The Cabinet is discussing an urgent solution to the financial situation of the Namibian Tourism Board, whose coffers will soon dry up as the tourism sector continues to suffer amid the Covid-19 pandemic.
This comes after the director general of the Namibian Tourism Board (NTB), Digu // Noabeb, confirmed that their financial situation continues to deteriorate.
In May, // Noabeb said the board needed to draw on its cash reserves at this point and speculated that if the situation remained the same, NTB would run out of reserves by October.
The situation has now turned dire with Public Enterprise Minister Leon Jooste confirming that the issue has reached Cabinet. He also said he communicated with Environment, Forestry and Tourism Minister Pohamba Shifeta and Finance Minister Iipumbu Shiimi to resolve the situation.
Jooste said that NTB’s challenges will be taken up by the Ministry of Tourism. Meanwhile, Shifeta confirmed that NTB was in dire financial straits, but asked tourism director Zebulun Chicalu questions.
Chicalu had not provided a comment at the time of the newspaper’s printing, saying he had to coordinate with finance first before providing an update.
Earlier information provided by NTB indicated that it had a healthy cash reserve of N $ 30.2 million before the pandemic.
The tourism organization earns money through levies collected from tourist establishments, as well as an annual government budget. Annually, NTB’s levy income is estimated to be between N $ 45 million and N $ 55 million.
Now the board finds itself hanging by a thread as the sector continues to weaken under pressure from a sluggish tourism sector. Due to Covid-19, there has been a drastic reduction in hotel occupancy rates and international tourist arrivals in Namibia.
“OCCUPANCY REMAINS LOW”
While occupancy levels in the hospitality sector remained low in August, which is typically one of the busiest and busiest months for tourism, the occupancy rate was comparatively higher this year. than at the same time last year. This is according to statistics provided by the Hospitality Association of Namibia (HAN).
Some 14,311 rooms were sold in August 2021 compared to only 6,977 in August 2020. According to Gitta Paetzold, CEO of HAN, this is still far from what the country recorded before Covid.
In 2019, that same period recorded an occupancy rate of around 67%, representing 79,398 rooms sold that month.
“It is nice to note that in August 2021, we could more than double the performance compared to last year to reach almost 20% occupancy, compared to just over 8% last year. But this is only due to the very low base, as August 2020 was the last month the borders were closed, hence the very low occupation at the time.
“Right now we’re not even a third of the normal tourist flow,” Paetzold said.
With the tourism and hospitality sector being one of the major contributors to the country’s gross domestic profit, considerable efforts have been made to revive the sector amid the pandemic.
Paetzold said the current flow of tourism to Namibia is encouraging and relaxed restrictions will help boost travel.
“The easing of restrictions and more countries recognizing Namibia as an ideal low-risk travel destination could help us move towards our goal of a reasonable recovery in tourism for the remainder of the year,” said she declared.
Institutions like the NTB are dependent on this renewal because the survival of the tourism industry depends on it.