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SA's Hospitality sector moving confidently towards 2010

Article Published: Tuesday 27 March 2007

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The boost in the country's tourism levels, as well as its knock-on effect on hotel accommodation, shows that the hospitality industry is moving confidently towards the 2010 FIFA World Cup South Africa.

"We are moving confidently towards 2010 and beyond and will be focusing on skills development and our staff to ensure a consistent world class delivery," said Helder Pereira, Managing Director of the Southern Sun, Tuesday.

Overall growth of tourism's contribution to the South African economy has had a predictable knock on effect on hotel performance.

"Johannesburg compares well with other international destinations with a 5.5 percent increase in occupancy over the period January to December 2006, compared to 5.3 percent in Paris and 2.4 percent in Hong Kong," Mr Pereira said.

However, her further added that revenue per available room had only increased by 9 percent compared to 29.6 percent in Singapore and 20.6 percent in London.

The statistics also showed that international visitor arrivals, from primary markets United States of America, United Kingdom, Europe, Australia, India, Canada and Africa, have continued to grow with a 13.4 percent increase recorded for the period January to October 2006.

"It is therefore quite likely that South Africa will exceed 8 million tourists for last year and this is after 2005 breaking the 7 million barrier for the first time," said Mr Pereira.

Locally, he noted, demand had also increased significantly and overall occupancies of 71 percent attained in 2006, adding that the national average room rates increased by 12 percent and yields have grown by 15 percent.

He explained that Durban had the highest occupancy levels, Cape Town boasted the highest yields and Johannesburg had shown the largest occupancy growth over the last two years.

"While 2010 readiness is a priority at this stage, we have to consider the lessons learnt during the 2006 FIFA World Cup in Germany - where a revenue Per increase of 36.7 percent, made up of an increase in room rates of 39.3 percent and a decrease in occupancy of 2.7 percent was experienced," he warned.

The major reason for this effect, he said, was the displacement of the usual corporate business which was postponed to after the World Cup and this contributed to a rate increase.

"FIFA returned over one million hotel rooms in April, being unable to sell them through the official World Cup Accommodation Service.

"South Africa, however, will be a different scenario," Mr Pereira said.
- BuaNews




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