How HGL-BOI Partnership Is Helping to Boost Tourism And Hospitality In Nigeria
The world will never forget a year like 2020. Some termed it the year of the apocalypse because not many people expected to survive it. No one will ever forget the virus that made millions sit indoors and suspect their family members at the slightest sneeze or cough.
The impact of the coronavirus on lives and businesses has been immense. It got worse with the maturation of the virus which culminated into a second, third and Delta variant, forcing several countries to restrict mobility, an important index for supply chains to thrive.
The world has suffered over 456,000,000 cases with over 6 million deaths. In Nigeria, over 254,000 confirmed cases have been detected with over 3,100 deaths. The Nigeria Centre for Disease Control detected 51 cases on the 11th of March, 2022 with the FCT in the lead and Lagos, Kano and Rivers, following right after.
This unfortunate pattern has affected the tourism and hospitality sectors in Nigeria — the resulting restriction in movement, the grounding of international travel for a period and the continuous downturn of the economy played big roles in the blow to the industry.
Recently, holidaymakers have been compelled to reconsider the locations of their vacations according to insights shared in an interview by Kemi Adeoye, Chief Financial Officer, Honeywell Group Limited and Moyo Ogunseinde, Executive Director, Anchorage Leisure Ltd (the owners of Radisson Blu Anchorage Hotel).
This interview formed part of an aspect of the Bank of Industry’s Impact series — a TV magazine programme that spotlights beneficiaries of the bank’s intervention in different sectors, as well as the achievements borne out of these interventions — was broadcast on Channels TV.
Both executives detailed the bank partnership and the role it played when the effects of the pandemic threatened the success of their investments.
Adeoye said, “one of the critical challenges in the sector is access to long term financing. However, partnering with BOI, an institution that is willing to provide financing for expansion and diversification of projects that enhance the socio-economic condition of Nigerians, makes it easier to function and thrive as a business.
“We approached BOI for financing for our renovation plans and the process was hassle-free. They had a deep understanding of our business and its operations, and I would say that it has been an interesting journey.”
Adeoye reckons that there are lessons to learn from the pandemic. One of the major aspects was in terms of local sourcing of products, as well as harnessing natural attractions like the Yankari Game Reserves or Obudu Cattle Ranch to make tourism more sustainable in the country.
Delivering key metrics for the future of growth in the hospitality market in the next two years, Moyo Ogunseinde says there is still a possibility of a compounded annual increase that will hit 12% in a two-year period.
According to her, “while this envisaged growth trajectory has been slightly checked by the COVID-19 pandemic and more specifically the appearance of the Delta variant, the proposed growth targets are still achievable, should the local and world economies continue to recover in the coming months. It is important to note that we have already seen Nigerian tourism rebound at a faster pace than other destinations in the region.
“Most countries have seen marginal recovery of about 8–10% while Nigeria has seen an increase of 36% for the same period. The projections of a 12% compounded annual increase up to 2023 are therefore still feasible despite the pandemic as we have seen a shift to domestic tourism. The likelihood of achieving these projections is however linked to how well the economy performs. The ambitious vaccine rollout will be a key factor in ensuring that this projected growth is sustained and that the country is perceived as a safe destination for business and leisure.”
The World Travel and Tourism Council has however continued to lament the loss of jobs in the sector. In a really depressing statistics published on its website in July 2021, it identified Asia Pacific as the region hit hardest by the COVID-19 pandemic according to the new annual Economic Trends Report. The report went on to state that travel and tourism GDP in Africa dropped 49.2% in 2020, in line with the global average.
Domestic spending declined by 42.8%, while international spending saw a much steeper contraction at 66.8% with a staggering loss of 7.2 million jobs.
Nonetheless, the General Manager of the Radisson Blu Anchorage Hotel Lagos, Ahmed Raza, believes ‘staycations’ are spurring new trends within the industry while innovating local offerings for business partners and guests.
He said, “revenue performance has been impacted by the COVID-19 pandemic due to the reduced business activities on the back of lockdown and travel restrictions which has led to revenue displacement. While revenue projections for 2021 are down when compared to 2019 due to the impact on all revenue streams of the hotel, we have been able to focus on different clientele including the staycation market and guests looking for city weekend getaways.
“As we emerge from the COVID restrictions and business travel returns, our current renovations make us well placed to gain a strong foothold in the market.”
To improve customer experience, the hotel invested in a new website, and collaborated with major online travel agents such as Expedia and booking.com. It also invested in the provision of an availability management system that is poised to take round the clock bookings.
In all of these, Adeoye thanks the BOI for supporting the company. “BOI provided resources required for us to successfully execute our renovation and expansion projects. Their strategic support has impacted the business positively.”
With the BOI partnership, Anchorage Leisures Limited, owners of Radisson Blu Anchorage, and its parent company, Honeywell Group Limited, can further consolidate its investment in the existing locations to serve clients better, while also embarking on an ambitious expansion plan targeting Abuja and the FCT, and other parts of the country.