Innovation fund moves to bailout tourism industry

Malawi Innovation Challenge Fund (Micf) says it wants to resuscitate the country’s tourism sector by providing financial support to business ideas across the sector, one of the worst-hit by the Covid-19 pandemic.

Micf fund manager Navin Kumar said in an interview on the sidelines of the virtual launch of the Tourism Recovery Window, through the United Nations Development Programme (UNDP) that considering the negative impact the pandemic has had on businesses in the sector, the fund will contribute 30 percent of the total project value.

This is unlike in the past when both the fund and beneficiary firms would each contribute 50 percent.

Said Kumar: “As governments around the region and internationally have introduced measures to contain the Covid-19 pandemic, restrictions on travel, business operations and people-to-people interactions have brought the tourism sector to a standstill in many countries, with Malawi being no exception.

“Even when tourism supply chains start to function again, new health protocols in the region, which may be adopted in Malawi, mean businesses will be operating at a restricted capacity.”

Following the arrangement, Micf contribution will be between $200 000 (K148 million) and $300 000 (K222 million), with the grantee contributing at least 30 percent of the total project value.

Firms, including hotel and accommodation providers, tour operators and eco-tourism providers wishing to apply for the window must, among others, be a private for-profit company with the idea implemented in Malawi and with a minimum turnover of $200 000 (K148 million).

The projects will be expected to be completed within a maximum 30 months.

UNDP resident representative Shigeki Komatsubara said the tourism recovery window is being launched at a time of grave uncertainty and risk, observing that if economic ramifications of this pandemic are not considered, many of the hard earned gains over the past decade could be lost.

Secretary for Tourism Isaac Katopola said the Covid-19 pandemic would cut tourism sector earnings by 60 percent, adding that many hotels have an occupancy rate rate of less than 10 percent since April this year.