The African hospitality industry is in the throes of a massive transformation due to ground-breaking trade measures, rapidly evolving technology, and a new generation of visionary leaders.

“These forces are challenging the traditional ‘business as usual’ mindset and reshaping the African hospitality landscape,” said hospitality analyst, Toggle Market CEO, Fuad Sajdi, and VP of Africa, Abraham Muthogo Kamau, during a discussion at the African Hospitality Investment Forum in Nairobi earlier this week.

Hospitality leaders met at the conference to discuss growth opportunities in the region and to share their learnings from the last year, including developments across the trade and operational landscape.

Sajdi said the African Continental Free Trade Area (AfCFTA) was set to significantly bolster intra-Africa trade. By reducing trade barriers, it allows a more fluid movement of goods, services, and people across borders. The ripple effect would be profound, with the hospitality sector one of the many industries reaping the benefits of the regional integration, he said.

“One of the most exciting outcomes of more regional integration is the rise of home-grown hotel chains that are now expanding beyond their national borders,” Sajdi pointed out.

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.

The United Nations World Tourism Organisation forecasts 134 million visitors by 2035. These figures make it the second-fastest-growing region in tourism after Asia Pacific.

Dynamic generation of leaders

Sajdi said the new wave of hospitality brands was being led by a dynamic generation of African leaders who were harnessing the benefits of the AfCFTA, using innovative practices to enhance the hospitality experience with a unique African flavour that could cater better for the African consumer needs while at the same time offering global standards of service.

“For example, over 80% of safari lodges in South Africa are managed by indigenous brands and are a part of the tourism sector that generates around 70% of hospitality revenue. This segment is multiplying across the region.”

Supply chain challenges

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

This will be addressed through increased intra-Africa trade and the easing of cross-border restrictions on the continent.