Tourism is a key driver in every emerging economy’s GDP, driving growth and job creation. Yet, what of the luxury segment and its potential growth in the tourism sector?
According to a new report published by Allied Market Research, titled ‘Luxury Travel Market – Global Opportunity Analysis and Industry Forecast, 2014 to 2022’, the global luxury travel market is expected to generate US$1,154bn by 2022, growing at a compound annual growth rate of 6.4% from 2016 to 2022. Millennials in particular are projected to play a significant part in driving this growth as they seek experiential and unique travel experiences while being very connected with technology (i.e. via social media), enabling them to communicate their experiences to the world. Millennials are fast becoming today’s travel market due their influence, affluence and aspirational outlook.
Africa is known for its experiential travel but there is still a wide gap for luxury experiential travel to take the lead. To this end, Africa’s Travel Indaba 2019 has set up its ‘Luxury Pavilion’ where some of Africa’s most extravagant travel escapes will be showcased to buyers with the express aim of growing the luxury segment’s slice of the bigger tourism pie.
“All participants at this year’s Africa’s Travel Indaba Lap of Luxury Pavilion are valued for their quality service, experience, innovation and heritage. In 2019, we want to show that Africa, especially South Africa, is a destination well positioned in the minds of foreign tourists seeking exclusivity, luxury and unique experiences,” says Amanda Kotze-Nhlapo, South African National Conventions Bureau Chief Convention Bureau Officer.
In 2018, the United Nations World Tourism Organisation reported an increase of 36m international arrivals on the continent between 2000 and 2017. The tourism industry is also playing an increasingly important role in the global economy, contributing 5% of GDP, 30% of service exports and 235m jobs worldwide. While the luxury segment is well established in parts of East and Southern Africa, there is still room for growth of luxury offerings on other parts of the continent.