Global Competitiveness Programme: Department of Tourism & SA Tourism briefings

Committee: Tourism

Chairperson: Mr D Gumede (ANC)

Date of Meeting: 13 Sep 2010

Summary

The Committee was briefed on the Global Competitiveness Programme by the National Department of Tourism. This programme compared South Africa to other tourist destinations and to other sectors within the South African economy, in order to highlight successes and issues requiring attention. It was mentioned that although South Africa, prior to the 2010 World Cup, had been ranked 128th in the list of favoured destinations, largely due to safety concerns, it had since risen. However, some of the challenges that the Programme had highlighted were that tourists chose not to visit South Africa because they feared for their safety and security, did not consider that it gave sufficient value for money, and the high costs of travelling. The study concluded with recommendations that skills and training were urgently required in the tourism sector. Perceptions of South Africa, the value for money, comprehensive tourism trade agreements, and the new draft National Tourism Sector Strategy were all issues that now needed the industry’s focus. It was highlighted that the statistics now being presented excluded day visitors to South Africa, which accounted for the difference between previous and current statistics. Sixteen tourists were now required to create one job.

Members felt that the statistics were confusing, and, although it was explained that until 2009 the statistics given had encompassed day visitors and longer-stay visitors in one list, whereas they were subsequently separated out, Members asked that the statistics should be more fully explained at a later meeting. Members commented that South Africa was not attracting the higher end of the tourism market, and were concerned at the numbers who had been deterred from visiting, mostly due to negative perceptions about safety. They asked what was being done to address negative foreign press reports, how South Africa was being positively marketed, how negative perceptions could be changed, and commented that more budget was needed to put to marketing. Members also stressed that other departments must be made aware of the perceptions and realities, to address issues around transport, safety and other matters. They noted that costs of flights and unreliability were also hindering visits to certain areas, and that it was necessary to generate higher numbers of visitors. Members also asked about training to fill the skills gap, and what investments the Department was making, and what was being done for rural tourism. 


Minutes

Global Competitiveness Project: National Department of Tourism (NDT) briefing
Mr Kingsley Makhubela, Director-General, Department of Tourism, explained that the research used in his presentation had been done two years ago by the United Nations World Tourism Organisation. Most of the elements were still relevant. The recent successes in South Africa, contributed to by the 2010 FIFA World Cup, had also resulted in a positive shift in South Africa’s favour. Prior to the World Cup, South Africa had been ranked at 128 of favoured destinations, mostly due to fears around safety, but this perception has changed since the World Cup.

Ms Roshene Singh, Chief Marketing Officer, SA Tourism, briefed the Committee on the Global Competitiveness Programme (GCP). She outlined the statistics from the World Economic Forum on South Africa’s global ranking for 2009. The objective of the GCP study was to assess the levels of performance of South African tourism and to highlight areas of concern. South Africa was compared with five other destinations: Australia, Brazil, Kenya, Thailand and the United States. The comparison focused on arrivals, growth of the industry and the contribution to Gross Domestic Product (GDP). Tourism was then compared internally with other sectors in South Africa’s economy. South Africa’s accessibility as a tourist destination was analysed and it was concluded that some of the drawbacks to South Africa as a destination were safety and security, the high costs of travelling, and the perceived value for money. However, the perception of safety and security among foreigners improved if they visited South Africa. The study also analysed the transport capacity of South Africa and concluded that more direct flights would increase the number of tourists. The study concluded with the recommendations that skills and training were urgently required in the tourism sector. Perceptions of South Africa, the value for money, comprehensive tourism trade agreements, and the new draft National Tourism Sector Strategy were all issues that now needed to receive special focus by the industry.

Mr G Krumbock (DA) interrupted the presentation to ask for clarity on the statistics used in the presentation for South Africa’s arrivals.

Ms Singh explained that since January 2009, Statistics South Africa had separated the day visitors from the overnight tourists, leading to a drop in the figures.

Discussion
The Chairperson noted that the 2009/10 Annual Report of both the Department and SA Tourism had been tabled and circulated on time. He thanked them for their efficiency. The formal invitations for the Committee to attend the World Tourism Day in Limpopo had also arrived.

Mr Krumbock (DA) questioned the remark by Ms Singh about the statistics earlier, and questioned how it was possible that the previous figures could have been wrong. He asked for a further explanation.

Ms Singh clarified that the earlier statistics for visitors did not include refugees or immigrants. The Department had been under the impression that all people listed had been staying for at least a night, but Statistics SA then explained that not all of them were. With effect from January 2009, the statistics were separated out, showing different lists for visitors who spent more than a night in the country, and same day visitors. This would be confusing, as targets for the Department required examination of five years of data. For purposes of comparison, therefore the Department had to keep using the combined statistics. In its presentation, the Department estimated the statistics for tourists who excluded day visitors. The study had also been shared with the tourism industry.

Mr Krumbock stated that the number of tourists needed to create one job seemed to have gone up from 12 to 16. He presumed that this high number was due to the large percentage of South Africa’s tourists visiting from neighbouring countries for only a short amount of time. He commented that South Africa did not seem to be attracting the high end of the tourism market. He also referred to the slide that measured the number of people who had considered visiting South Africa but were deterred due to various reasons, often blown out of proportion by the overseas press, as seen during the 2010 World Cup. He asked how the negative perceptions of South Africa could be changed. Mr Krumbock suggested that SA Tourism needed more funding for its marketing overseas to change perceptions and attract overseas tourists.

