STATEMENT BY HIS EXCELLENCY HON. UHURU KENYATTA, C.G.H.,PRESIDENT AND COMMANDER IN CHIEF OF THE DEFENCE FORCES OF THE REPUBLIC OF KENYAON THE TOURISM SECTOR, ISSUED AT STATE HOUSE, NAIROBI, 23RD MAY, 2014
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Fellow Kenyans,
As Kenyans are aware, the Tourism sector plays an important rolein our economic development,both directly and indirectly. Since last year, thesector has experienced some challenges, which have impacted negatively on itsperformance.
After growing strongly and steadily between 2001 and 2007,tourism sector suffered its worse when the international arrivals declined by31 percent due to, among others, the election related challenges and impact ofinternational economic and financial crises.
Last year, international arrivals dropped further due tosecurity related challenges. With the recent advisories from some in ourtraditional source market that account for about 46 percent, tourism sector islikely to continue facing difficulties.
In view of the importance of the tourism sector in Kenya’seconomy, especially its multiplier effect on various sectors, the Governmentand stakeholders have agreed measures to get the numbers back into our hotels,and growing it on a sustained basis to at least 10 million visitors annually ina decade.
I now turn to the specific measures to stimulate tourism sector recovery:
First, under Tax measures, the Government, with effect from 12thJune 2014, will allow all corporate and business entities to pay vacation trip expenses for their staff on annual leave in Kenya and deduct such expenditures in their taxes.
Through this measure, we shall directly give at least 25,000Kenyans a chance to go for a week’s holiday every month at the expense of their employers, bringing to total over 300,000 additional Kenyan guests in ourhotels throughout the country.
Second, with effect from 29th May 2014, all air ticketing services supplied by travel agents shall be exempt under the VAT Act, 2013 so as to enhance our competitiveness in the region.
Third, all outstanding income tax related refunds amounting owed to the tourism industry players will paid out by Kenya Revenue Authority not later than next Thursday 29th May 2014. We expect this measure to improvesector liquidity and cash-flow;
Fourth, to further encourage local guests in our National parksand attract both regional and international tourists, all park fees currentlyset at USD90 per non-resident and KShs.1,200 per resident guest shall bereduced to USD.80 and KShs.1,000, respectively, effective 12th June 2014.
Fifth, to encourage both local and international flights into Moi International Airport and Malindi Airport, the Government has reduced, with immediate effect, the landing charges by 40 percent and 10 percent, respectively.
Sixth, Government has, with immediate effect, revoked the National Treasury Circular restricting the public service from holding conferences and other meetings in private hotels. It will now be possible forthe public sector to hold conferences and meetings in private hotels throughoutthe country as when the need arises;
Seventh, the Government has allocated adequate resources to expand Malindi Airport to international standards to allow for largercommercial aircrafts to land. This will encourage growth of charter tourism.
Eighth, all budgetary resources, at the National Government,earmarked for foreign travel will, in Supplementary II, be reallocated todomestic travel to further give impetus to tourism sector recovery. Similarly,we urge Parliament and the Judiciary to do the same.
Ninth, the National Government urges the County Governments toreallocate all their foreign travels budgets to domestic travels in order tospur growth of domestic tourism and sustain employment.
In addition, the industry has identified a raft of measures,which will complement Government’s initiatives. In particular:
First, The industry will offer better vacation package to Kenyans compared to what they offer international package tours, estimated atabout USD 60 daily per person on full board;
Second, The Government and Industry will develop an interactive Kenya Tourism Portal, within a week, to promote and manage booking and distribution of domestic guests under the Tourism Stimulus Program
Third, The Government and Industry will, within two weeks,develop a comprehensive promotional campaign program to popularize both international and domestic tourism.
And for the Medium to Long Term measures, the Government will shortly reconstitute a Task Force with a mandate of developing a strategy toaddress underlying challenges and positioning Kenya as the preferreddestination for safari, commercial, educational and health, conferencing andprofessional services in Africa, attracting at least 5 million guests in thenext 5 years.
***Thank you and God bless you
BRON***