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'We haven't made a cent': After months without income, wine tour operators fear for thei

FIN24 / 06 JULY 2020 - 17.33 / PENNY MASHEGO

  • Wine tourism is a R7.2 billion industry.

  • The industry employs up to 10 233 people directly on average and provides more than 36 000 employment opportunities.

  • A loss of international visitors and domestic support means a devastating and sustained loss of income for the sector.

  • Some argue if business travel is allowed, leisure travel should be too.

The continuing coronavirus lockdown will have a devastating impact on South Africa's R7.2 billion wine tourism sector, impacting tens of thousands of workers and shutting down some businesses for good, industry leaders have warned.

Wine tour companies are among the many affected by South Africa's response to the Covid-19 pandemic – now in place for more than 100 days – and have urged government to allow them to operate.

While wine tour companies have felt the impact of international travel restrictions, this has not been the only area in which their income has suffered.

Rico Basson, CEO of Vinpro, which which represents 3 500 South African wine producers, cellars and other industry stakeholders, said wine tourism had suffered crippling losses between March and June – usually a busy time locally, he noted.

"A significant factor in the estimated loss is the strong domestic support that wine tourism in South Africa enjoys, especially over traditional school holidays and Easter weekend," Basson said.

According to a report by Vinpro, South Africa’s wine tourism industry’s direct and indirect GDP contribution was R7.2 billion in 2019.

The industry employs up to 10 233 people directly on average and provides more than 36 000 employment opportunities.

But the loss of international visitors, too, has taken its toll.

Johan Barnard, co-owner of La Rochelle Tours in Cape Town, said the company has been going through tough times and a prolonged lockdown could put its existence in jeopardy.

"We haven’t made a single cent since the [first] day of lockdown and, like many other tour companies in the wine industry, we are 100% reliant on international guests, so until international travel is allowed to South Africa, we won’t make any money," Barnard said.

The Department of Tourism has made Covid-19 relief available to eligible companies. Eligibility includes Broad-Based Black Economic Empowerment criteria, which trade union Solidarity and its associate Afriforum attempted to challenge, unsuccessfully, in court.

Barnard said La Rochelle does not meet the B-BBEE requirements to receive government funding. Instead, La Rochelle is staying afloat from savings it has accumulated over its 20 years in business.

However, he says, those savings are running low.

"We can’t go on like this. We’ve got staff, vehicle and insurance to pay. Money’s going to dry up soon [and] we need to get back into the game as soon as possible, otherwise we will be another statistic," Barnard said, referring to companies that collapsed during the lockdown.

Peak season starting soon

The wine tourism industry is currently in its off-peak season, which ends in the beginning of September.

"We lost a big chunk of March [and April], which is still high season.

"My biggest fear is that if international tourism is not allowed by 1 September [when high season starts] if we miss that, then I foresee many companies, including small guest houses and hotels, being closed for good," said Barnard.

Some of his neighbours have already closed down their businesses.

The Tourism Business Council South Africa (TBCSA), meanwhile, has demanded that leisure travel be allowed to resume.

The council, which is weighing its legal options and considering approaching the courts in a bid to force government to allow the sector to operate, says the travel and tourism industry lost more than R68 billion in 100 days of lockdown.

Tshifhiwa Tshivhengwa, CEO of TBCSA, has said if business travel can continue, then leisure travel should also be allowed to operate, otherwise the 1.5-million people employed in the sector will face mass retrenchments.

Tshivhengwa has urged government to find solutions to keeping people safe from the virus, while also allowing them to return to work as long as they do so in a responsible manner, which he says many of the TBCSA’s members are ready to do.

The government has allowed more companies to operate under Level 3. But South Africa’s Covid-19 infection rate has also risen rapidly, bringing the total near 200 000.

As the country passed 100 days of lockdown, it also exceeded 3 000 deaths from the virus.

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LINK : https://www.news24.com/fin24/companies/we-havent-made-a-cent-after-months-without-income-wine-tour-operators-fear-for-their-future-20200706

Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER

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