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Tourism promotional budget to remain at sh2b in 2010/11

By Vision Reporter

Added 1st June 2010 03:00 AM

THE Government will not increase funding to the tourism sector in the next financial year.According to the national budget framework paper for 2010/11, the total allocation for Uganda Tourism Board (UTB) is projected to remain constant at sh2.05b.

By David Mugabe

THE Government will not increase funding to the tourism sector in the next financial year.According to the national budget framework paper for 2010/11, the total allocation for Uganda Tourism Board (UTB) is projected to remain constant at sh2.05b.

However, the figure is still subject to parliamentary approval. But sector experts believe a thorough lobbying process through Parliament and the higher executive could cause change.

In the 2009/2010 budget, UTB, the lead promotion agency received sh2b. Edwin Muzahura, the Tourism Uganda marketing and public relations manager, said the agency may seek other funding options in the event that the Government does not change its position.

“We will keep lobbying the Government. We still think the Government can rescind its position,” said Muzahura. Cuthbert Baguma, the new Tourism Uganda boss, disclosed that his agency needs sh22b to effectively sell the country’s rich attractions for better foreign earnings.

Top executives of UTB appeared before parliament recently presenting their case for additional budget boosts. But the visit was late because budget figures were already worked out.

Tourism is number three on the list of the national primary growth areas of the newly released National Development Plan coming after agriculture and forestry.

Following the enactment of the Tourism Bill in 2008, UTB was empowered to run the sector, a development that also meant some financial liberty.

“By implementing the tourism levy, we think we could generate some resources,” said Muzahura. UTB is empowered to collect 2% of the total expenditure bill generated by hotels.

The Tourism Act came into force in May 2009 after the President Yoweri Museveni assented to it in 2008. The Act gives the coordination role to UTB. The sector has not had effective legislation and has relied on the Hotels Act of 1964 and the Tourism Agency Act 1968.

“There was need to review this in view of the emerging role of the private sector,” said Muzahura. The tourism levy has been key in sustaining the tourism sector in Kenya and Tanzania.

Muzahura also said the agency is looking at another 2% levy on airport taxis as another source of income. Key on the agenda of UTB in the next financial year is to promote local and regional tourism that guards the sector from the uncertainties arising from external interruptions like the recent ash clouds that paralysed travel in mainland Europe.

The other is to focus the marketing on key prime markets, explore sustainable financing options as well as quality standards in the services industry like hotel grading.

In 2008, tourism contributed 9.2% or $1.2b to the gross domestic product while in Kenya, it brought in $3.5b or 10.8% to GDP according to the World Tourism and Travel Council (WTTC).

This variation maybe directly linked to the massive investment that Kenya puts into the sector. According to the draft corporate strategy plan 2009-2012, Kenya spends sh27 billion (ksh1 billion) in marketing alone.

Tourism arrivals increased from 512,000 in 2004 to 844,000 in 2008- an increase of 65% in under five years boosted by the commonwealth heads of government meeting (CHOGM) held here.

Kenya on the other hand had 1, 816,800 tourist visitors in 2008.

These comparisons experts argue provide strong insights to the value promotional cash provides in pushing not only arrival figures but also high end tourists that generate valuable revenue.

Kenya and Egypt are easily some of the biggest spenders on tourism promotion to the tune of sh189b combined.

Tourism promotional budget to remain at sh2b in 2010/11

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