Hotel owners engage EU ambassadors on COVID-19 losses

Kasese , Uganda | THE INDEPENDENT | Lodge owners and tourism operators have appealed to the European Union (EU) delegation in Uganda to consider clear accessibility of the Euro 6 million grant (25.2 billion Shillings) that was recently extended to support the private tourism sector.

The EU ambassadors were on Saturday meeting a section of lodge owners and tourism operators at Elephant Plain Lodge, Kasese to discuss the impact of the coronavirus (COVID-19) pandemic on the tourism sector in Uganda.

The grant will be channeled through Uganda Development Bank (UDB), where actors can access it at a discounted rate of 8 percent.

The tourism sector is one of Uganda’s top foreign exchange-earners with annual receipts of USD 1.6 billion brought in by 1.8 million tourists according to the Uganda Tourism Board (UTB). Out of the 1.8 million tourists, 1.3 million are foreigners, while 500,000 are local tourists.

However, the sector has been affected since March after President Yoweri Kaguta Museveni announced the closure of all borders together with Entebbe International Airport, followed by the suspension of both private and public transport, business premises and any form of public gatherings. The measures meant that all tourist sites had to be shut to the public and therefore no operation of hotels and lodges.

In the past four months of the COVID-19 lockdown, the Executive Director of Uganda Hotel Owners Association Jeanne Byamugisha said that the industry has experienced a US Dollars 25 million monthly loss in revenue. The Association boosts of over 600 member hotels.

Ambassador Attilio Pacifici, the Head of the European Union delegation to Uganda said that the EU is committed to offer support to the sector given the current cash flow constraints in the sector occasioned by the reduction in visitors and tourists.

He explained that the Euro 6 million grant with an attached loan of Euro 8 million from UDB will go a long way in providing resuscitation of the tourism sector by allowing different companies to keep operating and also sustain existing jobs.

Speaking about accessibility of the funds, Pacifici said that the EU will try to ease the process but that it’s the bank which will have the responsibility of appraising and evaluating the reliability of the customer.

“So if you are somebody not able to account for money, have no business…so is a pretender, you will never get that money. So bona fide, genuine investors, somebody who has a business…yes…they will be eligible and we will try to make it easier,” he explained.

Adolfo Cires Alonso, the Advisor Finance, Agribusiness and Land to the EU delegation told Uganda Radio Network-URN that they are currently engaging UDB to come up with a procedure of how the money is going to be accessed and that they anticipate completing the process in the next 3 weeks so that tourism operators start submitting their applications.

But Amos Wekesa, the managing director of Great Lakes Safaris Limited said that what the tourism operators need is not a bail out but consideration from government in regard to payment of particular taxes like Pay As You Earn (PAYE) and remittance of National Social Security Fund (NSSF) contributions.

He also noted that the relief money coming in as loans should be paid back at a low rate to enable them effectively utilize it to resuscitate the sector.

Dickson Kateshumbwa, the director Park View Safari also said that the UDB funds should not be subjected to bureaucracies considering that there has previously been a problem of consumption of money sent to the bank.

Arnold Rwabwogo, the operations director at Hotel Margherita in Kasese said that he is optimistic to benefit from the EU grant and the government loan after the process is finalized.

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