Tourism Minister Patricia de Lille and the Federated Hospitality Association of Southern Africa (FEDHASA) on Friday reacted positively to President Cyril Ramaphosa's announcement that Phase Three of the Government-Business Partnership will have a strong focus on tourism as an economic driver.
De Lille said that she welcomes the launch by President Cyril Ramaphosa. “Phase Three of the Government-Business Partnership, which will expand its focus to tourism as one of the key sectors identified to drive inclusive economic growth, job creation, and build confidence.”
De Lille added that Phase Three has an immediate objective to lift economic growth above 3%, marking a shift from stabilisation and reform towards accelerating growth, investment, and employment.
Tourism, agriculture, agro-processing, and mining have been identified for their potential to attract investment, earn foreign revenue, and create jobs at scale.
De Lille said that the President identified improving air access, modernising visa processing, strengthening destination marketing, enhancing tourist safety, and expanding investment in tourism infrastructure as some of the key interventions required to unlock further growth in the sector.
“These priorities closely align with work already underway through the Cabinet endorsed Tourism Growth Partnership Plan (TGPP),” she said.
De Lille added that the TGPP is itself built on a partnership between government and the private sector and focuses on "Ease of Access; Coordinated Destination Marketing; Safety and Security; Tourism Product Development; and Job Creation."
“Tourism therefore enters Phase Three with an established partnership model and a clear programme of action. We are not starting from zero. Through the Tourism Growth Partnership Plan, the government and the private sector have already agreed on the barriers constraining tourism growth and the interventions required to address them,” she said.
Rose Murunzi, Bureau for Economic Research economist, said Phase 3 of the partnership, places greater emphasis on sector-specific interventions.
“South Africa reached 10.5 million tourist arrivals in 2025, just 2.6% above 2019, signalling that tourism has recovered from COVID but has yet to enter a new growth phase. The key finding is that recovery has been largely regional, rather than driven by long-haul markets. African arrivals, which account for more than 75% of the total, are 6.5% above 2019, while overseas arrivals remain 8.5% below,” said Murunzi.
Murunzi said there is also a clear volume-value divide: African visitors arrive in greater numbers but spend less, while visitors from outside Africa spend significantly more, particularly on accommodation and guided activities.
“The Middle East is an increasingly important market, particularly in winter. With tourism positioned as a labour-intensive export industry, at the BER we are cautiously optimistic.”
Brett Tungay, national chairperson of FEDHASA, said they are very pleased to see tourism being recognised at this level.
“Tourism has a proven ability to create jobs at scale and to spread economic activity into communities and regions across South Africa. The Tourism Department’s latest figures show that the sector contributed 4.9% to GDP and sustained 954,000 direct jobs in 2024.”
Tungay added that the President’s renewed focus, particularly the emphasis on improving air access, modernising visa processing, destination marketing, tourist safety, and investment in tourism infrastructure, is therefore very welcome. “These are issues that the industry has consistently identified as essential to unlocking further growth.”
Tungay said recognising tourism’s importance is only the first step.
“We also need to be cognisant of the fact that government policy and over-regulation can, in some instances, constrain the very growth we are trying to achieve. One of our major concerns is access to finance, particularly for small and medium-sized tourism businesses. Treasury lending criteria imposed on the banking sector have made it increasingly difficult for many SMMEs to access the finance they need to invest, expand, refurbish, and create additional employment.”
Tungay said this is particularly problematic in tourism, where many viable businesses have significant fixed assets but can struggle to meet increasingly restrictive lending requirements.
yogashen.pillay@nationalmg.co.za
THE NATIONAL
yogashen.pillay@nationalmg.co.za