Loss of Activity and Jobs in the African Tourism and Travel Industry

Tourism, an important sector of economic activity for many countries in Africa, will be heavily affected by COVID-19 with the generalization of travel restrictions, closing of borders and social distancing. IATA estimates the economic contribution of the air transport industry in Africa at US$ 55.8 billion dollars, supporting 6.2 million jobs and contributing 2.6% of GDP.

These restrictions affect international airlines including African giants Ethiopian Airlines, Egyptair, Kenya Airways, South African Airways, etc. The first effects will result in the partial unemployment of airlines staff and equipment. However, in normal times, airlines transport around 35% of world trade, and each job in air transport supports 24 others in the travel and tourism value chain, which creates around 70 million jobs (IATA, 2020). 

A communique from IATA indicated that “international bookings in Africa declined about 20% in March and April, domestic bookings declined about 15% in March and 25% in April. According to the latest data, that Ticket refunds increased by 75% in 2020 compared to the same period in 2019 (01 February – 11 March) “.

According to the same data, African airlines have already lost US$ 4.4 billion in revenue by March 11, 2020 due to COVID19. Ethiopian Airlines has indicated a loss of $190 million.

The number of tourists on the continent has continued to grow with an average annual growth rate of 5% in a constant proportion in recent years. Their number was around 70 million in 2019 and projected at 75 million in 2020 (UNWTO). Travel and tourism are one of the main engines of growth of the African economy, accounting for 8.5% of GDP in 2019 according to the World Tourism and Travel Council (WTTC).

For 15 African countries, the tourism sector represents more than 10% of the GDP and for 20 of the 55 African states, the share of tourism in the national wealth is more than 8%. This sector contributes much more to GDP in countries like Seychelles, Cape Verde and Mauritius (above 25% of GDP). Tourism employs more than a million people in each of the following countries: Nigeria, Ethiopia, South Africa, Kenya, and Tanzania. 

Tourism employment comprises more than 20 percent of total employment in Seychelles, Cape Verde, São Tomé and Príncipe, and Mauritius. During the past crises, including the 2008 financial crisis and the 2014 commodity price shock, African tourism experienced losses of up to $7.2 billion.

Under the average scenario, the tourism and travel sector in Africa could lose at least $50 billion due to the Covid 19 pandemic and at least 2 million direct and indirect jobs.

Source: AU