by Kemi Adeoye
What could have been
Nigeria was expected to be the fastest-growing hospitality
market with a projected 12 percent compound annual increase from 2019 to 2023
according to a PwC projection. In
early 2020 however,
the COVID-19 pandemic
spread globally, and
the tourism industry was one of
the worst-hit.
Globally, the tourism
industry contributes about 10 per cent to the
global GDP. This was
expected to rise
in four years
with significant upward
movement in Mauritius, Kenya, Nigeria, and South Africa.
In Nigeria, the contribution of travel and tourism to Nigeria’s GDP was 5.1 per
cent in 2019. In 2020 however, the upward trajectory slowed down due to the
pandemic.
With the ban on international and even local travel shortly
after the outbreak of the viral
infection in Nigeria,
non-essential travels were
suspended. Travel for
work and holidays were put on
hold and the nation as well as the rest of the world was forced to go
virtual as a
method of work
and entertainment. Due
to this, hotels,
tourist attractions, and air transportation were some of the industries
hinged on tourism that were badly affected.
Job loss in the travel and tourism industry
The World Travel & Tourism Council estimates that 1 in 10
workers in the world work in the hospitality industry. This translates to 1 in
10 workers losing their jobs as a result of the industry being grounded because
of the pandemic.
From March 2020 to around March 2021, many countries
announced a ban on international travel
and closure of restaurants and hotels while also limiting gatherings. All these
measures were put in place to reduce
the spread of the virus. However, they also
affected employment in the travel and hospitality sector.
The Regional Director
of the World
Travel and Tourism
Council, Andrew Brown revealed that “$4.5tn was lost by the tourism and
hospitality sectors as a result of the COVID-19 pandemic worldwide and over
770,000 jobs were lost in the sector in Nigeria alone.”
This figure also closely follows the estimation that 1 in 10
Nigerians lost his/her job in the
tourism industry which
also affected those
whose goods or
services are either directly or indirectly connected to it.
For example, the
production of in-flight
magazines in Nigeria
took a hit
when the tourism industry
suffered as a
result of the
pandemic. While magazine
production would be appropriately
considered a media
and communication sector,
its target audience is tied to
the travel industry which ultimately meant that those who worked in the
editorial, photography, copywriting, news gathering, typesetting, printing, and
distribution department of
the magazine lost
their jobs during
the aforementioned period.
Companies that also
provide cleaning services,
entertainment and advertising
for travel and tourism companies also had to lay off their workers,
reduce their pay or in some cases, keep them officially employed while not
paying them during the heat of the COVID-19 pandemic.
Beyond the examples mentioned above, there are more sectors
and industries whose existence is reliant on providing goods and services to
the tourism sector or are part of the supply chain that need the industry to
thrive for them to benefit. The people in these sectors belong to the so-called
‘other 9’ whose industries are not considered a part of travel and tourism but
essentially dependent on the sustained operation of the tourism sector for
survivability.
What does the future hold?
As the world
is trying to
adapt to the
changes brought by
the pandemic, the hospitality industry
is also making
a steady albeit
slow return. Research
by Jenny Southan, a travel editor
and founder of Globetrender, projected that “as people think more carefully
about the way
they travel, they
will seek out
hotels and travel companies that
are doing everything
they can to
minimise their impact
on the planet.
We can also expect accreditation to gain prominence, as
consumers look for reassurance from legitimate “eco-tourism” certifications
(Visitors) will want to book trips that
leave them feeling
better than before
when they return
home. Wellness tourism will be increasingly popular.”
Globally, there is
an optimistic projection
that the hospitality
industry will make a
remarkable return. However, only the prepared can make a quick return, and to
do so requires understanding the
uniquely changing needs
of customers
and clients. Nigeria needs
to take a
proactive approach in
order to be
at par with
global best practises and not
wait for others to take advantage of the relatively small market that is just
making a return.
A Harvard Business Review
article referenced partnerships between
or among companies as a means
for providing shortcuts for companies racing to improve their production efficiency
and quality control.
This symbiotic relationship
provides an essential opportunity
for rapid growth
in a period
where quick recovery
and adaptation to change is necessary.
According to Deloitte, “In
an environment of
dramatically lower revenues,
high fixed costs, less
than optimal asset returns, and
the need to
conserve capital,
hospitality organisations will
need to determine
which areas to
prioritise and invest in.
They will need
to find the
right balance between
investment and conservation, one that achieves
the highest ROI in the
near to medium
term. Some of these
decisions will endure;
others may not.
But the decisions made
in the months to
come will have
a lasting impact
on the operating
models of the hospitality sector for years to come.”
This level of
preparedness is evident
in the way
Radisson Blu Anchorage
Hotel, a respected hospitality
brand, and part
of Nigeria’s leading
investment holding company, Honeywell
Group Limited (HGL),
is fostering an
alliance with the
Bank of Industry to provide a
basis for the recovery of the hospitality industry in Nigeria.
This partnership is hinged on mutual respect nurtured by the
positive track record of Honeywell
group over the
years. Our impressive
performance before the
pandemic coupled with a sustained positive service delivery during the
pandemic shows a clear path of contributing toward the growth of Nigeria’s
economy.
Nigeria needs more of these important partnerships in the
hospitality sector to give it a much-needed boost.
Our relationship with the BOI has been a beneficial
relationship and the Bank of Industry has proven to be a valuable business partner. The bank has supported us in building our brand as a
foremost hospitality business.”
With this sort
of institutional support
long term, the
projected growth in
Nigeria’s tourism industry which faltered due to the pandemic, can
recover, and possibly reach the expected height.
According to Deloitte, “the COVID-19 pandemic will
eventually fade. The economy will
recover, and the
hospitality sector—from restaurants
to hotels, casinos
to sports—will regain its
footing and look
forward with confidence
to a successful, thriving future. Now
is the time
for companies to
act, adapt to the new
normal, position themselves for nimbleness, and thrive in the years
ahead.”
Article was written by Kemi Adeoye, Chief Financial Officer
at Honeywell Group Limited
0 comments:
Post a Comment