In the wake of the Covid-19 pandemic, the global travel and hospitality industry have been hit harder than say, manufacturing, because free movement of people and goods set the pace for international trade and tourism.
With governments all over the world imposing staggered lockdowns at various interludes during the past eight months, the hospitality industry has seen sharply reduced hotel occupancy leading to mass lay-offs of employees and revenue losses running into several billions of dollars.
Before the Coronavirus struck, Uganda was earning US$1.5 billion annually from tourism. Since the first case was reported in Uganda late March, the local industry has suffered.
Never in our wildest dreams did we imagine that we would be hit by a pandemic of this magnitude, in both scale and velocity of its spread.
Unfortunately, this pandemic found us — like so many other industries around the world — without any contingency measures,” Susan Muhwezi, the Chairperson of the Uganda Hotel Owners Association (UHOA) told Nnyonyi recently.
She added: “No insurance could cover this and we had no Plan B. As a result, the hotels took a very big hit both financially and operationally. Eight in 10 hotels had cancellations in reservations in the period March to June 2020, creating a very big deficit in hotel operations in Uganda. Covid-19 and the subsequent measures implemented to contain it has cost hotels US$320 million in business thus far, with projections indicating that figure will have risen to half a billion dollars by end December 2020.
Providing more details, Mrs. Muhwezi said 156,718 ( or 57.2%) of all staff were on unpaid leave while 94,512 (34.5%) experienced pay cuts, and 2,705 (1%) laid off.
The UHOA chief said the Association had approached the government through the Ministry of Finance, requesting for a stimulus package to help with operational costs and salvage staff retention.
“We are very happy to note that in partnership with fellow private sector stakeholders, UHOA was able to negotiate a stimulus package funded by the Uganda Development Bank (UDB) and the European Union (EU).” she said.
Over 50 UHOA members have applied. UHOA will measure the impact of these funds in early 2021 based on the recipients feedback.” she added. UDB disbursements will be in December.
Mrs. Muhwezi said the Association had also stepped up campaigns to encourage domestic tourism. This is a counter measure while waiting for foreign visitor numbers to pick up after the reopening of Entebbe International Airport.
“The quintessential strategy we employed was the review of the hotel accommodation rates to take into account the new normal. We are very much aware that even the domestic class we are currently marketing to has also been hit by the pandemic. People no longer had as much spending power as they did before. To accommodate this, many of the hotels substantially reduced their prices — with several charging in shillings rather than dollars — and many of the tour operators had created special tourism packages for domestic families to be able to travel more and stay longer at the hotels.
UHOA Chairperson added: “We are grateful that our government took the time to ensure safety precautions were in place before reopening the airport. However, the international arrivals have been very low and will be even lower due to the second pandemic wave and new lockdowns in our source markets. The impact of reopening of the airport has not yet been felt in the hotels, but we are optimistic that this will improve in mid-2021 after the National Elections have taken place and the second waves in the various source markets have subsided.
Turning to the requirements of the New Normal and Mrs. Muhwezi said UHOA was part of government and private sector initiatives that developed SOPs for hotels and lodges in Uganda. While Mrs. Muhwezi is confident about the capacity of the Ugandan hospitality industry to weather the Covid-19 situation, there were still factors that continued to work against them. “This festive season will be unlike all the other previous seasons. A few hotels have closed shop.
Many of our staff have been furloughed since March, and most people that usually travel around the festive season no longer have as much disposable income as they did before. Despite all this, we have so much to be grateful for this year and we hope that the celebration of life in 2020 will have an appreciated poignancy during the year’s holiday season.”
- Started in May 2000 with 9 members
- Founded by Dr B.M Kibirige the proprietor of Hotel Africana in Kampala
- Currently has 600 members
- The secretariat is in Kampala led by a CEO.
- Mrs. Muhwezi is the first female Chairperson of the UHOA
- In July 2019 she was voted unopposed for a second term of office as Chairlady of UHOA.