We think it’ going to be a tough year for tourism. Sorry… yes, one should be filled with optimism and hope at the beginning of a new year, but it doesn’t seem to be warranted.
There are a number of reasons:
- Don’t count on significant growth in overseas visitors. It’s tough times overseas and major sporting events, like World Cup, are usually followed by a vacuum.
- The World Tourism Organisation expects business travel in SA to increase by 2.8% in 2011. Compare that to Nigeria’s 7.8%, Kenya’s 5.9% and Malawi’s 8.4%!
- The next 33% electricity cost increase is due soon. The impact of the first increase was minimised by savings that could be made – switching hot water cylinders and pool pumps off for longer – but the next increase will hit accommodation establishments and the disposable income of their guests. And the fuel price keeps climbing.
- The IMF and other organisations predict SA’s growth will be lower than last year.
Government’s planned interventions are going to make running businesses more onerous rather than easier. Government’s policies have failed to create entrepreneurs who create wealth and jobs – in favour of the transfer of wealth to a select few who never worked or showed the creative skills that is usually associated with wealth creation. And then there are the “tenderpreneurs”…
Does President Zuma’s government in fact have a plan? The Times reported in January 2011: “President Jacob Zuma has instructed the ANC to stop “theorising” and devise “concrete” plans on how his government is to create the millions of jobs it has promised South Africans.” Does this mean that leaders in government are clueless?
CapeInfo does have a plan, which we will roll out in the coming weeks.