​​Shrewd management of future Covid waves is key to the tourism industry’s recovery

Tourism Minister Lindiwe Sisulu has recently faced a firestorm of criticism over her views on South Africa’s constitution and judiciary. While the minister battles calls for her dismissal, the industry she was appointed to oversee only five months ago is clawing its way out of a nearly two-year slump.

Stakeholders agree that the tourism industry, one of the hardest hit by Covid-19, is poised for recovery in 2022 — if the government is shrewd in how it manages future waves of the pandemic.

If all goes well, the industry is forecast to reach 60% of its pre-pandemic revenue levels, Tshifhiwa Tshivhengwa, chief executive of the Tourism Business Council of South Africa (TBSCA), said this week.

But this recovery will depend on how the pandemic is managed, Tshivhengwa said. “The virus is still going to be with us … So when we do this forecast, one has to keep in mind that there will be a fifth wave if we don’t get more people vaccinated. And when these waves come, it will depend on how we manage the situation.”

If the country continues to enjoy relaxed Covid-19 regulations, Tshivhengwa said, the domestic leisure market will receive a boost. The industry also needs a more robust international market, as well as more corporate and government travel, to reach the forecast levels of recovery. 

The sector’s recovery is looking promising, according to Federated Hospitality Association of Southern Africa (Fedhasa) chairperson Rosemary Anderson. This recovery, she said, will depend on a higher vaccination rate and less restrictive systems for travellers entering the country. 

Too big to fail

Before the pandemic, the South African tourism industry was enjoying a modest upswing. Statistics South Africa (Stats SA) data shows that employment in hotels and restaurants peaked in the first quarter of 2019. At the time there were 331 522 people employed in this sector — marking the highest number in a decade. 

According to a department of tourism report that cited Stats SA data, the direct contribution of tourism towards the country’s GDP increased from 2.7% in 2018 to 3.7% in 2019.

The sector directly contributed about 4.7% to the country’s total employment in 2019, according to data provided by the department. The 2019 figure marks a 26.4% rise in the number of direct jobs in 2019 compared with 2018. The large majority of the people employed in the sector are black.

According to the Stats SA figures on hotel and restaurant employment, in the second quarter of 2020, when the effects of the Covid-related lockdown had taken a toll, the number of people with jobs in the sector decreased by almost 25% compared with 2019. 

In the latter two quarters of 2020, employment in hotels and restaurants recovered slightly, but fell again at the beginning of 2021. By the third quarter of  last year, there were 252 783 people employed in the industry. 

“Around South Africa, there are many people who rely on tourism to put food on the table,” Tshivhengwa said.

“From a jobs point of view, tourism is a big sector. If we are able to get more tourists coming in, we can create jobs in rural and urban areas. And many of the jobs don’t require skilled workers … The industry attracts people from all walks of life.”

The Omicron effect

Towards the end of 2021, local tourism was dealt yet another blow: after local scientists announced they had detected a new Covid-19 variant, countries in Europe and the UK reacted by imposing travel bans on South Africa.

The industry was given a lifeline when the government decided against imposing stricter lockdown regulations during the fourth wave of the pandemic. A midnight curfew and restrictions on alcohol sales were eventually lifted.

By mid-December, the UK had removed the travel bans on African countries, but the EU had not. It lifted the ban last week.

In a letter to the EU, Tshivhengwa said in the first 48 hours since the ban was imposed on 25 November, South Africa’s tourism industry lost about R900-million. 

“The travel bans really put us a step backwards,” Tshivhengwa said this week. 

“A lot of bookings were cancelled. On the ground, it was chaotic — like nothing we have seen before. It really sent the industry back by billions. And when you lose billions as a struggling industry, it simply means that your recovery is not going to be as fast.”

But the government’s decision not to shut down tourism and hospitality during the fourth wave provided the industry with much-needed relief, Fedhasa’s Anderson said. “The restrictions implemented during the previous waves made it financially unviable for hospitality businesses to stay open. It also led to the unnecessary closure of so many businesses and the loss of tens of thousands of jobs.”

Fighting for a future

When the bans were announced, Sisulu called an urgent meeting with industry stakeholders, which she said would be one of many aimed at ensuring its survival through the festive season and preserving its long-term viability.

Stakeholders and Sisulu’s department have been locked in ongoing discussions to implement a tourism-recovery strategy, which was approved by the cabinet in April 2021 and notes that the sector has long failed to reach its full potential.

“Tourism’s contribution to economic output and employment is flat on pre-2008 levels, while global tourism growth has outstripped South Africa’s performance in the past decade. Compounding these challenges is the impact of the Covid-19 pandemic,” the report says.

“We have always believed that the private and the public sector must engage … So we engage with the department of tourism constantly,” Tshivhengwa said.

Although Sisulu has come under fire for her recent attacks on judges, Anderson applauds her engagement with the tourism sector in the few months she has headed the portfolio.

“She has given Fedhasa and other key industry role players the opportunity to attend a number of meetings with the department,” Anderson said.

“It is most unusual that a minister personally makes herself so available to the industry. 

She has also put together a ‘war room’ to set about tackling obstacles to tourism’s growth.”

If Sisulu continues to engage with stakeholders to the extent she has, Anderson said “things look very favourable for our industry. The key will be to make sure valuable ideas are translated into concrete action sooner rather than later”.

The department of tourism is optimistic about the domestic prospects for 2022 and believes implementation of the tourism recovery strategy will place the sector on a path to emerging from the Covid-19 crisis, spokesperson Seapei Lebele said.

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Sarah Smit
Sarah Smit
Sarah Smit is a general news reporter at the Mail & Guardian. She covers topics relating to labour, corruption and the law.
Anathi Madubela
Anathi Madubela is a business journalist with a keen interest in the retail sector.

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