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Tourism numbers paint a bleak picture for the industry

SA’s message to potential tourists requires adjustment.

Any thought that South Africa’s new era under President Cyril Ramaphosa would see tourists flocking back in their numbers was put to rest by tourism arrivals figures for April.
 
The figures, which show an almost 7% decline in foreign arrivals, paint a bleak picture for an industry that was earmarked by Ramaphosa as one of four sectors that will reignite the economy.

The figures also reflect what many expected – that the water crisis in the Western Cape has likely cost the economy dearly.

Residents queue to fill plastic water bottles at a natural water spring on the site of SABMiller’s Newlands brewery in Cape Town in February. Picture: Waldo Swiegers/Bloomberg

StatsSA said just over 3.5 million people passed through ports of entry in April based on Department of Home Affairs immigration information, with foreign arrivals decreasing 6.9% to just short of 1.3 million. Departures decreased by 9.1% and transits by 4%.

With Easter falling in March last year and April this year, the results for April alone look particularly bad, but are something of an anomaly.

StatsSA says that cumulatively, from January to April, the number of tourists from overseas countries decreased by 1.5% year-on-year.

Grant Thornton director Lee-Anne Bac says April’s stats were bad, but should be treated with caution because of the shift in the Easter holidays. The year-to-date figures for 2018 show that overseas arrivals are down 1.5%, while arrivals from the rest of Africa are up 5%. Total tourist arrivals are up more than 3%. This is nothing to crow about, but is certainly better than the April figures infer.

The water crisis is a big part of the problem, but there are other issues, says Bac, citing global turmoil as well as security concerns that we are not necessarily hearing about in SA, but which are nevertheless there.

She says one of the biggest problems is that South Africa is not sending a cohesive message to potential tourists: “Everyone, from our politicians to the private sector, needs to be aware of what they are doing and saying, and how this has an impact on tourism.”

With the water crisis, for example, the restrictions, panic and even the term ‘Day zero’ had a big impact, she says. “It was all [intended] to get locals to save water but the impact was much greater. As a society, we need to be more conscious of the repercussions of what we do.”

Hotels are not faring well, she says, and while the growth in Airbnb accommodation may have had some effect, the occupancy numbers, combined with foreign arrivals data, are a reflection of reduced demand rather than competitive pressure. 

Michael Avery speaks to Minister of Tourism Derek Hanekom to discuss factors impacting our disappointing foreign tourism statistics. Listen to the podcast: 

In 2018 (up to April), hotel occupancies were 62.3% against 67% in 2017 overall. The biggest problems are being experienced by five-star hotels, especially in the Western Cape.

Occupancy at five-star hotels in Cape Town in April was 55.8% compared to 69.4% last April, while average daily rates were R2 727 against R3 241 last year. Four-star hotels are also suffering, with occupancies at 56% (67%) and average rates at R1 200 (R1 300).

A view of the One & Only hotel in Cape Town. Picture: Shutterstock

Even taking the Easter shift into account, March figures, which should have had an Easter boost, are not much better. 

Five-star occupancies in March were 72% compared to 81% (with average rates down to R3 261 from R3 387) and four-star 73% compared to 85% March, with average rates only marginally down.

“The reduced occupancy has something to do with competition, both alternative and new, but primarily reflects reduced demand and the consequences of the water crisis.”

There is also a significant knock-on effect on many industries, from small tour operators to restaurants, wholesale suppliers and the wine and transport industries.

Tourists browse local crafts and souvenir goods for sale at a market in the downtown district of Cape Town. Picture: Kevin Sutherland/Bloomberg

“There is a multiplier effect with tourism, which is so wide – and it has an effect on jobs,” says Bac.

She is unsure of the outlook but says that tourism is growing globally and, while it goes through blips, it rebounds quickly. There is no reason why we can’t turn things around, she says, but it will take time. The effects of the water crisis in particular will take time to work through, given the long booking cycle.

“The industry is working hard to fix problems, including visa issues,” she adds. “It will pull through, and I am hopeful we are through the worst of it.”

With tourism contributing 2.9% to GDP, according to StatsSA, getting the numbers up is important. South Africa continues to attract the most overseas visitors from the UK, US, Germany, France, Netherlands, Australia, India, China, Canada and Brazil, with these countries representing 72.9% of all overseas tourists.

