NAIROBI, Kenya, May 20 – A proposed 69 percent budget cut for the Ministry of Tourism in the next financial year will have a devastating impact on the country’s economy as a whole, Minister Najib Balala has protested.
Mr Balala revealed on Wednesday that his ministry faced an imminent budget slash that could worsen the effects of last year’s economic slump.
“Activities of the Ministry of Tourism tend to trickle down to all other sectors. So the ripple effect of the cut will not only be a disaster to us but to the economy as a whole,” the Minister pointed out.
Mr Balala noted that the agricultural sector which is the country’s mainstay was a huge beneficiary of tourism activities, meaning that many people could lose their jobs and income as a result of the proposed budget slash.
“Remember that tourism is pillar number one in the Vision 2030. Why then would anyone go ahead and slash its budget which is already at the minimum?” Mr Balala posed.
The Minister indicated that they had requested for Sh1.1 million as funding for the Kenya Tourism Board (KTB) but may only receive an allocation of Sh250 million, notwithstanding that no other parastatal within his Ministry will also get full allocation.
Among some of the projects expected to stall as a result of the slash include a Sh150 million Beach Market that was to be put up for operators within the Coast.
“We have been intending to bring order to our beaches in a way that both the vendors and the industry benefits. But this may just now end up being a pipe dream,” Mr Balala said.
Establishment of a proper ministry office in Lamu will also take a back seat, in addition to the purchase of a surveillance boat for the region, which is a tourism hub for the country.
Mr Balala however said that he had held talks with Finance Minister Uhuru Kenyatta and raised his concerns. Tourism Ministry officials, he said, were now drawing up a proposal on the best way forward.
“If we can cut down costs we are ready to do it, but promotion of tourism overseas is key and not only overseas but even in Africa which is developing a serious working class,” Mr Balala said.
These revelations of a proposed budget cut come at a time when the sector has just witnessed the worst ever performance for 2008 in the last four years.
Earnings from the sector dropped by 19.4 percent from Sh65.4 billion recorded in 2007 to Sh52.7 billion.
Total tourists arrivals in the same period dipped by 40 percent to close at 1.1million while charter flight operations and bed occupancies declined by an average of 30 percent and 65 percent respectively.
The weakening of the shilling against major global currencies further reduced earnings to approximately $761.8 million
2007 has been hailed by players as the best year for the industry because arrivals for the first time touched the two million mark.
Achievements which were in 2008 were however reversed by internal and external factors like the political skirmishes at the beginning of the year and later in the year the global economic crunch.