SA travel industry reels amid looming coronavirus restrictions

South Africa’s already embattled travel and tourism sector has been dealt another blow with the announcement on Monday 16 March that the annual Africa Travel Indaba has been postponed due to the coronavirus outbreak

The high-profile Indaba is among the continent’s largest tourism marketing events and is claimed by the organisers to be one of the top three “must-visit” events of its kind on the global travel industry calendar. It was due to take place in Durban from 12 to 14 May.

Tourism Minister Mmamoloko Kubayi-Ngubane made the announcement at a special ministerial briefing in Pretoria. 

New dates for Indaba to be announced

She said the risk associated with a large number of people gathering in one place had prompted the decision to cancel the event.

“We will review the decision, depending on how the situation evolves and, working in consultation with industry stakeholders, we will advise on future dates.”

Travel industry hard-hit

The local travel industry has been hard hit since early in 2020 as international visitors either cancelled or postponed their trips to South Africa due to the unfolding coronavirus problems in their own countries and concerns about the health risks posed by air travel.

This has since been exacerbated by President Cyril Ramaphosa’s declaration of a national state of disaster on Sunday 15 March.

Among the package of measures designed to reduce the spread of the virus within South Africa, are stringent travel restrictions and bans on certain foreign visitors, as well as the closure of a number of ports of entry. 

A travel ban will be imposed on flights to and from Italy, Spain, Germany, the United Kingdom (UK), the United State (US), South Korea, Iran and China from Wednesday 18 March.

Gatherings of more than 100 people are also prohibited, which impacts tourism-related events, such as conferences and trade shows.

Likelihood of significant job losses

Writing in the London-based Guardian newspaper shortly after Ramaphosa’s announcement, Africa correspondent Jason Burke noted that “tourism is a major earner in South Africa, and significant numbers of jobs are likely to be lost”.

Two travel agents, who spoke off the record to The South African, said they were extremely concerned.

One, who is regarded as a high flier and works on commission only doing outbound travel, said she had “earned not a cent” so far during March. Another, who specialises in inbound tourism for the luxury safari market, said she feared for her job as business had dropped off so dramatically.

Business travel to SA proving to be the biggest loser

Speaking just prior to Ramaphosa’s declaration of a national state of disaster, SA Tourism CEO Sisa Ntshona, told Fin 24 that business travel was taking the biggest hit.

 “The meetings industry is at risk, because, even if we had to find an island with zero coronavirus cases and have a conference there, people won’t come, because it is not about the destination, but about where other delegates are coming from,” Ntshona said.

Moreover, many corporates are issuing no-travel notices to employees. Some major conferences can attract upwards of 10 000 delegates. 

Jeremy Gardiner, a director at Ninety One (previously Investec Asset Management), told Moneyweb that tourism will feel a sizeable impact from the new travel restrictions.

“For every eight tourists, one permanent job is created in South Africa,” Gardiner pointed out.

“But it looks like some countries are going to go into lockdown – they are going to stop travelling. So what happens to our tourism?”

As this means people will be flying less, both locally and abroad, this has implications for the South African Airways (SAA) as the business rescue practitioners try to find a way to save it. 

Anecdotally, already many local hospitality companies are receiving cancellations for the coming months. The biggest impact will be on smaller tourism operators, guest houses and restaurants that don’t have big balance sheets to sustain them through a period of low cash flows, Moneyweb reported.

Tourism industry committed to proactive response

Southern Africa Tourism Services Association (Satsa) CEO David Frost told the industry publication Tourism Update that despite the uncertainty around the full global impact of the COVID-19 strain of the coronavirus, the tourism industry remained committed to responding proactively and would do everything it could to safeguard travellers and customers at this uncertain time.

“We face a difficult challenge as an industry to respond to this continuously evolving situation. Our only defence is to monitor the situation around the clock and put in place proactive measures and flexible policies to assist travellers, members and their customers, so that when the situation returns to some normality, South Africa is open for business and ready to welcome the world,” he said.