Citizen Reporter
Reporter
2 minute read
29 May 2021
10:15 am

Fedhasa says tourism and hospitality wont survive third wave

Citizen Reporter

The possible further restrictions, Fedhasa says it will put the "nail in the coffin" for many businesses. 

View of the pools at The Houghton Hotel.

South African tourism is concerned that the effects of third-wave could “decimate” the industry and hospitality.

Federated Hospitality Association of South Africa (Fedhasa) says the recent increase of Covid-19 cases and some provinces heading into a third wave, further lockdown restrictions maybe are likely and it could halt the recovery efforts in the tourism industry.

Fedhasa said in a statement they understand the difficult balance act government has to do. To act against the Covid-19 pandemic.

The possible further restrictions, Fedhasa says it will put the “nail in the coffin” for many businesses.

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“The total number of liquidations in the hospitality sector in April 2021 was 158. However, the figure of 158 companies going into liquidation does not reflect the many more hospitality businesses that have closed down, but which did not formally follow the liquidation process, so the picture is likely much worse than these numbers indicate,” said Rosemary Anderson, chairperson of  Fedhasa.

The first and second wave has left many businesses behind and the businesses that survived can barely hang on any longer, Anderson adds.

“Some hotels, which are wholly reliant on business and international tourism, have been closed for over a year now,” she says.

Tourism and hospitality losses

  • The total income for the tourist accommodation industry decreased by 45,3% in March 2021 compared with March 2020.
  • Income from accommodation decreased by 35,9% year-on-year in March 2021, this resulted in a 16,5% decrease in the number of stay unit nights sold and a 23,2% decrease in the average income per stay unit night sold.
  • Total income generated food and beverages industry decreased by 21,9% in the first quarter of 2021 when compared with the first quarter of 2020.
  • Restaurants and coffee shops  had a loss of 30,2% and contributing -16,2 percentage points) and catering services (-41,1% and contributing -5,6 percentage points.

Fedhasa concludes they do have stringent measures in place to safeguard public health which they hope shouldn’t deter their hopes for recovery.

Complied by Sandisiwe Mbhele