Tourism’s Extraordinary effort to survive COVID-19 Pandemic

Tourism’s Extraordinary effort to survive COVID-19 Pandemic

Contents
 The Economic Value of Tourism in SA
 Industry health protocols and controls
 Flattening the Curve
 Impact of Covid-19
 Opening Domestic Tourism
 Inbound Tourism’s Importance & Challenges
 Tourism Industry Recovery Strategy
 Where is Tourism Globally
 Tourism’s Future after Covid-19
 Financial Support
 Tourism - Supporting the Recovery
 Way Forward
Tourism Sector Guiding Principles

The health of the citizens

The law enforcement aspect
Economic activity to preserve the sector
Equity – benefits for all
The Economic Value of Tourism in SA

8.6% R120bn 1,5m + - 49 000 R273,2bn R18,9bn

Total GDP forex Total Jobs High numbers Total spend R33,8bn
contribution Export Industry supported SMMEs 2018 Casinos &
Restaurants

Greater
Economic • 206,5b in • >12.5% of • 8% direct • Further impact on
 Manufacturing
Capital and locally impact to
Impact! supply chain manufactured retail sector  Services
vehicles (Car  Fuel
Rentals +)  Construction
 Agriculture
Comprehensive Sector Protocols Developed
Processes
• Employee Training, Screening, Social Distancing & Work from Home
• Public Social Distancing, Demarcated Areas, Physical Barriers & PPE
• Sanitization of High Touch Points, Deep Cleaning & Pest Control
• Preparation of HVAC, water reticulation systems, fridges, dishwashers,
laundries, bedrooms, restaurants, lobbies, casino floors etc.
• Increased Food handling systems and processes We already identify,
All protocols
know and track our
Access Controls
• Closure of Gyms, Swimming Pools, Bars, Theatres, Spa’s, Nightclubs &
Cinema’s
• Temperature & Guest Screening questionnaires at entrances of
establishments
• Use of loyalty card systems to limit /control access for traceability eg only
loyalty card holders will be allowed on Casino Floors
• Mandatory use of masks for all Guests

will align with WHO

clients
& DOH guidelines and
Social Distancing will
We be
willrevised
expand as Health
thisand
to & Safety Interventions
• Queuing systems, no less than 1.5m whenallnecessary
our • Educational Signage
• All Gazetted Capacities adhered to in terms of dining, vehicles, gatherings etc.• Staff PPE & Hygiene Resources
sub-sectors
• Dining Capacities, lobby areas - restricted to 50% or gazetted maximums with • Bio Hazard boxes for safe disposal of PPE
social distancing measures in place • Enhanced Food & Beverage Safety delivery measures
• Vehicle/craft capacities reduced to 70% or gazetted maximums with clear entry • Internal & Third Party Audits, with records maintained
and exit procedures
• Removal of chairs from every second slot machine & limited seating at tables
and no promotional activity, that encourages crowd gatherings
• Physical barriers and face shields/visors where practical and/or required
Epidemiological and Public Health Reviewed Protocols
FLATTENING THE CURVE
Quarantine and Isolation Hotels and Accommodation
 Developed and tested Protocols with DoH

Essential Workers Accommodation

 Medical & Health
 Infrastructure – telecoms, electricity, water
 Security - army & police

Repatriations – In and Outbound

 Hotels
 Ground transport and domestic flights
 Airports
 International flights
Impact of COVID-19 •
•
Car hire
Airlines
• Airports
• Cross country coach operators
In decline before Disaster Management and Lockdown • Long distance passenger trains
• All types of accommodation –
Industry at a standstill – closed down – 1 June small re-start hotels, guest houses, B&Bs,
Airbnbs, backpackers, national
and provincial parks and reserves,
self-catering, timeshare & resorts
Over 1000 companies applied for UIF TERS - ±35 000 employees • Tour, trip & shuttle operators
• Travel agents
• Inbound tour operators
Companies thinking of liquidations and retrenchments • Retail & crafts
• Restaurants
• Casinos
±50 000 tourism businesses - close temporarily or permanently • Conference centers
egs Comair & SA Express •
•
Exhibition centers & ICCs
Attractions – museums, heritage,
cultural & other
±555 000 – 600 000 tourism direct jobs could be lost in 2020 • Activities & adventure operators
• Sporting facilities & events
• Festivals, performing arts &
• Contraction - BBBEE in tourism negatively impacted creative industries
 Impact of COVID-19 (Cont.)

