Tourists in SA smiling all the way

2014-01-19 07:16

Cape Town - Clutching shopping bags, quaffing wine, and lounging on pristine beaches: South Africa's weak rand is drawing few complaints from foreign tourists who these days get more bang for their tourist bucks.

The teetering rand, a victim of ongoing emerging market volatility, is tipped to remain on the back foot after hitting a fresh five-year low of around 10.87 against the US dollar.

The plunge comes as tourists flock to Cape Town -- named as the world's top place to visit in 2014 by The New York Times -- for the peak southern hemisphere summer season armed with hard currency.

"From a visitor perspective, it all bodes well for international visitors coming to Cape Town," said Cape Town Tourism CEO Enver Duminy.

Foreigners spent an estimated $1.2 billion (R12.7bn) last year in the city and the industry is already pointing to a rosier season.

Official figures for December are still being tallied but feedback from hotels, tour operators and restaurants is that things look "a lot better" than the previous summer.

So cheap!

"If you look at our key source markets - UK, US, Germany, Netherlands - the exchange rate is in the favour of those travellers," said Duminy.

"Which is great news for us which means that we become a lot more affordable for a lot more people wanting to leave Europe or the US."

While recent market darlings, emerging economy currencies like South Africa have been hammered by moves in the US Federal Reserve to ease its stimulus package.

Added to this are domestic challenges such as sizeable twin deficits and spending needs, after a run of turbulent strikes.

"It's largely a global story of which South African characteristics play a part and certainly the depreciating trend is strong," said Peter Kent, portfolio manager at Investec Asset Management.

"We wouldn't be surprised to see it depreciate some more but on a sort of medium term horizon I would expect some stability, possibly a small rally."

Wine sales up

In the meantime tourists like Norwegian Vidar Woldengen, 47, are getting a welcome surprise.

"When people in Europe find out, I'm sure they will bring their money here as soon as they find out because I was really surprised," he said while browsing a popular African craft market.

"Now they can afford it."

Foreign arrivals were up by 14.5% year on year in November and hotels are reporting strong occupancy rates.

For the area's famed wine farms, the exchange rate is a boost but long-term impacts are also being eyed.

The rand helped winemakers smash exports records in 2013, with volumes leaving the country up 26%.

The country's oldest surviving estate Groot Constantia, hugely popular with tourists, exports 60% of its wine and sells a further 20% through its tasting room and restaurants.

Long term plans

"The effect of the weak rand now benefits us in the short term in terms of income but in the long term, it's going nail us in terms of input costs," said Jean Naude, general manager.

Others agree the long term impact of the weak rand is still to be seen.

"It does help with bang for buck but it's a small component of the decision making," said Rey Franco, manager of the Victoria & Alfred Hotel at the popular Waterfront shopping and restaurant hub.

"The feedback I've heard mostly from guests is 'wow, it's so cheap here', and that goes back to the fact that currency plays a factor in variable spending but it's not the decision maker when it comes to travel."

  • DerpyHooves - 2014-01-19 07:34

    "South Africa's weak rand is drawing few 'complaints' from foreign tourists." Some people are never happy. Or someone messed up 'complaint' with 'complement', tsk tsk, and it's in the subheading.

      Prangsuda Oudomsuk - 2014-01-19 09:01

      I beg to differ Sanity. Implying that being a tourist is fashionable makes me think you've never traveled abroad.There are many countries that rely heavily on tourism and are able to maintain these tourist levels for years. You seem like the type who will want an example, Thailand, about 20 million people a year. Further more, tourism creates opportunities for those in numerous sectors. If the prices are right, the services on standard and the LOCALS attitudes in check, tourist will come. In my opinion.

      Jonathan Woods - 2014-01-19 10:15

      Firstly, Derpy I know English is not your first language and it can be very confusing at times, but if you understand English then the statement actually makes perfect sense! Prangsuda, that is the whole point. Service, local attitude, safety. Places like Thailand have worked hard at these areas to retain the tourist volumes. About the only thing in SA's favour at the moment is price. The rest suck big time compared to other destinations!

      Tony van Niekerk - 2014-01-19 13:20

      Jonathan, I met up with a host of foreign tourists over the festive season and local attitude, as you put it, is one of the things they love most about SA. Comments are that everyone is so friendly, service is exceptional, food and accommodation is stunning. I am not sure where you get your information from, but it differs from the general trend.

      Justin Hemming - 2014-01-20 11:48

      U r either just dumb, or not English - makes perfect sense.

  • Lesia Mohale - 2014-01-19 07:52

    Yes, this is a country of peace. Let all come and enjoy life with us. Lets share Africa. No civil wars and kidnapping-and-ransom claims here. We are all citizens of the globe.

      Grace Andtruth - 2014-01-19 08:06

      What country do you live in? Not SA!!!

      Feik Mc Heither - 2014-01-19 08:55

      I think he just described it, SA. What country do you live in Grace? Maybe try and move to Yemen or Kenya then you'll know what a fcked up country look like. I'll even direct you to the US, they'll treat you like cr@p from the moment you land...and don't tell me about New York or LA when you haven't visited out sketches of the 'heavenly' US that gets sold to you over the media. If you are a traveller (which you clearly are not), you will appreciate SA every moment you set your foot in a different country.

