Kenya domestic tourism hit hardest, Kenya Airways recommends staff to take leave


NAIROBI, Kenya (eTN) – The absence of sufficient foreign tourist visitors in Kenya, needed to maintain the tourism industry’s occupancy figures, is being compounded by the collapse of the domestic tourism segment. Middle class Kenyans, who contributed to the industry by taking advantage of financially very attractive “residents rates” in beach resorts and safari lodges, are now staying at home for fear of running into violent confrontations on the roads or simply wanting to “watch our for their homes and businesses.”

Many would be travelers also feel this is not the time for travel and vacations, when their jobs are at stake and the country’s economy under severe threat. Domestic tourism in Kenya in past years accounted for as much as one third of the overall income, and as long as Kenyans do not travel their country it will be even harder to convince international visitors to return to Kenya’s sunshine coast or visit the world class national parks and reserves.

“The domestic tourism market is basically dead,” said Dr. Dan Kagagi, chief executive of the European Union (EU) funded tourism development initiative Tourism Trust Fund (TTF). He said it has become difficult to convince Kenyans to visit some parts of the country, effectively making local tourism, estimated to contribute 30 percent of tourism revenue, to grind to a halt. “If Kenyans are now scared of traveling, that wipes out domestic tourism.”

This report comes shortly after the sports tourism project at Masinga Dam in Central Kenya reopened its doors, which TTF supported with some 22 million Kenya shillings and which future now looks equally bleak.

Tourism Permanent Secretary Rebecca Nabutola is also quoted in the local Kenyan media to have put the losses for the tourism sector over the past weeks to at least 6 billion Kenya shillings. She is also on record that the country would need to add at least a billion Kenya shillings to the budget of the Kenya Tourist Board in coming months to aggressively promote the country in its core and emerging markets and arrest the present slide in fortunes.

Meanwhile, national carrier Kenya Airways (KQ) has now asked its staff members whose workloads have been reduced by falling passenger loads to apply for paid leave in the next few weeks.

The airline has also reduced capacity on several international routes, particularly to Europe, Southern Africa and Dubai, and is exploring measures to cut non-essential expenditure. The carrier is also reviewing its capacity by reducing the number of flights in some destinations and in some cases cancelling them.

Smaller aircraft are being deployed on some flights while frequencies have been reduced on other routes, including on the lucrative Nairobi to Mombasa high volume, tourist and domestic route.

Capacity has been reduced on Nairobi to London, Amsterdam, Paris, Johannesburg, Mombasa, Lagos, Khartoum, Cairo, Kisumu, Dubai, Kinshasa, Dzaoudzi (Mayotte Island), Hahaya (Moroni Island). On some of the routes, Boeing 777- 200 aircraft has been replaced by Boeing 767, while the new, but smaller, Embraer 170 aircraft has replaced some B737-300 on some domestic routes.

This follows four weeks of violence in Kenya’s major cities that has caused tourists to shun the country, while those enjoying holidays have opted to cut short their stay in Kenya.

Kenya Airways CEO, Mr Titus Naikuni, says that the airline has been affected by the political violence going on within Kenya in the last four weeks. “Our passenger numbers are operating on average at 15 percent below same time last year, which is quite significant, As required by the regulatory authority we have reviewed out forecast for the current financial year and do not see a need for a profit warning at the moment,” he said.

At the Nairobi Stock Exchange, the airline’s share price has slumped by over 35 per cent from above Sh70 ($1) to Sh45 (US$0.64) over the last five weeks. Royal Dutch Airlines KLM owns 26 percent of the African airline; 23 percent is owned by the Kenya government, while 51 percent is owned by both East African and foreign private companies and individuals.

Speaking at a media briefing at the company headquarters at near Jomo Kenyatta International Airport (JKIA), Nairobi, on Thursday evening, Naikuni reported that “the cargo business has also been impacted though not as much as the passenger business.” Cargo volumes are estimated to have dropped by four cents in January this year compared to the same period last year.

“But let me make it clear that we are not re-trenching anybody,” Naikuni said.
Presenting an update of the performance of his company following the post election violence, at the press briefing, the CEO sited, “the European routes of London, Amsterdam, Paris, Johannesburg and a number of African destinations as being the hardest hit.” He said Mombasa, a major tourist and business destination has been affected by the post election violence.

Naikuni went on to point out that despite the continued safe operations at JKIA, many travelers have kept away in response to media coverage and travel advisories. “While we all know that operations at JKIA are as safe as they have always been during normal operations, international media coverage and various travel advisories by key countries over the situation in the country have had a major impact on passenger numbers even for transiting ones.”

Naikuni announced that the management has moved on to institute a number of short term actions in attempt to mitigate the negative impact caused by the current situation. He said that Kenya Airways has been and will continue working with travel agents, tour operators, hoteliers, the Kenya Tourist Board and other organizations to develop campaigns to revive the ailing tourism sector.

Naikuni reiterated KQs continued commitment to its long-term expansion strategy. The CEO reiterated his airline’s commitment to its customers and Kenya while also urging Kenyans to foster peace since “instability is bad for business; it is bad for all of us.”

Listed on the Nairobi bourse in 1996, Kenya Airways is one of the few profitable airlines in Africa. It is also quoted in the stock markets of Uganda and Tanzania.