Why state is keen to speed up sale of stake in hotels

Tuesday, February 20th, 2024 09:56 | By
Alfred Mutua, Cabinet Secretary for Tourism and Wildlife. PHOTO/Print
Alfred Mutua, Cabinet Secretary for Tourism and Wildlife. PHOTO/Print

Last week’s decision by the cabinet giving the go-ahead for privatisation of State-owned hotels was informed by the need to save the businesses from collapse, Cabinet secretary Tourism and wildlife Alfred Mutua has explained.

“The move was only intended to make the hotels viable since some of them were technically insolvent,” he said.

The State-owned hotels approved for sale include Kakamega Golf Hotel, Sunset Hotel in Kisumu, Mombasa Beach Hotel, Ngulia Safari Lodge, Voi Safari Lodge.

According to Mutua, this was a significant move aimed at reducing the burden on the national exchequer since some of the hotels were technically insolvent.

The CS spoke at Zayed Children’s school in Mombasa during the annual prize giving day. He said these hotels had experienced a decline in quality, leading to their current financial predicament.

The Auditor General’s report of the 2022/23 financial year confirmed that most of the facilities under Kenya Safari Lodges and Hotels were in loss making territory and facing financial insolvency.

Bidding process

Mutua urged county governments to participate in the bidding process, assuring transparency in the privatisation proceedings. Kakamega County has, however, opposed the privatisation of Golf hotel where it has a shareholding of 20 per cent.

Addressing the need for a revitalised tourism sector, the CS outlined changes in marketing strategies.

“The focus will be on boosting tourism numbers at the coast, with plans to attract more charter flights and cruise ships. This initiative aims to reinvigorate the industry and enhance the overall tourism experience in the region,” Mutua said.

He also disclosed that the government will to introduce “Halal tourism” to as it strategises to tap the Middle East tourists market. Halal’ tourism is a growing market segment, with Muslim tourists seeking destinations which meet their needs, in terms of diet, dress or rituals

“The move will open doors to a new group of tourists into the county, complimenting domestic tourism and other foreign tourists from other continents,” Mutua said. Meanwhile, Ministry of Tourism intends to introduce a raft of measures aimed at revamping the sector and attracting more visitors to the country.
Tourism Principal Secretary John Ololtuaa said the sector has vast potential that is yet to be unleashed, adding that if well exploited, it can be the leading gross domestic product (GDP) contributor in the country.

Speaking when he graced the awarding ceremony for hospitality facilities in Mt Kenya region, he said the new strategies will also help increase the number of tourists in the country from 1.7 million recorded last year, to five million this year.

He said the ministry through the Tourism Board of Kenya intends to do intense marketing of Kenya as the best tourist destination globally.

He added that wildlife, water bodies, national heritage sites and cultural diversity are some of the key areas they will leverage on in promoting tourism.

“We have huge potential in tourism, all that is required is coming up with strategies to attract as many tourists as possible” he remarked. Ololtuaa said they are also seeking partnership with county governments to help in identifying and mapping of the tourists’ attraction sites for development.

“We shall also be seeking to join hands with the private sector to help identify any opportunity in the sector and the government will facilitate any development that will be required” he added.

Accreditation exercise

He disclosed that the ministry will carry out a national accreditation exercise to ensure all the hospitality facilities are registered and they operate within the stipulated guidelines.

He said the exercise will help in assessing the quality of services offered and provide guidelines for upgrading, adding that the last classification exercise was conducted back in 2019.

“This exercise will kick off in March and is expected to run for six months after which we will give the report” Ololtuaa said .

More on Business