Private equity investor Mediterrania Capital Partners (MCP) is considering investments in supermarkets, health and education as the impact of COVID-19 whittles down the list of financially strong candidates, CEO Albert Alsina tells The Africa Report.
Accor Hotels targets South Africa for expansion as arrivals slow
Accor Hotels wants to increase its presence in South Africa, Rwanda, Nigeria and Cameroon as it banks on the rise of Africa’s middle class, Mark Willis, CEO for Africa and the Middle East, told The Africa Report.
“Our main ambition for Africa is to rebalance our current presence in North Africa with a much larger presence in South Africa,” Willis said.
The company wants more properties in Johannesburg and Cape Town. Accor, which has a strong historical presence in francophone Africa, also wants to grow in Rwanda, Nigeria and Cameroon, Willis said. “We are constantly looking at different areas to increase our presence in the continent.”
South Africa’s President Cyril Ramaphosa said last year that the government aims to double international visitors to 21 million by 2030.
Yet Accor’s focus comes with the destination losing ground.
Between January and November 2019, government figures show that tourist and business trip arrivals in South Africa fell by 2.3%.
- The figures were dragged down by a 4% drop in arrivals from Europe, with arrivals from other Africa countries falling in line with the overall total.
Research from Landry Signé at the Brookings Institution in Washington DC argues that visa restrictions are “the most significant barrier to growth” in South African tourism.
- The problem is continent-wide: while visitors from North America need visas to travel to 45% of African countries, that rises to 55% for Africans travelling within the continent.
- Signé also argues that there is “substantial room for improvement” in South African government conservation of natural resources, with only 6.5% of land protected at the end of 2018.
Willis argues that one in three Africans are now middle class, and that the continent’s tourism market will increase due to the growth of regional airlines, improved infrastructure and better connectivity. Over the next five years, Accor plans to open 71 properties in Africa, raising inventory by 14,000 rooms to over 40,000, he said.
Economy, middle segments
In Africa as a whole, Willis is currently seeing a rise in demand for economy, midscale and extended stay segments, which he says is a “perfect fit” for Accor’s mid and economy brands such Ibis and Adagio.
- Accor, which has been in Africa since 1974, plans to open 16 hotels in Africa in 2020, which will increase its presence by nearly 3,000 rooms.
- These include the first Pullman hotel in Kenya and two Fairmont properties at Taghazout and Rabat in Morocco.
- The company also plans three new Mantis hotels in Rwanda, which will make the brand the country’s largest international operator.
Accor plans five hotels in Ethiopia, four of which will be in Addis Ababa and one in Mekelle.
Four of the hotels are scheduled to open in 2021 and the fifth in 2022, Willis said.
- He welcomed Ethiopia’s plan to build a new airport billed as larger than Heathrow. “This can only impact business and supply in a positive manner.”
- It’s too early to comment on the impact of coronavirus on African markets, Willis said. Accor Hotels is closely monitoring the spread of the virus and has taken measures to minimize risk of transmission, he said.
Bottom Line: More open visa regimes would improve the odds for Accor’s strategy and benefit African economies.
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