Budget 2017: Growth and transformation key as tourism gets R494m budget boost

2017-02-22 16:13 - Selene Brophy
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Cape Town -  Growth and transformation formed a key part Finance Minister Pravin Gordhan 2017 budget speech he outlined how South Africa's economy could remain resilient in the face of global economic challenges - Follow Fin24's coverage here 

When it comes to tourism, lauded by President Zuma as a key economic driver for job creation with its 13% growth in tourist arrivals for 2016 during the State of the Nation address - Gordhan pledged more support for tourism-related services, confirming an additional R494 million has been allocated for tourism promotion.

SEE: SA sees +10m International visitors as 2016 tourism growth hits 13% 

In relation to adding more support and transformation Gordhan referenced a budget tip received by Lisa Sheard, head of the Kruger Lowveld tourism member associations saying, “Tourism encourages ‘pride of place’. Pride of place ensures that the water will run, the streets will be clean, signage will be clear…”  

"Ms Sheard also wrote that “Tourism is ‘woman full’. Women excel and dominate… Tourism instills a good and honest work ethic – it will not make you rich and famous quickly, but it can be very rewarding.”

'Remove own goal obstacles, before adding more money'

David Frost, Southern Africa Tourism Services Association (SATSA) CEO responded to the announcement saying while it is brilliant to have an extra "half a billion to work with" to promote tourism in South Africa, he questions what the state means with “focused support”. 

"Before you give tourism services more support or spend more money to compete against 200 other country’s to encourage tourists to come here, government needs to take away the current “own goals”.  

Frost referenced “heavy handed” DHA birth certificate regulations that he says sees a family from Germany for example forking out an estimated 200 euro just to comply with. 

He also pointed to the tit-for-tat visa response to one of SA’s growing markets, New Zealand with visa requirements instated for both countries’ citizens at the end of 2016, requiring applicants to appear in person in Wellington. 

SEE: New Zealand visa changes: The first of many new visa restrictions for SA immigration? 

Frost says, “We’ll never count how many people are being turned away. These are the measures within the ambit of our control. It would have been nice to see better coordination within government in the budget speech streamlining the process for tourism to succeed, not that tourism succeeds despite the obstacles put in the way”. 

Inclusive transformation and growth

South Africa Tourism Chief Executive Officer Sisa Ntshona says the country's destination marketing organisation was definitely encouraged by the "vote of confidence by treasury for tourism to contribute to the overall GDP, which ultimately leads to better jobs and economic prosperity". 

In response to remarks by SATSA's Frost, Ntshona says he agreed with with sentiments saying, "Tourism is a competitive space, I do agree we don’t want to put unnecessary obstacles in place. But at the same time there needs to be balanced in that we protect the country". 

Ntshona added that one of the key issues of the budget speech was about inclusive growth, while at the same time bringing new players into the space. The challenge here says Ntshona is that "tourism growth is all good and well, but not if it only benefits a few - it needs to make an impact across broader society".

Ntshona says on this regard the "main thing to highlight is that it’s not either or, we have to grow while transforming as well". 

Asian market to South Africa grows 

Last year R2bn Tourism budget plan, with half designated to SA tourism for destination marketing was assigned to boost the industry that has shown remarkable recovery following a 6.8% decline in 2015

South Africa overall has seen enormous growth in Asian markets with China at 36%, in fact overtaking the UK as the country's biggest inbound market for international arrivals. 

Ntshona says, "We’ve seen targeted market increases such as China. Nigeria is also growing quite nicely, as is domestic tourism. These are just some of the investments starting to bear fruit."  

Looking ahead SA Tourism has the Middle East on its market watch-list as well as the Nordics, with the EU and UK remaining equally important according to Ntshona who states, "There is a lot to be done". 

SEE: Tourism business index impacted as South Africans not travelling enough locally

'Revive stagnant tourism products' 

Democratic Alliance MP for tourism James Vos says in response to the 2017 budget allocation, “We need to continue to adjust and ensure that we offer attractive and exciting opportunities, whether that’s for travellers or investors. 

Vos suggest the additional budget allocation should be utilized for "reviving stagnant tourism products, establishing effective Destination Marketing strategies and implementing Product Development programs to ensure for the building of tourism infrastructure and the development of products that drives demand and makes business sense".  

'Economic opportunities for all communities' 

Vos states the barriers of entry into entrepreneurs and small business opportunities sector is very low and therefore "programs aimed at bringing more people into this space" will also create economic opportunities for all communities. 

"Shocking statistics released by StatsSA revealed that unemployment in South Africa has risen to 36%. While some other industries are shedding jobs, tourism is steadily gaining them. Currently, one in 22 employed people in South Africa work in the tourism industry, representing 4.5% of the total workforce in our country. The reality is that tourism could contribute so much more to the economy." 

Vos says tourism in South Africa is being "allowed to rest on its laurels".

"Since tourism is doing well, largely thanks to private enterprise and the business sector - the government thinks that is enough. But this is a mistake. Given the job losses in the mining and manufacturing sectors, we need the tourism industry to keep South Africans working." 

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