The local travel and tourism sector had a rather trying 2015, with unpredictable challenges, such as the Ebola and Zika viruses, and obstructive domestic and international factors weighing against us. The good news is that the sector has
rebounded somewhat after last year’s unforeseen sociopolitical issues. Attending 2016’s local travel trade shows and expositions, the word in the high-end of the hospitality sector was exuberant, but also not without a modicum of warning.


DAZZLING DELIVERY

It must be noted that the quality, range, and depth of product South Africa has to offer local and international guests remains astounding. Conservation, community involvement, and the luxury safari lodge sector remain miles ahead of their competitors, and continue to dazzle guests with their ability to deliver on a fully integrated luxury bush experience.

The exquisitely positioned Tintswalo Atlantic in Hout Bay, Cape Town
The exquisitely positioned Tintswalo Atlantic in Hout Bay, Cape Town

ROBUST GROWTH

The hotel industry is robust, with an excellent growth outlook. In a nutshell, it has been a far better year than 2015 for most stakeholders, and the tourism industry is forecast to continue to post solid growth. In its recent Travel & Tourism Economic Impact 2016 South Africa Report, the World Travel & Tourism
Council noted that global growth in the travel and tourism sector (2.8%) out-paced that of the global economy (2.3%) for the fifth consecutive year


VISITOR SPEND

In South Africa, the direct contribution of travel and tourism to GDP in 2015 was R118.6bn (3% of GDP). This is forecast to rise 3.9% to R123.3bn in 2016, which is the fourth-highest in Africa, behind Namibia (5.3%), Kenya (4.4%), and Zambia
(4.2%), but above the global average of 3.3%. Leisure travel spending generated 65.3% of direct travel and tourism GDP in 2015 (R167.4bn), compared with 34.7% for business travel spending (R88.8bn). Despite good access to capital, travel and tourism investment in South Africa is flat to down, as we find ourselves
sixth in Africa, with a projected 4% growth. Our neighbours such as Zambia (10.6%), Tanzania (7.4%), Kenya (5.3%), Namibia (4.8%), and even Zimbabwe (4.6%) are all ahead of us on the growth curve.

&Beyond Leadwood Lodge
&Beyond Leadwood Lodge

VISA ISSUES

South African Tourism Services Association CEO David Frost, who is at the vanguard of lobbying the government for greater ease of access to our country, describes the stark reality that, despite the hard-won upturn, the government continues to remain obstructive in its inability to act, or even to consult the
industry, to stimulate tourism growth. He bluntly states: “Our government, and especially the Department of (Home) Affairs, is doing exactly the opposite. Not only are they acting obstructively, with the maintenance of the now infamous visa regulations and unabridged birth certificate rules, but they have
consistently not made good on their promises to meet and consult the industry.”


GOING BACKWARDS

“While we should have been capitalising on the collapsing currency, rather we have been stopping people coming, both independent travellers and groups. We went backwards for the first time in 15 years — we regressed 5% when the rand depreciated 36% against the pound and 44 % against the dollar,” Frost says. He elaborates on how the restrictive visa requirements are destructive for the tourism industry.

“The number of actual people denied boarding (or) entry (en route to South Africa) are an average of 40 people a day,” he says. “Immeasurable harm is done where we cannot quantify the loss of tourism we would have received.” 
Considering the official unemployment rate of 26.7%, Frost notes that South Africa should be trying to support a growth industry, not throwing obstacles in its way. And he is frustrated by the latest data. “International arrivals are up 11% in the first four months of 2016, but we are only 6% up on 2014, which is 3% year-on-year growth — we should be doing double-digit growth,” he says.

Singita Sabora tennis court
Singita Sabora tennis court

HOTEL DEVELOPMENT

On a brighter note, another indicator of the state of the tourism and travel sector is the upsurge in hotel development and hotel management companies. Michael Pownall, former GM at Taj Cape Town and now partner at PMR Hospitality Partners, a local hospitality management company, presents a familiar snapshot. “It has been a very positive year for business confidence
in hotel developments for South Africa, particularly Cape Town,” Pownall says. “The cycle of positive tourism indicators would suggest 2016-17 is a great time to seize new projects.


SAFELY SOUTH AFRICAN

With the recent terrorist attacks in Europe and the attempted coup in Turkey, there is at least a perception that travel in South Africa is safe. Add to this the benefits of the exchange rate and a well-priced long-haul ticket, and you
have a winning combination that is arguably hard to beat. With a market that is primarily 60% US trade, and 10% to 20% UK trade, even Brexit is not anticipated to have a detrimental effect. In fact, perhaps quite the contrary, as the Brits will look further afield to stretch their pounds.

Oaklands Country Manor, between Joburg and Durban
Oaklands Country Manor, between Joburg and Durban

LUXURY LODGE

Mark Witney, chief operating officer for Singita, which is arguably at the apex of luxury safari travel, is exuberant about the sector. “Business is booming … we hit our budget by the end of April,” he beams, “and this even with two price increases since the drop in the exchange rate.” At a cost of about $1,500 per person per night, Singita still represents good value to his wealthy guests, especially with the uniqueness, comforts, and experience that South Africa affords.


