Nam records an occupancy rate of 61% in July
A boost for tourism
July 2023 occupancy levels have been the best over the last five years.
The tourism peak season of 2023 is exhibiting robust performance, with July 2023 recording an occupancy rate of 61.0%, compared to 51.0% in July 2022. The month of July marks the commencement of peak season by demonstrating a steep uptick in occupancy rates for each year. July 2023 occupancy levels have been the best over the last five years, having surpassed July 2018’s occupancy rate by 0.12 percentage points, according to Simonis Storm.Year to date (YTD), the average occupancy rate is 46.3%, 2.6 percentage points short of 2019’s average of 48.9%.
This performance signals a continued and much needed recovery within the tourism sector. This should be positive for the third quarter (3Q) of 2023 gross domestic products (GDP) results, as additional tourists translate to higher general consumer spending in the country and supports accommodation and tour operator businesses as well, Simonis Storm added.
On average, occupancy rates in the different areas of Namibia have increased by 9.5 percentage points on an annual basis and 9.8 percentage points on a monthly basis. The southern area of Namibia recorded the lowest occupancy rate in July 2023 at 58.9%, from 50.7% in the prior month. This month, the central area had the highest occupancy rate of 62.7%, followed by the northern area at 62.5%, and the coastal area at 59.5%.
YTD, Germany, Switzerland and Austria accounted for the largest stake of our occupants (33.5%), being the usual main tourist source market for Namibia. Locals are the second largest driver of visitors at nationwide hospitality establishments, accounting for 25.1% of occupants, followed by South Africans at 9.0% YTD, Simonis Storm pointed out.
Airport
The number of arrivals at Hosea Kutako International Airport (HKIA) are close to general pre-pandemic levels, primarily driven by international and regional arrivals. The first half (1H) of 2023 underperformed compared to 1H2018 and 1H2019, but outperformed 1H2017.
This reinforces the point that the tourism sector has not yet recovered fully to pre-pandemic levels but is expected to do so by 2024.
HKIA received 16 472 international arrivals compared to 11 952 in June 2022 and 141 in June 2020. Namibia Airports Company (NAC) have reached breakeven point according to the preliminary results of FY2022/23, operating at about 78% of pre-pandemic levels. Construction of new terminal buildings at Katima Mulilo, Rundu and Luderitz is planned to meet current demand and improve services in anticipation of more arrivals due to mining activities in the North and oil, gas and green hydrogen activities in the South of Namibia. This should also benefit local construction companies, if locals are able to be awarded the job.
In 2023, rental companies in Namibia recorded the highest level of vehicle purchases since June 2019. This is in response to a significant increase in demand for rentals, with expectations of further increases in the upcoming peak quarter. The self-drive trend continues to be the top choice for a lot of tourists visiting Namibia, resulting in sustained high demand for rental cars equipped with camping gear.
This has also supported very high levels of general vehicle sales, improving profitability of car dealerships and adding to retail sales, Simonis Storm said.