Nigeria set to surpass Mauritius in hospitality sector growth Nigeria is set to overtake Mauritius within the next five years to become the larger hospitality market. This despite Mauritius being the more developed market of the two in almost all categories. This is according to PwC, who for the first time included information about hotel accommodation in Nigeria and Mauritius in its annual hospitality outlook report. The selection of the two countries was based on the quality of the hospitality data available, but PwC is looking to include other African countries in its report going forward. “Today the focus is no longer on South Africa alone, but rather the development of the entire African continent,” explained Nikki Forster, PwC Leader of Hospitality and Gaming. Stay units in Nigeria are projected to surpass Mauritius in 2015 and to be 63% greater in 2017. The decline in stay unit nights experience in Mauritius in 2012 is expected to continue in 2013 before the market recovers. An increase in occupancy rates in Nigeria is projected for the year, which will put it ahead of Mauritius. Furthermore, occupancy rates in Nigeria will continue to be higher than in Mauritius throughout the forecast period. Despite the large number of five-star hotels in Mauritius, the average hotel room in Nigeria cost 27% more than in Mauritius in 2012, which Forster explains is largely due to the high demand and relative short supply of quality accommodation in Nigeria. The average room rate for accommodation in Nigeria was US$275 (R2 544) in 2012, versus an €166 (R2 005) in Mauritius. This is forecast to to increase to US$338 (R3 126) in Nigeria by 2017, an average compound increase of 4,2%. In Mauritius, average room rate is expected to rise to €238 (R2 874) by 2017, an average compound increase of 7,5%. Hotel room revenue is also forecast to grow much faster in Nigeria than in Mauritius. The growth in Nigeria is partly attributed to the government’s commitment to boosting the hospitality sector, with an investment of US$2bn to improve infrastructure and to raise the hospitality sector to international standards. Forster notes that most of the big players in South Africa’s hospitality industry have entered the Nigerian market, including Protea, Tsogo Sun, and Sun International. “Nigeria has the potential to grow into one the biggest economies on the African continent,” she says. But challenges remain which limit growth, particularly political instability, security and infrastructure concerns. Mauritius is facing its own set of challenges, says Forster. These include increased competition not only from rival resort destinations, but also from other accommodation categories. “Hotels are facing increased competition from the guesthouse and bungalow market in Mauritius.” She adds that reduced air access from key source markets is another factor impacting on growth.
Posted on: Fri, 28 Jun 2013 17:22:22 +0000
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