Exclusive: Egypt expects double-digit growth in tourism after recording second-fastest rate in North Africa
Tourism revenue grew 40 per cent year-on-year in 2018 and accounts for 20 per cent of gross domestic product
Egypt expects double-digit growth in its tourism sector this year after it rebounded in 2018, as Africa’s third-largest economy presses forward with investment in its transportation and aviation infrastructure, the country’s tourism minister said.
Egypt’s travel and tourism sector recovered last year, making it the second-fastest growing in North Africa after Ethiopia, accelerating at 16.5 per cent, ahead of the global average of 3.9 per cent, according to World Travel & Tourism Council.
“The government has done a lot in terms of investment in infrastructure for security and that has contributed to the rebound in tourism,” Rania Al Mashat told The National at the World Economic Forum at the Dead Sea.
“Yes, it’s going to be strong,” Ms Mashat said when asked if the sector’s pace of growth would be on par with last year. She declined to provide specific projections, however.
The 2011 uprising and resulting political turmoil in the country caused the economy to contract. The instability dented tourism, led to capital flight and a depreciation in the value of the Egyptian pound. However, with the help of the International Monetary Fund, the country’s economy expanded at about 5.5 per cent last year and is projected to grow 6 per cent this year.
Tourism revenue grew 40 per cent year-on-year in 2018, accounting for 20 per cent of gross domestic product. The tourism industry is the second-largest foreign exchange earner for the country and it sustains 2.5 million Egyptian jobs.
“We are putting a lot of emphasis on the two key elements of tourism development, which is the software - the investment in human capital matching the skills required with what is offered,” Ms Mashat said. “The second is the hardware, the infrastructure around hotels, and there we are upgrading the criteria for classification of hotels and engaging with international institutions that boost our competitiveness.”
International tourists spent over Dh46 billion in Egypt last year, according to the WTTC. The largest inbound international markets were: Germany (13 per cent); Russia (12 per cent); the UK (7 per cent); Saudi Arabia (6 per cent); and Italy (3 per cent).
The government is working on rolling out with the private sector a private equity fund that will bring investment into the tourism industry and also overhaul its hotels or help to build new ones, Ms Mashat said.
“We want to have anchor investors, as a government we won’t have money in there but we will be championing the fund, showcasing that the sector is very important for the country,” she said. “We are creating the structural reforms that are required so that it’s a winning sector for any investor who puts money in the country.”
The government is still finalising the details of the fund and how it will be managed, she said, declining to specify its size.
The country currently has 250,000 hotel rooms and more are likely to come online as new cities are being constructed.
The government is also in the process of opening or constructing new airports at key destinations across the country.
Updated: April 8, 2019 08:26 AM