South Africa’s tourism sector experienced a decline in international arrivals during May, despite a rise in spending on accommodation in April, according to the latest data released by Statistics South Africa.
The figures reveal a 3.4 percent decline in overall tourist movement, both inbound and outbound, when comparing May to April this year. However, on a year-on-year basis, tourism was up by 22.2 percent.
While the volume of international travellers dropped in May, the income from accommodation bookings in April reflected an encouraging 14.8 percent increase compared to the same period last year.
Economist Lara Hodes from Investec commented on the outlook, noting that the numbers for June are likely to soften further. She attributed this expected dip to rising geopolitical tensions, which may affect global travel patterns.
Despite these challenges, Hodes remains optimistic about the role of tourism in the country’s broader economic landscape.
“The domestic tourism sector continues to be a vital driver of economic growth and employment. It is also a key focus of government policy.”
Hodes pointed to Operation Vulindlela Phase II, launched last month, as an example of efforts to support the sector. One of the initiative’s priorities is to streamline South Africa’s visa system in order to boost tourism and attract foreign investment.
Tourism currently supports approximately 1.5 million jobs in the country, both directly and indirectly.
When comparing April and May of this year, the data shows a slight decline in travel volumes by South African residents. However, the number of foreign arrivals increased during that same period.
April’s growth in accommodation income was largely driven by the “other” accommodation category, which includes lodges, bed-and-breakfasts, and self-catering units.
This segment saw a 21.2 percent year-on-year increase, while hotels experienced an 11.1 percent gain. The rise was supported by a 4.5 percent increase in the number of stay unit nights sold and a 9.9 percent increase in the average income per stay unit night sold.
Notably, this income figure excludes revenue from restaurants and bar sales.
Although the annual trend appears positive, Hodes cautioned that quarterly performance tells a more complex story. When adjusted for seasonal changes and inflation, accommodation income actually declined in April on a quarter-on-quarter basis.
She also highlighted the findings of the Bureau for Economic Research’s Other Services survey, which reported a sharp decline in confidence among businesses in the hotel and restaurant subsector during the second quarter of the year. This drop in confidence was accompanied by weaker business conditions and lower volumes.
As the country continues to recover from the impact of the pandemic and other global disruptions, South Africa’s tourism industry remains a key sector to watch, with both signs of resilience and challenges ahead.
Facebook Comments