AFRICANEWS

Zambia

Terror hits tourism trade, tea companies

Economy

The terrorist attacks in the United States have reduced Zambia’s flourishing tourism trade to a trickle, and tea companies all across Africa have been hit. But there’s a silver lining behind the cloud, with the announcement of new trade deals between the U.S. and COMESA.

The aftershocks of the September 11 bombing of the World Trade Centre and the Pentagon in the United States have found their way into Zambia, shaking the country’s tourism trade and tea companies to their foundations.

Zambia has felt the impact of the terrorist attacks as the expected tourism boom is at on its knees. Tour operators in Zambia are now facing near extinction, handling between five to 10 foreign tourists as compared to 100 to 300 tourists per month before the terrorist attacks.

Tour operators say that the accommodation room occupancy rate in Livingstone, Zambia's tourist capital, has plummeted. It is estimated that the strike on terror has cost the Zambian economy a whopping US$13 million through cancellation by tourists who should have visited the region. The tour operators argue that there was no way Zambia could register a tourism boom when all countries in the SADC region have recorded poor performance after the bombings.

The decline in tourism comes in the wake of worldwide safety concerns following threats by Osama Bin-Laden discouraging Muslims from flying and climbing tall buildings.

Sindiso Ngwenya, deputy general secretary of the Common Market for East and Southern Africa (COMESA) Free Trade Area, told a recent meeting of the Zambia Business and Financial Writers Forum that, although most COMESA countries are relatively safe, the fear of flying in the west will greatly affect the tourism industry, which heavily depends on tourists from the west. The airline industry will also face direct effects in the reduction of passengers.

"The first economic sector to be directly affected is the tourism industry," said Ngwenya. He noted that the attacks in America occurred at a time when the global economy was going through a recession.

"One can clearly see that the recent attacks in America and counter attacks on Afghanistan will affect the entire world as well as the COMESA region politically as well as economically," Ngwenya said.

He added: "It is quite clear that on the political front, the recent terrorism attacks in America will have an effect on global politics in the sense that we have already seen a shift of focus from economic development to security concerns."

Meanwhile, the tea industry is also limping along. Ngwenya said that thousands of jobs in the COMESA region have been threatened by the persistent bombing of the Taliban-led Islamic State of Afghanistan by American and British forces, which has resulted in the abrupt "death" of a big tea market that the impoverished sub-Saharan region was enjoying in Afghanistan. Afghanstan provided one of the major markets for tea.

Ngwenya said that the rapid development of intra-COMESA business over the last year saved several tea companies from total collapse. "Afghanistan was a major tea market for COMESA," he said. "If we had no business linkages and strong partnerships within our region, our tea prices could have tumbled and farmers pushed out of business."

COMESA boasts of good tea companies in most of its member countries, with Kenya, Malawi, Zimbabwe, and Zambia standing out. There have been no reports of collapses in Kenya and Malawi. Zimbabwe has, however, reported low business in most sectors, largely due to the political tensions in the country.

Zambia's Kawambwa Tea Company is reportedly facing liquidity problems. Ngwenya could not say if the problems of Kawambwa had a direct link to the bombings in Afghanistan.

Kawambwa Tea Company, a former state enterprise, was sold by the Zambia Privatisation Agency (ZPA) to Metal Distributors of the United Kingdom for K400 million cash (about US$100,000) in 1996. Kawambwa had established markets in the sub-region as well as Southeast Asia.

Some Kawambwa tea workers could not link the firm's failure to the loss of the Afghan market, emphasising more that lack of investment since privatisation was responsible for the current status of the company.

The U.S. and Britain believe that Osama bin Laden and the Al Queda were responsible for the attacks, which claimed more than 5,000 lives. Bin Laden has denied involvement but stated that he strongly supported the attacks.

Bin Laden, a Saudi royal, has been living in Afghanistan as a guest of the Taliban, the ruling Islamic militia led by supreme leader, Mulla Omar. The Taliban has since declared a "Jihad," holy war, on the U.S. and has been calling on all Moslems around the world to attack American interests.

The U.S. has been on alert since the bombings started as fears of more terrorist attacks grew. Since the attacks, businesses across Europe, America, and Asia have recorded massive losses, with airlines being the worst culprits.

The U.S. government says it will do everything possible to enhance trade and investment in Zambia and Africa in general despite setbacks including the September 11 terrorist attacks.

Dan Mozena, deputy chief of mission at the U.S. embassy, said November 7 that the attack on the U.S. would "see the rise of a phoenix of love, peace and prosperity." He was speaking at a reception his embassy hosted for managers of Zambia's mining companies and top officials of General Electrical, one of the biggest companies in the U.S. that has broken investment ground in Zambia.

Mozena said since his government was aware that poverty was a catalyst of terrorism, his government would do everything to enhance trade with Africa in an effort to eradicate poverty.

The U.S. has, meanwhile, signed an agreement with COMESA to boost trade investment in the region. In a statement released in Lusaka on November 8, COMESA said it is the first regional grouping in the sub-Saharan Africa to sign a Trade and Investment Framework Agreement (TIFA) with the United States.

The main purpose of the TIFA is for the development of the improved trade and investment relations between the U.S. and COMESA. The agreement is aimed at developing and expanding trade in products and services and promoting appropriate measures to encourage and facilitate trades in goods and services.

It will help the two sides to review the progress made by COMESA member states in taking advantage of the AGOA. The agreement will also provide for the convening of the Council on Trade and Investment. The council will also be responsible for identifying and working towards the removal of implementations to trade and investment.

The signing of the TIFA is said to have marked another milestone in the history of cooperation between the U.S. and COMESA. COMESA has also established an attractive dialogue with the U.S. private sector through the Corporate Council on Africa.

This agreement signals the intention of the U.S. and the international community to move on from the devastation of the September 11 attacks. The Organisation of African Unity (OAU), while condemning terrorism, feels the international community has shifted its attention from political problems afflicting Africa to the strike against terror in Afghanistan.

Addressing the 56th United Nations General Assembly in New York on Saturday November 11, Zambian president and OAU chairman Dr. Frederick Chiluba called on the developed world not to overlook the problems of Africa as they focused their efforts on fighting the scourge of international terrorism.

Chiluba called terrorism "an affront to humanity" and "a heinous and cowardly act" that was hated almost as much as apartheid or any form of racism. He said Africa would continue to fight international terrorism as it had done for years and would remain resolutely committed to this cause.

In spite of the magnitude of the problem of terrorism, this must not override or deduct from the international community the appropriate focus on the outstanding matters on the global agenda, said Chiluba.

President Chiluba, who catalogued examples of where Africa had made efforts to solve her own problems, said, however, that the continent needed moral and practical support from the international community, emphasising that the international community should be full partners in the search for peace in Africa.

He was referring to the persistent conflict in the Democratic Republic of Congo that had started receiving UN attention prior to the September 11 attacks in America.

But the US and its allies decision to fight Afghanistan for harbouring alleged terrorist Osama-Bin Laden has shifted the focus from the war-torn DRC. For instance, the UN General Assembly chose to discuss among things terrorism as opposed to finding lasting peace solution in Africa.

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