Your weekly member update on industry news and views worth noting
A Message from the Chief Executive Officer
Welcome to our very first edition of the TBCSA Weekly for 2018. As you settle into the new year, we thought this would be a good time for us to send you our well wishes for the year ahead, and also share some thoughts on what lies ahead for the travel and tourism sector which might be of value to your business.
We kick-off this edition by sharing our take on the year 2018, as expressed in our Financial Mail article that was published in the latter part of December 2017. The article appeared as part of the publication’s year- end supplement titled South Africa and Africa in 2018, with the travel and tourism feature being based on a conversation with the TBCSA Secretariat. Click Here to download and read the full feature.
Business unusual is the ‘new black’
Reflecting back on 2017, and looking ahead to South Africa’s socio-political and economic prospects in 2018, it remains clear that business unusual is the ‘new black’. With the outcomes of the 2017 ANC elective conference still in our minds, and other political party conferences soon to follow ahead of the 2019 general elections, it remains to be seen how these developments will shape dynamics in our operating environment in the months ahead. However, one thing we have already noted since the year has begun, is that the winds of change are here – we already have three government sponsored Commissions investigating issues of governance and allegations of wrong doing; the big one being the investigation into allegations of State Capture.
SA has the potential to grow its tourism GDP
Travel and tourism thrives in a thriving economic environment. In reverse, the country’s economy stands to benefit from a thriving travel and tourism sector. Whilst South Africa attracts close to 10-million tourists and accounts for 10% of GDP, it could be bigger, if underpinned by a strong economic environment.
A World Bank report recently placed South Africa’s growth outlook for 2018 at 1,1%. Another report, this time by the International Monetary Fund weighed in with revised growth projections sitting at mildly 0.9%. Though green shoots in as far as the economy is concerned are always welcome, the level of the expected growth is still far too low to stimulate the necessary growth for job creation. Furthermore, to quote one economic commentator, Xhanti Payi, “this is certainly not for government coffers which have been struggling. It is estimated that government will need to borrow some R163 billion for the 2018/19 financial year, and Treasury signalled that this could be more as we experience revenue shortfalls. This excludes the R50 billion shortfall from last year, and the demands for free education”.
Of course, securing critical energy and water resources and ensuring more investment in related infrastructure will go a long way to strengthen the economy, thereby, creating a stronger basis to attract more investment (including investment in travel and tourism). In this respect, it will be pivotal to ensure that the corporate governance and related issues around Eskom are sufficiently addressed to ensure its long-term sustainability. Moreover, innovative solutions are needed to address the current drought situation gripping the Eastern and Western Cape, KwaZulu-Natal and other parts of the country. Just this week, the municipality of Tshwane issued a notice to both residents and business informing them of plans to institute water restrictions. Indeed, water conservation practices must be part and parcel of our everyday operations.
Click Here to listen to the full SAT/Tourism Update webinar on the drought crisis in Cape Town.
Click Here for details of a Special JAMMS session titled: Day Zero – Responsible Tourism, taking place on Friday, 02 February 2018 at the Cape Town International Convention Centre.
As the TBCSA, in close collaboration with you as members and our stakeholders, we look forward to playing our part to contribute to the conversations and solutions for some of these challenges. After all, it is in doing this amongst others that we can unlock travel and tourism’s potential to grow.
Turning challenges into opportunities
Whilst many commentators expect even stronger headwinds ahead, we have opted to adopt a broader view which sees opportunities that come with the challenges. In addition to issues around the drought crisis, there are a few other themes and priorities which will continue to receive a great level of our attention this year.
Foremost are issues related to tourist safety, a major issue particularly in 2017. How we work as a collective to proactively prepare and manage issues of tourist safety and security will be key. Last year, a great effort was made to forge stronger ties with all the relevant stakeholders within and outside of the industry. This is work that we will continue to build on in 2018.
Disruptor or enabler? Whichever way one look at technology and its impact on the world (and our sector) there is no doubt that technological advances will continue to present both opportunities and challenges for the sector. Last year saw us engage on several occasions on the impact of the sharing economy. We plan to follow-up on these conversations going forward, to find a way to balance the need to protect the reputation of our destination, whilst at the same time not discouraging investment and opportunities afforded to entrepreneurs (especially emerging entrepreneurs) as a result of the immense potential of the sharing economy.
As more and more of our members continue to pursue opportunities for growth and expansion beyond South Africa’s borders, you can be sure that the TBCSA Secretariat will also continue to keep tabs on issues of regional Africa tourism growth and development. We are encouraged by current efforts to reinvigorate the work of RETOSA (Regional Tourism Organisation of Southern Africa), a critical lead stakeholder in this area and we hope to work closely with the organisation to ensure that you are kept abreast of key developments and opportunities across the region.
Regional Africa tourism growth
Still on the topic of regional Africa, we are equally encouraged by the recent tourism performance. A recent UNWTO World Tourism Barometer shows that regional Africa reached record 62 million international arrivals in 2017, translating to a growth of 8%.
Arrivals in Sub-Saharan Africa increased by 5% while North Africa enjoyed a strong recovery with a 13% growth in arrivals. The continental growth supersedes that of the international number, which stood at 7% in 2017 to reach 1,322 million. Africa is expected to grow by 5%-7% ahead of its counterparts, Asia and the Pacific by 5%-6%, the Middle East by 4%-6%, both Europe and the Americas by 3.5%-4.5% respectively.
On the international front, there was a major focus on World Economic Forum, which recently took place in Davos, Switzerland. The theme Creating a Shared Future in a Fractured World is quite poignant given the current complex state of international affairs. Look out for upcoming editions of the TBCSA Weekly where we will be taking a closer look at the outcomes of WEF 2018 and in particular, its implications for travel and tourism businesses.
Going far together as a collective
As we conclude this edition, I wish to turn your attention to the TBCSA collective. Reflecting on all the key milestones of the organization in the past years, we wish to say that our journey to mainstream travel and tourism as a key economic sector continues in 2018 with your support and the guidance of our Board. As a member, you can look forward to more direct engagement through one-on-one member meetings. We also plan to explore more innovative means of facilitating greater collective industry dialogue on pertinent industry issues – so watch this space.
As the old African adage goes, if you want to go somewhere quickly, go alone. BUT if you want to go far, go together. With this, we look forward to a year of success in working with you. Wishing you and your organisation the best for 2018.
Ms. Mmatšatši Ramawela
CHIEF EXECUTIVE OFFICER