Economy

Sh2.3bn allocated for tourism revival

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Tourists at the Maasai Mara Game Reserve. FILE PHOTO | NATION MEDIA GROUP

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Summary

  • The government has allocated Sh2.3 billion to the tourism sector to help it recover from an economic fallout caused by the coronavirus.
  • Kenya's tourism sector was hit hard after the government banned all local and international flights in March, resulting in low tourist traffic at hotels.

The government has allocated Sh2.3 billion to the tourism sector to help it recover from an economic fallout caused by the coronavirus.

The Treasury allocated Sh1.7 billion to the Tourism Fund and Sh643 million to the Tourism Promotion Fund to help lift the sector battered by the effects of the pandemic which restricted travel.

Kenya's tourism sector was hit hard after the government banned all local and international flights in March, resulting in low tourist traffic at hotels.

Data from the Kenya National Bureau of Statistics (KNBS) showed that international arrivals dropped from 1.54 million in 2019 to 439,447 in 2020.

“The outbreak of the Covid-19 Pandemic and the ensuing containment measures significantly affected tourism, sports, culture, and arts sectors.

“To support the recovery of these sectors, I have proposed an allocation of Sh1.7 billion for the Tourism Fund; Sh643.0 million for Tourism Promotion Fund,” the Ministry of Finance Cabinet Secretary Ukur Yatani said while reading the budget at the Parliament.



This comes on the back of similar stimulus packages introduced by the government last year such as a Sh2 billion stimulus package as well as the Sh10 billion State-backed credit scheme to help the sector recover.

Despite allocation, the industry continues to incur losses as the number of tourists remains low. For instance, the sector lost Sh80 billion in the first six months of 2020.

This comes even as the Tourism Research Institute (TRI) estimated that it will take another three years before arrivals in Kenya rebound to the pre-Covid levels, pointing to prolonged pain for sector players who have been the worst hit by the economic fallout from the pandemic.

The institute said it expects international visitors to hit 2.2 million in 2024, slightly surpassing the 2.1 million visitors in 2019 when the industry had one of its best years.