OBG talks to Hassan Ahdab, Vice-President, Regional Director for Africa and Indian Ocean Islands, Starwood Hotels and Resorts Worldwide

Interview: Hassan Ahdab 

With modest visitor numbers, how important are non-room revenues and amenities in West Africa?

HASSAN AHDAB: The West African market actually presents vast opportunities. The market is booming and therefore non-room revenue and amenities don’t have to play a massive role. As far as growth goes, the continent is showing remarkable trends in a number of areas that we believe provide substantial growth prospects for the leisure and tourism industry as a whole.

For one, the IMF predicts that between 2011 and 2015, no continent will grow faster than Africa. With regard to West Africa specifically, Ghana and Nigeria represent two of the world’s fastest growing economies and will continue to be over the coming years. This macroeconomic expansion is also driving growth of a middle class in these countries. This boom in sub-Saharan Africa is attracting business talent from abroad. In recent years, investors have been piling into Lagos and Nairobi as if they were Frankfurt or Tokyo. Anaemic growth in other countries is making sub-Saharan Africa an attractive destination for investment.

Demographically, the continent and the region boast the right kind of population growth (rising longevity, and declining birth rates). With 70% of the population under 35, Africa will enjoy an extraordinary demographic dividend as young people's energy and talents drive economic growth and development. Rapid urbanisation is also accompanying this population growth, a phenomenon which lures investors to capital cities.

One trend in hospitality reflecting this increased attention on the continent is the large rise in high-end leisure tourism over recent years, with growth from emerging markets in Asia and the Middle East, specifically Japan, China and Russia. Nigeria is poised to capture some of this flow in the coming years.

What are the merits of new development activity versus acquisitions of existing hotels?

AHDAB: Putting up a hotel in Africa is not an easy task, as they have to be self-sufficient, with their own water filtration systems and generators. Infrastructure problems can also delay the construction process by a number of months. In sub-Saharan Africa, the proportion of the road network that is paved stands at 17.6%.

Even the simplest of tasks, like getting furniture and fixtures into the country, can be challenging due to dealings with supply chains, logistics issues and paperwork for imports. So both new developments and hotel conversions come with their own set of challenges.

What are the challenges hotel operators face when undertaking new management contracts?

AHDAB: Each country varies in its infrastructure capabilities. Resources such as power and water are key elements to successfully operating international standard hotels. Where these are unavailable or unreliable, it is necessary for owners or developers and operators to become self-sufficient by providing generators, water treatment plants, and sufficient water storage facilities. Because of this, importing construction materials and fittings is of equal importance to the development costs, and ports authorities are vital to ensuring fast, simplified and secure importation of relevant goods into countries. In addition, governments could help by streamlining this process as much as possible.

How can global hotel chains contribute towards the development of human resources in Nigeria?

AHDAB: Where local training and skills are lacking, global hotel chains have the benefit of being able to tap into strengths developed in other parts of the network. Global exchange programmes can expose an employee to different management expertise and a variety of skill sets required in other markets. Even without physical exchanges, electronic training can bring expertise and best practice from one corner of the company to another. This type of training can be made available for all levels. Regardless of the format, it is important that all training and knowledge shared be adapted to the locations where people are based.