Tourism should not just be for the wealthy, says deputy minister following BEE ruling | Fin24

Deputy Tourism Minister Fish Mahlalela.

• Deputy Minister of Tourism Fish Mahlalela raised the importance of transformation in the industry during a celebration of World Tourism Day.
• He said black economic empowerment in the tourism sector is the “unapologetic” policy of the SA government.
• Earlier this month, the Supreme Court of Appeal ruled that it was unlawful to require B-BBEE credentials in order to have qualified for a special Covid-19 tourism relief fund.

Inclusivity means recognising that tourism is not just for international visitors or the wealthy, Deputy Minister of Tourism Fish Mahlalela said at a celebration of World Tourism Day on Monday.

Mahlalela said transformation could help the tourism sector expand and broaden its reach. 

“It is a pity that some people have tended to understand transformation in a negative sense of it undermining free market principles and slowing down the momentum of hard-won gains in the tourism sector, or the broader economy,” he said.

“To the contrary, we as the ANC government see transformation as a necessary tool for nation building and social cohesion, which helps us redress the imbalances of the past. It helps us to ensure that people who were historically excluded from this sector of the economy also find a fair share of participation.”

Mahlalela said an inclusive approach meant tourism could reach more people – not just the wealthy, or international travellers. 

“We are able to drive inclusivity by ensuring that everyone participate in tourism and those who lack sufficient means are supported by the state. Inclusivity does not, however, end there. It also entails that we broaden the scope of the tourism sub-sectors, to expand tourism beyond its conventional reach to include other sub-sectors such as rural and township tourism, cultural and sports tourism just to mention a few,” he said.

“As much as we want to see our hospitality sector functioning in full capacity, international and domestic tourism soaring again, we also want small entrepreneurs and other previously excluded role players also contributing and benefitting from the tourism sector.

“We also need to change the perception of tourism as the preserve of wealthy local and international people taking a holiday. All of us are potential tourists if we take the time to explore outside our everyday environment and the social and cultural richness all around us.”

Transformation helps to drive gender parity, enterprise development and “balanced ownership and management of the means of production”, Mahlalela said.

Unlawful to require B-BBEE credentials

Earlier this month, the Supreme Court of Appeal (SCA) found that it was unlawful for the tourism minister to have required that tourism businesses meet Broad-based Black Economic Empowerment (B-BBEE) requirements in order to be considered for relief from a special Covid-19 Tourism Relief Fund of R200 million. The fund was announced in April 2020 and selected businesses received a once-off payment of a maximum of R50 000 each.

The Solidarity trade union and lobby group AfriForum took legal action on what it claimed to be “race-based criteria” for eligibility for financial assistance from the fund, challenging the tourism minister’s approach. However, Solidarity and AfriForum agreed that it would not be practical or perhaps even possible for the minister to try to recover any of the funds already disbursed from the fund. 

But they did want the declaratory order from the SCA to the effect that the minister was not legally obliged by the B-BBEE Act to make eligibility for assistance from the fund subject to the Tourism Sector Code and that her direction was consequently unlawful, which the court granted. 

The office of the tourism minister had argued that government was obliged by statute to include B-BBEE criteria in the directions for eligibility to financial assistance. 

According to the World Travel and Tourism Council, in 2018, South Africa’s tourism sector accounted for 2.9% of GDP (8.6% indirectly), supported over 725 000 jobs directly (1.49 million indirectly) and accounted for 8.2% of total investment activity. Inbound tourism generated approximately R82.5 billion in direct foreign spend, contributing an equivalent of 9.2% of total national exports. This positioned tourism as the second most important export sector in the economy in 2018. Domestic tourist activity contributed a further R9.49 billion in direct expenditure.

The tourism sector is therefore, one of the critical intervention areas that have been identified in the Economic Reconstruction and Recovery Plan, according to Mahlalela.