Tourism gets R340m BOOST to transform
A R340 million transformation fund has been established to improve the low levels of transformation in the tourism sector over three years.
Speaking to City Press during the tourism department’s Transformation Summit held in Benoni last week, Minister Tokozile Xasa said the transformation fund was established in partnership with the National Empowerment Fund (NEF). The department contributed R40 million. “Over the next three years, the total amount is R340 million. We are starting small as from our side we are contributing R40 million, which is catering for the capped grant funding.
“So, we want to see how far it will go because it has to start now,” she said.
Xasa said the fund will be made available to small and medium enterprises through the national office and not through the various provincial tourism agencies.
“We have precincts and nodes that we have identified so that we track progress of our funding,” she said.
She added that the fund hopes to make a difference and transform the entire tourism value chain. Included in its mission for transformation was gender equity in executive positions, as well as ownership and infrastructure maintenance.
The fund, Xasa said, would be used to encourage private sector investment and to unlock the potential of small, medium and micro enterprises, cooperatives and township enterprises.
The department has also received the preliminary State of Transformation Report. Xasa said she was not impressed by its findings, but not surprised.
“The results are worrying. In fact they are confirming what has been the issue – that the levels of transformation are low,” she said. Xasa added that the level of participation in the research was also worrying as it was on a voluntary basis.
“The report confirms that we have not moved. Be it in supplier development, in skills development and even in the actual industry,” she said, adding that the report was almost a replica of the same one commissioned in 2011.
Xasa said that, before 2009, businesses in the industry claimed there was not enough local skilled labour to employ and that was why it was flooded with foreign employees.
The department subsequently established a skills development programme that included Unisa.
One of the biggest challenges facing the industry is the lack of placement opportunities for trained practitioners, Xasa said.
“From this report the indication is that we have not yet dented what we have picked up on in 2011.
“If you look into the numbers that we have been training, not all of them get absorbed,” she said.
Xasa said the government already had several other mechanisms it could use to drive transformation, including the issuance of operating licences in various sectors.
Government also had R10 billion per year in buying power, as estimated by National Treasury.
“These must be effectively used to drive transformation, as they are within the public sector’s control.
“Government cannot achieve transformation by itself; the private sector has a significant role to play and contribution to make.
“This includes, but is not limited to, direct empowerment through implementation of the codes. Such would result in more enterprise and supplier development opportunities and inclusivity through ownership and management control,” she said.
Xasa also said one of the crucial success factors for transformation remained access to strategic land parcels at local government and within communal properties.
“We believe that long-term leases for the use of strategic land parcels would significantly assist in getting black enterprises into the business of tourism, particularly in strategic tourism hubs.
“In the same vein, we believe traditional leaders and their constituencies could leverage their strategic land through partnerships with government and industry for community benefit,” she said.
Government cannot achieve transformation by itself; the private sector has a significant role to play and contribution to make