Government unveils 6 key areas of tourism sector support scheme for recovery

Zimbabwe’s Minister of the Environment, Climate Change, Tourism and Hospitality Industry Nqobizitha Mangaliso Ndlovu on Thursday announced a support scheme by his administration for the recovery of the sector ravaged by Covid-19.

Having expected a boom after a 11% drop in arrivals from 2018 to 2019, Ndlovu said the sector was working with a best case scenario of 30% and worst of 85% reduction for 2020.

As such the government had unveiled a scheme to help business to access money to survive as well as stimulate domestic tourism.

These are

Government Guarantee Facility of ZWL500 000 000.00
Government will provide Bank Guarantee Facility worth ZWL500 000 000.00 to assist the Tourism Sector to access working Capital Loans from Banks. In coming up with this decision Government is cognizant of the fact that the tourism sector has lost substantial business through cancellations and postponement of travel since January 2020 to date. We are also aware that that access to lines of credit are often hampered by lack of collateral or often stringent lending conditions by the financial institutions. We believe the Bank Guarantee Facility will go a long way in helping Tourism Industry to kick-start operations. Operational details of the Facility will be finalized by Treasury and will be announced within the next few days.
Tourism Revolving Fund
The Government is keen to see increased investment in tourism facilities as we are fully conscious of the impending capacity constraints in the sector by way of rooms shortage, conference facilities limitations and related infrastructure. In view of the foregoing, the Government has approved the establishment of a Tourism Revolving Fund for the Sector and has injected seed capital of ZWL20 000 000.00 into this Fund. While Government has injected the local currency to kick the Revolving Fund, we will continue to work with local and international partners to attract more capital into this fund. Operational details of this Fund will be announced in due course.
Waiver of Value Added Tax on Domestic Tourism
One of the key lessons clearly coming out of the events unfolding around the effects of the COVID – 19 pandemic is the need to develop domestic tourism. In this respect, it is envisaged that due to the current measures that restrict travel aimed at containing the COVID 19 pandemic, international tourism will be slow to recover, hence the need to provide incentives to stimulate domestic tourism. Government has therefore approved a waiver of Value Added Tax payable by domestic tourist for accommodation and services. This is envisaged to significantly lower the cost accessing tourism facilities by locals and I want to challenge you all in the sector to meet government half way by thoroughly interrogating our cost structures so that our people can experience their beautiful country and your pristine facilities at affordable rates.
It is my view that our revival will be anchored on domestic tourism and focus has to be on driving demand for our facilities. Operational details of this waiver will be announced in due course.
Deferment of Liquidation of Foreign Currency paid by International Clients
Government is aware that a number of international clients had made advance payments for their travel into Zimbabwe which were however interrupted by the COVID – 19 Pandemic. We appeal for such potential visitors to postpone their visits and come when the scourge is over. In this regard, Government has approved the deferment of the liquidation of foreign currency paid by international clients who could not travel due to the pandemic.
Support For Zimbabwe Tourism Authority
Further, Government is cognizant of the integral role played by the Zimbabwe Tourism Authority (ZTA) in driving the National Tourism Recovery and Growth. Currently the ZTA is funded largely from the 2% Levy charged on tourists travelling into the country. Given the current downturn in tourist arrivals, revenue streams for ZTA have declined substantially. ZTA will be afforded substantial support to ensure that the organization is capacitated to fully discharge its mandate.
Payment of Money owed to Tourism Operators by Various Government Institutions
In addition, Government has also undertaken to settle all long overdue bills with the Tourism Sector players for services already rendered. This move is expected to unlock working resources for the Sector.

He was speaking at a breakfast meeting held in Harare.