZWL79.13 million, with a mix of 55% local and 45% export.

"Room nights dropped by 16% to 132 525 from 158 210 reported last year. The decline was across both our markets, with domestic and export reducing by 7% and 19% respectively," added the company.

Forex

Both African Sun and rival hotelier Rainbow Tourism Group (RTG) are banking on their businesses' forex generation capacity to continue investing in upgrades and refurbishments of their offerings.

RTG said its focus for the remainder of the year would be on driving growth in revenues through the consolidation of the domestic market, and continued aggressive sales and marketing in overseas markets.

"The company will also invest in high potential source markets such as the African continent, which is less sensitive to macro-environmental factors affecting destination Zimbabwe.

"The second half of the year usually contributes about 60% of business volumes and a similar trend is anticipated in 2019," RTG said.

For the full year to the end of June, RTG generated foreign currency revenues of US$4.8m, up 9% from US$4.4m recorded during the same period in 2018.

"Increased foreign arrivals into resort hotels accounted for much of the growth at 5% above prior year. Overall, arrivals into RTG hotels grew by 14% in comparison to the national average growth of 1%," the company said.

A third significant player in the Zimbabwean hoteling industry, Meikles, is disposing of its flagship Meikles Hotel in Harare.

Thabani Mpofu, company secretary for Meikles, said recently that the directors of the company had engaged regulatory authorities "in the process of finalising the Meikles Hotel transaction". They are awaiting responses.

"The company will be seeking approval of its shareholders for the proposed disposal at an extraordinary general meeting to be convened at a future date," said Mpofu.

zimbabwe  |  tourism  |  economic growth  |  hotels
NEXT ON FIN24X

 
 
 
 

Company Snapshot

#MINIBUDGET2019

Struggling power utility Eskom will take centre stage at this year's mini budget
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

What do you think about private healthcare in SA?

Previous results · Suggest a vote

Loading...