DEVELOPMENT OF AN INTERNATIONAL BEACH TOURISM DESTINATION ALONG THE SOUTH AFRICAN EAST COAST
APRIL 2001
Prepared by
GRANT THORNTON KESSEL FEINSTEIN
For
TOURISM KWAZULU-NATAL
TABLE OF CONTENTS
Page
SECTION 1: BACKGROUND & METHODOLOGY
1.1. Background 1 1.2. Methodology 1 1.3. Abbreviations 2
SECTION 2: GLOBAL TRENDS IN LEISURE
2.1. Introductory Comments 4 2.2. Growth in Worldwide Tourism 4 2.3. Purpose of Trip 4 2.4. Changing Trends in Tourism 5 2.5. Factors Influencing Leisure, Recreation and Holiday Patterns 6
SECTION 3: BEACH TOURISM – AN INTRODUCTION
3.1 Introductory Comments 9 3.2 Models of Beach Tourism 9 3.2.1 Model 1: Niche Beach Destinations 9 3.2.2 Model 2: Mass Beach Destinations 10 3.3 Factors Impacting on the Development of Beach Tourism Worldwide 11 3.3.1 Supply and Demand Factors 11 3.3.2 Tour Operators 12 3.3.3 Air Charters 12
SECTION 4: SELECTED INTERNATIONAL BEACH DESTINATIONS
4.1 Introductory Comments 14 4.2 Spain 16 4.2.1 Features of the Spanish Tourism Industry 17 4.2.1.1 Market Size and Share 17 4.2.1.2 Gateway to Spain 17 4.2.2 Development of Tourism in Spain 18 4.2.2.1 Tourist Arrivals 18 4.2.2.2 Spatial Distribution of Tourism 18 4.2.2.3 Spatial Distribution of Tourist Accommodation 22 4.2.2.4 Development of Tourist Accommodation 23 4.2.2.5 Diversification of the Tourism Product 24 4.2.3 Policies Directing the Growth of Tourism in Spain 26
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4.2.3.1 National and Autonomous Governments 26 4.2.3.2 Municipal Authorities 29 4.2.3.3 Private Investors 30 4.2.4 Rejuvenation of the Tourism Industry 30 4.2.5 Tourism Marketing 31 4.3 Portugal 32 4.3.1 Features of the Portuguese Tourism Industry 33 4.3.1.1 Size and Market Share 33 4.3.2 Development of Tourism in Portugal 34 4.3.2.1 Tourist Arrivals 34 4.3.2.2 Development of Tourist Accommodation 35 4.3.2.3 Spatial Distribution of Tourism 36 4.3.2.4 The Role of Investment in Developing Portugal’s Tourism Industry 37 4.3.3 Policies Directing the Development of Tourism in Portugal 38 4.4 Greece 40 4.4.1 Features of the Greek Tourism Industry 41 4.4.1.1 Size and Market Share 41 4.4.1.2 Gateway to Greece 42 4.4.2 Development of Tourism in Greece 42 4.4.2.1 Tourist Arrivals 42 4.4.2.2 Spatial Distribution of Tourism 43 4.4.2.3 Development of Tourist Accommodation 44 4.4.3 Policies Directing the Development of Tourism in Greece 45 4.4.3.1 Policy During the Dictatorship – 1967-1974 46 4.4.3.2 Policy Trends in 1974 –1990 46 4.4.3.3 Policy Trends, 2000-2006 47 4.4.4 Tourism Marketing 49 4.5 Cyprus 50 4.5.1 Features of the Cypriot Tourism Industry 51 4.5.1.1 Size and Market Share 51 4.5.1.2 Gateway to Cyprus 53 4.5.2 Development of Tourism in Cyprus 54 4.5.2.1 Tourist Arrivals 54 4.5.2.2 Spatial Distribution of Tourism 56 4.5.2.3 Development of Tourist Accommodation 57 4.5.3 Policies Directing the Development of Tourism in Cyprus 59 4.5.3.1 Tourism Development Plan 59 4.5.3.2 Product Improvement Strategy 60 4.5.4 Tourism Marketing 61 4.6 The Islands of the Bahamas 63 4.6.1 Features of the Bahamian Tourism Industry 64 4.6.1.1 Size and Market Share 64 4.6.1.2 Gateway to the Bahamas 64
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4.6.2 Development of Tourism in the Bahamas 66 4.6.2.1 Tourist arrivals 66 4.6.3 Policies Directing the Development of Tourism in the Bahamas 66 4.6.3.1 Accommodation 66 4.6.3.2 Hotel Encouragement Act 67 4.6.3.3 Development of the Family Islands Ecotourism Programme 67 4.6.3.4 Infrastructure 68 4.7 Bermuda 69 4.7.1 Features of the Bermudian Tourism Industry 70 4.7.1.1 Size and Market Share 70 4.7.2 Development of Tourism in Bermuda 70 4.7.2.1 Tourist Arrivals 70 4.7.2.2 Economic Performance of the Tourism Industry 73 4.7.3 Policies Directing the Development of Tourism in Bermuda 73 