Tourism industry hits rock bottom due to virus fallout
'Unless steps can be taken to support the industry, a major component of our economy will close down and restarting it will be a challenge.'
A totally deserted Durban beachfront is seen with no humans on it on day 43 of the national lockdown as a result of Covid-19, South Africa, 09 May 2020. Picture: EPA-EFE / KIM LUDBROOK
The tourism industry is going to have to be rebuilt from the ground up in the wake of the consequences of the lockdown brought on by the novel coronavirus, according to Tshifhiwa Tshivhengwa, CEO of the Tourism Business Council of South Africa (TBCSA).
His comments came after the TBCSA released a survey showing the dire straits the industry was in. More than 10 million international tourism trips were made to South Africa last year and in 2018, R273.2 billion was injected into the economy. This year, however, has been an unmitigated disaster for the industry, which supported more than 740 000 direct jobs and 1.5 million related jobs.
In April, the department of tourism, in collaboration with the TBCSA and IFC, a member of the World Bank Group, conducted the Tourism Industry Survey of SA: Covid-19, which looked at the extent of the impact of the virus, how effective the support has been and what kind of work was still required.
The lockdown rendered the tourism sector totally inactive.
Tshivhengwa said: “This is an unprecedented crisis for the tourism industry, with the impact felt before lockdown and expected to last well beyond the easing of restrictions. Unless steps can be taken to support the industry, a major component of our economy will close down and restarting it will be a challenge.”
Respondent summary
- 50% operate in the Western Cape.
- 66% have one to 10 employees and 52% have annual turnover of up to R3 million.
- 46% are accommodation providers, 20% are tour operators and the rest provide activities, conventions or are conservancy-related.
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- 99% of responding firms are affected by Covid-19.
- 64% believe their business will survive.
- 83% of firms report revenues in March are down more than 50% compared to last year, and 34% say revenues are 100% less.
- 58% of firms can’t service their debts and 54% of firms can’t cover fixed costs.
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