South Africa’s travel and tourism industry performed significantly worse than expected in the second quarter of 2015, says the Tourism Business Council of South Africa (TBCSA).
In the period April-June, business performance levels across the tourism value chain fell from 99.9 in the first quarter to 83.6 in the second quarter.
“This is the lowest performance level since the third quarter of 2011, when the industry registered a very low index score of 70.0,” says TBCSA. A score of 100 is regarded as an indication of normal levels of trade.
“The results are worrying, says TBCSA CEO, Mmatšatši Ramawela. “To be realistic, we anticipated that there would be some decline, judging by our member feedback and the outcomes of the impact assessment study on the new immigration regulations. The past couple of months have been particularly tumultuous for our industry and generally business confidence is low. However, despite the decline in trade conditions, what’s coming out strongly from the latest Tourism Board Index report is that maintaining employment levels remains top priority for many operators.”
The drop in performance comes from a number of contributing factors, such as the new visa legislation with regard to biometrics and unabridged birth certificates.
The effect of the Ebola outbreak appears to be subsiding, with more than half of respondents citing no or neutral impact, while only 16.9% of respondents cited negative impacts as a result of the xenophobic attacks.
The accommodation sector’s index score dropped to 82.6 compared with the forecast 102.7. Other tourism businesses (excluding accommodation) also recorded lower than normal performance, with a score of 84.4 compared with the anticipated 93.2
The accommodation sector is still planning to increase capacity in spite of poor recent and expected performance. Gillian Saunders, head of advisory services at Grant Thornton, says: “Expansion plans for accommodation capacity increases have long lead times and many projects were no doubt planned during the high-performance years of 2013 and 2014, and cannot be shelved now without worse financial consequences.”
Source: etnw
Second quarter tourism figures slump
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