Virtually all tourists from Africa came from the SADC region.

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Tourists are abandoning Cape Town just like the voters will abandon the DA in 2019…

Viva DA, Viva!

Thanks for stuffing up Cape Town.

And your alternative party is………………………………….?

So basically the only city worth visiting in SA is Cape Town? Oh dear…

I agree. Bear in mind, another SA town probably worth visiting is Swakopmund…

Swakopmund is not part of SA – and neither is Walvis Bay

@Darwin.

Having spent a very nice 5 nights in Swakopmund recently (March 18) maybe MFK point is sorta being missed.

In fact even in Windhoek, counter intuitively, it is more like South Africa today than before SWA independence. I have visited since 1988.

Visit what today is Namibia. Not a screaming success at all but W_a_a_Y better than the continual aggro in SA from the usual suspects.

I recently browsed some CT hotel rates, and what I’ve seen (especially the top end establishments out of mere interest) command high rates….then I start to wonder (based on supply vs demand principle) “surely it cannot be that bad” / must be going fairly well then, at that tariffs.

(On another note, where is our commentator “Robert in Sydney”? Many hated his comment…now we seem to miss him 😉

You be the Bob guy then. Tourism is down because the local are overcharging horribly. Even by overseas standards.

exactly. If local establishments are able to “overcharge” compared to overseas, then things are quite rosy in CT then? Yes?

There’s no way Robert could stay away from this website.Either he’s fallen on hard times and can’t afford to post comments or he’s no longer around.

I know. Was wondering whether “RiS” is maybe a “RIP”….but picked him up under his Twitter account (using the same RobertinSydney name)

He posted tweets earlier today. Actually chatted with Alec Hogg & David Shapiro recently. I note he’s still commenting on Twitter regarding SA (that SA needs to be build from the ground up!). See web-address below. (info in public domain)

https://twitter.com/robertinsydney?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor

An organised third force trying to destroy the country with petrol bombs on highways is certainly not an inviting factor for bus loads of tourists. Where is central intelligence in Govt to tackle this scurge. No political will.

ANC government ARE the third force……governing the country into the ground while the rest of us are trying to save it.

Complete bumpf! Tourism has been in a ‘bleak picture’ for 40 years or more according to whoever measures these things and publishes rubbish like this. Right through the end of apartheid (’94), the World Cup was a ‘disaster’, the weakening/strengthening rand, Zuma this Zuma that and on and on. (/sarc off) – ya, whatever!

I don’t believe a word of it. I travel a fair bit. Where ever I am I hear foreign languages and English accents spoken – european, Brits, American, Japanese, Chinese.

Take just this last weekend at Pilanesberg: tour buses galore, 30+ Americans at Bakubung restaurant, kids and all. German, Dutch and other languages being spoken left and right.

In a Cape Town BnB earlier this year, British and fraco-phone african at the breakfast table. A complete polyglot noise at the wine farms, V&A, promenade etc.

Bleak se voet!

The worthless Rand. From the parking helpful to local billionaires all are believing. foreigners, visiting, should be happy. Having the time of life spending the stuff. Then the bill arrives, can be paid in hard currency. Shel shocked they realize how cheap things are at home.

The Article is not taking into consideration that 2018 is a soccer world cup year. Usually oversea’s travelers would visit the host nation if they were planning to travel overseas in that year.

Have a look at the 2014 vs 2013 statistics and I’m sure you will see a similar trend.

However- Day zero campaign was very detrimental to tourism in the Cape.
Paying international 5 star rates and being subjected to a drip water saving shower with not option of a bath will direct the discerning traveler to another destination till the water comes back

People do research before they visit a country and South Africa being a dangerous place pops up everywhere. You can’t hike Table Mountain trails, travel in groups etc. Yes water shortage in Cape Town but our neighboring states like Namibia and Botswana have better ratings. There’s a total lack of understanding at ground level that SA need global investment including tourists. Why invest in a place you don’t even want to visit.

accomodation in SA is way too expensive considering the weak Rand.
many European countries offer better value for money sans squatter camps and the chance of losing your life.
i wish people would find an alternative to CT – SO OVERRATED

A lot of tourists and travellers are robbed between the airport and their hotel. They also get followed from shopping centres. Crime is now really damaging everything. It also does not help when tyres are burnt on the freeway and rocks are launched off bridges.

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