By Ndafadza Madanha
PLAYERS in the tourism sector are upbeat that the 5 percent export incentive extended to them by the Reserve Bank of Zimbabwe (RBZ) will help in restoring competitiveness and bolster foreign currency generation.
Zimbabwe Council of Tourism (ZCT) president, Tich Hwingwiri said the incentive will cushion operators once foreign currency receipts improve.
“We welcome the incentive which will cushion operators once the foreign receipts increase significantly. Destinations that attract foreign visitors such as Victoria Falls and cities such as Harare will benefit more compared to the other destinations such as Nyanga which are predominantly driven by the local market. It is a game of numbers,” said Hwingwiri.
Presenting his monetary statement earlier in the year RBZ governor John Mangudya, announced a 5 percent incentive as it sought to cushion the sector against the weakening rand which had adversely affected Zimbabwe’s competitiveness as a destination compared to regional peers.
“In view of the above, the Bank is extending the export incentive scheme to the tourism industry to reward the industry’s contribution to foreign exchange generation.
This policy stance is taken in view of the loss of competitiveness of the industry manly due to price differential between Zimbabwe and the region.
The depreciation South African rand and other regional currencies affects the price competitiveness of the country’s tourism industry considering that the bulk of inbound tourists come from Africa, particularly South Africa.
In view of this, Zimbabwe becomes more expensive as a tourist destination as the US$ strengthens against the regional currencies.
The export incentive scheme is therefore expected to provide some cushion to allow the tourism sector to adjust prices to remain competitive,” said Mangudya.
According to the ministry of Finance and Economic development the tourism sector is expected to grow by 0.8% this year.
The lackluster growth in the industry has been compounded by the prevailing unconducive number of non-security/crime roadblocks on our roads.