UK travel ban terrible news for SA tourism industry and economy

While the rationale for the United Kingdom (UK) ban on travel between South Africa and the UK Is understandable, economists have warned that the economic impact on the tourism industry was set to lead to huge losses in coming months.

The UK ban on visitors from SA followed the identification of a new fast-spreading Covid-19 variant. As surging South African coronavirus cases are expected to hit the one million mark, the country is undergoing the second wave of the virus, with Health Minister Dr Zweli Mkhize warning that much of it is driven by this new variant of the virus.

While there could be “a small negative impact” on trade between the two countries, economist Mike Schussler, on Sunday said the travel ban could lead to a further decline in the first quarter of South Africa’s gross domestic product (GDP).

“The UK tourism is very important to SA and we will feel a further negative impact from that,” said Schussler.

Economic risk analyst Rob Jeffrey said the UK travel ban meant SA would face an even slower economic recovery than anticipated.

“This is terrible for the SA tourism and hotel industries. But given the state of play regarding the virus in the UK and abroad, that decision had to be made,” said Jeffrey.

Quoting Stats SA figures to illustrate the effect of the UK travel ban, University of Johannesburg professor in the school of economics, Peter Bauer, explained: “The 2018 figures indicated that tourism contributed 2.9% directly to the South African GDP.

“In 2019, there were an estimated 16.65 million people visiting South Africa, of which about 430 000 were from the UK. A very large number of them visit the popular areas of the Western Cape, relying on seasonal trade from tourism.

“With the outbreak of coronavirus, the South African tourism sector was impacted quite heavily, with spillover into numerous sectors, such as arts and culture, which was one of the hardest hit sectors.

“We have seen losses in such businesses like the airline industry, especially with the 2020 Tokyo Olympics being postponed earlier this year, which has had a noticeable global impact.”

Bauer said additional travel bans were going to put “more pressure” on things.

“While these travel bans are quite justifiable, unfortunately there is little alternative available, especially as the virus mutates – as seen both in South Africa and the UK. The travel restrictions are aimed at slowing the rate of the spread of the virus,” said Bauer.

Political fallout might be less severe

Political experts Dr Ralph Mathekga and University of South Africa’s political science professor Dirk Kotze, said strong diplomatic ties between the two countries are unlikely to be affected by the travel ban.

“When it comes to the management of Covid-19, I don’t think the UK decision may sully its long-term diplomatic relations with SA. The pandemic has caused so much crisis and panic around the world, making it understandable when countries like the UK reach decisions that will benefit their own citizens.

“It has nothing to do with diplomacy, but about a crisis which no one knows how to deal with – a crisis not perhaps seen in the past 100 years,” said Mathekga.

Kotze predicted that South Africa was likely to experience more travel bans during the New Year.

He said: “For now, there are not really alternative options, with the UK desperate to address the pandemic. Both countries are in a similar situation and the SA government wants to keep everything open for as long as possible.

“More travel bans during the New year will most probably follow.”

brians@citizen.co.za

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