South Africa’s slow vaccination rate risks permanently damaging one of the country’s few thriving economic sectors – the tourism industry.
Emerging and developing markets across the world are highly reliant on tourism. According to the Oxford Business Group, tourism accounted for 11% of GDP in Thailand, 9% in the Philippines, 8% in Morocco and 7% in Tunisia in 2019. South Africa, too, draws much of its GDP from tourism.
Tourism lobby group, South African Tourism, indicated recently that international and domestic tourism contributed R125 billion to the economy and provided more than 750 000 direct jobs in 2019.
According to the World Travel & Tourism Council’s (WTTC) annual review of the economic impact and social importance of the sector, tourism sustained 1.5 million livelihoods. There can be no doubt that tourism is a vital sector for South Africa’s economy and growth prospects.
However, South Africa’s tourism sector, like all those around the world, was one of the biggest casualties of the Covid-19 pandemic. The majority of countries around the world have placed restrictions and strict regulations on air travel in order to curb the spread of Covid-19. As a result, global leisure travel declined dramatically, putting many of the livelihoods dependent on the tourism sector at risk. South Africa is no exception.
Stats SA’s release on tourist accommodation for December 2020 showed that income in the tourist accommodation industry declined by 57.7% in December 2020 compared with December 2019. Another report by Stats SA on tourism and migration for December 2020 showed that foreign arrivals decreased by 82.1% (from 1.5 million arrivals in December 2019 to just 279 539 in December 2020).
The local tourism industry is therefore in dire straits. Vaccines, however, offer the tourism industry much-needed relief – if they succeed in bringing the rate of infections under control. Inoculating enough people will help a country to win back confidence that it is a safe destination to travel to. But countries that are unable to act effectively against Covid-19 will be flagged as high-risk destinations that ought to be avoided.
We have already witnessed this in South Africa when the second, more infectious and stubborn variant of Covid-19 was identified. Many countries have since suspended flights to South Africa, primarily driven by fear of the second variant. UAE-based airline Emirates suspended flights to South Africa until 10 March. Virgin Atlantic also extended its ban on flights to and from South Africa and may not resume flights until April. British Airways announced the suspension of all South Africa flights until 16 April. KLM Royal Dutch airlines’ ban on travellers from South Africa, imposed on 23 January, is still in place. The United States, and a number of other countries in Europe, have banned travel to and from South Africa, with limited exceptions for some workers and returning citizens.
South African Tourism and the Tourism Business Council of SA (TBCSA) believe that the tourism industry’s prospects of recovering to levels last seen in 2019 will depend on how fast and how extensively the government rolls out Covid-19 vaccines.
Health Minister Dr Zweli Mkhize says the government remains committed to its original plan of vaccinating 40 million people, or 65% of the population, by the end of the 2021. However, the first deadline of inoculating 1.5 million South Africans by the end of March will be missed. So far, the country has managed to vaccinate only around 150 000 people – that’s 10% of the target for March. Furthermore, the country has managed to vaccinate around just 5 000 people a day since the vaccination programme started.
According to the South African Medical Research Council’s Professor Glenda Gray, South Africa will need to ramp up its roll-out with between 120 000 to 150 000 jabs a day in order to meet targets. By comparison, the Seychelles aims to vaccinate at least 70% of its population by the end of March.
The island state’s Minister for Foreign Affairs and Tourism Sylvestre Radegonde commented: ‘The Covid-19 immunisation campaign is an important milestone for the restart of our tourism industry as the country balances its efforts to maintain its tourism activities and protect its population.’ Seychelles is heavily dependent on tourism for its economic health, but with its aggressive vaccine roll-out, the country is aiming at reopening its borders to international visitors on 25 March.
One reason for South Africa’s slow vaccination process is that the AstraZeneca vaccine, of which the country imported 1 million doses, proved less effective against the second variant of the coronavirus.
The government halted the roll-out of vaccines until a more effective substitute – the Johnson & Johnson vaccine – could be obtained. But the government should bear most of the blame. Daily Friend writer Jonathan Katzenellenbogen pointed out that there was no allocation in the government’s Medium-Term Budget Policy Statement released in October 2020 to buy enough vaccine doses to cover two thirds of the population. And this despite vaccine development by a number of companies having reached an advanced stage. Katzenellenbogen also pointed out that the Medium-Term Budget contained financial support of R10bn for SAA (slightly above the approximate cost of R8.6bn for a vaccine programme at the time) – a strong indication of the government’s priorities.
Furthermore, it was only when the government came under mounting pressure from civil society groups, including the Institute of Race Relations, that South Africa’s political leadership acted with greater urgency to procure vaccines.
Critics also say South Africa squandered the advantage of having hosted as many as four Covid-19 vaccine trials. Professor Barry Schoub, one of the country’s top vaccine advisers, said: ‘It should have been a commitment as part of their arrangement. We didn’t do that. We could have had Johnson & Johnson. We could have had AstraZeneca and to some extent also Pfizer, because they were trialled here.’
The government has failed to be proactive in sourcing and procuring vaccines.
Not only has South Africa missed crucial vaccination targets, but a third wave of Covid-19 is widely expected in winter. As long as the bulk of South Africans remain unvaccinated through 2021, there is a high risk of a new strain of the virus emerging against which current vaccines will be ineffective.
All of this will make it especially difficult for South Africa’s tourism industry to lure international visitors and to get back on its feet.
The V&A Waterfront in Cape Town is South Africa’s most visited tourist attraction. Growthpoint Properties, which owns a 50% stake in the V&A Waterfront, says that the number of tenants in arrears continues to climb and bad debt almost doubled between June and December of 2020, from R6.8 million to R13.3 million.
Growthpoint’s South African CEO, Estienne de Klerk, said that the quicker countries where most of South Africa’s tourists came from were able to vaccinate their populations, the quicker confidence would return among travellers. However, De Klerk noted that South Africa would have to do its part to show that it had the situation under control. ‘I think, given the pace of vaccination, that confidence will take some time to come back.’
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