South Africa’s tourism sector lost an estimated R164 billion in spending by domestic and inbound visitors to the country in 2020 because of the Covid-19 pandemic.
The Bureau for Economic Research at the University of Stellenbosch reports that the number of jobs supported by South Africa’s tourism industry declined by 960 000 to 640 000 last year – that’s close on a million jobs lost.
As recently as 2018, South Africa’s Tourism sector employed 1.6 million people.
The Bureau says spending by domestic and inbound visitors slumped to R109 billion in 2020 from R273 billion in 2018.
It further estimated that based on tourism expenditure in 2020, the sector’s contribution to GDP shrank to 2.9% last year from 7.2% in 2018.
Statistics South Africa reported on Monday that the estimated number of total insolvencies increased by 129.7% in the three months to end-July 2021 compared with the corresponding period in 2020, with insolvencies increasing by 157.7% year-on-year in July 2021.
Stats SA data shows there were a total of 286 compulsory and voluntary liquidations of companies and close corporations in the trade, catering and accommodation sector in the eight months to end-August 2021 compared to 333 in the corresponding period in 2020.
Federated Hospitality Association of Southern Africa (Fedhasa) national chair Rosemary Anderson said many tourism and hospitality companies simply could not hold on any longer when winter put a further dent on local tourism, with the riots in KwaZulu-Natal and Gauteng “putting a nail in the coffin for many involved in hospitality”.
Anderson said even if companies involved in hospitality were not directly negatively affected by the destruction and looting, consumers stopped going out during that turbulent week and several weeks afterwards.
“The looting and destruction had a massively negative effect on tourism and hospitality." he said.
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