- NMB Sectors
Shared insights from our "Hospitality in the Bay" webinar
The world economy has taken a substantial blow as a result of the COVID-19 pandemic; however, few sectors have been as harshly impacted as travel and tourism.
Contributing 10.4% to the global GDP and employing 319 million people across the world, the travel and tourism industry has been identified as one of the leading sectors to propel growth in emerging economies.
On the South African landscape, the travel and tourism industry directly accounted for 2.8% of the GDP in 2018 (roughly R139bn, which was expected to increase to R145.3bn in 2019) while its indirect contribution stood at 8.2% (which is indicative of the strong economic ties to other sectors), making South Africa the largest tourism economy in Africa according to the World Travel and Tourism Council.
At the 2019 Africa Travel Indaba, HE President Cyril Ramaphosa noted that "[t]his is a sector of our economy that can grow exponentially and I believe we have not reached its full potential... Tourism is the new gold.”
This statement aligns with the goal set out by the Presidency in 2018 to attract R1.2trn in new investment for South Africa over the following five years, with the travel and tourism sector being ahead of target at the time.
The Nelson Mandela Bay Business Chamber views the local travel and tourism industry as important and is at the forefront of facilitating the discussion on how to develop and protect this industry during these trying times. To this end, the Business Chamber (on Wednesday 17 June 2020), hosted a panel discussion with key stakeholders from the sector within the Nelson Mandela Bay.
The panel consisted of esteemed speakers: Nicholas Forsythe - Operations Manager at The Boardwalk Hotel, Casino, Conference Centre and Spa, Tracy Lancaster - Group General Manager at Mantis Collection, and Guy Dakin - Managing Director at BLC Attorneys.
Facilitating the panel discussion, Business Chamber CEO Nomkhita Mona, posed questions to each of the panelists addressing the current issues faced by the travel, tourism and hospitality industry, and ways to move forward and rebuild.
Mr Dakin spoke on the need for Government to make additional provision of relief packages required by those in the sector, as the Temporary Employer/Employee Relief Scheme (TERS) assistance is due to end in June. He further emphasised the need to protect persons working in the sector and the importance of keeping them involved. Within NMB, tourism and hospitality indirectly accounts for one in every ten jobs, while nationally the sector employs an estimated 1.6 million people. Mr Dakin also highlighted the growing importance and potential of events-based tourism to the reputation of Port Elizabeth and Nelson Mandela Bay as a tourist destination.
Ms Lancaster addressed the health and safety protocols which will be require implementation at establishments within the hospitality sector. She urged those within the industry to "embrace and implement the procedures relevant to our establishments and the industry as a whole" as laid out by the Federated Hospitality Association of Southern Africa (FEDHASA), noting that staff training and consistent management of the protocols will be essential. Ms Lancaster further noted the importance of finding environmentally friendly ways to adhere to the health and safety requirements, particularly with regards to the disposable PPE and other instruments related to the industry such as take away containers, cutlery etc. This echoes an announcement made by President Ramaphosa at the 2019 Africa Travel Indaba wherein he stated "[t]here is a growing need for sustainable development, to grow and transform our economies while reducing the impact on the environment." Ms Lancaster also acknowledged the challenge to businesses of balancing the health and safety imperatives stemming from more onerous regulation and protocol with the associated rise in expenditure in order to achieve the necessary compliance.
Mr Forsythe spoke on the need for industry to "pause and reset", allowing business leaders to look into their establishments and reflect on how to unpack and improve their businesses by focusing on core service delivery, digitisation, and by building relationships with customers, suppliers and new markets. Mr Forsythe also addressed the need for standard operating procedures (SOPs) to adapt to the new normal and implored business owners to recognise that this new way of life was going to be the standard going forward and was unlikely to revert to the pre-COVID-19 state. He acknowledged that a new business culture would be required and urged industry role players to think differently about their operating hours, shift rotations, staff productivity and skills development.
The Business Chamber CEO Nomkhita Mona stated that she would ensure that “the various proposals and ideas put forward by the panelists be brought to the relevant spheres of Government.” These proposals include, but are not limited to:
There is certainly also a case to be made to focus on domestic tourism over the short-to-medium term.
The panelists and the Business Chamber are of the opinion that implementing these proposals would be required to improve, protect and develop the industry, locally and at a national level. All speakers agreed on the need for NMB to have a more structured ongoing conversation and collaborative effort to rebuild and better plan for the future of local tourism.
The Business Chamber strongly urges the Metro and the Province to come to the table and strategise with the private sector on how to address the current issues facing the tourism sector – the onus cannot exclusively rely on the national government, all stakeholders at every level have a duty to collaborate and move the industry forward.