>1,1 -1,2 million jobs in total

Impact
beyond • Agriculture, manufacturing – vehicles, textiles, furniture,
tourism chemicals - banking, retail, construction
• Conservation major impact & risk (SANParks 72% revenue
from tourism)
• Environmental crime increase – hunger and reduced anti-
poaching, security etc
 Latest Impact Studies
TBCSA, IFC & NDT April: TBCSA Supply - Survey Mid-May
Based on “Core” Scenario:
• 58% and 54% of businesses could not cover debt 1st June - domestic corporate travel
repayments or fixed costs respectively in March 1st September - domestic leisure & corporate travel
1st December 2021 - regional travel - no large groups;
1st March 2021 International Borders fully open - all travel allowed.
Bureau For Economic Research (May)
Better Case 1: Worse Case 2:
➔ Industry expects to achieve 18% annual turnover
20% international tourism No international tourism for
Q3, domestic tourism average 3Q 2020, domestic tourism ➔ Considering laying-off 37% or retrenching 23% employees
41.8% for the year average 30,2% for the year
➔ 46% of business will still be partially closed, or closed, in
February 2021
R171.4bn less tourism spend R195.5bn less tourism spend
– 62,7% of total, 1,02 million – 71,6% of total, 1,15 million
jobs lost jobs lost
➔ At 18% turnover - industry spend declines to R49,1bn
 GDP decline from 8,7%
➔ More than 600 000 direct & 1,23m total jobs lost
to 3,2% (scenario 1) or to 2,5% (scenario 2)
By Q2 2021 1,4 million jobs lost ➔ Total contribution to GDP declines - 8,6% to 1.55%
Domestic Tourism and Leisure Activities
“Gatherings” Allowed
 Funerals ≤ 50
 Church services ≤ 50
 Meetings/training in corporate offices
 Training eg field guides*, aviation
 Restaurants in hotels & guest houses
 Canteen in workplaces eg hospitals
 Large retail stores
Activities allowed Travel & Accommodation
Allowed For Business
 Tour guiding*  Private car
 Hunting*  Car Hire - interprovincial
 Hiking*  Taxis, mini-buses, buses, coaches
 Private self-drive excursions  Domestic Flights - interprovincial
 Recreational fishing**  Hotels, guest houses, lodges B&Bs,
 Canoeing & kayaking** timeshare, resorts, private home
 Sports for professional purposes letting

“Gatherings” Not Allowed Activities not allowed Travel & Accommodation

 Casinos  Open-vehicle drives Allowed For Pleasure?
 Restaurants  Guided tours in vehicles
 Private car with no overnighting?
 Small meetings in third party premises  Sport for leisure purposes
 Small exhibitions  All non-specified activities
 Attractions
• The virus does not distinguish based on purpose of stay
• The virus does not distinguish based on distance or purpose of travel
• We can do these equally safely with our stringent operating protocols

*Statement by the Minister of Tourism

** Statement from the Department of Environment, Forestry & Fisheries
The Importance of the Inbound Tourism Industry
Total Foreign Travel spend R120bn (2018)

10,2 million
Foreign tourists
8,7% of total
South African Exports
44% of Tourism Industry
Critical to Balance of Payments
Spend
2,4 million 1 2 3 4
Overseas 375 000 direct jobs
659 000 + total jobs
Mining Tourism Ferro/Alloys Vehicles
R198bn R40,5bn 36,7bn
R120bn
640 000
African air arrivals

