We note with deep concern the recent negative media reports regarding the tourism industry’s impact on Botswana’s economy and communities.
However, we would like to set the record straight: the tourism industry is a significant employer, supporting over 50,000 direct jobs, and a vital source of foreign exchange. In some rural areas of the country, the tourism sector is the largest single source of employment and income.
There are 360 companies that the tax authorities have categorised as Large Tax Payers because each pays more than P10 million. These companies contribute seventy per cent (70%) of the income tax. Ten per cent (10%) of these large taxpayers are in the tourism industry. It is clear, therefore, that the tourism industry contributes hundreds of millions in tax and royalties to the government, driving social and economic development. Indeed, for some of the large tourism companies, tax and related payments to government account for the largest single share of the value added generated.
In addition to taxes and royalties, the tourism industry pays substantial lease fees directly to local communities, for sub-leases whose rights are owned by those communities. It is therefore incorrect to claim that the tourism sector “benefits only a small segment of society”.
Wealth creation
The tourism businesses are unfairly accused of extracting wealth. This is misleading because, in business, wealth is created through investment, not extraction. The same applies to the tourism industry, where entrepreneurs invest resources first to generate growth. The level of investment required for high quality tourism facilities is very high, especially in remote areas of the country, and it is only to be expected that part of the returns from economic activity are used to repay that investment.
Repatriation of profits
It is important to note that Botswana’s investment laws allow for remittances and the full repatriation of profits and dividends, which serve as crucial incentives for foreign investors, boosting the country’s investment climate. This policy applies across all sectors, not just tourism, and it is regrettable that media commentators ascribe improper motives to the repatriation of profits.
Leakages
We also wish to clarify that the industry’s imports of goods and services are often mistaken for “leakages”. However, like other businesses in Botswana, the tourism industry depends on imports to operate effectively, just as the government imports vehicles and other vital supplies. Labelling these legitimate business transactions as ‘leakages’ is misleading, conceptually flawed, unnecessarily pejorative, and unfairly singles out the tourism industry.
High Value, Low Volume
The Botswana government adopted the concept of high value , low impact Strategy in 1990 as part of the Tourism Policy to protect the ecologically sensitive Okavango Delta.
It should also be noted that adopting a high value-low impact strategy for one part of the country does not preclude the adoption of different strategies in other parts of the country. It is not “either or”. Indeed, tourism has grown throughout the country on the basis of sports and adventure tourism, cultural tourism etc., and has enormous potential for further growth. Botswana’s tourism accommodation is not solely about luxury lodges in the Okavango, but also comprises guest houses and hotels throughout the country, which provide investment and income generation opportunities for both individuals and businesses.
Collaboration
We urge a fact-based approach to critique the tourism industry and look forward to working together with the Government of Botswana and other interested parties to further develop Botswana’s tourism sector for the benefit of its people.
Conclusion
HATAB members carry out business in accordance with the laws of Botswana, and to suggest improper motives behind these businesses is irresponsible and grossly unfair. We believe that a balanced understanding of the industry’s operations would help promote a more constructive dialogue.
HATAB’s Public Affairs & Communications Department
Telephone; +267 395 7144
Email:hatabpublicaffairs@hatab.bw
