Terror Takes Toll on Kenya’s Tourism Industry

Twenty-two years ago, Ron Darnborough traded the murky world of Nairobi's pipes and drains for a stretch of Kenya's palm-fringed coast.

What then seemed the perfect reward for time served managing a plumbing company in one of Africa's busiest cities seems less so now as the 75-year-old digs into savings to prevent his family-run hotel closing.

Arrivals on the coast are down 60 per cent this year, according to the Kenya Tourism Development Authority. Last year was not great either. Raymond Matiba, authority chairman, says that if the trend continues the country's number two hard currency earner will slide into long-term torpor.

The International Monetary Fund estimates conservatively that the tourism crisis has cost Kenya a percentage point in economic growth. From up-country pig farmers who supply hotels - as Kenyans have no appetite for bacon - to the minibus companies transporting hotel staff along the coast, everyone is hurting. "We are not dying yet but life is at a standstill," says Omar Shee, who freezes seafood for the dwindling population of fishermen in Watamu, the northern resort where Mr Darnborough has his hotel.

Sheltered by a reef where psychedelic fish dart through coral, and with Arab dhows floating across a turquoise horizon, Mr Darnborough's view is no less idyllic than in 1981 when he began luring big-drinking game fishermen to the Ocean Sports hotel. But thanks to al-Qaeda and the west's response to the threat it poses in East Africa, he is almost alone now propping up the bar.

Al-Qaeda has struck selected targets twice in Kenya, killing 15 a year ago at an exclusive Israeli beach hotel and more than 200 in 1998 when the US embassy in Nairobi was bombed.

Western intelligence agencies believe a small terrorist cell is eluding capture despite heavy-handed security among the coastal population of Muslims.

But US and other diplomats argue that long-term structural problems are as much to blame for the tourism crisis as the terrorism-related warnings that have discouraged westerners from travelling to Kenya for much of 2003.

Political turmoil in the 1990s, deteriorating infrastructure and competition especially from South Africa - which in the decade since apartheid ended has marketed its big game parks more aggressively than Kenya - have taken their toll on what was Africa's most popular destination.

As hoteliers halve their staff, slice fares and pray for a busy Christmas after their worst year in four decades, few are prepared to buy the diplomatic line. Most are convinced their country has been unfairly singled out in a year when terrorists have struck the world over. Nowhere else has the UK banned flights as it did for four months to Mombasa. Now the US is resisting Kenyan government pressure to soften state department warnings that make it impossible to get travel insurance.

A tour of a dozen coastal hotels gives a glimpse of the consequences. Occupancy rates range from less than 10 per cent to 25, at what should be nearing peak season. If deserted white sands, solitary deckchairs and exclusive service by waiters appeal, Kenya this winter presents the perfect destination. Tour operators have responded with cut-price deals.

According to the tourism board, smaller luxury hotels are faring a little better, as are some safari camps. But two-thirds of Kenya's $225m annual tourism revenues come from the coast where hotels tend to cater for low-budget European holidaymakers on package tours. They break even at 50-60 per cent occupancy and need more during peak seasons to make their annual profits.

The prospects of a pick-up are mixed, Mr Matiba said. A new Kenyan airline, East African Safaris, started flights from the UK this month and a Dutch charter brought in sun-seekers last week. Other European charters are scheduled over Christmas.

But charters from the UK, traditionally Kenya's biggest market, are resuming only next year. Abercrombie and Kent, the UK tour operator has just closed its office in the resort town of Malindi.

Perhaps the one thriving sector is security. A number of hotels have hired consultants to train guards. They have put up video cameras and reinforced entry points. Others have used the lull to refurbish, replacing inflammable thatch with safer, less attractive roofing to reduce insurance premiums.

"Al-Qaeda is changing the nature of the tourism industry the world over," says one hotelier. He predicts that destination risk assessment would soon be a lucrative global business. But for Mr Darnborough, and the thousands of Kenyans who have trained in the hospitality trade, it is late to be changing careers.