CRITICAL ANALYSIS OF TOURISM INDUSTRY AND SUSTAINABLE DEVELOPMENT DURING COVID - 19 PANDEMIC. A CASE OF RWANDA

Abstract

Rwanda is gifted not only with breathtaking landscapes, diverse flora and fauna as well as rich traditional culture but with people who love their country and stand up for nature conservation and the wellbeing of their communities. Rwanda’s economic growth over the last two decade has been remarkable. With a government that is committed to achieving sustainable economic growth coupled with growth in employment opportunities for its people, Rwanda has made impressive progress in rehabilitating and stabilizing its economy to exceed pre-1994 levels. Tourism is one of the largest foreign exchange earners and fastest-growing sectors in the East African Community (EAC). According to the EAC Secretariat, tourist arrivals in the EAC region increased from 3.5 million persons in 2006 to about 7 million in 2019. Tourism contributed to the Gross Domestic Product (GDP) of the EAC Partner States by an average of 9.5% in 2019. It contributed an average of 17.2% to EAC total exports and 7.1% to employment. However, the upward trajectory in tourism in the region, with its positive impact on the economy was devastatingly affected by the onset of COVID-19 pandemic in March 2020. The effect of COVID-19 emphasized the tremendous importance and positive contribution of Travel & Tourism. It enables socio-economic development, job creation, poverty reduction, driving prosperity and significant positive social impact, including providing unique opportunities to women, minorities, and youth. To achieve the objectives, the study deployed a mixed-methods approach of data collection. This entailed a qualitative method through interviews with key industry informants and a quantitative method whereby a semi-structured survey questionnaire was administered to all key subsectors of the tourism and hospitality industry. The latter was aimed at determining how the sector was impacted upon at micro-level. In addition, the study involved analysis of trends in key tourism indicators from statistical reports from Partner States and other sources. These included indicators such as international tourist arrivals, tourism receipts, tourism jobs, visitors to parks, and hotel occupancy rates. The lockdown, social distancing, and increased costs associated with the COVID-19 pandemic have reduced output and employment, increased poverty, and depressed trade transactions; in the absence of a strong response by government, output will be lower over the next decade due to COVID-19. The pandemic-driven rise in the fiscal deficit is increasing public debt, thus exacerbating existing challenges to sustainability and increasing the urgency of shifting from large public investments to human capital development as the main driver of growth. The government’s rapid response to the pandemic has succeeded in keeping the population share of new infections and of deaths well below that of most other countries. However, critical health services, particularly childhood immunization and nutrition services, have been disrupted, which is increasing stunting and preventable diseases. The combination of poorer nutrition, limited health services, learning losses from school closures, and the likelihood that some children (particularly adolescent girls and children from poor households) may never return to school will reduce incomes and productivity over the medium term. The government responded rapidly and effectively to the challenges posed by the pandemic, putting in place the Economic Recovery Plan (ERP) to support households and firms, quickly imposing constraints on mobility to limit the spread of the disease, ramping up social protection programs, and setting up remote learning. Key priorities going forward include: (i) improving the government’s expenditure allocation, financial management and revenue mobilization; (ii) strengthening the resilience of the health system and preparing for administration of a vaccine; (iii) reducing learning losses (targeting the most vulnerable), improving skills and strengthening accountability in education; and (iv) expanding the flagship social safety net program, building adaptive systems to respond quickly to shocks, improving poverty targeting of safety net programs, and scaling up the use of digital payments.

Keywords: COVID-19, Sustainable Tourism, Rwanda

CITATION: Rwigema, P. C. (2021). Critical analysis of tourism industry and sustainable development during Covid - 19 pandemic.  A case of Rwanda. The Strategic Journal of Business & Change Management, 8 (4), 594 – 625.