Business Maverick

TOURISM INDUSTRY

Income streams: Boom time for caravan parks and campsites

A campsite with its own kitchen at Mount Cedar.

SA’s battered tourism sector is slowly recovering, but its income streams remain less than half of that obtained before the pandemic – with the notable exception of caravan parks and campsites. A faster vaccination roll-out is the shot in the arm that the industry requires.

Measured in current prices, the total income of South Africa’s tourist accommodation industry rose by 56.9% in September 2021 compared with the same month in 2020, Statistics South Africa (Stats SA) said on Monday. If just income from accommodation is included – so restaurant/bar sales and “other” income is excluded – the increase was 74.4%. 

This is no shocker as there were still plenty of lockdown restrictions in place in September of last year, though bans on interprovincial travel for leisure purposes had been lifted. But what is really revealing about the data is to look at it over the April to September period and also for 2019, which underscores the scale of the horror that was unleashed on the tourism sector during the initial hard lockdowns. (See charts below) 

Take, for example, the numbers for April. Total income for the tourist sector soared by almost 3,000% in April of this year compared with that dreadful month in 2020, when the harshest lockdown restrictions were in place. In May the increase was a mere 1,762% and the growth has been slowing since, a reflection of the gradual easing that took place last year.  

Some numbers really leap out. 

Accommodation income for caravan parks and camping sites in April soared by 17,150% – this is not a typo. They were obviously closed in April of last year, but what could explain such a rebound? Was there a scramble to get back to nature or find more affordable accommodation among cash-strapped South Africans? Or are campsites and caravan parks ideal business models for laundering ill-gotten gains?  

In July the year-on-year income increase for such facilities was still a massive 3,000%, compared to 141.5% for hotels. But perhaps the call of the caravan park is waning: in September growth was a modest 8.6% while for hotels it was 100%.  

It still all points to a rebound. The tourism sector has been battered but is not out. South Africans with the means like to get out and about and foreign tourists are slowly returning.  

But the sector’s income streams still remain well short of pre-pandemic levels – less than half, in fact. 

In the July to September period, income from tourist accommodation in South Africa reached almost R2.7-billion, according to Stats SA.  

In the same period in 2019 it exceeded R6.2-billion, well over twice the 2021 figure.  

The one exception is the caravan parks and camping sites sub-sector. From July to September this year, it generated R73.3-million in income compared to R65.8-million in the same period in 2019. Its overall contribution is small, but it is the one accommodation category that is now exceeding its pre-pandemic performance.  

The overall number – and the sharp decline compared to 2019 – points to the potential of a labour-intensive sector in an economy with an unemployment rate of 34.4%, and one that also has many small and family-run businesses. As the fourth wave looms – its timing is far from clear, but there is a scientific consensus that another Covid-19 wave will probably engulf South Africa – this should give policymakers something to ponder. (They probably won’t, but anyway).  

Just over 23% of South Africa’s population is now vaccinated, but at this rate, the 70% mark will not be reached until July of 2023. That is just too slow. To compete for international tourists and the forex they bring, the pace of getting jabs into arms needs to accelerate. The caravan parks, bless them, can’t do it alone. The tourist accommodation industry is earning less than half of what it potentially could, though this is partly because many households have less disposable income than they had two years ago.   

Still, the real shocker in this data is the comparison with 2019. At this rate, the overall sector will only get back to pre-pandemic income levels in 2023 or 2024, or even later. DM/BM

Gallery

"Information pertaining to Covid-19, vaccines, how to control the spread of the virus and potential treatments is ever-changing. Under the South African Disaster Management Act Regulation 11(5)(c) it is prohibited to publish information through any medium with the intention to deceive people on government measures to address COVID-19. We are therefore disabling the comment section on this article in order to protect both the commenting member and ourselves from potential liability. Should you have additional information that you think we should know, please email [email protected]"