Tourism as a Source of Revenue for the Nigerian Economy

SaturdayOctober 02, 2021 / 11:22 PM / by FDC/ Header ImageCredit: Guardian Nigeria

In the year 2019, tourism contributed $1.5 billion to the Nigerianeconomy, which was scarcely 0.3% of the total GDP. In 2020 this value dropped,largely thanks to COVID-19. Yet as the Secretary-General of the United NationsWorld Tourism Organization has observed, Nigeria has the potential to be one ofthe world's best tourist destinations.

Tourism presents economic, social and technologicalopportunities for Nigeria. Economically, it serves as a channel for foreignreserves and investment in the economy, which by extension, leads to GDP growthand economic diversification. Socially, tourism serves to promote tolerance. InNigeria, an increase in tourism could be a uniting force in an otherwisefractured country. As UN Secretary General Antonio Guterres stated, "tourismcan... [bring] people together. Tourism can promote solidarity and trust - crucial ingredients in advancing the global cooperation that is so urgentlyneeded at this time."

Technologically, as demand increases, the sector willbe forced to evolve the technology it employs. This would enable those who workin tourism to be able to serve more people, reduce human errors and increaseefficiency. However, to reap the benefits of the tourism sector, Nigeria needsto do more with regards to nature conservation, investment in tourisminfrastructure and boosting domestic tourism.

The Nigeriangovernment has suffered from a budget deficit for many years with this year notbeing an exception. This constrain of resources has made it hard for thegovernment to invest in tourism and the resources gained are focused on the oilsector which generates about 80% of the revenue in Nigeria. Evidently, in 2018,the Nigeria Extractive Industries Transparency Initiative (NEITI) stated thatthe government spent $1.8 million of fuel subsidy which was 4 times more thanits expenditure on health, education and science.

The level ofinsecurity in the country is also another factor that has dented growth inNigerian tourism. Nigeria is one of the countries with the highest number ofdeaths from terrorism and this has affected the tourism sector through lowerinvestments and loss of natural resources. With these factors in place, theNigerian tourism sector is expected to have a stunted growth for a long time.In order to prevent this, the government should effect policies which wouldincrease investment and reduce insecurity.

With regardsto natural resource protection, Rwanda offers an example. Rwanda is a countrywhich has taken great steps to preserving its natural resources and using itfor the betterment of its tourism sector. The eastern African country holds anannual gorilla naming ceremony with its main aim being to curb the killing ofgorillas. The ceremony has already led to positive effects in the country as theIUCN have renounced the animals being endangered and the number of tourists hasincreased over the years. It is to be noted that one gorilla has the capacityto generate an average of $3million during its lifetime so by preserving themthe revenue goes to the government and can be used to grow the society. In linewith this, the Rwandan government allocated 10% of the revenue gotten from thetourism to develop the surrounding neighborhood increasing the standard ofliving of its habitants. With this good example given by Rwanda, Nigeria stillstands a chance at developing its tourism sector and its economy as a whole.

Another areaof focus for Nigeria ought to be in tourism infrastructure, specificallysporting infrastructure. By investing in this area of the economy, thedependence on oil would be reduced and the economy would operate a morediversified economy. Countries like England and France have come to realize thevalue of sports in tourism. Wimbledon, which is the oldest tennis tournament inthe world, is held in England every year. It has served as a great source ofrevenue for England and has also helped to develop its tourism sector. In theyear 2019, the 13 days event was attended by 500,397 people and watchedby 96 million people.

To this cause,the Wimbledon tournament has received various donations worldwide which havehelped to increase the foreign reserve and GDP in England. In the case ofFrance, the country holds a yearly cycling event known widely as Tour deFrance. This event is used as a channel for tourism as the contestants travelthrough different areas in France and even neighboring cities. The cyclingevent is said to be watched by an estimate of 3.5 billion people on TV while 12million people attend it physically. The Tour's revenue according to experts isestimated to be between $60-$150 million which can go a long way in the tourismsector.

Insecurity asstated before, is a challenge affecting the tourism sector. The government ofNigeria has to then increase its expenditure on security services as this wouldhelp to promote peace and stability in the country. Egypt is also anothercountry that has significant issues with insecurity but has taken measures tocurb this action and improve its tourism. While Nigeria's military expenditurein 2020 was $2.403bn, Egypt increased its military expenditure to $4.016bn in2020 from $3.744bn in 2019 (7.26%)6. Due to this action tourism now serves asone of the leading factors contributing to Egypt's national income as thenumber of tourists visiting has been increasing after the restrictions wereremoved (an average of 500,00 people per month since April).7

It can then beconcluded that some developing and developing countries such as Morocco, Egypt,England and Poland have used tourism to boost their economy, and Nigeria canfollow suit as tourism can be used to revive the part of the economy thatCOVID-19 subdued. This can only be achieved by curtailing insecurity,increasing government expenditure to tourism and diversification fromtraditional tourist attractions of game reserves and national parks toactivities such as sports