SA Tourism asks state to pump up relief aid

The industry is estimated to have already lost R54bn due to the pandemic

The head of the body tasked with promoting SA’s tourism industry, which is facing the loss of more than 400,000 jobs from the Covid-19 pandemic due to forced closures since March, has called on the government to greatly increase financial aid for businesses in the sector.

“When SA holds back a sector from operating, they have a duty to support it and make sure it doesn’t fold,” SA Tourism CEO Sisa Ntshona said, echoing a call from the Organisation for Economic Co-operation and Development (OECD) for increased aid.

The existing package of R200m is “indeed a drop in the ocean”, he said, though acknowledging that the government faced constraints due to its dire fiscal position.

SA Tourism is an entity of the department of tourism, tasked with marketing the country to business and leisure travellers.

The entity also monitors and evaluates the performance of the sector.

Tourism is estimated to have already lost R54bn due to the pandemic so far and is set to lose another R80.2bn in foreignexchange receipts that would have been generated between May and December, according to government data.

The sector, which contributed an estimated 8.6% to GDP and supported about 1.5-million people, has been one of the biggest casualties of the economic slump caused by Covid19, threatening to add to the record unemployment levels that have made SA one of the most unequal countries in the world. Associated industries such as aviation have also been hit hard, while a ban on alcohol sales threatens wine farms that employ thousands, mainly in the Western Cape.

Ntshona said SA Tourism would make a case for some of the R200bn loan guarantee scheme agreed between the government and commercial banks to help distressed businesses be set aside for the industry, which he said made R700m to R1bn a day when fully operational.

“So with each day that goes by, that’s an opportunity lost,” he said.

The government offered some relief to the sector last week, easing lockdown regulations to enable leisure travel within provinces and moving the daily curfew an hour later to allow restaurants to trade for an extra hour.

With international travel having come to a virtual halt and subject to uncertainty about the trajectory of the global pandemic and effect on travel, domestic tourism — which accounted for R153bn in 2018 — is set to become “bread and butter” for the sector, Ntshona said.

The OECD, an international policy-formulation organisation and think-tank, whose members are the richest democracies, called on the government to support the development of local tourism so as to counter the seasonality of international tourism. It also called for the diversification of tourism products and of pricing mechanisms.

While stakeholders would have wanted the sector to be reopened, the fact that it mainly involves the movement of people and social interactions means that it is “a pure recipe for Covid-19 to spread”, it said.

The country needed to manage the spread of Covid-19 so that it was ranked among those that were relatively safe to visit.

“Our ticket to recovery is that we must be in the green zone [of countries that are safe for travel during the pandemic], and how do we get to the green zone? — by managing the pandemic,” said Ntshona.

On Friday, the OECD recommended that the government increase its relief fund for the sector and extend it until the middle of 2021.

This would be particularly important if there was a renewed outbreak later in the year, the OECD said in a section devoted to the tourism sector in its 2020 economic survey of SA released on Friday.

Tourism is one of the key sectors identified by the National Development Plan — a blueprint to address SA’s socioeconomic challenges — as having potential to contribute towards the creation of 11-million jobs by 2030.