
South African Tourism (SAT) has announced that it has utilized 72% of its budget for the 2024/25 fiscal year. CEO Nombulelo Guliwe highlighted that this “shows our commitment to optimizing our budget.”
This declaration comes in the wake of media reports suggesting that SAT may struggle to fully utilize its annual budget of R1.2 billion, raising concerns that it could be required to return over R800 million to the National Treasury.
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Guliwe assured that the current management and leadership of SAT are focused on thoroughly reviewing costs and will steer clear of lavish spending despite claims regarding the underutilization of their budget.
“Regardless of unfounded claims suggesting an 80% surplus, we will not succumb to pressure for irresponsible spending,” she stated.
However, the exact budget allocations remain uncertain.
R100m Tender
The discussion centers around a controversial R100 million tender for event management awarded to an inexperienced company for Meetings Africa and Africa’s Travel Indaba, a claim that SAT has contested.
In December 2024, SAT launched an independent forensic investigation into the event management tender, which is still in progress.
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“As clarified in the statement released on December 16, 2024, no vendor has yet been awarded the R100 million event management tender,” Guliwe noted.
Value of the Sector
In his recent letter to the nation, published on January 13, President Cyril Ramaphosa highlighted the importance of the tourism sector, especially as the country gears up to host the G20 Summit, expected to be the largest tourism catalyst on the continent.
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The tourism sector is crucial for growth and job creation in South Africa, with Ramaphosa noting in 2023 that the nation welcomed approximately 8.5 million international tourists who contributed over R95 billion in spending.
“Our tourism sector holds immense potential to grow beyond its current capacity,” Ramaphosa remarked.
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“This year marks the inaugural G20 summit on African soil, and we will use this opportunity to showcase and promote South Africa as a premier destination for tourism.”
Prospects
SAT has secured 53 bids for international events, which are estimated to generate R616 million for the economy in the current fiscal year.
Over the long-term, these events are projected to attract more than 24,000 delegates from 2024 to 2029, further solidifying South Africa’s reputation as a leading hub for international conferences and events.
The World Travel and Tourism Council (WTTC) reported that tourism represented 8.2% of South Africa’s GDP directly and indirectly in 2023.
This sector is also a major employer, with 1.46 million people engaged in tourism as of 2023, and expectations suggest that this figure could rise to 1.7 million jobs in 2024 once the data is finalized.
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Research from Stellenbosch University indicates that for every 30 new tourists to a destination, one new job is created.
From January to October 2024, SAT reported 7.2 million visitors to the country, a 5.7% increase from the same period in 2023.
Moreover, preliminary data from the recent festive season shows promising results for the sector, backed by high occupancy rates and strong participation in events nationwide.
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