COVID-19 and tourism in Uganda

Project Active since Firms, Trade and COVID-19

COVID-19 is having a devastating effect on the global economy and for many developing countries tourism seems to be the most affected sector. Especially since tourists from the north are likely to first opt for destinations that are both closer to home and equipped with better health facilities, the impact of COVID-19 on tourism in developing countries could be severe and long-lasting with many firms going out of business. Crucially, the sector employs many workers in relatively high-productivity jobs and is of paramount importance as a foreign exchange earner in many developing countries, generating around 10% of total exports in non-oil exporting Least Developed Countries.

Uganda is no exception: tourism is the country’s single most important export product, generating about 940 million USD in 2017, corresponding to circa 4% of GDP or 20% of total goods and services exports. This is twice as much as earnings from coffee, the country’s traditional export cash crop. Tourism also employs a growing number of workers in relatively high-productivity jobs, around 270,000 people directly and around 400,000 people indirectly, together accounting for about 6.7% of total national employment.

Against this background the following questions are of crucial importance as the Government of Uganda wishes to identify policy options to react to the impact of the crisis on the sector:

  • What is the impact of COVID-19 on Uganda’s tourism industry and its suppliers?
  • What are the best policy responses to the crisis?
  • Is the very survival of many tourism enterprises at risk and what can be done to prevent this?

This project aims at answering these questions relying on available national and international data, as well as unstructured interviews with key players in the industry.