Tanzania and Kenya are projected to have the next fastest growing hotel industry in Africa after Nigeria, due to ongoing tourism promotional campaigns, a healthy economy and strong visitor appeal, a report says.

The report by PricewaterhouseCoopers (PWC) – Hotels outlook: 2018-2022 – says room revenue increased by 15.4% in Tanzania and 28% in Kenya in 2018.

In Tanzania, the impact of the 18% VAT tax on tourist services and rising visa costs for business visitors that hurt the market in 2017 was largely absorbed in 2018, and guest nights rebounded.

"We project Tanzania and Kenya to be the next fastest growing, with compound annual increases of 8.2% and 7.4%, respectively. Increased room capacity, a strong economy, growth in tourism from India and China, and Tanzania’s appeal as an exotic destination will fuel growth over the next five years,” the report says.

"Overall room revenue in South Africa, Nigeria, Mauritius, Kenya and Tanzania rose 7.4% in 2018, up from the 1.9% increase in 2017.

“Mauritius continued to grow in 2018 but room revenue growth in South Africa fell to only 0.5%." Tourism is the main source of hard currency in Tanzania, best known for its beaches, wildlife safaris and Mount Kilimanjaro.

It generated $2.4 billion in 2018 compared with $2.3 billion in 2017, as the number of tourists visiting the country rose from 1.3 million in 2017 to 1.5 million in 2018. The tourism sector recorded 25% of earned foreign currency, which contributed to 17% of GDP.