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“We’re behind, but 2023 is looking positive” – FEDHASA Reports following Festive Season Survey amongst members

Feast or famine appears to be the nature of the tourism sector’s performance over the festive season as a joint survey conducted by FEDHASA and SATSA reveals.

This after data issued last week by Statistics South Africa for January to December 2022 indicates that most of the country languishes behind the global and African recovery average, except for Cape Town whose tourist arrivals are 4% behind pre-pandemic levels.

At 44% behind pre-pandemic levels, South Africa’s tourist arrivals for the year fall behind the UN World Tourism Organization global average of 35%.

The slower recovery is somewhat understandable when one considers that during the first part of the year, South Africa’s inbound arrivals were highly impacted by the travel regulations that had been imposed by foreign governments due to Omicron.

When South Africa’s own restrictions were lifted in June our recovery rate started escalating:

  • July: -36,18%
  • August: -37,69%
  • September: -36,98%
  • October: -39,20%
  • November: -35,35%
  • December: 25,75%

Although the recovery seems to be accelerating towards the last part of the 2022, several of South Africa’s important markets pre-Covid have been slow to return, such as Italy (-50%), France (-54%), Brazil (-81%) and Asia in general for obvious reasons (-62%).

“We are behind our African competitors and have a lot of ground to catch-up which requires a focussed all-of-government approach to remove any constraints that hamper the hospitality sector’s ability to grow and create jobs,” says Lee-Anne Singer, FEDHASA Cape Chair.

A focussed approach has served Cape Town well. Its recovery is thanks, in part, to the collaborative air access and cruising focus which has resulted in a total of 75 ship visits carrying over 195,000 arriving visitors, and a 71% domestic and 96% international recovery at Cape Town International Airport.

Festive Season Survey

The survey run recently amongst tourism and hospitality business indicates that while 50% saw better festive season bookings in 2022 compared with 2019, 18% saw the same performance and 32% were worse off.

Reasons cited as challenges include the constrained domestic airlift, economic considerations affecting a particular market segment and basic infrastructure delivery issues. Further, survey respondents largely agreed that there had been a trend towards last-minute booking, with the festive season starting much later this past year than in previous years.

On a positive note, small group travel, higher spend and longer trips, paired with pent-up demand following COVID, would drive recovery in 2023, according to respondents who were largely positive about prospects for recovery this year – over 51% say 2023 will be better than 2019. 

For those who believe it will be worse, local economic challenges, the rising cost of running a tourism business and basic infrastructure failures featured among challenges cited as hindering the growth of their business and keeping them up at night.

Over 58% of respondents confirm their forward bookings for Q1 2023 are already better than Q1 in 2022; the rest saying it is the same or worse.

“The tourism and hospitality sector deeply desires to be part of the solution to job creation in South Africa and its potential has been widely acknowledged by government. However, our members tell us that their ability to do so is severely constrained by basic infrastructure failures and red tape, which is completely within government’s control. If they are serious about job creation, it’s time to take tourism seriously,” Singer concludes.

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