Ethiopia’s tourism potential yet to be fully exploited

In 2016, over 800,000 tourists visited Ethiopia, bringing over ETB 128 billion (USD 5.6 billion) to the country. This is a decrease of approximately 11% from 2015's over 900,000 visitors. This is according to a new report by Jumia Travel Ethiopia, which further states that the Ministry of Culture and Tourism hopes to increase the number of tourists to one million, and the revenue to well over ETB 675 billion (USD 29.8 billion) in 2017. On the other hand, a remarkable growth has been achieved in terms of investment on the sector, rising by 3.7% end of 2016.

"The country is looking for a transformational growth that will take the sector to the next level, marketing Ethiopia locally and internationally to list the country among Africa's top five destinations. We are also shifting gear to incorporating technology into the industry," said Solomon Tadesse, CEO of Ethiopian Tourism Corporation.

Among top challenges leading to the decline of tourist arrivals are recent safety and security concerns that have been a major setback to the country's growing leisure and conference tourism industry. However, the sector remains resilient as the country continues working towards prioritizing security to ensure the safety of visitors and citizens, as well as minimize the impact of security threats. Paul Midy, CEO of Jumia Travel remains optimistic saying, "Challenges abound but the future is inspiring. We look forward to bringing the intended growth and progress into reality."

The report focuses on interesting findings, indicating that although conference tourism is growing in Ethiopia, leisure spending contributes 84.4% to GDP while 15.6% is from business spending. In 2015, the direct contribution of Travel & Tourism to GDP was ETB 51.3 billion (USD 2.26 billion) - accounting for 4.1% of total GDP, and is forecast to rise to ETB 85 billion (USD 3.7 billion) by 2026.

In terms of hotel booking, Addis Ababa has the highest demand at 39%, followed by Hawassa at 11.2%, Bishoftu at 8.1%, and Bahir Dar at 7.5%. Majority of international arrivals are from other African countries (31%), and Europe (30%). While domestic tourism continues to gain popularity among Ethiopians (31.3%), foreign visitor spending is still higher at (68.7%).

According to Alexander Burtenshaw, the country manager of Jumia Travel Ethiopia, expansion of tourism activities has reduced Ethiopia's dependence on agriculture. "Until recently, little had been invested in mapping the country's tourism, but the last decade has seen intensified interest from investors."

Preferences are high for the 2 and 3 star hotels, attracting 37% and 36% of total hotel bookings respectively. Notably, a large number of customers favor online payment (59%) as compared to pay-at-hotel (41%). The rising growth of online payments can be attributed to foreign travelers who book hotels with international credit cards.

Find the full report here