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Why it's business unusual for SA tourism industry

Oct 26 2019 16:53
Carin Smith

The SA tourism industry faces a time of "business unusual" where many factors conspire against it, Christelle Grohmann, director of the tourism specialist unit at professional services firm BDO, tells Fin24.

The latest Tourism Business Index (TBI) by BDO indicates that the private sector does not feel a turnaround is going to come any time soon. In fact, the 2019 TBI reflected the second lowest index figure in a 9-year period.

At the recent 2019 African Tourism Leadership Forum in Durban it was highlighted that SA can no longer expect the private sector to "entrepreneur itself" out of poor policy decisions, says Grohmann. "Every government decision, every act of xenophobia impacts the tourism and hospitality industry."

Factors such as the constrained economic climate; safety and security; birth certificate and visa requirements; and water challenges are all obstacles local tourism has to overcome against the backdrop of an already very competitive global tourism industry in which it is easy for travellers to choose other options.

These factors are all hitting the SA's tourism at once and cannot be addressed by South Africa's tourism industry on its own, neither by government on its own, Grohmann emphasises.

She explains that SA has not made any ground in recouping the 1.3% drop in 2018 overseas tourists, which has now been compounded by the latest data indicating a 2% drop in overseas tourist arrivals between January to August 2019. By contrast, tourism numbers are actually growing globally.

Figures released by Stats SA reflect that the biggest drop in overseas visitors for the year to date are from traditional markets such as France (-8.7%), Germany (-7.8%) and Australia (--4%).  These big international markets account for 74% of all overseas tourists visiting SA.

A further concern for Grohmann is the 16% drop in tourist arrivals from other African countries. The SA tourism market appears to be losing out to countries like Egypt and Kenya.

In his State of the Nation Address earlier this year, President Cyril Ramaphosa set the goal of achieving 21-million tourists by 2030. This is double the number of tourists SA had at the beginning of the year and equates to a 6% compound growth.

According to Grohmann, the latest decline in numbers highlights that the SA tourism industry is far from having the momentum to achieve these goals.

SA Tourism acting CEO Sthembiso Dlamini echoes Grohmann's view that it would take cooperation by all stakeholders in the country to overcome the challenges the industry faces.

"SA (as a tourism destination) has it all and we believe we have what it takes to reach the president's target if we all work together with our trade partners and government," Dlamini recently told the SABC at the conclusion of a North American road show undertaken by SA Tourism and the Tourism Business Council of SA.

The roadshow included stops in the UK and central Europe. Key markets identified included Austria, Switzerland and Germany, the UK, the US, China, India, Australia and Nigeria.

According to Dlamini, it became clear that SA would have to increase its "airlift" and make it easy for tourists to visit the country. Targeting the increasing number of young travellers in the word and addressing safety and security as well as environmental issues were other important points raised.

In Grohmann's view, continued traditional marketing methods are not enough - as reflected in the decline in international tourist arrivals.

"We need to all together come up with something special. SA needs the impetus of a big event like the FIFA Soccer World Cup in 2010," says Grohmann.

"Making it easier for tourists to come to SA is one thing, but at the end of the day you still need to convince them to come."

In her view, one cannot expect SA Tourism, the tourism marketing arm of the SA government, to manage the huge task at hand on its own.

"The private sector, the public sector, the South African public, all the provinces and government departments would have to work together to overcome the challenges facing the tourism industry," she concludes.

sa tourism  |  tourism  |  sa economy
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