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Business Reporter
Most players in the tourism sector are small to medium enterprises and do not have the financial muscle to go for months without generating income, Environment, Tourism and Hospitality Industry Minister Mangaliso Ndlovu has said.
Due to the Caovid-19 travel restrictions and global lockdown measures, the tourism sector across the globe has been the hardest hit as players have lost potential revenue.
Zimbabwe has not been spared from the effects with some operators reported to have closed down leaving thousands of people in the sector jobless.
Presenting his 2020 Mid-Term Budget Review last week, Finance and Economic Development Minister Mthuli Ncube said, indications are that the subsector will contract by 7,4 percent in 2020.
On his part Minister Ndlovu said the sector might only generate US$300 million this year out of earlier projections of US$1,3 billion.
Speaking on Capitalk FM’s “Strait Talk” programme, Minister Ndlovu said even the few bigger players in the economy are now struggling to meet operating costs as some have remained closed whilst others have partially opened.
“Most players in the industry are small to medium, and there are very few big players in the industry who might have reserves or the financial muscle to sustain such a huge shock.
He said within the country a number of small players had literally closed down.
“But even the big players, really, they are feeling the hit. You cannot go for four months paying your workers even if its half pay without any income,” said Minister Ndlovu.
He said if the sector opens, it might only operate at around 25 percent of its capacity still, all this depending on the timing of reopening adding that this could be in September or October.
“Reopening will also depend on the development of the virus.
“We are currently quite worried about the trend, and we will be watching that story,” Minister Ndlovu said.
As of July 21, Zimbabwe had 1 713 confirmed cases, including 472 recoveries and twenty-six (26) deaths.
Online Reporter