It was a shock to see that, after a steady improvement in Tourism Confidence in the past few quarters, it has done an about-turn and declined in the second quarter of this year, as reflected in the latest reading of the Tourism Business Council of South Africa FNB Tourism Business Index.
The Tourism Business Index measured 94.7 for the past three months, below the normal average of 100, and far below the 112,4 reading of the first quarter of this year. Whilst the forecast for the second quarter Tourism Index in the first quarter was 103, actual confidence was ten points lower than expected. The lower Tourism Index is attributed to travel agents, transport operators, and conference centres, a far more pessimistic tourism segment, in that its average Index was only 86,2, an extreme contrast to the Accommodation segment, which more optimistically measured 105,8.
The Tourism Business Council expressed its concern about the obstacles to the growth in the Tourism industry, including increasing costs of doing business due to government legislation, regulations, and input costs. Reduced demand from our country’ traditional source markets, and the restrained economy, also influenced Tourism Confidence.
The Tourism Business Index could be far more negative in the third quarter when the impact of the changes in the Department of Home Affairs’ Immigration Regulations take effect, against which Minister of Tourism Derek Hanekom and SA Tourism have not expressed any strong concern nor taken any appropriate action.
Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com Twitter: @WhaleCottage
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