Tourism sector faces viability challenges

down operations citing viability problems at a time when the industry is said to be growing.
According to council records, Sprayview Hotel had its water supplies disconnected last December amid revelations that it owed the municipality about $27 000 in unpaid water tariffs.
Other hotels managed to avert water disconnections after agreeing payment plans with the municipality.
While the tourism sector was hyped as one of the fastest emerging economic sectors last year and projected to grow by 13,7 percent this year and reaching up to 15 percent in the year 2015, market performance of the country’s top tourism and hospitality companies is showing otherwise.
Last year alone, A&K, &Beyond and Kalambeza Safaris were some of the notable companies that folded.
Another big company, United Touring Company popularly known as UTC also streamlined its operations.
As these and other companies folded operations, the country according to the Zimbabwe Tourism Authority (ZTA), recorded a 10 percent average rise in foreign tourist arrivals between 2009 and the first half 2011.
According to a report compiled by the Zimbabwe Tourism Authority (ZTA), the country had since dollarisation registered growth in foreign tourist arrivals.
In 2009, there was a three percent increase in arrivals on average. In 2010, arrivals grew by 11 percent while they grew by 16 percent in 2011.
The first half of 2011 recorded 657 302 tourist arrivals, representing a 16 percent increase from the 568 706 recorded in 2010.
In separate interviews, tour and adventure operators said while there had been a notable upsurge in arrivals, the sector was still reeling under the effects of the economic meltdown experienced in the last decade.
“For close to 10 or so years, we were making losses as the tourism sector. Arrivals were very low and companies struggled for survival. Now after the introduction of the multi-currency system, the debts are now catching up with us.
“The profits we are making, if any, are going to service debts incurred when the economy was virtually down.
“So some are falling by the wayside and those with a strong financial background are staying afloat while others are sinking,” said a manager from a tour company.
Mr Ben Tesa, the managing director of Khanondo Safaris, said increased volumes would take time to reflect on the balance sheets of some companies as they had borrowed at prohibitive rates during the era of hyper-inflation.