STRATEGY

Big tourism business

Tshifhiwa Tshivhengwa, CEO of the TBCSA
Explore 63 - Article 28896 - LWG30159.JPG.jpeg

South Africa has the largest travel and tourism economy in Africa, generating up to 1.5 million jobs and contributing R425.8 billion to the economy, says the World Travel & Tourism Council (WTTC). Planning to build on this, the Tourism Business Council of South Africa has a new strategy with the potential to double international arrivals to 21 million and create an additional 2 million jobs by 2030.

 

According to Tshifhiwa Tshivhengwa, CEO of the Tourism Business Council of South Africa (TBCSA), the new strategy was necessitated by the lack of economic growth in the country. He says the TBCSA investigated the potential within tourism to be the catalyst for economic growth and job creation.

 “We looked into how tourism can be a catalyst for economic development and job creation, and we decided that we need to look beyond business as usual if we are to create more jobs. A decision was made to examine tourism potential and that’s how the 2030 strategy was introduced. If we are to create employment in the country, we need the economy to grow at a pace of 6% per annum. Our strategy aims to grow the tourist numbers by 6% - to double the number of tourist arrivals to 21 million by 2030 and therefore creating 2 million additional jobs,” says Tshivhengwa.

Other industries that will benefit from the new strategy include the likes of agriculture and manufacturing. One third of tourism spending goes to other sectors such as retail of textiles, leather, clothing and footwear, automotive fuel, household articles and appliances. According to Stats SA Tourism TSA, direct tourism spend supports 8 percent of the retail industry. The strategy will drive inclusive growth by creating more opportunities for small businesses to enter the industry to provide various services.

The new, revised system differs from the previous one as the strategy looks at potential of tourism instead of business as usual. Business as usual projects 16 million international tourists by 2030 at a 3,7% (currently 3,9% / 2011 – 2018) Compound Annual Growth Rate (CAGR). Tourism potential as per our strategy projects 21 million international tourists by 2030 at a CAGR of 6%.

“The doubling of tourist arrivals will attract investments in the accommodation sector and by the building of new runways at various airports. This will also stimulate visitor export to R 445 311 million by 2030,” he says.

Tshivhengwa highlights the key focus points of the strategy and says to achieve the 2030 strategic goals, the following must happen:

  • We need to remove regulatory barriers.
  • South Africa has to grant visa waivers to more countries.
  • An e-visa system needs to be introduced.
  • We need to re-look our children traveling requirements.
  • We have to grow existing markets.
  • There has to be a focused marketing plan in key countries to grow the market.
  • South Africa has to invest in emerging markets such as China and India.
  • We need to cultivate special interest markets.
  • We have to be able to deal decisively with tourism crime or crime in general.

 

But which new opportunities will the new system create? And in which sectors of tourism can we expect a much higher growth potential than what we currently have? Tshivhengwa says the strategy will create opportunities across all sectors of the industry from airlines, to tour operators, accommodation providers, attractions, etc.

 The new strategy will target the following key markets:

  • UK Hub - grow from 466 878 (2018) to 1 080 025 (2030) CAGR 6.4%
  • Americas - grow from 534 750 (2018) to 1 543 266 (2030) CAGR 8.7%
  • Africa - grow from 679 818 (2018) to 1 754 484 (2030) CAGR 8.1%
  • China - grow from 95 509 (2018) to 1 935 775 (2030) CAGR 25.9%
  • India - grow from 95 554 (2018) to 1 636 196 (2030) CAGR 24.2%
  • Central Europe - grow from 435 782 (2018) to 780 492 (2030) CAGR 4.5%

 

According to Tshivhengwa, these markets represent the greatest potential and we need to continue gaining market share to grow the numbers. However, recent protests and xenophobic attacks have made an impact on the South African tourism industry and have tainted the country’s image as a safe destination. Tshivhengwa says damage has been done to our country as a brand, and this drives tourist away to other countries.

“This presents a set of challenges for the Tourism Business Council of South Africa in implementing the strategy. The biggest challenge is addressing crime in the country, as tourists prefer to visit countries that are safe.  The biggest challenge for the industry is to navigate the realities of our country from crime, protests, to regulatory barriers, which make it difficult to sell South Africa as a tourist destination.

“Over the past 20 years, one of the things that tourists are worried about is their safety. This has been one of the inhibitors to growth … if it were not for this we would be sitting on 15 million to 20 million visitors a year.

“As a country, we’ve got everything that any tourist would want to see and it’s quite important that they feel safe. We have, however, seen a recurrence of the same crimes against tourists in the past few months and this calls for us to look at tourism differently as it creates jobs. It’s labour intensive and doesn’t require too much infrastructure,” Tshivhengwa concludes.

 

Candice Marescia & Leigh Angelo

 

DID YOU KNOW?

For every R100 spent directly on tourism, the full effect across the economy is to generate an additional R97 of indirect and induced spend in other sectors (WTTC 2017). These sectors include manufacturing, (of vehicles, linen, crockery and cutlery), agriculture and other service sectors such as finance, banking, wholesale, marketing and advertising. 

 

 

 

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