One of South Africa’s most important industries struggle to recover

Although South Africa’s tourism industry has recently begun to turn a corner, it is still lagging behind pre-pandemic levels.

South Africa’s tourism industry has struggled to bounce back after the Covid-19 pandemic. According to Statistics South Africa’s Tourism report, a total of 8.9 million tourists arrived in the country in 2024.

Although this is a 5.1% increase from the previous year, it is still below the 10.2 million tourists South Africa recorded in 2019.

The World Travel & Tourism Council’s (WTTC) latest Economic Impact Research (EIR) revealed that South Africa’s Travel & Tourism sector is making progress.

The report projected that in 2025, travel and tourism will support 1.9 million jobs, surpassing 2019 levels and marking an all-time high.

Domestic visitor spending is forecasted to reach R445 billion in 2025, 3.8% above 2019 levels. However, while there has been a recovery on these fronts, other areas have lagged.

Travel and tourism’s total economic contribution is projected to reach R659.8 billion. This is equivalent to 8.9% of national GDP, but still 3.4% below the 2019 peak.

Although international visitor spending is set to grow steadily, it is expected to remain below pre-pandemic levels at R128.4 billion, R37.7 billion lower than in 2019.

“South Africa’s Travel & Tourism sector is slowly turning the corner,” explained WTTC President and CEO Julia Simpson.

“Jobs are leading the recovery, with employment expected to reach new highs, showing the enormous human impact of the sector’s growth.”

Tourism Business Council of South Africa (TBCSA) CEO Tshifhiwa Tshivhengwa told Daily Investor that global competition is a major reason the country has struggled to recover to pre-pandemic levels.

“Many countries that were not traditionally tourism destinations have emerged and started actively promoting themselves. Tourists from places like the United States or Europe now have many more options,” he explained.

Opportunities grow, but so does competition

The global tourism market has expanded, and many governments are investing in tourism as a core pillar of economic growth.

That increases competition for attention and spending, meaning South Africa will need to improve its international marketing.

He explained that South Africa’s campaigns must be more targeted and robust to keep the country at the forefront of people’s minds.

“Right now, if you mention safari, travellers are increasingly looking to East Africa. We need to reclaim our leadership as a safari destination and highlight the unique experiences we offer,” he said.

“While the United States market has largely recovered, we still have work to do in European markets. Stronger marketing, destination development, and better tourism infrastructure will all help us close that recovery gap.”

According to Tshivhengwa, South Africa’s luxury travel market is also underserved, presenting opportunities for growth in both domestic and international tourism.

Since South Africa has a relatively low exchange rate, tourists from other countries can enjoy 5-star hotels and resorts that they can’t afford elsewhere.

Domestically, South Africa’s middle class is growing and increasingly seeking out luxury holiday experiences. Despite this, very few luxury offerings are available in the country, especially outside of areas like Cape Town and the Kruger.

”There’s clearly room for more luxury developments, especially along our coastlines,” Tshivhengwa said. “For example, the Eastern Cape remains relatively underdeveloped in terms of high-end accommodation.”

In Gauteng and Durban, there has been very little large-scale luxury hotel development. While areas like Umhlanga saw some activity during the Covid-19 pandemic, it was small-scale.

“Meanwhile, demand continues to grow. International visitors find South Africa affordable, and domestically, the rising middle class is also seeking luxury options,” Tshivhengwa said.

“There’s a clear financial gap between current supply and the actual demand, which presents a strong opportunity for development.”