Could tourism be the new mining boom for SA?
Throughout the economic downturn, which began in 2008, the tourism industry has continued to be an economic driving force for South Africa. With all the challenges experienced in the mining and manufacturing sector in 2015 and 2016, tourism has been one industry that continued to prove its economic potential in a tough global environment.
Last year alone, over nine million visitors arrived in South Africa, an increase of just over one million compared to the 2015 figures. This represents a 13% growth in tourism arrivals.
It is these numbers that have probably propelled government to declare tourism as a key job driver.
Added to the growth in tourist numbers was the growth in tourism spend. According to the Department of Tourism, during the first months of 2016, up to R39.3 billion in foreign direct spend was achieved in South Africa.
With the Treasury allocating an additional R494 million to the tourism budget this year, there is no doubt of the kind of value government sees in the sector.
Tourism currently contributes about 9% to the country’s Gross Domestic Product (GDP). Over the last ten years, tourism in South Africa has emerged as a leading economic growth sector.
It is now one of the largest contributors to GDP, and offers significant employment and enterprise development opportunities.
It is a labour-intensive industry that brings in foreign revenue and stimulates a broad range of other industries.
In the State of the Nation Address, President Jacob Zuma mentioned the tourism sector as one of the five top economic sectors that would reverse a sluggish economic growth, mobilise domestic and foreign investment and help in the development of small and medium enterprises.
The National Development Plan (NDP) also recognises tourism as one of the main drivers of South Africa’s economy and of employment.
The Department of Tourism says its policy focus over the medium term will be on creating work opportunities and increasing the number of domestic and international tourist arrivals from 11 million in 2015/16 to 12 million by 2017/18.
The National Tourism Sector Strategy (NTSS) seeks to increase tourism’s total direct and indirect contribution to the economy from R189, 4 billion in 2009 to R318, 2 billion in 2015 and R499 billion in 2020.
Specifically, the strategy commits the tourism sector to creating 22 000 additional jobs by 2020.
According to research conducted by the National Convention Bureau, 40% of all convention delegates attending meetings in South Africa return in five years’ time as tourists, thus boosting tourism growth and job creation.
Addressing Meeting Africa 2017 in Johannesburg recently, Tourism Minister Derek Hanekom told delegates at the conference that travel and tourism now contributed around 3.3% to Africa’s GDP, and supports over 9 million jobs directly, or 3% of total employment.
“Tourism is a significant economic sector around the world, and it now comprises 30% of all global service exports,” he said.
Travel and Tourism Council forecasts that the number of jobs in tourism is set to grow this year.
“We already have a vibrant, established local travel industry. Leisure tourism and the business events industry hold massive potential to play an even more meaningful role in the economic transformation of our country, and our continent.”
Last year, the minister told parliament that despite certain challenges that resulted in the massive decline in 2015, the tourism sector remains resilient and a key part of the NDP, as an important economic driver.
It is estimated that meetings, incentives, conventions and exhibitions supported about 280 000 direct and indirect jobs in South Africa in 2015.
The Western Cape remains the country’s most developed tourism region. The tourism industry in the province has grown faster and created more jobs than any other industry.
One in 10 employees in the Western Cape earns a living in the tourism industry, and it contributes more than R25 billion to the provincial economy. – SAnews.gov.za