By In2EastAfrica Reporter For over one decade or so, the country’s hospitality industry has seen some big strides with ne... thumbnail 1 summary

For over one decade or so, the country’s hospitality industry has seen some big strides with new investments in hotels. Still, there is high demand for more luxurious hotels in the central business district in Dar es Salaam.

Mr. Trevor Ward

Daily News Staff Writer GABRIEL NDERUMAKI had an interview recently with Trevor Ward, a specialist consultant in the hospitality and leisure industries on a variety of issues.
Q: Something about yourself and your involvement in the hospitality Industry
A: I am a hotel and tourism consultant, based in Lagos, Nigeria and have worked in the industry for almost 40 years. I have a university degree in hotel management and have been a consultant for 30 years. I have lived in Nigeria for almost 10 years, travelling all over Africa advising on new development, operations and branding.
Q: Why are you visiting Dar es Salaam?
A: I am advising a client, who has asked me to undertake a market and financial appraisal of their proposed hotel project in the new central business district in Dar es Salaam. They are looking to build a new hotel with extensive facilities, to cater to the growing number of visitors to the city.
Q: Tanzania is regarded as among the top 20 fastest growing economies in the world. Yet, the hotel industry has not matched up with these economic changes. What is your comment about this and if you think the country is on the right track as far as the sector is concerned?
A: I think your observation is correct, in that other fastgrowing economies in Africa, such as Angola, Ghana, Nigeria, Kenya and Ethiopia have seen a lot more activity than there has been in Tanzania. Having said that, there has been some activity in the tourist spots, such as Zanzibar. It is Dar es Salaam that has missed out, resulting in a shortage of hotel rooms there. Partly, this is because of the crowded nature of the city centre, where finding adequately-sized plots of land for hotel building is extremely difficult. Our client appears to have the only sizeable piece of land that will allow for adequate parking and conference facilities, important facilities that some existing hotels lack. The recently concluded African Hotel Investment Forum (AHIF2012) held in Nairobi in September, proved the strength of interest in the African hotel industry in general and the East African industry in particular – more than 400 delegates met at the event, including senior executives from the international hotel chains and investors in hotels and several deals were done there.
Q: In your view, what is driving the demand for hotel rooms in Dar es Salaam?
A: The hotel market in Dar es Salaam is almost business-related, with a small amount of residential, conference and aircrew. There is a direct correlation between economic growth, particularly which is led by new investment and demand for hotel accommodation. And the more an economy diversifies, the greater the resultant growth in hotel demands. So Tanzania, with massive growth in the construction sector and in the oil & gas industry, is experiencing growth in arrivals – in 2011, there were 14 per cent more aircraft movements and 15 per cent more passenger movements at JNIA than the previous year and the majority of these passengers need hotel accommodation. New airlines, such as Turkish, are helping to generate the increase in passenger numbers, but at the end of the day it is the Tanzanian economy and of course the strength of the tourism product, in all its rich diversity that is the real cause. Hotels are an essential part of any city’s commercial infrastructure and the growth in room stock can itself contribute to attracting new investment in other sectors, as investors look more favourably on the environment as a whole – so long as other infrastructure such as transportation, power, water and communications also improve. A virtuous circle, so to speak.
Q: You talk of increasing tourist arrivals as one of the key demand drives. In your opinion when did Tanzania pick up on the trade on what factors have contributed to this?
A: I think I have answered this but let me add that it happened more from mid 90s following Serena’s investment in the northern game lodges and Zanzibar as it kick-started the process. Furthermore, Tanzania’s reputation as a stable and peaceful country with hospitable people has also strongly contributed to the increasing numbers of visitors.
Q: It’s a fact that Tanzania’s neighbours like Kenya and Rwanda have made some good progress in the hospitality industry. Do you think the country is somewhere close to what is happening in the two countries in the hospitality industry?
A: Kenya is Tanzania’s main rival when it comes to the leisure tourism product and has had a head start. Nairobi is a major regional hub, with considerably more flights than JNIA and that has helped the Kenyan tourism trade enormously. In addition, the Kenyan government has funded the marketing of the country’s tourism product, to a greater extent than has the Tanzanian government.
The policy makers need to recognise that the tourism industry deserves public support and that investment of public money in the industry brings enormous returns, in terms of creating employment (particularly for women and for unskilled and semi-skilled workers and in areas where few other employment opportunities exist), tax revenues, foreign exchange earnings and so on. Rwanda has much more of a “special interest” tourism product than either Kenya or Tanzania, so is likely to continue to be a “niche” player. In my opinion Tanzania can, with the political will and support, easily catch up with Kenya.
Q: What do you think is the government’s role to attract new investments in the hospitality industry?
A: In one word, “facilitation.” Government is there to create an environment which is conducive to private sector investors, who have the option of investing elsewhere if the process is easier and the returns better. There are some useful tax exemptions and reductions in Tanzania, but the bureaucracy in obtaining permissions and permits can be overwhelming, particularly for overseas investors who don’t “know the system.” However, I must say that the Ministry of Tourism is very supportive of new developments and this is indeed commendable. Another role