Hoteliers are betting on the weakening shilling to lure international bargain hunters as Kenya embarks on an aggressive drive to win tourists back to its facilities.
A weak shilling raises the short term prospect of cutting holidaying and conferencing expenses for visitors holding hard currencies, says the Kenya Tourism Board (KTB), a State agency that markets the country’s attractions.
“The weakening shilling means we have cheaper inbound holidays,” chief executive Muriithi Ndegwa said at the launch of this year’s Magical Kenya Expo to be held in Kwale in October.
Kenya has lined up a massive international marketing programme in bid to win back tourists who have shunned the country in the past three years over security concerns.
The drive targeting both the emerging and traditional source markets follows recent allocation of Sh7.1 billion to revive tourism in the fiscal year that began this month. MPs have since slashed S00 million from the budget.
“Due to the lower purchasing power of the shilling, rooms quoted in Kenya shilling will cost a customer holding dollars much less, giving them the luxury of saving or extending their stay.
“Customers are able to book and pay less,” said Heritage Hotels chief executive Mohammed Hersi.
With the shilling having lost about seven units to the dollar since June, hoteliers say they are reaping the benefits.
“Fluctuations in the Kenyan currency means we now get more shillings per dollar from the stays, especially those that are being paid in dollars,” said Mr Hersi.
READ: Njoroge says shilling’s fall now beyond CBK control
In the long run, however, hoteliers expect the cost of running the premises to go up with increase in the prices of fuel and electricity, which are major expenses in the hotel business.
The tourism industry has taken a beating over the last year following the insecurity threats and travel aisories issued against the country. By May, international arrivals for 2015 had declined by 25 per cent to 284,313 from 381,278 for the same period last year.
Kenya’s conference tourism received a shot in the arm after the country hosted the Global Entrepreneurship Summit last weekend attended by US President Barack Obama and billionaires Richard Branson, Daymond Johnson of Fubu and Mark Cuban, among others.
In addition, the Africa First Ladies Conference on Cancer, World PR Conference and Africa Travel Association conferences will also be taking place before year end. The World Trade Organisation’s ministerial conference is slated for December.