South African tourism industry being hit on all fronts

Published on : Wednesday, July 22, 2015

South AfricanThe South African tourism industry is being pounded on all fronts, with new legislation on travelling minors producing unabridged birth certificates and visa restrictions packing the biggest punch, the latest South African Tourism Business Index (TBI) shows.

 

 

The TBI for the second quarter of 2015 was released on Monday and showed a newly pessimistic outlook, according to the Tourism Business Council of South Africa (TBCSA). The TBI is compiled for the TBCSA by international consulting and accounting services provider Grant Thornton.

 

 

The negative contributory factors cited by respondents in the accommodation and other tourism sectors were: nww legislation with regard to biometrics and unabridged birth certificates; visa restrictions; general state of the economy; labour unrest (strikes); poor service delivery in terms of electricity and water shortages; impact of the Ebola virus; reduced demand from government officials; high utility costs; high cost of flights, accommodation and car hire; xenophobia; and an increase in the cost of fuel.

 

 

With regard to other tourism businesses, insufficient overseas leisure demand (54 per cent) continued to be the greatest negative contributing factor to poor business performance.

 

 

This was followed by insufficient domestic business demand (40 per cent), insufficient overseas business demand (39 per cent), insufficient domestic leisure demand (38 per cent) and competitor market behaviour (38 per cent).

 

 

Among the few positive impact factors cited by respondents regarding the last quarter were a weak exchange rate, strong domestic business demand, large meetings and conferences taking place and long weekends and school holidays.

 

 

The BTI shows that overall, the tourism industry performed significantly lower than expected, lowest performance since the third quarter of 2011, but not as low as in the first nine months of 2011.

 

 

The accommodation sector achieved worse than normal business performance and this sector indicated a pessimistic outlook.

 

 

The TBI shows that second quarter blues are also present among other tourism businesses. In the accommodation sector, 27.5 per cent of TBI respondents expect less than normal business performance next year while only 8.2 per cent expect better than normal business performance.

 

 

Among other tourism businesses, 41.4 per cent of respondents expect less than normal business performance next year, while 23.4 per cent expect better results.

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