• Globally Competitive Destination – numerous accolades

• Incredible diversity of authentic and connected experiences
 The Inbound Tourism Industry – Dire Situation
➔ Summer high season from September/ October to February/March
“If South Africa were to remain a closed
➔ Summer high season - 6 months 60% of business (9 months 77% of business) country till February, it would have an
➔ Re-open in March 2021 – lose an entire high season incredible negative long-term affect and
I have no doubt would impact on the
➔ Advance bookings with long lead times – loss of forward book
whole of 2021 business. Booking
➔ Close 2020 – 2021 season - 2021-2022 season also impacted patterns from our customers are early,
➔ Far more business failures with six plus months in advance being
the norm. Our customers continue to
➔ Damage to our global reputation as a destination shop around and book holidays, and
➔ Risk of loss of regional hub and lead African destination status – maybe permanent they’ll end up going on holiday to other
parts of the world. The whole process of
“ONE YEAR of closed borders is unrealistic and will make SA and its tourism industry suffer tremendously. I know rebuilding confidence in South Africa
that we are starting to direct all clients to TANZANIA and BOTSWANA, both of which will be reopening their would start from scratch again.”
borders in the coming weeks. Clients can’t wait for SA to decide whether it wants to be seen as a welcoming Senior Manager, Kuoni, UK, 5 May 2020
country, or one that, in essence, sends a message that all foreigners are carriers of the virus and should be kept
out. EVERY COUNTRY is reopening within 2-3 months of shutting down.” US Outbound Operator, 3 June 2020

• Reducing the risk of transmission in the sector

 Operate in outdoor spaces within nature, warm climate
 Following other destinations in opening up; opportunity to learn best practise
 Already in trial mode: domestic, airports, repatriations
Tourism Industry Recovery Strategy - Request
DOMESTIC LEISURE, TRAVEL & TOURISM
LEISURE PHASE PHASE
PREPARATION LESIURE PHASE
MICE & EXPANSION PHASE
PREPARATION PHASE
➔ Restaurants, casinos & small meetings/exhibitions
➔ ➔ Progressive increasing of meeting size – <100 then <500
Leisure travel – all modes and distances
➔ ➔ Small events - distancing & sanitising
Safe attractions & activities – distancing & sanitising
➔ ➔ Increase restaurant etc capacities – 50% - distance allowing
Controlled liquor sales

INTERNATIONAL TRAVEL & TOURISM

PREPARATION PHASE PHASE 1 OPENING - TRIAL PHASE

➔ Research and investigations - planning
➔ profiles & pandemic stage
International travel requires lead times and certainty
➔ Plan - then announce with ± 6 - 8 weeks lead time
➔ Remain flexible to potential changing of plans
➔ Identify “safe” source markets eg Germany – similar risk
➔ Travellers vetted – international/outbound market protocols
➔ All airport, airline and ground operation protocols in place
➔ Clearly packaged offers with resort/lodge bubbles
➔ Maximise reserves/open spaces and open-air activities
➔ Low risk areas - Limpopo, Mpumalanga
➔ Independent business travel
Tourism Industry – Recovery Strategy Request
DOMESTIC LEISURE, TRAVEL & TOURISM

ONGOING – GROWTH & RE-ESTABLISHING PHASE 3 – FINAL PHASE

➔ Protocols reduced to “new normal” levels

INTERNATIONAL TRAVEL & TOURISM

PHASE 2A - OPENING PHASE
➔ Add more direct links to key markets, eg
Australia, France, Italy (maybe EU bubble),
UK, USA,
➔ Expand destination experiences – wine
farms, beaches and local destinations
➔ Cruise ships
➔ Open regional flights
➔ Destination bubble neighbouring
countries – competitive Southern Africa
offering
PHASE 2B – ADD MORE FLIGHTS PHASE 3 – FINAL PHASE
➔ Hub flights – eg Via Middle East, via ➔ Air access fully open
Ethiopia
➔ Destination fully promoted Protocols
➔ Newer generators – eg China, India reduced to “new normal” levels
➔ Progressive promotion of more activities, ➔ International MICE enabled
experiences & destinations
➔ Protocols reduced - enhance experiences ➔ Restart longer term growth strategy – 21
million arrivals
➔ MICE enabling started
➔ Small events & individual delegates
➔– likely horizon on large events
Tourism is starting to open –up globally:
➔ European & other countries – opening for in-bound and out-bound travel
➔ Varies plans and dates announced
➔ Bubbles, Bridges & Corridors eg Australia and New Zealand
➔ Airlines, generators and destinations collaborating

