Why the Recession will Grow Nigeria’s Travel & Hospitality
Industry
The International Monetary Funds (IMF) predicted in 2015 that
Nigeria’s economy will slide into a recession in 2016 by 1.8 per cent. The
forecast indicated that our economy will grow at a much slower pace than South
Africa’s. Months after the prediction, truly Nigeria slipped into a recession.
Everywhere around the world, recession is one of the most dreaded economic
downturns. The reasons - although not far-fetched – include, but not limited
to, drop in stock market, hike in unemployment, salary cuts in most private
establishments and monumental decline in housing market. Many economy and
non-economy experts have weighed in on the ways to curb the ripple effects of
this monster that has clutched its fist on commerce and trade. But like they
say, talk is cheap. Recently, I heard in the news that the Minister of Finance,
Mrs. Kemi Adeosun, out of her many ‘un-put-down-able’ rhetorics on how to
revive the economy and chase out recession, had said the commencement of rice
production in some parts of the country will deal a major positive blow on the
recession. Well, I’d like to think she was quoted out of context because I
can’t think of any immediate impact rice production will have on the economy
right now. But then again, what do I know about the economics of a country?
Absolutely nothing!
Our fears and worries about the ugly reality of where we’re at
this point in time are completely not misplaced. We have reasons to quake with
fear. Prices of items have shot up like never before. And sadly, revenue/income
has remained firmly reluctant to grow. Not too long ago, I saw a meme that was
circulated on social media which compared very aptly the rising costs of living
to a student who passes his exams and moves from one class to the other, and
income to a student who has been repeating same class with no hope of
graduating to a new class. While the meme was very amusing, it passed a very
serious message in a comical way but the underlining truth could not be missed
for those who could read between the lines.
Nonetheless, this doesn’t mean that the things a recession carries
around are mere economic vices. A number of macro economy experts have made
deliberate efforts to shift our attentions to the equally promising
opportunities that a recession promises. While it may be highly improbable to
sell these opportunities to anyone, I think they are surprisingly appealing,
depending on what side of the divide you are. As a travel and tourism
enthusiast, I am always on the look-out for bright and ingenious ideas on how
to grow our hospitality sector. I led myself to a lot of mind-boggling and
quizzical conversations on how to rewrite a better destiny for this sector. And
so, an economy in a recession, as far as I am concerned, is not a threat to
this sector. Rather, it will boost its growth and the attendant benefits are
the ingredients we need to promote the sector.
Recently, Jumia Travel’s global CEO, Paul Midy was in the country
on a week-long working visit. During his stay, a number of journalists dropped
by our office to have a quick chat with him. Although, more than 90% of these
distinguished journalists intended to inquire if Jumia Travel will be
relocating office from Nigeria due to the recession and also find out what the
company was planning to do to stay afloat in business. They all came prepared,
each of them hoping to be the first to break the news of the company’s decision
to pack its business from Nigeria and relocate to any of the more economically
stable African countries. Sadly, the CEO’s response was indeed the most
shocking comment they had ever received from any top boss they have spoken to
since the recession paralyzed the economy. Paul quickly dismissed their
speculations on any plot to relocate. He stated that the recession makes our
business more lucrative and profitable. The shock on their faces betrayed their
expectations.
“The reason, he continued, is because recession has made the
country a cheaper place to do business. The fall in the value of naira makes it
cheaper for people who want to trade with Nigeria and for businessmen and women
to travel through Nigeria to other destinations both in Africa and beyond. We
know that many foreign firms are withdrawing from Nigeria but we are instead
increasing our investment because Nigeria is our core market and with the
depreciating value of the naira, goods from this part of Africa have become
very cheap for our customers in other parts of Africa. We see recession as a
short term and mid-term situation but in the long term, Nigeria is still the
strongest market with almost 200 million people.”
The recession has restricted a number of Nigerians to the shores
of the country to spend their vacations. It is therefore not surprising that
hotel booking portals have received an unprecedented requests from well-meaning
Nigerians who are planning to spend their vacations in some of the tourist
sites in the country. People are already locking down a lot of hotels in the
South South for the Calabar International festival in December. The recession
has awaken our forsaken interests in engaging in intra-country vacations by
visiting any of the choice destinations spread all over the country. A lot of
airlines, hotels, travel agencies, OTAs etc, will undoubtedly benefit immensely
from the patronage which will contribute significantly to our GDP eventually.
More patronage for these service providers will also attract increase in the
workforce, meaning employment for more people. Imagine the millions of nairas
which will hitherto be spent in other countries now being spent internally. The
ripple will run through the whole gamut of our economy.
0 Comments