BUSINESS OF CONSERVATION

Singita’s product is the embodiment of the safari and outdoor luxury experience. “The challenge when everybody expects luxury, is to maintain engagement and leadership through innovation, and to align ourselves in a
far more conservation-focused world,” Witney says. “Our goal and ambition really is to reconnect the guest with nature, and to offer a more immersive wilderness experience. “Conservation is perceived to be more a philanthropic
exercise, but is in actuality more of an investment, and has to make business sense to function optimally,” Witney says.

The dramatic fever tree forest near Return Africa’s Pafuri Camp
The dramatic fever tree forest near Return Africa’s Pafuri Camp

CHANGING TRAVEL PATTERNS

Rob More, CEO of More Hotels, which owns and operates a number of upmarket lodges and hotels, similarly remains bullish in his outlook. “This has possibly been the best year since South Africa’s acceptance onto the global luxury travellers bucket list, for a few reasons, namely: pent-up demand from
2015’s Ebola scare; and the Zika virus and the Olympics affecting normal travel patterns to a long-haul competitor. And Kenya and surrounds continue to receive negative press on terrorism cells and the like.  

Conservation is perceived to be a more philanthropic
exercise, but is in actuality more of an investment

“The softening rand has attracted a new market who may have previously not been able to afford South Africa,” More says. “ We have competitive flights into Southern Africa, which has again assisted affordability; and momentum in the US market, which is being fuelled by growing awareness.  

“Our forecast, barring any unexpected dramatic event, for example, a terrorism incident in South Africa, is that it will be another strong year, achieving between 8% and 10% growth on 2015, which was a record year for luxury visitors.” As More points out: “The quality of our products in South Africa — how well they suit a client who is short on time, but has a meaningful budget, and who is looking for high impact, accessible, unique experiences — make South Africa well positioned (for at least a few years) to take up a large percentage of this market.”


UNIQUE EXPERIENCES

Joe Cloete, GM of Shamwari Group, which includes Shamwari Game Reserve, Jock Safari Lodge, and Sanbona Wildlife Reserve, has also witnessed an upturn
since 2015, claiming a huge increase in international and South African guests booking at the properties. 

“There has been a very healthy growth in occupancies year on year, as South Africa has become a desirable destination across the world, and, of course, the favourable exchange rate has made South Africa a very affordable destination. We are seeing excellent growth out of the UK and Europe, but the very encouraging growth has come out of North America, and family travel has become huge.” 

Cloete says sustainable conservation has always been the Shamwari model, and that there is probably an oversaturation of luxury lodges in the market — and certainly an overuse of the word luxury. “Unique, family travel experiences are what remain with you for a lifetime, not necessarily luxury décor,” he says. “There is a massive trend coming through where guests specifically want to support the right kind of conservation products that provide a positive social and ecological result.”


PRIVATE GUIDES

Richard Anderson, of Anderson Expeditions, is a leading private expedition guide, and picks up on guests’ sentiments by conversing with them around the night fire during his trips. “In essence, private guiding is a wordof-mouth 
business; it takes time to build up a network of clients who trust you,” he says. 
Anderson says the safari industry and the end client are increasingly understanding the value that private guides are bringing. “I think private guiding is a good reflection of the purchasing evolution of the discerning consumer,”
he says. “We’ve moved away from the mass market convenience of a Starbucks experience. People now want their coffee from their favourite barista, who knows their name when they walk in the door and custom makes the best cappuccino for that customer.”

&Beyond Leadwood Lodge
&Beyond Leadwood Lodge

BUILDING TRUST

This level of attention and bespoke detail, together with the luxury bush experience, is a winning combination that keeps guests coming back. “Our guests typically place a high importance on travel, experiences, and spending
meaningful time with their families and friends. They’re prepared to spend a significant amount of money on these trips. Travel purchasing decisions are primarily based on  referrals from close relatives, friends, or colleagues. Trust
is the single most important element when deciding which company or guide to travel with,” Anderson says. He concludes: “To my mind, Africa and an African
safari is a near impossible ‘product’ to beat. We have the perfect mix of weather, wildlife, people, history, culture, and brilliant infrastructure to get people to these places. So, assuming global and continental forces maintain
relative stable, high-end tourism to Africa is only going to increase.” 


MIRACLE OF A GUEST

Witney sums up the fortunes of the local tourism industry as he reflects on how and why people choose to visit South Africa. “How did the guest find us, and why are they here? If you think about the entire process it took for the visitor
to actually get here, to our shores, and finally to find themselves here on a game drive, having a sundowner, or on top of Table Mountain, it is actually quite remarkable.” It’s what Witney aptly describes as “the miracle of a guest” — something that the travel and tourism industry should never take for granted, and, by all accounts, save for our Home Affairs minister, certainly does not.

Oaklands Country Manor, between Joburg and Durban
Oaklands Country Manor, between Joburg and Durban

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