ZIMBABWE’S Tourism Minister Walter Mzembi is having a tough time convincing government to scrap a 15% tax on accommodation for foreign visitors, which he says makes the country a more expensive and less competitive tourism destination. It appears, he has bigger problems to worry about.
While the tax situation is clearly a drawback to Mzembi’s targeted US$5 billion annual tourism contribution to GDP by 2020 from about US$1 billion in 2013, the country’s political situation leaves a lot to be desired and is mainly responsible for Zimbabwe’s poor rankings in the 2015 World Economic Forum Travel and Tourism Competitive Report.
Furthermore, an impractical bad pricing system with high hotel and transport rates is also a setback to Zimbabwe’s tourism at a time the sector battles to deal with other challenges such as heavy police presence on the highways and corruption.
The Tourism minister this week missed a Parliamentary briefing in which he was meant to lobby against the 15% tax, seen hitting arrivals, and is now expected to appear in the lower house next week. In an interview on Tuesday, Mzembi could not be drawn to comment on the subject of tax on grounds, saying it would pre-empt his presentation.
He however said: “The sector should not be taxed to death.”
According to the travel and tourism report, which was released last week, Zimbabwe is ranked among the worst tourism destinations in the world at number 115 out of 141 countries.
In Africa, Zimbabwe ranks 15th behind South Africa, Seychelles, Mauritius and Kenya which are ranked first, second, third and fourth respectively.
Zimbabwe’s ranking in the region was also behind countries like Botswana, Tanzania, Rwanda and Zambia which ranked seventh, eight, ninth and tenth respectively.
The ranking methodology is based on what is called the Travel and Tourism Competitive Index which has four sub-indexes, the first sub index is the enabling environment which captures the general settings –business environment, safety and security, health and hygiene, human resources and labour market as well as ICT readiness- necessary for operating in a country.
Zimbabwe has perennially performed badly in the world doing business index due to poor respect for property rights, bad governance and policy inconsistency. In the travel and tourism index, Zimbabwe ranked 138th on the business environment, only ahead of three countries-Chad, Argentina and Venezuela.
The second sub index is the travel and tourism policy and enabling conditions sub index which captures specific policies or strategic aspects that impact the travel and tourism industry more directly such as prioritisation of travel and tourism, international openness, price competitiveness and environmental sustainability while the infrastructure sub index captures the availability and quality of physical infrastructure of each economy specifically air transport infrastructure, ground and port infrastructure, tourist service infrastructure.
Zimbabwe was ranked 74th on safety and security, 115th on ICT readiness and 130th on health and hygiene.
Lastly, the natural and cultural resources sub index captures the principal “reasons to travel” bring natural resources, cultural resources and business travel.
Zimbabwe’s best ranking is on pricing competitiveness at number 44, but it appears the situation will change for the worst after introduction of the new tax.
Mzembi said the global tourism report was misinformed and based on wrong perceptions of Zimbabwe.
“I object to this, my country is very attractive and I invite everyone to come and witness it. The problem we have is just perception and the day we sit down as a people and say Zimbabwe should not be known for bad things is the day it ends,” said the minister, adding ,“For us to be attractive we must win the perception war blow by blow and we need collective effort.”
Although Mzembi was quick to dismiss the report, the media is always awash with numerous reports of politically-motivated violence and policy discord.
Furthermore, hotel operators under the Hospitality Association of Zimbabwe are on record saying the country’s transport network is poor and costing them business.
The situation is however expected to keep improving after introduction of flights into the resort towns of Kariba and Victoria falls by flag carrier air Zimbabwe.
Last week, Air Zimbabwe’s Airbus A320 returned from South African technical where it was undergoing technical checks. It will boost air transport in the country in terms of flight frequencies and capacity.
However, the cost of transport remains a hindrance with a return flight between Harare and Victoria Falls on the national airline going for at least US$200 per passenger while a return ticket from Harare to Johannesburg goes for at least US$290 based on Air Zimbabwe’s flyers.
Tourists who choose to endure a 12 hour road trip between Harare and Victoria Falls for instance will have to part with US$130 for a return ticket on the luxury coaches, a situation believed to be stifling domestic tourism. Furthermore, the cost of accommodation per night goes for around US$125 per head for a decent hotel room in the resort areas.