Tourists from overseas down

Any thought the new era under President Cyril Ramaphosa would see tourists flocking back 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 earmarked by Ramaphosa as one of four sectors that would reignite the economy.

Statistics SA 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%.

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

But Grant Thornton director Lee-Anne Bac says April’s statistics should be treated with caution. While overseas arrivals were down, arrivals from the rest of Africa were up 5%. Total tourist arrivals were up more than 3%.

Bac cited the Western Cape water crisis, global turmoil as well as security concerns as issues.

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

Hotels are not faring well 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. 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 suffering too, with occupancies at 56% (67%) and average rates at R1 200 (R1 300). Even taking the Easter shift into account, March figures are not much better. Five-star occupancies in March were 72% compared to 81% and four-star 73% compared to 85% in March, with average rates marginally down.

“The industry is working hard to fix problems, including visa issues,” BAC adds. With tourism contributing 2.9% to GDP, according to Statistics SA, getting the numbers up is important.