Tourism industry likely wanted more from Ramaphosa's SONA on recovery action, expert

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The hospitality industry, in particular, has been amongst the sectors hardest hit by lockdown measures.
The hospitality industry, in particular, has been amongst the sectors hardest hit by lockdown measures.
  • A tourism expert says he would have wanted the President to articulate plans in SONA to deal with incentivising the domestic tourism market.
  • Focus on an e-visa should maybe be secondary at this point, in his view, as it speaks to the international tourism market.
  • Projections by hospitality businesses show a significant decline in earnings, down on average by 72% for the next three months.

The industry and its parent ministry likely expected to hear more on recovery measures and stimulus support in President Cyril Ramaphosa’s State of the Nation Address (SONA) on Thursday evening.

This is the view of Dr Kaitano Dube of the Department of Hospitality, Tourism & Public Relations at the Vaal University of Technology.

Apart from saying that work is underway to reform SA's visa and immigration regime to grow the tourism sector, Ramaphosa announced that the special Covid-19 Unemployment Insurance Fund Temporary Employer/Employee Relief Scheme (TERS) benefit will be extended until 15 March 2021, but only for those sectors that have not been able to operate.

Specifics around which sectors would be included would be announced at a later stage. Dube says delays with processing business tourist visas, for example, has a huge negative bearing, as investors then regard SA as, “... the destination of last resort”, in terms of wanting to bring skills that aren’t available in the country.

“An e-visa application is a welcome development always but for now, our focus would have been on how we can tap into [the] domestic and regional tourism market to provide industry much needed relief given insufficient budget support to the industry,” says Dube.

“I would have wanted the president to articulate plans to deal with incentivising the domestic tourism market and on how the country can tap into the regional tourism market, within SADC. Plans on how we are going to deal with the sort of challenges we have seen playing out at Beitbridge and other borders such as Lebombo border posts to promote regional tourism into the country.”

He points out that almost all borders in trans-frontier parks have been closed after Covid-19 restrictions with serious impacts on the regional tourism market. This needs attention.

International tourists

“We are unlikely to see any significant international tourism flow from the international tourism market up until such a time we achieve herd immunity in the country. Achieving this at the current rate can take us up to earliest in my prediction informed by SONA Covid-19 vaccine procurement plan at best in late 2021 or early 2022 realistically speaking,” says Dube.

“Given the current variant of Covid-19 dominating South Africa, we are unlikely to see any significant travel to the country until such time as we achieve herd immunity.”

That is why, in his view, the e-visa is a secondary aspect for now in as much as it speaks to the international tourism market. 

“Maybe we might need at a later stage when the pandemic is over to extend a visa on arrival to those countries mentioned in SONA as a vigorous marketing campaign to kick start the industry,” he suggests. 

State of tourism

Referring to Stats SA tourism data for the period since the pandemic started in SA in March last year, Dube says the best performing tourism period must have been November to mid-December. 

“At best most tourism companies were operating at around 30% a few might have gone as far as 50%. With the country moving to adjusted Level 3 Google Mobility Data shows that most people were staying at home,” says Dube.

“With the tourism sector largely having been dependent on the domestic market during the Covid-19 pandemic era there are strong calls for the government to find ways of preserving the tourism industry as it is one of the largest job spinners we have.”

In his view, the focus should be on preserving the current tourism businesses as new entrances are likely to fail.

Last but not least, Dube wonders whether it is not perhaps time to take the money allocated for SAA’s business rescue, and use it rather towards saving the local tourism industry, especially in the light of an expected third wave of the pandemic, something tourism can hardly afford.

Industry responses

Tourism associations like the hospitality industry body Fedhasa, the tourism services association SATSA, and the Association of Southern African Travel Agents (ASATA) have all welcomed Ramaphosa's TERS announcement. They, however, await clarity on what conditions would be for businesses to qualify for it.

Projections by hospitality businesses show a significant decline in earnings, down on average by 72% for the next three months. Plettenberg Bay's hospitality industry, for example, estimates that the town lost in excess R674 million in tourism earnings between the months of October, November, and December 2020 as the tourism industry experienced the cancellation of Plett Rage, the closure of their beaches, and the ban on alcohol sales in hotels and restaurants.   

"The hospitality industry, in particular, has been amongst the sectors hardest hit by lockdown measures with no business left unscathed, from the large group brands all the way down to a modest tavern or small coffee shop. Many have been unable to reopen, despite the easing of certain regulations in recent days, specifically due to the absence of international and corporate travel, as well as restrictions on operating hours and limits on customer capacity," says Fedhasa chair Rosemary Anderson. 

David Frost, CEO of SATSA, is hopeful that Nedlac, following multiple engagements with the Tourism Business Council of SA, is aware of the plight of the industry and the need for relief in order to retain jobs, and that this will result in tourism being included in the list of sectors the UIF/TERS extension will apply to.

CEO of ASATA, Otto de Vries, says a significant number of countries around the world, including Australia, Algeria, Belgium, Brazil, Canada, Croatia, Dubai, France, Germany, Hong Kong, Ireland, Israel, Italy, Mauritius, the Netherlands, New Zealand, Spain, Singapore, Qatar, the UK, and the US have instituted travel bans from South Africa in the wake of concerns around the Covid-19 variant first reported in South African.

These countries form by far the largest portion of our outbound travel market.

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