Travel and Tourism Drive Economic Growth in Africa

Travel and tourism remain vital to Africa’s economy, contributing 8.5% of GDP in 2018, equivalent to $194.2 billion. According to the 2019 Jumia Hospitality Report Africa, this impressive growth positioned the continent as the second-fastest growing tourism region globally, with a 5.6% growth rate, trailing only the Asia-Pacific region and surpassing the global average of 3.9%.

“Our goal is to showcase Africa as a continent rich in beauty and opportunity,” said Estelle Verdier, Jumia’s Head of Travel. “Through this report, we aim to highlight the vast potential of the tourism industry, which we believe is an untapped driver of economic growth.” Verdier spoke during the report’s official launch at the Africa Hotel Investment Forum (AHIF) in Addis Ababa, ahead of World Tourism Day 2019.

In 2018, Africa welcomed 67 million international tourists, marking a 7% increase from 63 million in 2017 and 58 million in 2016. This steady rise is attributed to the affordability and ease of travel within the continent, with domestic travelers accounting for 56% of spending compared to 44% for international visitors. Leisure travel plays a crucial role, making up 71% of total tourist expenditures in 2018.

Verdier noted that the African Continental Free Trade Area (ACFTA) is expected to further enhance domestic travel. “To unlock the full potential of this sector, we need cooperation from all industry stakeholders. Governments should consider eliminating visa requirements for African travelers, and ministries should promote local tourism to attract more regional visitors. At Jumia, we will continue to offer diverse products at affordable prices, including special resident rates for regional travelers.”

Now in its third edition, the report highlights that while pay-at-hotel remains the preferred payment method for Jumia’s travel platform, its usage dropped from 65% in 2018 to 62% in 2019. In contrast, card transactions increased by 24%, reflecting growing trust in the booking platform. Meanwhile, the use of mobile money and travel agencies fell by 11% and 20%, respectively. Mobile traffic on Jumia’s platform rose significantly, accounting for 74% in 2019, up from 57% in 2018, driven by increased mobile penetration across the continent. The mobile industry contributed $144 billion to Africa’s economy in 2018, representing 8.6% of total GDP, an increase from $110 billion (7.1% of GDP) in 2017.

Aviation Industry Insights

Africa’s passenger traffic grew from 88.5 million in 2017 to 92 million in 2018, a 5.5% increase, but its global share decreased slightly to 2.1%. The report attributes this decline to stiff competition from other regions, particularly Asia-Pacific. However, Africa’s share is projected to grow by 4.9% annually over the next two decades.

Improved visa facilitation in key tourism destinations is also boosting the tourism and aviation sectors. For example, Ethiopia’s relaxed visa policies and enhanced connectivity have made it the fastest-growing travel destination in Africa, with a 48.6% growth rate in 2018, valued at $7.4 billion.

“Many African leaders are committed to making travel easier and more affordable across the continent,” said Sthembiso Dlamini, Acting CEO of South African Tourism. “Initiatives like the East Africa Visa program, which allows travelers to apply online for visas to Uganda, Rwanda, and Kenya, are examples of visionary collaboration. By pooling our resources and sharing knowledge, we can achieve much more.”

In terms of airline revenue in African airspace, Emirates topped the list, earning over $837 million from popular routes such as Johannesburg, Cairo, Cape Town, and Mauritius. The most profitable air route from April 2018 to March 2019 was from Johannesburg to Dubai, generating $315.6 million. State-owned Angola Airlines and South African Airways were the only African airlines to feature in the top ten highest revenue routes, earning $231.6 million on the Luanda-Lisbon route and $185 million between Cape Town and Johannesburg, respectively.