Ngeria’s Hotel Industry Records Low Patronage
Analysts at Agusto & Co estimate that turnover for Nigeria’s hotel industry in 2014 stood at 562 billion naira, the bulk of which was generated from hotel rooms. CNBC Africa’s Esther Awoniyi caught up with Jimi Ogbobine, Senior Analyst at Agusto & Co.
AWONIYI: The figure from 2014 according to your report that’s quite high, have you been tracking the numbers for this year and is the industry set to pass a figure from 2014?
OGBOBINE: This year has not been very good for the hotel industry. In the first quarter of the year, the country was waiting for the Valentine’s Day election which was eventually postponed to March. The election season lasted for the entire first half of the year. We are in the second half of the year now, everyone is waiting for the policy, and businesses have a ‘do nothing’ scenario which isn’t good as well.
AWONIYI: According to your report also, there were 7,000 hotels in Nigeria in 2014. Did you group these hotels into categories, to know which ones foreign and local visitors are more attracted to?
OGBOBINE: The bulk of guests in Nigerian hotels are corporate guests, close to 80% are corporate reservations and we have another 13% who are business travellers coming from foreign countries. So, collectively the occupants of the bulk of rooms in hotels are corporate guests. Nigeria has a very bad perception, high risk profile; Boko Haram and Ebola. As a business traveller coming into Nigeria, the advice corporate companies give is do not stay in an unknown hotel, and companies as well are most likely to register their corporate guests in renowned hotels.
AWONIYI: I have done the market analysis, a business coming from outside the country to Nigeria basically has to put the money aside for these issues of power etc.
OGBOBINE: Yes, but you would agree that every business even banks put on generators, but in hotels it has to be on 24hours of the day and on the downside of it, we have a summer season for instance where foreign people are looking for hot destinations to travel, tropical destinations to travel to, Nigeria is totally left out of that, just about 6% of guests come in for tourism because we are not a tourism destination.
AWONIYI: But for those who are going to come in and use some of these renowned hotels, with what the exchange rate is right now wouldn’t it be a good opportunity for foreign visitors?
OGBOBINE: Yes it is, the perception is very high in Nigeria, every country is issuing a visa, there is issue in travel alert, the summer holiday planner cannot tell you the differences between Calabar and Maiduguri so, the perception issues are real. Nigeria is not your tropical holiday destination. We don’t have activities that tourists can engage in that’s why the bulk of our guests are business travellers and they have all sort of restrictions issued by their companies and embassies so, it’s really choking the industry that you can’t even stretch your visit from a business start to a holiday and when you leave the country, you realise all you did was attend meetings so, that type of out referral that will help Nigeria attract more visitors and increasing hotel occupants isn’t happening.
AWONIYI: But this isn’t going to stop the big names from coming here to setup hotels.
OGBOBINE: This is why the political issues matter for Nigerian hotels, if the bulk of your travellers are business travellers, then politicians have to start talking about the economic reforms we are expecting, so that businesses, investments, FDI can resume, even FDI’S can start inflow because that is what actually determines business stay in Nigeria. If we are a more diversified hotel industry which can tap into summer seasons, holiday seasons for foreign investors then that will be massive for us. And the advantage we hold here is this: Kenya and Gambia which are some of the biggest holiday sites in sub-Saharan Africa outside South Africa, really benefit from the summer season and other holiday seasons of foreign travellers, we are already doing very well in terms of the business side but if we can take care of the tourism side that means that our hotel will have all season times so they will operate well during the holiday season and off holiday seasons.
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1 Comments
This one among editorial competence of The Guardian newspaper of Nigeria; taking time and the right thinking to focus on sustainable aspects of Nigeria tourism with critical analysis of its economic indices and values.
This is away and above mire tourism news reportage, rather the Guardian editorial competence alert us on our economic achievements and the flaws in some areas and why with comparism on other African states that made progress and why. The point here is that Nigeria as the largest economy in Africa is not yet tapping from tourism as a global sector for economic recovery strategy.
We will review and take appropriate action.