Uganda: Tourism Sector Requires More Funding

By Baluku Geoffrey
Kampala, Uganda

Tourism has become one of the worlds fastest growing industries and hence forth an economic catalyst bringing earnings to countries in form of foreign exchange. The tourism industry continues to enjoy above average results and has for the past few years recorded sustained growth as high lighted in the United Nations World Tourism Organization (UNWTO) report "Tourism Highlights 2007".

In Uganda, tourism contributes nearly 26% of the country's total export earnings and also provides vital employment for people with a wide range of skills as well as the unskilled. Take for instance the hospitality sub sector alone employs country wide an estimated 59,000 people with the related transport sector accounting for another 18,000 jobs.

In as much as the above statistics have made government identify the tourism industry as one of its key priority economic sectors, there is little to show from its input. From Hon. Suruma's proposed budget for financial years 2008 / 2009, it is evident that government continues to deliberately under fund tourism.

The tourism sector brought in US$449 into the economy of Uganda last year (2007). However, from the sector allocations proposed by the finance minister, a meager 5% was allocated to the tourism, trade and Industry ministry. It is vital for government to stop paying lip service and put some meat on the skeleton.

Efforts must be made to increase funding to the sector if Uganda is to remain relevant in the tourist trade. Government seems to be behaving like a herdsman that keeps milking his cows with out feeding them.

What would you expect from such a cow? It is surely not enough for government to say so much about tourism and the economy's growth without making something tangible for it to prosper in real terms. 

Tourism as we all know operates in a market economy and it's subject to international forces. New destinations emerge and others decline because they are under cut on prices or become un fashionable. 

From a survey carried out through some of the trade fairs across the United States, Europe and South Africa, it was noted that Uganda was largely a blank page. If we are to put Uganda on the world map, then there is need to strengthen Tourism Uganda (formerly Uganda Tourist Board). Tourism Uganda (UTB) was created in 1994 by statute to operate as the government's tourism marketing arm.

Despite the continued under funding, the board is charged with the promotion of Uganda in the domestic and international arena. The tourism product is an amalgam of accommodation, tourist attractions, entertainment, catering and transport. The passing of the tourism bill and governments proposal to increase development spending by allocating about 1.1 trillion (about US$687.5 million) to the roads sector are all welcome moves that will go a long way in improving the tourism product.

However, this alone will not ease the problem of funding to the sector. Government should treat UTB (Tourism Uganda) as a baby who crawls before he or she walks. There is also need to improve further / strengthen the relationship between the private and public sector. Take for instance the membership of the Association of Uganda Tour Operators (AUTO) have in the past few years been the biggest marketers of our country's tourism resources. This association recently elected a vibrant new board to steer its interests for the next two years. 

All the association needs is waivers in the areas of tax such as zero rate on VAT plus incentives in monetary terms so as to enable the members cut on marketing costs. Supporting UTB and AUTO will surely be an important leverage not only to winching Uganda out of poverty but also lead to the growth of the tourism industry. If funding is increased, the tour operators will then find it easy to attend international trade fairs that are considered the biggest one stop marketing points of tourism around the world. 

Among the big travel shows are WTM in London, ITB in Germany, JATA in Japan, COTTM in China, INDABA in Durban South Africa, FITUR, some in Spain, USA and of recent the ever growing KARIBU fair in Tanzania. Regionally our neighbors that include Tanzania, Kenya and of recent Rwanda have increased funding to their tourism sectors which is evident from not only the publicity they are getting but also the increased number of tourists to their countries.

Thus if Uganda is to become or remain competitive, then there is surely need for government not only to increase funding but should also consider zero rating VAT on tour operator services as this will enable us compete favourably.