Mr Makhubela replied that perceptions did not disappear on their own, and that strategies needed to be developed. The Minister of Tourism had participated in Presidential visits where there had been a specific focus on individuals involved in tourism. He referred to a recent visit made by the Minister to China, where he engaged with businessmen and the press on the issues of tourism. This way it had been possible to directly address the concerns on safety, value for money, visas and other issues.

Mr Victor Tharage, Deputy Director-General, Department of Tourism, replied that the tourism budget of South Africa was lower than Kenya’s investment.

Ms M Njobe (COPE) referred to the point that some potential visitors were reluctant to visit South Africa. Ms Njobe wondered if the Department of Tourism was sharing this information with other departments. The study referred to various reasons that tourists did not visit South Africa, and other departments should be made aware of the impact of these reasons on tourism. In particular there were issues of safety, skills and education.

Mr Tharage explained the issue of mandates. The Department of Tourism was dependent on every other sector. There were inter-department cluster meetings held, and the Director-General of Tourism did meet with the other Director-Generals in order to make them aware of and to focus on issues that needed to be solved. He also referred to the issue of airlift, noting that ticket prices to fly to South Africa were high and the number of carriers flying to South Africa had decreased. There had been a lack of investment in some routes. The solution was to generate higher numbers of tourists, as there were still a large number of tourists who were keen to visit South Africa, and this would lower the prices.

Ms V Bam-Mugwanya (ANC) asked if the Department was offering training to assist the skills gap. She also asked about the dissemination of information, and wondered if this presentation would be made available to other departments so as to synthesise operations across the country. She enquired what investment portfolio was being planned by the Department, and what had already been done by way of investment, and what might have been recovered.

Mr Tharage replied that the Department had two ways in which to invest. One was a Public Works programme which invested in areas that had potential. He conceded that the Department needed a more coherent approach. The Department had an investment brochure which was available.
 
Ms Bam-Mugwanya asked how the Department defined rural tourism.

The Chairperson felt that sometimes the Committee could be hindered by different definitions. The definition of ‘rural tourism’ could refer to heritage tourism in rural areas, or to tourism in rural game parks and nature reserves.

Ms J Manganye (ANC) that safety perceptions were important. If South Africans did not feel safe in their own country, then tourists would tend to pick up on this. She asked how South Africa was being marketed overseas. She also stated how impressed she had been with how Limpopo had marketed rural areas.

The Chairperson commented that although there were good attractions in Limpopo, the roads and transport were difficult to access in the rural areas. Although this affected tourism direction, the Department of Tourism unfortunately did not have any mandate to fix those problems.

The Chairperson also felt that the issue of safety was being explored by the Tourism Safety Initiative, which had been explained by Mr Tatalias on 31 August. Safety had been defined as incorporating a number of health, crime, road safety, water quality and sanitation issues.

Ms Manganye asked how the figures quoted in the statistics differentiated between tourists and refugees.

The Chairperson then asked if the new statistics released by the Tourism Department could be explained by a statistician, so that the Committee could understand the difference between them and the old figures.

Mr Tharage replied that the Committee would receive a briefing from Statistics SA and the Deputy Director-General of Tourism involved with the statistics, on 21 September.

Ms T Tshivhase (ANC) was concerned that there had been a lot of propaganda about the safety in South Africa prior to and during the 2010 FIFA World Cup, which had convinced many tourists not to visit. She asked how the Department responded to false reports in the foreign press that negatively impacted on tourists.

The Chairperson commented that the Committee was not stating that there was no violent crime in South Africa. However, it must be remembered that crime was a global problem and not merely endemic to South Africa.

Ms Singh replied that safety was the biggest barrier. Perceptions of South Africa were most often transmitted by word of mouth. The Department therefore used past visitors to South Africa in their marketing campaigns. When the Department was marketing South Africa prior to the World Cup, it had brought General Cele and his team to speak to foreign media. It was not in fact Europeans and Westerners who expressed the most fears about their safety, but people in Kenya, Nigeria and other African countries. The World Cup also encouraged cooperation between small and large businesses, as evidenced by the large tour operators subcontracting smaller operators for transport.

The Chairperson asked if Embassies could be used to convey messages and change perceptions.

Mr Tharage explained that there had been a revision of the International Relations strategy and that Tourism was one of the departments highlighted in the strategy.

The Chairperson commented that the airlink strategy needed to be reexamined. Airlines should be competing with some of the major bus companies, to visit more minor cities more often. He also felt that the Department of Tourism needed greater visibility. He felt that the Department needed to fight the negative reporting on South Africa. However, he stressed that it would require more funding for marketing. 
 
Ms Bam-Mugwanya highlighted the issue that SA Airlink’s flights to areas of the former Transkei had been erratic and were sometimes diverted to East London, with no alternatives offered. She felt that this negatively impacted on tourism in the area.

The Chairperson replied that the Freedom Charter had set out that monopolies needed to be dealt with and abolished.

The meeting was adjourned.