      Chuck Morris - 2014-01-19 10:38

      You know that world is not only Africa? Why you not talk about European countries. My 16 years old daughter just spent one and half month on holiday in Europe and she didn't want to come back. She was born in SA and as she says, if she can stay in Europe only what she will miss is parents and weather, but not circus, which SA become.

      Eish Wena - 2014-01-19 11:14

      Give me some of that sh$%# you smoking brother.

      Tony van Niekerk - 2014-01-19 13:22

      Agree, Lesia. Our country offers tourists the best there is globally.

  • Peter Ogle - 2014-01-19 08:18

    South Africa has lost lots of its good skilled workers,most have left the country but for me its worth working out thanks to the leaders of S.A

      Grace Andtruth - 2014-01-19 08:25

      Do you also sleep with a zuma blanket?

      agness.makgoka - 2014-01-19 08:29

      Just go Zimbabwe did not vanish from earth because of alienation, nor did North Korea.

      Chuck Morris - 2014-01-19 10:50

      Yes didn't vanish from earth, but would you honestly to go stay and live there? And if yes, you should seek medical advice.

  • lovenergy - 2014-01-19 08:24

    News24 are you seriously trying to put a positive spin on our effed up currency? It might be getting cheaper for tourists but the citizens are suffering!

      Jon Low - 2014-01-19 12:10

      The citizens employed in the hotel, restaurant, car-hire and other hospitality businesses aren't suffering at all. They're doing very well.

  • Gluteus Maximus - 2014-01-19 08:30

    So are we to become a country of waiters and waitresses? Wake up we need real jobs and industry. For v that we need a good government and education.

  • Reine Marais - 2014-01-19 09:01

    People don't want to actually Live here. They want to tour here. Elsewhere they can actually get a job. And they can actually afford to live. Here they get to holiday at a really cheap rate, spend their foreign currency, converted to rands, and then go back to their jobs and their lives. They don't have to stay here and deal with the bureacracy, the appalling cost of medical aid, the 'no job' scenario because one is the wrong colour or the wrong age or the wrong gender. And we grovel to the tourists, after all. Because that seems to be the only place left by which to survive, albeit for a single season, in ZA.

      Jon Low - 2014-01-19 12:12

      Tourists tour, and then go back home. That's what tourists are supposed to do.

  • DraconiaShadow - 2014-01-19 09:02

    exchange rate is a victim of zuma . what a joke

  • Chris John - 2014-01-19 09:20

    Anyone seen a pristine beach recently?

      Judith Mellet - 2014-01-19 12:49

      Been to Cape Town recently, Chris? Kilometers upon kilometers of pristine beaches all along the coastline...

      Tony van Niekerk - 2014-01-19 13:25

      Everywhere around me, no matter which one I choose. Don't know about Natal but can confirm from George to Lamberts it looks fantastic.

  • Dirk Fourie - 2014-01-19 09:22

    The flock of tourists will surely raise prices due to the greediness og businesses. SA'ns will not be able to afford its own country's tourist destinations or properties. But the ANC gains lots by deflating the Rand. Its not the emerging markets, its the Rand dropping even against the Mozambique and Indian currencies.

  • JeanMeyer - 2014-01-19 09:59

    What is with you people, making every single thing about politics and who runs the co

  • JeanMeyer - 2014-01-19 10:12

    Why do people on here always make everything political. Anyway, this country needs tourists to spend money. I live in Cape Town (the tourism paradise of RSA) and I can tell you there is nothing more wonderful to see other people enjoy the city and country that we take for granted. And if you read the article you would have seen that the tourist industry just in Cape Town alone brought in R12bn. That money stays in the city and province. Most of it will go back into the industry and even into service delivery. And the money doesnt go to government because the tourists doesnt pay government to go and eat. They pay the restaurant, meaning the money goes directly into business who will now be able to expand and create more job opportunities. This country needs tourists.

      FairnessforAll Freedom - 2014-01-19 12:15

      The money goes into the business, does the business not pay tax based on their earnings?, therefore, government gets their share, not so.

  • Ntutu Dlova - 2014-01-19 10:27

    Any scandal in this that DA can use

      Judith Mellet - 2014-01-19 12:51


  • Billy Basson - 2014-01-19 10:34

    I will be here to free the dolphins and switch off the lights.

  • Alan Meyer - 2014-01-19 17:32

    This is how we create jobs. Bring the tourists. !!!!

  • Andile Mafredos - 2014-01-19 21:24

    ANC led government should prioritize to combat high profile crimes committed by illegal Nigerian immigrants. Nigerians flock to South Africa for the sole purpose of committing horrific crimes such as banking fraud, drug sales, identity theft, fake marriages and child kidnapping. They enter South Africa under the pretext of tourism and conducting business, but only to overstay their permits and expand their criminal network in South Africa. Why cannot the government launch a massive operation against Nigerian criminals? Many South Africans have been victimized by these fraudstars who hack bank accounts of not just individuals but also businesses. Unless the South African government take firm measures such as tracking the already present Nigerians and sending them back home, limiting the number of those entering the country and keeping an eye on them, south Africans will continue to live under the fear of Nigerian criminals

  • Marlese Thompson - 2014-01-22 14:59

    It is not fair they can enjoy the cram of our lovely country but we the locals can not be course the pricing is to high for normal households all the places just caters for the over seas market we would also like to show our kids and Grandkids our lovely country but can not afford it. They must have pricing for South Africans that is affordable and have different pricing for over seas visitors

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