Some Examples:
• Germany - lifting travel ban for EU states + UK, Iceland, Norway, Liechtenstein & Switzerland from 15 June
• 6000 German tourists to Spain's Balearic Islands 2nd half of June "pilot” with TUI
• 11 airlines will connect Munich to 52 international cities by mid-June
• Italy reopened borders for most other European countries - no quarantine & move freely between regions. 
Rome, Milan & Naples Airports resuming international arrivals
• Czech Republic ended travel restrictions for Germany, Hungary & Austria, and plans free travel with most EU
countries by June 15
• Austria has opened to all neighbours apart from Italy
• Turkey, Greece, Spain and Portugal negotiating with UK on “transport corridors” with no quarantine
• Spain will reopen its land borders with France & Portugal and relax 14-day quarantine on July 1
• All Greek airports will be open from July 1 to international flights — including UK — with random testing of
arrivals
• Tunisia is to open sea, air and land borders on June 27
Our Key Markets
➔ All travel post COVID-19 needs:
➔ Airlines operating
➔ Outbound country approval
➔ Destination approval
➔ Germany - travel warnings will be downgraded – replaced with guidelines – memo going to cabinet
➔ UK “The Foreign & Commonwealth Office currently advises British nationals against all but essential
international travel. 
➔ This advice is being kept under constant review”
➔ Currently 14 days quarantine on return – being challenged
➔ USA - “The Department of State advises U.S. citizens to avoid all international travel due to the
global impact of COVID-19” – unchanged since 31 March
➔ Australia – currently outbound travel is banned 
➔ China – group outbound travel ban, many destinations restricting Chinese inbound
➔ Foreign airlines may choose from list of approved cities to operateone international passenger
flight a week beginning June 8
Tourism’s Future after COVID19
1 2 3 4
Can recover – Current expectations Critical to ensure If re-start only level 1- 0
Can deliver growth - – industry will recover supply-side survival  supply side decimation
Economic activity through-out 2021 to enable recovery  delay revival & growth
and jobs

Cannot afford to destroy 8,6%+ of the

economy
• Request – phased earlier easing of • But – while any aspect of • Many businesses will
restrictions – safe transport, safe travel restricted – eg still struggle to survive!
accommodation and safe attractions international
Investment in the Sector

UIF TERS program continue for longer than the current 3 months

Government financial relief program for companies with turnover of more than R300m

SMME relief program fund must be increased from R200m

Consider creating special travel and tourism fund

Discussion needed around options and needs

Tourism – Supporting the Recovery
1 2 3 4
A real world-class Waive visas for Critical skills Vehicle
e-Visa with improved more source visas, temporary licensing fixed!
airport e-infrastructure markets work visas

5 6
Reduce other Vat issues
red tape addressed

7 8 9 10
Additional funds for Private Public Partnership Air liberalization and Investment incentives
tourism marketing to implement marketing national air access – resort IDZs
& Combine SA Tourism & initiative
Brand SA
Way Forward
Advisory group to Industry will invest in, Industry will support Industry will continue
work with President’s, and test, safe and assist SMMEs to
DoH’s, Treasury’s and operate safely  to push
operations
transformation
other experts to
 increase purchasing
finalise: from BBEEE
Let’s help save businesses
 training and
 Phased
de-restricting of 1,5 million jobs and empowering
women, youth and
safe operations
enable beneficial growth in communities
 Financial support  Continue to
this sector in a Post contribute revenues
COVID19 world! to fiscus via levies &
taxes
T “To emerge from this Covid-19 crisis will require an
extraordinary effort”
- President Cyril Ramaphosa

Summary
Thank-you
&
Discussion