Tourism dead in the water
By October, fewer than 20% of small businesses in the tourism sector would have survived the national lockdown to curb the transmission of Covid-19.
This estimate, by tourism specialist Shaun van Eck, suggests that SA’s tourism sector, which was already struggling before the pandemic because of fewer foreign tourist arrivals, will significantly compound the crisis in the broader economy.
“There is currently no tourism happening — [visitors at] bed and breakfasts and guest houses are virtually non-existent,” Van Eck said.
And the longer the lockdown continues, the more dire will the consequences be, particularly for small operators in the hospitality sector.
“Small businesses in the tourism industry are not getting their voice heard and this is going to have dire consequences to the industry,” Van Eck, a tourism author, coach and strategist, said.
For most small tourism operators, April and May are the last months they will be able to pay salaries and wages.
June to September are expected to be a period of mass closures, insolvencies and the loss of huge expertise to the SA tourism industry.
“The decimation of B&B, local and township tour operators, restaurants and experience providers will be a huge loss, especially to towns and villages whose economies rely on tourism,” Van Eck said.
He said that, at a tourism webinar he attended last week, many smaller operators had expressed doubts that the government’s tourism relief grant — introduced to counter the consequences of the enforced lockdown — would do much to ease their plight.
“Most people ... feel left out of the loop, with not much hope,” Van Eck said, adding that operators he had spoken to did not have much faith in the government measure.
The grants, which are worth a combined R6n, are aimed at helping tourism operators defray running costs for three months during the lockdown.
However, the relief measure has been beset by controversy — including court challenges — over the tourism ministry’s insistence that compliance with SA’s broad-based BEE codes should be one of the criteria operators need to meet.
Port Elizabeth Metro B&B Association chair Shena Wilmot said tourism had come to an abrupt halt after March 15, when president Cyril Ramaphosa declared a national state of disaster.
“Since the March 15 speech, the taps have been turned off.
“In the months to come, there will be a wholesale shutdowns with very few businesses still standing.
“Travel is a luxury — it doesn’t matter where you are travelling from — but with people not having two cents to rub together even domestic travel and tourism is not on the cards,” Wilmot said.
Tour operator and owner of Enkosi Travel and Tours, Sisa Manxiwa said even before the lockdown was implemented on March 27 there had been a significant dip in foreign and SA tourists opting for tours.
“We took a big dive in business and now the lockdown has killed business for tour operators — business is dead,” Manxiwa, who offers tours around the Eastern and Western Cape with a focus on city and township tours, said.
He said he believed it would take up to a year, if not longer, for business to pick up again — and even that did not mean tourism businesses would continue operating.
“It all depends on the international tourists and it will take some time before they consider travelling abroad again,” Manxiwa said.
Junaine Baatjies, who is involved in building tourism capacity in Nelson Mandela Bay’s northern areas, said the sector’s future looked extremely bleak.
“We were supposed to start a going green campaign in the northern areas in order to attract more tourism, but since the lockdown nothing has been done and [it] cannot be done,” Baatjies said.
“We now have to change our focus on what we want to achieve — there are big challenges going forward.
“We will probably have to go back to the drawing board,” Baatjies said.
Van Eck said any financial reserves that businesses had were drained by an extremely poor winter season in 2019 and a moderate pre-virus summer.
“Summer turnovers have been cut by our annual reductions in foreign arrivals for a few years and by business travel that has reduced as the economy stutters.
“For many of these experienced small business operators, the financial cupboard is bare.
“For most, in fact, the cupboard and the house both belong to the bank,” Van Eck said.
He said the big challenge was that smaller tourism businesses were largely voiceless with limited budgets and did not belong to the national associations that feed into the Tourism Business Council of South Africa.
“The local tourism associations that they belong to do not have a national body and so local-level tourism is hardly heard.
“The result is a lack of focus on strategies for towns, rural areas and their tourism businesses,” Van Eck said.
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