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PURPOSE OF PRESENTATION

NAMIBIA INTERNATIONAL INVESTORS CONFERENCE THE ECONOMIC IMPACT OF THE TOURISM SECTOR ON THE NAMIBIAN ECONOMY: THE TOURISM SATELLITE ACCOUNT Presented by Dr. K. Shangula 31 st November 2007 Windhoek, Namibia. PURPOSE OF PRESENTATION. BACKGROUND ON TOURISM SECTOR ITS IMPACT ON NATIONAL ECONOMY:

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PURPOSE OF PRESENTATION

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  1. NAMIBIA INTERNATIONAL INVESTORS CONFERENCETHE ECONOMIC IMPACT OF THE TOURISM SECTOR ON THE NAMIBIAN ECONOMY: THE TOURISM SATELLITE ACCOUNTPresented by Dr. K. Shangula31st November 2007Windhoek, Namibia

  2. PURPOSE OF PRESENTATION • BACKGROUND ON TOURISM SECTOR • ITS IMPACT ON NATIONAL ECONOMY: ♦ Foreign Exchange Earnings ♦ Employment Creation and Poverty Alleviation ♦ Its Contribution to National Income ♦ Its contribution to Governments Revenues • CHALLENGES • ACHIEVEMENTS: CBNRM focus • CONCLUSION 2

  3. BACKGROUND ON TOURISM SECTOR • Catalyst for national economic development • Since independence its share contribution to national economy has been increasing • Tourist arrivals increased from 254 978 in 1993 to 833 350 in 2006 • Downturn in number of arrivals in years 2001-2003 (terrorism, military conflicts, world economic recession) • Tourism arrivals normalize in 2004 • Namibia primarily a nature-based tourism destination 3

  4. Economic Impact of Tourism • ‘Multiplier’ impact makes tourism viable and valuable tool for socio-economic development • Impact of tourism segmented into 4 main components: ♦ Foreign Exchange Earnings ♦ Employment Creation and Poverty Alleviation ♦ Its Contribution to National Income ♦ Its contribution to Governments Revenues 4

  5. Economic Impact of Tourism:Foreign Exchange Earnings (FEE) • For 2006 gross receipts from international tourist arrivals is N$4.2 billion • FEE vital for sustaining development • Tourism generates much-needed foreign exchange • This has contributed to the diversification of the national economies 5

  6. Foreign Exchange Earnings cont… • Three important variables for the measurement of receipts from tourist: ♦Tourist arrivals: business travelers 102 489 (12.3%) ), visiting friends and relatives 309 632 (37.2%) and holiday traveler 405 904 (48.7%) ♦ Length of stay: ALS is 19 days ♦ Per diem: important to provide a “value for money’ 6

  7. Foreign Exchange Earnings 7

  8. positive growth in the number of accommodation establishments The growth of small and medium enterprise, particularly, in the rural areas, is contributing towards employment creation In 2006 the broader tourism economy was expected to create 71.800 (direct and indirect) Employment Creation 8

  9. Employment Creation • Of these, 18. 800 jobs will come from the tourism industry, which represent 4.7% of the country’s workforce. • It is forecasted that economic growth will result in 4.2% annual increase in jobs between 2007-2016. 9

  10. Tourism’s Contribution to National Income • Tourism Satellite Account (TSA) for 2006 was N$1.5 billion of the gross domestic product, which constitutes about 3.7% of total GDP. • Because of its ‘multiplier effect’ TSA contribution amount to N$6.7 billion. • N$1.3 billion was the estimated capital investment which constitutes 12.3% of total investment. 10

  11. Tourism’s contribution to Government Revenue: 2005/2006 • Park entrance fees 26 971 695.33 • Private telephone calls 300.00 • Film fees 70 900.00 • Unclaimed cheques 257 769.87 • Miscellaneous 239 449.50 • Departmental fines 17 049.10 • Tourists concessions 1 859 522.11 • Applications fees for gambling licences 43 200.00 • Wildlife registration and licences 176 800.00 • Wildlife utilization permits 215 245.00 • Aeronautical Taxes 1 000 000.00 • TOTAL 120 851 930.91 11

  12. CHALLENGES • Continuing growth of source markets, and diversification • Competition • Destination management • Offer value for money • Growing demand for responsible tourism • Demand for accurate and timely data for TSA • Challenge of management and leadership (lack of skills and expertise) • Lack of tourism marketing (at community level), promotion and operations skills 12

  13. Achievements: CBNRM focus • In 2006 CBNRM generated more than N$26 million. • Conservancies earned more than N$19 million ( approx. 73% of total CBNRM income). • Joint Venture Tourism: N$9 830 198 (51.6%). • Trophy hunting: N$6 075 868 (31.9%). • Small tourism enterprises: approx N$7 million. • Cash income to conservancies increased from N$592 467 in 1998 to N$14 506 221 in 2006. 13

  14. CONCLUSION • Tourism industry is growing fast in Namibia. • GOVT has made substantial direct financial investment in the tourism industry. • Concerted efforts needed from all stakeholders to spread benefits from tourism 14

  15. As investor, we invite you • To invest in trans-frontier conservation areas • To invest in conservancies. • To enter in Joint Ventures with Conservancies • To enter in Public-Private Partnership with Namibia Wildlife Resorts and Local Governments. 15

  16. As visitors we invite you: • To visit natural heritage of land:- Etosha, Sossusvlei, Fish River Canyon. • To visit rock art of earlier peoples. • To see wildlife. • To see remains of the German colonial past. • To enjoy the warms of Namibians and their hospitality. 16

  17. I THANK YOU 17

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