BRIC visitors spend R3 billion a year in SA
VISITORS from Brazil, Russia, India and China, the four emerging economies that form the BRICS bloc together with South Africa, spend about R3 billion a year in South Africa.
An economic analysis issued by professional services firm PwC revealed that visitors from the BRIC nations supported an estimated 26 000 South African jobs in 2016.
PwC economist Christie Viljoen said: “South Africa is a much-desired destination among the BRIC nations. Tourism supports more than 1.6 million jobs in South Africa and accounts for more than 9 percent of the country’s GDP.
“While the opportunities are aplenty in the local tourism market, there are also a number of risks and challenges. Overall, the recent economic and political turmoil has not hindered or affected the influx of foreign visitors into the country. We also do not expect this to be a challenge in the near future.”
The BRICS nations held their annual summit in Johannesburg this week, with calls for a united front against rising protectionism in the US.
President Cyril Ramaphosa urged BRICS to come up with measures to protect small industries against the possible implications from tariffs imposed by the US.
Ramaphosa said BRICS needed to make full use of the New Development Bank to protect industries.
“Under the partnership, and in support of the manufacturing sector, a new industrial revolution advisory group comprising policymakers and experts from all BRICS countries will be established,” Ramaphosa said.
Chinese President Xi Jinping said the escalation of protectionism and unilateralism would have far-reaching implications economies.
Xi said the world needed to push back against such measures through multinational bodies like the UN and the World Trade Organisation.
“We are facing a choice between co-operation and confrontation, between opening up and closed-door policy and between mutual benefit and a beggar-thy-neighbour approach,” Xi said.
The PwC survey found that arrivals from the BRIC nations increased by 6.1 percent last year – higher than the average of all tourist arrivals – to
for emerging 275 521 visitors. The easing of visa requirements for several BRIC countries over the past several years had added to increased arrivals. BRIC tourists accounted for 2.7 percent of all arrivals in South Africa last year, from 2.6 percent in 2016.
“Around a third of tourist expenditure in South Africa is associated with business-related travel, with the remainder being leisure related. Transport (26.5 percent) and accommodation (15 percent) accounted for the largest proportion of international tourist expenditure in South Africa during 2016,” said PwC.
According to the latest World Travel and Tourism Council (WTTC) report, the total contribution of travel and tourism to the country’s GDP was R412.5bn, 8.9 percent of GDP last year. It is forecast to rise by 2.9 percent this year and to rise by 3.5 percent annually till 2028 to R598.6bn, which represents 10.1 percent of GDP in 2028.
The WTTC report also states that last year the total contribution of travel and tourism to employment, including jobs indirectly supported by the industry, was 9.5 percent of total employment – 1 530 500 jobs. This is expected to rise by 3.3 percent this year to 1 580 500 jobs.
SA Tourism chief executive Sisa Ntshona said the BRIC countries were actually major source markets for tourism in South Africa.
Ntshona said hosting the BRICS summit was a great advertisement for South Africa in terms of tourism in general and business tourism in particular.
He said South Africa needed to review its visa requirements to attract more visitors.
“It is important that we remove as many barriers as possible with those countries, everything from visas, unabridged certificates and airline connectivity,” Ntshona said. ESKOM has forecast a 9 percent increase in the price of coal in the 2018/19 financial year, compared with the 3.8 percent increase in 2017/18.
The power utility’s integrated report for the year to March showed that coal prices appeared to be a major component of its total costs as it looked to rely on short- and medium-term contracts amid reduced production from so-called cost-plus mines.
Eskom said coal prices increased 3.8 percent in the period.
In its latest annual report, Eskom has forecast a 9 percent jump in the coal price.
An almost double-digit increase in the coal price would be inconsistent with Eskom’s focus on cost containment.
“Eskom… faces several operational and strategic risks going forward,” chief executive Phakamani Hadebe said in the report.
Elevated coal costs would typically increase Eskom’s overall primary energy costs and lift the utility’s tariff requirements.
Since the 2015/16 financial year, coal price increases have been on a roller-coaster ride, dropping from 19.2 percent in 2015/16 to 3.5 percent in 2016/17.
Eskom said mines required significant investment in order to increase production. The utility said it expected reduced output from the collieries until they were recapitalised.
Eskom said it would recapitalise these coal mines only “where long-term benefits can be demonstrated”. It planned to spend R10.7 billion on financing expansion at the collieries over the next five years.
“However, a two-to-three-year delay can be expected before the capital investment will result in increased output and productivity levels,” Eskom said.
Eskom will stop production at expensive power stations Hendrina, Grootvlei and Komati in the 2019/20 financial year.
Eskom said the move was subject to it hitting plant availability of 80 percent, as well as an assessment of the impact on employees and local communities. It said that if demand was higher than current assumptions, the stations would be “recalled” to meet demand.
In the year ended March 31, plant availability rose from 77.3 percent to 78 percent.
Hadebe said Eskom was on course to achieve plant availability of 80 percent in the current financial year.
The timing of new build beyond Medupi and Kusile power stations would depend on the Department of Energy’s integrated resource plan.
President Cyril Ramaphosa chairs the BRICS Africa Outreach and BRICS Plus interactive dialogue at the 10th BRICS Summit in Johannesburg. The summit’s theme is “BRICS in Africa: Collaboration for Inclusive Growth and Shared Prosperity in the Fourth...