Impact of the new visa regulations

Tourism Industry Responds to Home Affairs Criticism;

Urges Deputy President to Suspend Visa Regulations

1 October 2015 – It is with great disappointment that the member associations of the Tourism Business Council of South Africa (TBCSA) note the recent outpouring of criticism levelled against the tourism industry by senior officials from the Department of Home Affairs. This is particularly concerning in light of the fact that an Inter-Ministerial Committee (IMC) process, chaired by the Deputy President Cyril Ramaphosa, is currently underway.

As CEO of the Southern Africa Tourism Services Association (SATSA), David Frost, states: “The members of the TBCSA elected to respect the IMC process convened by the President and remained silent while the Committee deliberated on issues relating to the new visa regulations. Sadly, the IMC has not been accorded the same level of respect by the Department of Home Affairs, which has taken to the press, stakeholder workshops and social media to air its views.”

Recent examples include:

• Speaking at a media briefing on 27 September, Minister Malusi Gigaba said that opposition to the new visa regulations had been based on “lies and cooked-up figures and surveys that have no credibility whatsoever”. He went on to state: “I think our tourism sector has not been selling South Africa as well as they should (sic). They should be selling the country on the basis of what it offers travellers, not on the basis that it’s easy for somebody to enter South Africa with a child, unnoticed.” He expressed the same sentiments on Twitter.

• Department of Home Affairs Deputy Minister, Fatima Chohan, told attendees at an immigration regulations compliance workshop that she did not expect wholesale changes to be made to the regulations. This despite the fact that the Deputy President is yet to announce the findings of the IMC process.

• Minister Gigaba has repeatedly accused the tourism industry of putting profits ahead of child safety, a stance that he echoed during a live interview with Radio 702’s John Robbie.

“We have reached the point where this relentless barrage of unsubstantiated accusations cannot go unanswered, particularly given that tourism jobs are being lost every day that this process drags on,” added Frost.

The member associations of the TBCSA urge the Deputy President to consider the following:

• Minister Gigaba has stated that his department expected tourism to drop as a result of the visa regulations. We would expect that government policies would dictate that in the case of anticipated losses, these would be weighed up against the benefits in a comprehensive economic impact assessment, following which government could collectively make a decision on the matter. It is clear that this process has not been followed, despite tourism being a priority sector.

• The Department of Home Affairs is unable to consistently implement its own regulations. The new dispensation announced for children from Lesotho is evidence of this, along with the fact that Chinese tourists are required to apply for visas in person, even though the biometric equipment is yet to arrive in the country a year after the requirements came into force.

“Overwhelming evidence from multiple reliable sources points to the disastrous impact these ill thought-out and draconian requirements are having on the tourism industry (see overleaf for details). We cannot afford to waste another moment. The economy has already suffered devastating losses as a result and thousands of jobs are on the line. We urge the Deputy President to scrap these requirements before any more damage is done and to set up inclusive structures to look at workable alternatives that balance security with economic growth,” concludes Mavuso Msimang, Chairman of the TBCSA.

‘’We would also respectively request that the IMC be allowed the space for their deliberations without inflammatory statements being made that only heighten tensions between the various stakeholders and frustrate efforts for an appropriate outcome.” 

Impact of the Visa Regulations: DATA SNAPSHOT

STATISTICS SA:

Prior to the announcement of the visa regulations, tourist arrivals into South Africa had been steadily growing:

2011 = 2 176 719 arrivals

2012 = 2 505 763 arrivals (15,1% growth)

2013 = 2 660 631 arrivals (6,1% growth)

The first two quarters of 2014 also saw growth (5,6%) but this changed abruptly in the third quarter of 2014 – the in-person visa application requirement came into effect in June 2014. Since then, there has been a systematic decline in tourist arrivals, particularly out of the BRIC source markets:
 

From Sep – Dec 2014, Brazil was down -37%, China -46.9% and India -14.4%, continuing into 2015.

The June 2015 arrivals data from Statistics SA showed:

·       Overseas arrivals down -13% to 113 689 from 130 410

·       US down -9% to 29 269 from 26 503

·       UK down -8% to 17 897 from 19 371

·       Australia down -11% to 7 682 from 8 654

·       Germany down -12% to 6 983 from 7 927

·       India down -25% to 6 577 from 8 785

·       France up 1% to 5 112 from 5 064

·       Netherlands down -3.5% to 4 256 from 4 411

·       China down -27% to 4 167 from 5 823

COMPETITOR COMPARISONS

In June 2015, tourist arrivals to Australia were up 7% year on year. 

·       US up 4%

·       UK up 3% 

·       Germany up 12%

·       India up 5%

·       China up 21%

 
In June 2015, tourist arrivals to Mauritius were up 8% year on year. 

·       UK up 12%

·       Germany up 3.5%

·       India up 17.5%

·       China up 60%

In June 2015, tourist arrivals to Thailand were up 53% year on year. 

·       UK up 9%

·       US up 30%

·       Germany up 6.5%

·       India up 23%

·       China up 187%

AASA:

AASA (Airlines Association of Southern Africa) data for June, July and August 2015 showed a 44% decline in the number of children under the age of 18 travelling in and out of South Africa across all source markets when compared to the same period in 2014.

STATS SA:

Based on Stats SA data for Jan – April 2015, this means that SA will lose 138 000 foreign air passengers per annum due to the regulations. However, as only 24% of foreign travellers enter/exit SA by air, when one includes all ports of entry (air, land and sea), South Africa is likely to lose 578 000 foreign tourists per annum due to the regulations.

According to SA Tourism, the average spend per passenger is R13 000, which amounts to R7.51bn revenue lost to the country.

TRAVEL AGENCY DST DATA:

July 2014 saw a 21% decline year on year in air ticketing revenue for tickets purchased to South Africa, according to IATA’s air ticketing data. There was a 22% decline in air ticketing revenue from the European market, a 6% decline from the North American Market, a 40% decline from South America and a 36% decline from Asia.

FORWARD KEYS:

An analysis of data based on reservations by intelligence firm ForwardKeys showed that international arrivals of families into SA increased by 1.8% between 01 September 2014 and 31 May 2015, but with effect from 01 June 2015 with the advent of the birth certificate requirements, they dropped by

 -9.8%. Reservations from the UK were down -3%, Germany -16%, US -18%, the Netherlands -3% and France and Sweden -29%.