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Kenya govt eyes cheaper option to fund expansion of convention centers

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The government is considering financing alternatives to raise cash for development of additional convention centers in a strategic move to fast track implementation of the vision 2030 flagship project and grow conference tourism business.

Private sector players led by Kenya Tourism Federation (KTF) and Kenya Association of Hotel Keepers and Caterers (KAHC) are fretting slackened pace in development of these facilities saying it would deny the country huge revenues.

Though the country is considered a gateway to the East Africa market, entry of Ethiopia and Rwanda into the business threatens to increase competition in the segment, said KTF Chairperson, Lucy Karume noted.

Among the options floated yesterday at stakeholders meeting comprising the government and the private sector there are possibilities to leverage on asset backed financing, bonds and real estate investments trust (REITS) to actively engage the private sector.

The proposed legal framework to boost funds for the strategy is expected to save the tourism industry from the shocks of travel advisories and tame layoffs by hotels during low seasons.

“International Tourism numbers would increase from current 1.8 million to three million by 2017, while bed nights by the domestic tourists will almost double to 4 million from 2.8 million,” said PS in the ministry of East Africa, commerce and tourism, Ibrahim Mohammed.

The committee will seek advice from the capital markets authority (CMA) on which instruments will be effective in giving investors an assurance on investments.

Kenya seeks to rope in a million more tourists through additional conventional centers to be erected in Nairobi, Kisumu and Mombasa projected to add 30,000 new beds for the market.

However, the government is yet to break ground on construction of Mombasa convention center where a partial feasibility study has been completed after three years.

Construction of the proposed Boma International convention center expected to accommodate 15,000 new delegates will begin January next year with a completion date of 2017.

Kenya is ranked second in conference tourism after South Africa having hosted 29 international conferences and conventions in 2012 with Cape Town and Durban hosting 45 and 25 events respectively.

Private sector players are also seeking an expanded mandate in the steering committee to a 50/50 share where they will hold the technical parts of the operations while the government develops enabling policies and environment.

The private sector claim government is doing too little to attract investors to its projects, citing high cost of land and infrastructure as main hindrance.

“What the government has been doing is moving away from incentivizing the private sector,” said KAHC Chief executive, Mike Macharia.

The stakeholders also want ministries of transport and information included in the committee to guide in designing logistics to such centers.

Kenya govt eyes cheaper option to fund expansion of convention centers Reviewed by on . The government is considering financing alternatives to raise cash for development of additional convention centers in a strategic move to fast track implementa The government is considering financing alternatives to raise cash for development of additional convention centers in a strategic move to fast track implementa Rating: 0

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