South Africa’s crime rate could scare off potential Gulf investors

Potential investors in the Gulf Cooperation Council (GCC) and the United Arab Emirates (UAE) are concerned about South Africa’s high crime rates.

Tourism Minister Lindiwe Sisulu is currently in Dubai, meeting with potential investors to strengthen relations between South Africa and the UAE into a more comprehensive strategic partnership.

Sisulu had bilateral engagements with key Investors in the GCC Region, including the Chairman of the SOBHA Group (Mr G Pennon), a multinational real estate and construction entity, Chairman of Emirates Group, His Highness, Sheik Ahmed Bin Saeed Al Makhtoum, CEO of the Bin Otaiba Hotel Group, Khalaf Bin Ahmed Al Otaiba and CEO of Millat Investments, Mr Hamza Farooqui. 

The UAE is one of South Africa’s top bilateral trade partners in the Middle East, with total exports worth R25.4 billion in 2018.

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“Of concern to the potential investors was that safety and security in South Africa continue to be a hindrance to sustainable investments,” said the department in a statement.

The National Tourism Sector Strategy and Tourism Sector Recovery Plan aims to promote South Africa as a preferred destination for tourism investment by highlighting opportunities in major attractions, especially in underdeveloped areas with high tourism potential.

“Through the Tourism recovery Plan, tourism intends to match specific tourism investment opportunities to potential financiers and thus contribute towards the Presidential Investment Mobilisation Drive, launched in 2018 to generate about $100 billion (or R1.2 trillion) fixed investments over five years,” said the department.

South Africa has a code-sharing agreement with the Emirates, which gives the airline access to South Africa’s domestic routes while Emirates promotes South Africa on its Airline’s Global Network.

“Airlift is a key pillar for South Africa’ tourism recovery, and therefore it is critical to collaborate with Emirates to support our turnaround strategy,” said Sisulu.

Sisulu acknowledged that although tourism has tremendous potential for long-term sustainable growth, safety and security does indeed hurt the South African economy.

She reiterated that the South African government has put in place measures to address security problems in the country. ‘We will continue to create a conducive environment for tourism investments,” she assured delegates.

Some of the prominent investors from the GCC region with a physical presence in South Africa are: 

• Otaiba Group (UAE) with an investment in the country estimated at R3.5 billion, the Hilton Durban, Port Edward in Port Elizabeth, the Hyatt in Rosebank and the Radisson- Blu Sea Point in Cape Town.
• IFA (Kuwait) with an investment estimated at R10 billion in the Zimbali Resort in KwaZulu-Natal, Boschendal Farm Estate in the Western Cape and the Legend Golf and Safari Resort in Limpopo.
• Adel Al-Sumait (Kuwait) with an investment estimated at R203 million invested in Al-Thandiwe Safaris in Limpopo
• Dubai Investment Corporation with an investment estimated at R420 million in Shamwari Game Reserve, and a stake in the One & Only Hotel in Cape Town

(Compiled by Narissa Subramoney)

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