TTSSP recommends strategies to curb tourism revenue leakages
DODOMA: THE Tanzania Tourism Sector Safety and Protection (TTSSP) has urged the government to formulate a tourism investment policy requiring all new tourism projects to have at least 51 percent local ownership.
The organization made the recommendation as one of the solutions to the significant challenges faced by tourism sectors in developing countries, where most of the revenue often leaks out of the local economy to foreign-owned companies and imports.
Speaking exclusively to the Daily News recently, TTSSP Chief Executive Officer and founder, Dr Majaliwa Maswila, also suggested that, to ensure locals benefit more from the tourism sector, the state should establish a Tourism Development Bank to provide low-interest loans to Tanzanians investing in tourism-related businesses.
According to Dr Maswila, studies have shown that in some developing countries, as little as 5 percent of every 100 dollars spent by tourists remains in the local economy while in Tanzania specifically, only about 15 percent of the total tourism income stays within the country.
He outlined additional measures the government could take to maximize local benefits from the sector, including encouraging the use of local payment methods and minimizing foreign currency transactions by promoting wire transfers to Tanzanian banks.
“Travelers and tour operators should be advised to research before booking and confirm whether operators use Tanzanian bank accounts and clearly disclose payment terms upfront,” he said.
Dr Maswila emphasized the need for the government to enforce the Foreign Exchange Act (1992), which mandates the monitoring of transfers exceeding $10,000 for residents traveling abroad.
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He also advised that all tour operators should be required to register their transactions through local banks.
Other strategies proposed by TTSSP include prioritizing the purchase of local products, souvenirs, and food from local markets, and encouraging tourists to choose locally owned accommodations instead of large international hotel chains.
The organization also promoted the concept of ‘Eat Local’ to encourage tourists to dine at locally owned restaurants and cafés over international chains or hotel-based establishments.
The TTSSP report also suggests that increasing the number of indigenous investors in tourism infrastructure and services will require incentives for locally owned companies, including financial support and similar initiatives.
Dr Maswila also warned about the impact of large multinational companies on the local economy and urged the adoption of strategies to limit their dominance.
He concluded by recommending support for diversified economic development beyond tourism to reduce over-reliance on the sector.
He also emphasized the importance of using online platforms to promote local businesses and experiences, making it easier for tourists to find and support them.
Listed on the Tanzania Tourism Board (TTB) website as a key stakeholder in the country’s tourism sector, TTSSP plays a critical role in ensuring the safety and well-being of tourists visiting the country.
The organization is committed to safeguarding tourists’ rights, strengthening security measures within the sector, and creating a safe environment for all visitors. It also works closely with the government in tourism registration, provides technical expertise on tourism-related issues, and coordinates with security agencies to enhance overall safety in the sector.
