Tourism sector sniffs more business after passing of bill


Following Uganda’s successful hosting of the Commonwealth Heads of State (CHOGM) in which the country made substantial strides in tourism publicity and development, the country’s Parliament has passed the much-anticipated Tourism Bill 2007.

The Bill which has been in Parliament since 2005, has been sidelined by political issues but also delayed by “certain bureaucrats opposed to vesting more functions in the Uganda Tourist Board (UTB) (now known as Tourism Uganda (TU)) and changing the board structure to allow the private sector a qualified majority,” according to an industry source.

As part of a 10-point action plan that has been developed by the Ministry of Tourism Trade and Industry (MTTI), the bill seeks to among others, remove the legal and institutional bottlenecks to the development of the tourism industry.

The bill comes with several positive proposals like the introduction of a tourism development levy of 2% on accommodation revenue earned by hotels that will facilitate the marketing and capacity building activities of TU.

Uganda from the time of Independence was one of the biggest hot spots for tourists in Africa coming close to the million mark in 1970 and dropping to 25,000 in 1986. From then on, it has been an upward trend.

According to the World Travel and Tourism Council, Uganda is among the top 10 global tourist growth destinations with arrivals figures over the last three years increasing at an average rate of over 20% per year.

TU general manager, Mr. James Bahinguza says on the agency website that arrivals raking in substantial foreign exchange revenues and jobs currently stand at over 600,000.

“This bill will certainly give the UTB more relief and leverage in attracting tourists in a country which arguably has some of the best attractions in the world. Tourism and the country at large will be better off once the bill is passed,” said a tour operator who spoke to the East African Business Week on anonymity.

Stakeholders argue that the industry could have performed better had there been more financing for TU.

“UTB is understaffed and resource less. It is hard for it to turn round the tourism industry without the technocrats to plan and implement policies,” Mr. Gideon Badagawa, the Director Policy Advocacy at the Private Sector Foundation Uganda says in an interview with an online publication.

Some industry players however, though elated by the development have warned that government should seriously buy into the idea of prioritising tourism than give lip service to a sector that brings in $320million annually- about 25% of export earnings annually.

“Uganda’s tourism is still dependant on the will of the political class. Should they political class buy into the idea of priotising tourism then we shall be in business,” Mr. Amos Wekesa, the vice president of Uganda Tourism Association (UTA) and also managing director of Great Lakes Safaris Ltd told East African Business Week on Thursday.

On many occasions, tour operators have been critical of the country’s performance at international exhibitions and events when compared to the other East African countries because of the small working annual budget of Ush300 million ($180,000) allocated to TU.

The country has had to compete with agents whose countries have heavily invested in millions of dollars in their tourism marketing programmes.

Neighbours Tanzania, Rwanda and Kenya spend substantially more money on local and foreign tourism promotions.

TU’s annual budget for promotion and marketing, according to the ministry is on average $500,000 per annum compared to Kenya Tourist Board’s (KTB) $2.5 million and Tanzania Tourist Board’s (TTB) $1.5 million.

“To augment government’s financial contribution, KTB and TTB derive a larger proportion of their budget support from a tourism levy. Given TU’s unfavourable position, Uganda could emulate its East African neighbours and establish a similar levy to support TU’s activities,” the ministry says on its website.

East African Business Week saw sample copies of the bill that gives TU, the industry watch-dog, powers to licence, issue and enforce standards for the sector. The bill is awaiting the President’s endorsement and signature.

According to Prof. Wolfgang Thome, former UTA president, the initial draft of the bill had been developed in private public partnership from 2004 until 2005, when stakeholders unanimously passed the draft and handed it to the tourism ministry for processing.

“Registration in the tourism sector, as does licensing, monitoring and enforcement, needs a new regulatory foundation to be able to effectively deal with defaulters, briefcase companies and habitual offenders, which can potentially give Uganda’s tourism sector a bad name in the international markets,” Prof. Thome said in a statement before the bill was passed by parliament.

The new tourism law also wants all domestic air operations to be tax exempt so as to encourage tourists to use local air travel across the country.

“The bill should be prioritised as it is essential for the sector,” Mr. Pierre Declerck, Brussels Airlines country manager for Uganda told East African Business Week on Friday.

It is hoped that a waiver on import duty on tour vehicles and equipment is also expected so as to encourage more investors into the business of tour operators and also leave an impression on the tourists.

“The tourism sector has the highest trickle-down effect in a given country. For example, one tourist coming to Uganda and making a 14-day safari will start his/her spending at the airport by paying $50 as visa fee, is picked up by a driver who has visited a petrol station, pays for accommodation each night, tips workers, transfers to a national park and pays park entrance fees, takes a boat launch, buys crafts and eats in restaurants along the way. The list is endless,” Wekesa argues in a penned opinion.

A 2004 publication by the Uganda Bureau of Statistics (UBOS), the tourism sector is rated next to the retail trade and accounts for about 20% of persons employed in the country.

While Wekesa goes on to argue that quality investors first visit countries as tourists, then pick interest in investing in those countries without giving funny conditions, other experts are optimistic that that TU will become a more effective agency to market Uganda’s tourism potential if the Bill becomes Act in its current form.