LATE last month, the Kenya Tourist Board released a statement claiming that Kenya’s tourist arrival numbers during the first four months of this year had fallen a mere 4% from a year earlier, to 381,000.
To this, Tourism Promotion Services Eastern Africa, which operates the Serena chain of hotels, luxury lodges and tented camps, replied: "You must be joking!"
Accusations that the tourism board was out of touch with reality followed in the Tourism Promotion Services statement, in which it also questioned if the board and those in the Kenyan tourism industry lived in the same country.
According to Tourism Promotion Services, tourist numbers fell 30%-50%, with those in the Maasai Mara falling at least 20%. In its defence, the tourism board said its figures were collected before last month’s Lamu attacks and, as a result, did not reflect the complex setbacks that had since faced Kenya as far as tourism was concerned.
This year, Kenya’s economy has been walloped by a wave of terrorist attacks, including the brazen raid in Lamu that killed more than 40 people.
Tourism has been one of the hardest hit sectors of the economy, with several countries issuing warnings against nonessential travel to Kenya.
Political uncertainty, especially around the Saba Saba Day rallies on July 7, contributed to doubt about the country’s future. Despite all of this, the forecast is not all doom and gloom.
Kenya recently issued Africa’s biggest debut eurobond for an impressive $2bn, and the deal was so oversubscribed — Morgan Stanley was among the investors — that the cost of the loan was substantially lower than had been expected.
There are new roads everywhere, and new bridges and huge malls being dug out of hillsides. So while one sector of the economy is evidently affected by various complex factors, it would seem that other aspects continue to thrive due to the country’s diversified economy.
Kenya’s middle class is worthy of note. The African Development Bank says about 16.8% of Kenyans belong to the middle class — people capable of spending $2-$20 a day.
However, the World Bank estimates that less than 2% of Kenya’s population belongs to the global middle class — people capable of spending $10-$20 a day.
Nevertheless, it would seem that to remedy its present malaise, Kenya’s tourist industry has begun to target domestic tourists as an alternative market.
This year, the tourism board shot an advertisement to promote domestic tourism. The premise of the advertisement was to persuade Kenyans to spend less money and time drinking and watching English Premier League football at home, and instead to travel more to appreciate the country’s famed tourist sites.
This is a valid premise when you consider that Kenya is Africa’s third-biggest beer market, according to Euromonitor.
Kenya’s alcohol economy is booming, and at a glance it would seem that Kenya’s favourite destination is indeed the bottom of a beer bottle.
During 2012, key international companies sought to penetrate the Kenyan market further in order to tap into the growing domestic demand for alcoholic drinks.
Heineken set up an office in the country to oversee brand advertising and distribution, putting the fate of Maxam, its local distributor, in its hands.
Diageo, which owns East African Breweries, oversaw the roll-out of key new brands such as Tusker Lite and Snapp, while the company’s popular Senator Keg brand led volume sales.
Distell threatened to sever ties with Kenya Wine Agencies, a government-owned wine and spirits distributor, as it felt persistent delays in privatising the entity were interfering with its strategic expansion plans — a matter that was settled out of court.
SABMiller, which owns 29% of Distell, recently acquired Crown Beverages to secure a firm foothold in the region and lock horns with the industry giant, East African Breweries. The most notable local producer that has not yet fallen prey to this multinational encroachment is Keroche Breweries, which has expansion plans of its own as it seeks to battle it out with the big guns for market share.
Kenya’s diversified economy is a unique one to watch.
This year and next, it will be interesting to see whether the tourism board will succeed in winning middle-class Kenyans’ share of wallet, or whether beer will continue its reign as the choice of pastimes and revelry.
• Maingi is a Nairobi-based brand management and strategy expert.
Post a comment