Third Wave and Further Restrictions Could Decimate Tourism and Hospitality Industry

FEDHASA, the voice of hospitality in South Africa, has raised concerns over the impact of the predicted third wave in South Africa, and the impact this and additional lockdown measures over Easter, will have on an already devastated industry.   

Recent reports released by Statistics SA have illustrated the economic damage to hospitality and tourism inflicted by South Africa’s second wave towards the end of December and into January, during which time Government raised the lockdown to Level 3, instating the beach and alcohol bans and introducing an earlier curfew.

According to its Statistics of Liquidations and Insolvencies report, a total of 56 companies in the Trade, Catering and Accommodation industry were liquidated in the period January – February 2021. Adding further context, Statistics SA’s Accommodation and Food & Beverage key findings reports for January 2021 showed a significant decline in total income for tourist accommodation (-72,9%) compared with January 2020. The Food and Beverage sector did not fare much better, with a decline of -36,1% in total income generated in the same period.

“However, the figure of 56 companies going into liquidation does not reflect the many more hospitality businesses that have closed down, but not formally followed the liquidation process, so the pictures is likely much worse than these numbers indicate,” says Rosemary Anderson, Chairperson of FEDHASA.

“The hospitality industry was left in tatters by the first and second waves and many businesses are now so financially compromised that they are unable to hang on any longer, especially in light of a predicted third wave and resultant lockdown measures. Some hotels, which are wholly reliant on business and international tourism, have been closed for a full year now,” says Anderson.

A major source of concern is that in anticipation of Easter, Government will introduce restrictions that will have further detrimental impact on the tourism and hospitality businesses that have been relying on a financial boost over this period to survive and retain staff.  

“FEDHASA has designed a robust set of health and safety protocols for COVID-19, and our members are acutely aware of the importance of adhering to these standards in order to safeguard the public and be able to continue trading. Despite the likely increase in domestic travel over Easter, arguably there is no sector quite as cognisant of the direct relationship between adherence to protocols and the recovery of the sector than the hospitality and tourism industry,” adds Anderson. Continued trading with strict compliance to safety measures, combined with the mass vaccination of the South African public, is the only solution, says Anderson. “Over 120 countries are not allowing South African travellers in, or their citizens to travel to South Africa. It is concerning that our vaccination programme is yet to begin in earnest, and we risk being left behind unless we soon start to see more progress in this regard,” she concludes.