Deputy Minister of Tourism Fish Mahlalela
15 September 2022
Programme director, (Thami Nkadimeng)
Minister in the Presidency, Mr Mondli Gungubele,
Honourable Chairpersons and Honourable Members of the Portfolio Committee and Select Committee of Tourism,
Chairperson and Members of the Interim Board of SA Tourism,
TBCSA Board Chairman Mr Blacky Komani and Members of the TBCSA Board,
Director General Tharage and senior management of the Department of Tourism,
Acting CE of SA Tourism and Executive Management of South African Tourism
TBCSA CEO Mr Tshifhiwa Tshivhengwa
Members of the media
Ladies and Gentlemen
It gives me great pleasure to address you on the occasion of the Tourism Business Council of South Africa (TBCSA) inaugural Tourism Leadership Conference.
I would like to start by acknowledging all stakeholders here today, represented by over three hundred delegates to map the way forward for the sector.
At the outset, one must applaud the tourism sector’s resilience during the hurricane of Covid-19. The fact that we are gathering here in person is a testament to the undying spirit of our people, including you, the women and men in the tourism sector value chain. I am glad to say we pulled together and survived. Now we are poised for unparalleled growth, to live again as it were.
While we navigate this year of recovery and plan together for a prosperous year ahead, we must acknowledge the achievements that emerged from this crisis, and these include.
The dogged campaign undertaken by the private sector to lobby for the removal of South Africa from the various red lists and in particular UK’s Red List.
The private sector’s continued inputs in changing Covid regulations so that these delivered a balance between saving lives and livelihoods.
The support for Government’s vaccination drive through such initiatives as Jab4Tourism.
The ongoing initiative by private sector bodies and companies across the country to promote South Africa as a preferred tourism destination.
The marketing campaigns that were run not only to shine a spotlight on tourism and its potential for South Africa’s economy, but also to keep our industry hopeful when times were particularly tough.
The tourism sector is a critical economic sector for South Africa and we are gathering here at Sun City, a fine example of our tourism offerings, to focus on repositioning South Africa’s tourism sector as an engine of growth.
Numbers don’t lie! Between January and June 2022, 15,2 million domestic tourism trips were taken. Between January and June 2022, 15,2 million domestic trips were taken. This is a significant win for the tourism sector, as this is higher than pre-pandemic levels, indicating that South Africa’s domestic tourism sector also experienced the revenge travel trend.
The biggest driver of domestic travel in the first six months of 2022 was the easing of Covid-19 travel restrictions. Thus, it is opportune to send our gratitude to all South Africans who heeded the call and travelled within their own country when the world imposed travel bans and restrictions on South Africa. Domestic tourism continues to be the backbone of our sector, bread and butter if you insist. We have just concluded the hugely successful Sho’t left Travel Week. This campaign performed well, with many South Africans taking advantage of the great deals designed to ensure that travel is accessible to all locals.
The buoyance of the domestic tourism market augurs well for the sector as a whole.
According to Statistics SA, by June this year, we had received nearly 2.28 million international visitors; this is a phenomenal growth spurt. We are on track to matching and surpassing last year’s full-year total tourist arrival statistics of just over 2.3 million. The Total Foreign Direct Spend from January to June 2022 was R21.5 billion.
The target to reach 21 million tourist arrivals by 2030 still stands, and we are working with all the stakeholders in the sector to attain this. This is thanks to the extraordinary work being done by the various South Africa Tourism teams, industry leaders, tourism operators, the aviation sector, and all involved in the hospitality industry.
Massive efforts are underway to market South Africa as an attractive destination and grow domestic travel and international arrivals. Early this year, we launched our global campaign, Live Again; we received incredible feedback; the numbers also tell a very positive story!
Earlier this month, we launched Tourism Month, celebrated annually in September, to highlight and bring to the fore the importance of the tourism sector. The purpose of highlighting Tourism Month is to create awareness about planned domestic tourism activities and enthuse South Africans to travel within their homeland. Tourism’s contribution to the South African economy and its potential to transform the trajectory of our economy and the country’s prosperity cannot be underestimated.
Tourism – the Engine of Growth
Programme director, the theme of this inaugural conference, Tourism – the Engine of Growth for South Africa, is timely and relevant.
According to Stats SA data for 2019, one in every 21 working South Africans was employed in the tourism industry. We would like to double this figure in the next five years.
For this sector to expand, a working partnership between the private and public sectors and all spheres of government to create an enabling environment for exponential growth. For us to continue to be an anchor for employment and economic growth, we have to work together and this conference is indeed about driving this very sentiment and spirit.
As the government tourism sector lead and principals, the Minister and I remain committed to making the conditions favourable for the private sector to thrive and contribute its fair share of jobs, taxes and innovation. Undoubtedly, this sector must benefit our people in urban and rural areas of our vast and beautiful country. Transformation in the industry is not the periphery but the core to the tourism sector reaching its full potential.
