Africa’s opportunity to boost growth by winning over Chinese tourists

The continent shows great untapped potential in the tourism segment according to the World Economic Forum.

By PHILIP MYBURGH

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With the number of Chinese outbound travellers surging each year, Africa has a ...
significant opportunity to boost its economic development through tourism.

The African tourism sector has made meaningful strides in recent years but is still barely scratching the surface of its potential.

Boasting an enviable natural environment as well as rich and diverse cultures, Africa could be poised for a tourism boom as international travel becomes more accessible amid a steady rise in global income.

1.4 BILLION PEOPLE

In particular, China’s population of about 1.4 billion people is increasingly looking for new experiences in foreign lands – a massive opportunity for African states that position themselves correctly.

According to the China Outbound Tourism Market 2019 - 2025 report, China’s outbound tourism market is set to surpass the $270 billion threshold by 2025.

Africa’s tour operators should consider gearing themselves up towards this segment of the market, particularly as the continent forges closer trade ties with the world’s second largest economy.

A report by Nielsen and Alibaba’s Alipay shows that Chinese travellers consider the availability of mobile payment platforms when choosing a destination.

Since these are ubiquitous in China, African merchants should consider adding these functionalities.

In choosing a destination, research shows that Chinese tourists are also concerned about issues such as travel safety, crime and dietary hygiene, while pricing and the ease of visa applications rank among the most important considerations.

POPULAR DESTINATIONS

Booking statistics show that Egypt, Mauritius, Kenya, Morocco, Tanzania, Tunisia and Ethiopia are doing a good job of courting the Chinese traveller – they are among the continent’s most popular destinations for Chinese tourists.

The full impact of these efforts should not be overlooked. The travel and tourism industry generated 8.5 per cent of Africa’s GDP in 2018 – nearly the same contribution as the health and banking sectors combined, according to a 2019 report by the World Travel & Tourism Council (WTTC).

The sector directly and indirectly employed 24.3 million people in Africa in 2018 – more jobs than the mining industry provides.

Yet in other markets that have positioned themselves as tourism hubs – partly by taking a regional approach – tourism makes up a bigger portion of the overall economic pie.

In the European Union (EU) for instance, the sector accounts for 10.1 per cent of GDP, the WTTC’s research shows.

Promisingly, Africa shows great untapped potential in the natural tourism segment, the World Economic Forum (WEF) says.

JOB CREATION

For the continent, the opportunity for further job creation and economic development is massive.

Aside from its direct contribution to the economy, the tourism industry stimulates demand for transport, telecommunications, financial services and local products sold through restaurants, grocery stores, and curio and clothing outlets. This in turn boosts other local sectors, including agriculture.

For now, tourism in Sub-Saharan Africa is held back by lower health and hygiene scores, less developed infrastructure, and challenges in promoting cultural and business travel, according to the WEF.

Sub-Saharan Africa’s tourism sector is making strides in the areas of digital capabilities, international openness and price competitiveness, with the West African region flagged as the continent’s most improved markets over the past two years.

To promote tourism, African countries should also consider removing visa constraints, linking up with neighbouring countries to jointly promote sub-regions, and jointly developing cross-border transportation links. Skills development will also be essential.

It is more important than ever that African states view tourism as a key tool in the pursuit of poverty alleviation, environmental protection and economic development, as envisioned in the United Nations’ 2030 Agenda for Sustainable Development.

Mr Myburgh is the Executive Head, Pan Africa China PBB at Standard Bank Group