How intra-African trade measures, technology and new generation of leaders challenge business as usual

DSUBAI, UNITED ARAB EMIRATE, June 14, 2023/EINPresswire.com/ -- For too many years, African hospitality leaders have worked incredibly hard to maintain operational standards when critical products are unavailable to be sourced on time due to a myriad of reasons, from changing trade restrictions, poor transport infrastructure, currency fluctuations, and supply chain breakages.

This week leaders across the hospitality sector have descended into Nairobi city, the vibrant capital of Kenya and hub of East Africa, to join the annual African Hospitality Investment Forum (AHIF) to discuss growth opportunities in the region, and to share their learnings from the last year including developments across the trade and operational landscape. Attending is Toggle Market’s CEO, Fuad Sajdi, and VP of Africa, Abraham Muthogo Kamau, where they have been leading discussions on leveraging local and regional sourcing, and the innovative ways the sector is reducing operational costs.

Supply chain challenges in Africa have been one of the primary obstacles for economic growth and diversification, with businesses continuing to pay inflated prices for nearly every consumable and operational product that is not locally grown or manufactured – where even then it is more profitable to export outside the continent than to cater to the regional market due to weak intra-trade regulations.

Today there are promising signs that this status quo is changing fast.

The African hospitality industry is in the throes of a massive transformation. The catalysts? Ground-breaking trade measures, rapidly evolving technology, and a fresh generation of visionary leaders. These forces are challenging the traditional "business as usual" mindset and reshaping the African hospitality landscape.

The African Continental Free Trade Area (AfCFTA), the largest free trade area globally since the formation of the World Trade Organization, is set to significantly bolster intra-African trade. By reducing trade barriers, it allows a more fluid movement of goods, services, and people across borders. The ripple effect will be profound, with the hospitality sector one of the many industries reaping the benefits of this regional integration – at once connecting 1.3 billion people across 55 countries with a combined gross domestic product (GDP) valued at US$3.4 trillion and with a major potential as well to lift over 30 million people out of the poverty line.

For this to succeed there will need to be mutual and significant policy reforms and trade facilitation measures to reduce red tape, simplify customs procedures, and make it easier for African businesses to integrate into global supply chains. The upside is a boost of income gains around $300 billion.

The role of technology and the importance of a knowledge-based economy will increasingly be a driving force for transforming economic prosperity. The latest report from UNCTAD has warned that neglecting the high knowledge-intensive services, such as information and communications technology services and financial services, will be a key reason holding back export diversification.

One of the most exciting outcomes of more regional integration is the rise of home-grown hotel chains that are now expanding beyond their respective national borders. In 2022, intra-African travel accounted for 40% of the total number of hotel guests in the continent, up from 34% in 2019, according to the African Development Bank. This increase is partly attributable to the easing of travel restrictions and the growth of African hotel chains.

This new wave of hospitality brands is being led by a dynamic generation of African leaders who understand the local markets and are at the forefront of developing more viable value-based networks and forging stronger regional partnerships. These individuals are harnessing the benefits of the AfCFTA, using innovative practices to enhance the hospitality experience with a unique African flavour that can cater better to the African consumer needs while at the same time offering global standards of service.

Technology is a driving force behind this transformation. Digitization is permeating every facet of the hospitality experience from reservation systems to room service, with growing numbers of hotels now using a form of smart-room technology or employing AI-driven services such as chatbots for customer service and offering mobile apps for reservations and in-stay services.

The integration of technology has also enhanced efficiency and sustainability. African hotels can see up to 30% increase in energy efficiency and 25% reduction in water usage, thanks to the adoption of smart technologies.

Muna Khogali
Toggle Market
+44 7508 030742
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