The effect of the Ebola virus is gradually taking its toll on businesses in the country, with hotel occupancy and the inbound load factor for air travel dropping by an average of 50 per cent in Nigeria’s commercial capital, THISDAY has learnt.
The Managing Director/Chief Executive Officer, Financial Derivatives Company Limited (FDC), Mr. Bismarck Rewane, who confirmed this, revealed that in the Ikoyi area of Lagos, hotel occupancy had nosedived from 65 per cent to about 30 per cent, while in Victoria Island, where hotel occupancy is higher, investigations showed that it had also fallen from about 70 per cent, down to about 20 per cent since the outbreak of the virus.
Similarly, dinning and restaurant traffic in major hotels in the state has also declined by 50 per cent.
When contacted, a manager of one of the leading hotels in Lagos who did not want his name in print, confirmed a 50 per cent drop in dinning and restaurant traffic.
The virus which is estimated to have killed over 1,500 people in Guinea, Liberia, Sierra Leone, Democratic Republic of Congo (DRC) and Nigeria, spread to another West African country, Senegal at the weekend.
Rewane further disclosed that outbound and inbound load factors for air travel, which usually peaks at this time, has also suffered.
According to the FDC CEO, whereas the outbound load factor was still high at 90 per cent, the inbound load factor had dropped significantly to about 40 per cent.
Also, he said inter-regional aviation traffic in the West African sub-region, of which Nigeria alone accounts for 30 per cent of the flights in the region, had dropped by 75 per cent.
“The sub-region has a lot of tag-along flights because of its high level of intra-regional trade with Nigeria, a major commercial hub in the sub-region as a major trade destination,” he explained.
He added that a lot of informal trades also take place between Nigeria and other countries in the sub-region.
In terms of trade, he said the informal sector in Nigeria accounts for 30 per cent of the country’s GDP.
“Most of these retail traders in Nigeria travel by road to these West African countries, but all this has died as a result of the Ebola outbreak,” he added.
According to Rewane, “This is not something that we can joke about because what is happening to the worst hit countries has a serious knock-on effect on the Nigerian economy.”
He cautioned the federal government not to underestimate the economic consequences of the virus in West Africa, insisting that it would be in the interest of the government to ensure that its neighbours effectively combat the virus.
Rewane recalled that during the Euro crisis about two years ago, Germany, as the largest economy in Europe and fourth largest in world, moved promptly to bail out Spain and Greece, in order to avoid a knock-on effect on its economy.
THISDAY had exclusively reported last week that Africa’s richest man and Nigerian cement magnate, Alhaji Aliko Dangote, had pulled out some of his employees from his cement plant in Liberia.
The Chief Executive Officer, Dangote Cement Plc, Devakumar Edwin, had explained that some members of staff of the company had left Liberia as a result of the spread of the virus and increased air transport out of the West African country.
Moody’s had announced that the outbreak of the virus in Nigeria could lead to serious disruptions in some sec
tors of the economy with negative financial consequences.
An FDC report listed sectors that would be impacted mostly by the epidemic in Nigeria to include aviation, hospitality and tourism, trade, medical and agriculture.