Deputy Director General for Tourism, Sindiswa Nhlumayo 

CEO of SA Tourism, Moeketsi Mosola

Distinguished guests

Ladies and Gentlemen

Introduction

Business tourism continues to thrive with a resilience that seems to defy the looming threat inherent in the many economic and social curved balls presently at play in our world, all of which have the potential to seriously impact global travel.

Business tourism is one of the fastest growing and most complex sectors of the wider tourism economy. It has its own special demands to which only those who can guarantee to meet and exceed expectations with a committed professionalism, will excel.

The statistics are looking impressive with leisure tourism destinations aiming to expand their market share of the business tourism market. It's therefore not difficult to understand why so many economies want a piece of this highly lucrative action and South Africa is no exception.

Many of the delegates are high spenders, usually accompanied, and spend time traveling around on pre and post tours. This market is therefore crucial to addressing the more equitable spread of increased tourism spend, geographic spread and seasonality issues. It also enhances economic development by showcasing investment opportunities to large numbers of delegates who are on official conference business.

South African Tourism Statistics: January * November 2007

I am pleased to announce that the overall foreign arrivals increased by 8.6% from January to November 2007.

The growth in Africa air markets was led by healthy increases out of Kenya at 15.4% and Nigeria at 14.8%.

Arrivals from the Americas have shown consistent annual growth since 2002; with over 23 400 more visitors arriving from the United States.  This  brings the total figure to 255 822 and makes this market the second largest source market for South Africa. 

Arrivals out of Europe are up by 2.6% for the year to date and this was driven largely by the significant increase of 9.6% out of France.  We believe that this is due to the turnaround strategy implemented in this market. However, air capacity issues may inhibit further growth.  

There was a loss of 2.2% in arrivals out of Germany as a result of market-specific economic activity and we expect this trend to continue.

Growth out of Asia and Australasia was led by expansion in two markets, those being India at 19.1% and China at 11.8%.  Australia, a key market, continues to grow at satisfactory levels with an increase of 6.5% for the year to date. 

The increase in arrivals from across all the regions of the world - and in particular air arrivals - reflects not only the growing awareness of South Africa as a tourism destination but also the success of the Airlift Strategy passed by Cabinet last year that resulted in increased access to the South African market for foreign carriers.

Business Tourism Share of the arrivals

Business travel is a lucrative sector of the market which ramps up tourism's contribution to the economy in general. On average, business travellers spend three times more than leisure travellers and up to 40% of business travellers return to a destination within five years. There is also a significant crossover into the leisure travel market. Eighteen percent of business travellers go on tours prior to their business activities, while 22% do the same afterwards.  

Business tourists currently make up 5% of South Africa's total tourism market. I am certain that this figure will be improved upon in the lead up to 2010 and I believe that the industry's vision of doubling this figure in the next three years is not overly ambitious. The further development and roll out of the Business Unusual campaign will play an important part in the expansion of the sector.

An estimated 6-7% of all tourist arrivals to South Africa for 2007 will be made up of business tourists. Roughly, this translates to 550 000 estimated arrivals as compared to 470 000 in 2006.The growth in bed nights from 2005 to 2006 was 18%, and our 2007 estimates indicate that growth in bed nights will be approximately 19%.

Total foreign direct spend in South Africa by business tourists amounted to R2,4 billion in 2006 compared to approximately R2,1billion in 2005. 

According to the Union of International Associations rankings, South Africa is positioned at number 28 out of 36 countries, with 90 international meetings * just over 1% of the global meetings market.

2010 as a catalyst for Business Tourism growth

It has been said that South Africa is the jewel of Africa's conference and incentive crown, and that our country's popularity is set to receive a significant boost in the run-up to the 2010 FIFA Soccer World Cup.  

The South African Government and the private sector continues to invest in the country's world-class infrastructure in order to enhance our position as a major competitor in the global business tourism industry. Recent developments and future initiatives include:

Transport

The Airports Company of South Africa (ACSA) has injected R5,2 billion into extensions and refurbishments that are currently in progress at the country's three main airports namely O.R. Tambo International Airport, Cape Town International Airport and Durban International Airport. These projects are designed to increase both the capacity and efficiency ahead of the FIFA World Cup in 2010. 

In addition, a new R2 billion airport, the King Shaka International Airport is under construction at La Mercy north of Durban. 

By the end of February 2008, Polokwane International Airport will boast a new terminal worth R45 million. This building will be able to accommodate 200 000 passengers per year that, at a push, may be doubled, compared to the current 50 000 passengers per year.

Convention Centres

In Durban a new R460 million state-of-the art indoor arena, capable of accommodating audiences of up to 10 000, has opened its doors at the internationally-acclaimed Inkosi Albert Luthuli Convention Centre. 

The Cape Town International Convention Centre plans to double its size by expanding across the adjacent freeway to the site of Customs House. The plans involve the establishment of a mirror image of the existing centre next to the harbour.

Port Elizabeth is to get its own convention centre namely the Nelson Mandela Bay International Convention Centre. This will include a 1 000-seater convention and conference centre with a range of add-on facilities.  The Mandela Bay Development Agency is inspecting sites on which to construct the NMBCC.

Construction on the Bloemfontein International Convention Centre is complete and the centre was opened in November 2007. The main arena accommodates 

4 000 to 5 000 delegates.

Recent Business Tourism Wins

Furthermore, in Cape Town the business tourism calendar for 2010 and beyond is filling up rapidly.  The Western Cape has already secured altogether 10 major conferences and conventions for 2010.  These conferences are expected to bring in a combined 16300 business tourists which will have a significant economic impact of approximately R166.3million on Cape Town as well as the Western Cape.

The Inkosi Albert Luthuli Convention Centre has recently secured the right to host the 57th Session on the International Statistical Institute in 2009 which will bring in 2500 delegates. It will also host the International Committee on Non-Destructive Testing in 2012 which will attract 1500 delegates.

This is positive proof that having a strategy to which all parties are aligned delivers good results.  



Conclusion

The opportunity for us to prosper as an industry lies in the resolution to continue to deliver world class products and services to our clients and to remain focused on our goals. 

I can therefore say with the utmost confidence that South Africa is in an excellent position to welcome more and more business and leisure travellers to our shores in the days, months and years to come * and we look forward to doing this.  South Africa stands ready!



I thank you