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Gauteng accommodation pricey

Mar 26 2010 15:42

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Johannesburg - Sixty-five percent of Gauteng establishments are charging more than 50% above peak season rates for accommodation during the 2010 Fifa World Cup, a survey released by the tourism ministry found on Friday.

In North West, 53% of the establishments were charging prices 50% higher than the high season rate for 2010.

Overall, 74% of the establishments - hotels, bed and breakfasts and self-catering venues - were charging less than 50% more.

"By far the majority of accommodation establishments in South Africa are very responsible," said Tourism Minister Marthinus van Schalkwyk.

He said the industry was conducting itself "in terms of the global norm", and that the standard principles of supply and demand in a "robust, free market global economy" were at play.

Gauteng is home to three of the stadiums where World Cup matches will be played, two host cities and will host the opening and closing games.

His department commissioned Grant Thornton to conduct the study, which sampled 2 479 accommodation establishments, less than a quarter of the 15 882 establishments it asked for information.

In the Western Cape, only 13% of the establishments were raising their prices by more than 50%.

'Only 10% are very bad apples'

This was because the industry in the province had signed a code of conduct on responsible pricing.

"Given the fact that South Africa is a robust free market economy, fans are encouraged to shop around and avoid establishments with exorbitant pricing, in line with our desire that South Africa continues to remain a value for money destination," he said.

Van Schalkwyk had assured the tourism industry that the government would not set prices for them.

"We believe that the industry should take responsibility for the few bad apples... this industry has acted responsibly.

"I've given an assurance to the industry that we will treat the industry with a light touch," he said.

Van Schalkwyk said what was happening in South Africa did not "come close" to the price gouging in Athens, which hosted the 2004 Olympics.

In Athens, overly inflated prices led to tourists staying away from the destination during and after the event.

The study, which used Athens as an international benchmark, noted that prices there were inflated by 260% on the same period the previous year.

Van Schalkwyk wanted visitors to return to South Africa after the World Cup.

Industry officials were confident that accommodation would be "sustainable".

Tourism Business Council of SA chairperson Tommy Edmond said: "In reality there is accommodation with reasonable prices available."

Federated Hospitality Association of Southern Africa executive director Brett Duncan acknowledged that prices had increased.

He said there would not be a shortage of accommodation during the tournament, which the government expects will draw 450 000 tourists to the country.

- Sapa

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