Tourism Policy Consultations towards an Inclusivity
The National Department of Tourism have played a significant role in ensuring that the public sector supports the sector at large in promoting South Africa as the number one tourist destination.
The Department is reviewing the 1996 Tourism White Paper, which is expected to guide the sector to the next phase of tourism development.
The Ministry and the Department will be commencing on consultations on the policy document and would want full participation from the sector so that we can define our marching orders for the next couple of years with the intent to strengthen our ability to grow this sector, to transform this sector, so that it is an inclusive sector, where young people and women and black people feel “accommodated” and belong and are an equal part of – as owners and tourists.
We are open to suggestions and it will be good for us to hear what are these fundamental things that are going to move the needle on growth, inclusivity and sustainability.
I am confident that from this conference, we will align private and public sector business strategies around the tourism rebound focus and galvanise action for development. Evidence from Asia, Latin America and the rest of Africa show how private sector contributions stimulate economic growth and can help implement the Sustainable Development Goals (SDG) agenda.
Growing the Tourism Engine
Tourism, according to the World Travel & Tourism Council (WTTC), directly contributes 3,2% in 2021 to South Africa’s GDP, more than agriculture, utilities and construction. The Travel and Tourism industry are crucial drivers for job creation globally, as 1 in 11 jobs (289 million jobs) were created in the industry in 2021.
New data by the WTTC shows the South African Travel & Tourism sector is forecasted to grow at an average rate of 7.6% annually over the next decade, meaning that this sector will outstrip the projected 1.8% growth rate of the country’s overall economy. As an industry, we must be well-equipped to make this forecast a reality. As the South African government, we are committed to unlocking barriers in the sector.
I hope the outcome of our discussions here will not only be a recognition that we must synthesise our collaboration between the private and public sectors, which we know is key to the industry’s success, but that we spur into action and do so!
Lifting the Barriers to tourism
As we know, the rest of the African continent remains our most significant source market leader. Still, our continent is constrained and continues to struggle with numerous barriers to tourism growth, including poor road infrastructure between major cities, limited airlift and stringent immigration regulations.
We are acutely aware of the potential revenue opportunities lost due to these barriers and are engaging with related departments to address these challenges as we work towards our sector’s recovery. The Department of Tourism is working with the Department of Home Affairs and Department of Transport with a view to facilitate ease of access.
There are some positive developments in the area of visa notwithstanding the challenges. The prioritised tourism markets largely enjoy visa waivers from Department of Home Affairs.
Positive developments include the roll-out of the enhanced e-visa platform in some of our key source markets, including Nigeria. All indications and feedback are that this enhanced e-visa platform is live and is welcomed by all travellers who have been longing to visit South Africa but were hampered by an onerous and frustrating visa application process. This is part of a grand scheme toward easing access to South Africa from the West African market. This is important for recovering South Africa’s tourism sector and the greater continent’s intra-trade activities.
The Department of Tourism (DoT) continuously supports air access initiatives to ensure that regulatory barriers are identified to facilitate their removal. Both ACSA and the Department of Tourism participate in various route platforms to engage with airlines to choose South Africa as a destination of choice. Tremendous work has also been done by the provincial Air Access Committees where they have brought international airlines to South Africa. South African Tourism has supported these air access initiatives.
The issue of the Tour Operating Licensing delays has been a longstanding issue and I am pleased to report that there are also positive developments in the area of land transport. The Department of Transport recently reported that plans are in place to deal with backlog of tour operating licenses and the DoT expects the backlog issues to have been addressed by the end of September 2022.
Call to Private Sector
We encourage the private sector to lead the way in investing in experiences and in creating and packaging deals that are attractive to tourists with varying preferences, and these include heritage and cultural tourism, so that we are able to bring more value to SA offerings. South Africa is renowned for its quality assured establishments and high service excellence - now more than ever, we must continue to maintain this enviable reputation.
Meanwhile, we are pleased that South African Airways (SAA) marks 12 months back in the air this month after experiencing turbulence in recent times. It is already taking to the African skies, bringing the world to Africa and taking Africa to the world. SAA already flies to Windhoek (Namibia), Blantyre (Malawi), Dar es Salaam (Tanzania), Accra (Ghana), Lagos (Nigeria), Kinshasa (DRC), Harare (Zimbabwe) and the Island of Mauritius to name a few. To increase its footprint without the burden of capital outlay, SAA is working on a strategic co-sharing partnership with Kenya Airways, among others.
We welcome the recent (14 September) signing of a deal that sees the Brussels-based Air Belgium launching two routes to South Africa with up to three weekly flights simultaneously to Cape Town and Johannesburg. It is a vote of confidence in our country, especially in the tourism sector.
We have to do more in our continent to solve the airlift crisis. We need more direct routes to re-ignite intra-African travel to reduce travel time and cost. According to former SAA Chief Commercial Officer Simon Newton-Smith, we have a 4% airlift but 18% of the population. This makes us the only continent that offers big aviation growth opportunities.
Sadly the demise of Comair is hitting the sector hard, and its liquidation contributes greatly to increased demand leading to price hikes. The rise in fuel prices is also a major factor. Thankfully, the Competition Commission held meetings with FlySafair, Lift, Airlink and SAA recently to discuss rate increases and try to prevent possible price gouging. The commission warned that it would monitor airline prices and investigate if fares became suspiciously high.
All of us here today have to do everything in our power to remove barriers to the growth of this industry, including the elephant in the room and high crime levels in our country. It is common knowledge that South Africa faces a higher than average crime rate in specific offences such as murders and rapes compared to its peers in the Organization for Economic Cooperation and Development (OECD) community.
As we know, crime impedes tourism by significantly damaging our country’s image.
Thus, the prerequisite for industry growth is to be judged by its reputation of how it protects the life and limb of visitors and its citizen alike.
Tourism safety has been consistently identified across several studies, media and crime reports as a challenge threatening tourism growth and, therefore, foreign direct investment, visitor spending and employment. In response, we are ramping up the National Tourism Safety Strategy implementation. The strategy delineates each stakeholder’s role in the tourism value chain to enhance the safety of all tourists. As a result, we call upon all visitors and local travellers to partner with us in ensuring safety and security while visiting our beautiful landscapes.
Programme director, as the government with our partners, we are tasked with fully implementing the Tourism Sector Recovery Plan (TSRP). The Plan is a product of a collaborative effort with key stakeholders from the government, the sector and other social partners. We designed this Plan in 2020 to facilitate the sector recovery to preserve jobs and livelihoods, facilitate new job opportunities, match demand and supply, and strengthen transformation.
As we sit here today, I am happy to say we are poised for a rebound and growth, judging by the delegates’ enthusiasm and recent half-yearly performance figures in the sector. My cautious optimism is grounded in reality.
The country’s premier economic plan, the Economic Reconstruction and Recovery Plan, identifies tourism as one of the priority areas of intervention. The Tourism Recovery Plan has three strategic themes: Re-Igniting Demand, Rejuvenating Supply and Strengthening Enabling Capability. With the total rescind of all Covid-19 restrictions, we have already stimulated demand both in the domestic and international markets, as numbers of our sector’s first half-year performance report show. The Strategic Interventions are supported by catalytic programmes with specific actions, time-frames and an indication of those responsible for implementing each strategic intervention.
The successful implementation of the Recovery Plan will partly depend on enablers whose mandate is beyond the Department of Tourism and the tourism industry in general, such as the implementation of e-visas, tourist safety, airlift capacity etc.
We face a challenging global economic environment that will put additional pressure on our recovery: a surge in oil prices, conflict in Ukraine, increase in inflation, potential rise in interest rates, high debt volumes and the continued disruption in supply chains.
That said, our role players confirm the incredible pent up demand has translated into a strong foundation that will take us into what we hope will be a bumper 2022/2023 summer season. This is even more likely with the increased airlift, particularly from our traditional source markets, which will improve access for travellers wishing to visit South Africa.
However, to harness this potential we have to work together. The only way to achieve success and unprecedented tourism growth, and job creation, is by coming together, capitalising on each other’s strengths and working as one.
I would like to encourage all stakeholders in the room and indeed the tourism industry to see this conference as the start of concrete actions that will deliver the catalytic growth the sector, and indeed South Africa’s economy needs.
Tourism retains its rich potential to create jobs as SA’s third-highest GDP earner and by the very nature of its geographic distribution and low barriers to entry, tourism also generates economic activity, SME opportunities and employment for low- and semi-skilled workers in rural and remote areas with the greatest need.
Tourism has a deep and wide value chain, which offers many SME opportunities, from vehicle manufacturing for the car-rental industry to textile manufacturers producing the linen that accommodation providers and restaurants buy. For every direct job created in the tourism sector, one additional job is created on an indirect or induced basis.
What needs to be done is clear – to execute the how, Minister Sisulu and myself see structured engagement, through the establishment of public-private teams that address the challenges and devise innovative, but practical solutions that deliver swift change.
South Africa is a vibrant destination and is the perfect place to host significant business events and conferences as the country has top-quality infrastructure. Our Global Advocacy Programme is our strategic way of ensuring that as partners, our collective endeavour must remain to re-ignite the industry for faster growth, job creation and innovation.
I look forward to engaging further with our partners at home and abroad as we work without ceasing towards our rebound strategy and contribute positively to our country’s economic growth.
I thank you