4.7.3.1 Grading Policy 75 4.7.3.2 Timeshare Policy 75 4.7.3.3 Cruiseship Policy 75 4.8 Kenya 76 4.8.1 Features of the Kenyan Tourism Industry 77 4.8.1.1 Tourist Arrivals 77 4.8.2 Development of Tourism in Kenya 78 4.8.2.1 Tourist Arrivals 78 4.8.2.2 Spatial Distribution of Tourism 80 4.8.3 Policies Directing the Development of Tourism in Kenya 82 4.8.3.1 General Tourism Policies 82 4.8.3.2 Tourism Investment Policies in Kenya 83 4.8.4 Tourism Marketing 85 4.9 Mauritius 86 4.9.1 Features of the Mauritian Tourism Industry 87 4.9.1.1 Size and Market Share 87 4.9.2 Development of Tourism in Mauritius 89 4.9.2.1 Factors Influencing Tourism Development – Pre 1990 89 4.9.2.2 Factors Influencing Tourism Development – 1990s and Beyond 90 4.9.3 Policies Directing the Development of Tourism in Mauritius 92 4.9.4 Tourism Marketing 94 4.10 Thailand 95 4.10.1 Features of Thailand’s Tourism Industry 96 4.10.1.1 Size and Market Share 96 4.10.1.2 Gateway to Thailand 98 4.10.2 Development of Tourism in Thailand 99 4.10.2.1 Spatial Distribution of Tourism 99 4.10.3 Policies Directing Tourism Development in Thailand 101 4.10.4 Tourism Marketing 103
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SECTION 5: LESSONS FROM ABROAD
5.1 Introductory Comments 104 5.2 Overview of the Development of Beach Tourism 104 5.2.1 Initial Stage 104 5.2.2 Growth Stage 104 5.2.3 Mature Stage 105 5.2.4 Declining Stage 106 5.2.5 Rejuvenation Stage 106 5.3 The Importance of Planning for Tourism 106 5.4 Restructuring Policies for Beach Tourism 106 5.5 Sustainable Tourism Development 107 5.6 Tourism Investment Policies and Incentives 109
SECTION 6: IMPORTANT OUTBOUND MARKETS FOR BEACH TOURISM
6.1 UK Outbound Market 111 6.1.1 Size and Market Share of the UK Outbound Market 111 6.1.2 Long-Haul Destinations 112 6.1.3 Long-Haul Travellers Behaviour and Attitudes 113 6.1.4 Types of Holidays Taken 113 6.1.5 UK Outbound Beach Holiday Travellers to South Africa 114 6.2 USA Outbound Market 117 6.2.1 Size and Share of the US Outbound Market 117 6.2.2 Long-Haul Traveller Behaviour and Attitudes 117 6.2.3 US Outbound Beach Holiday Travellers 118 6.2.4 Sun and Beach Related Activities 119 6.2.5 US Outbound Beach Holidaymakers to South Africa 119 6.3 German Outbound Market 120 6.3.1 Size and Market Share of the German Outbound Market 120 6.3.2 Travel Motivation 121 6.3.3 German Outbound Beach Holiday Travellers 122 6.3.4 Sun and Beach Related Activities 122 6.3.5 German Outbound Beach Holiday Travellers to South Africa 123
SECTION 7: BEACH TOURISM IN SOUTH AFRICA
7.1 Introductory Comments 126 7.2 Tourism in South Africa – A Strategic Perspective 126 7.3 The Need for Coastal Management in Developing Beach Tourism 127 7.3.1 South African Blue Flag Campaign 127 7.4 The Coastal Regions of South Africa 128 April 2001 Page 4
7.5 Features of the South African Tourism Industry 129 7.5.1 Foreign Tourist Arrivals 129 7.5.2 Country of Origin 131 7.5.3 Purpose of Visit 131 7.5.4 Average Length of Stay 132 7.5.5 Most Visited Provinces 133 7.5.6 Type of Accommodation Used 134 7.6 Features of Tourism along the ESSA 134 7.6.1 Foreign Tourist Arrivals 134 7.6.2 Country of Origin 136 7.6.3 Purpose of Visit 137 7.6.4 Type of Accommodation Used 138 7.6.5 Attractions made use of or Visited 139 7.6.6 Rating of Attractions Used or Visited 142 7.6.7 Factors Influencing Decision to Travel 142 7.6.8 Booking Arrangements 143 7.6.9 Expenditure 144
SECTION 8: EASTERN SEABOARD OF SOUTH AFRICA INFRASTRUCTURE FOR TOURISM
8.1 Beach Tourism Products 146 8.1.1 Beach Leisure Products 146 8.1.2 Existing and Potential Products 147 8.1.3 Tourist Accommodation Along the ESSA 155 8.1.4 Type of Accommodation Available 155 8.1.5 Tourism-Support Infrastructure 158 8.1.6 Air Travel 159 8.1.7 Roads 164 8.1.8 Rail 167 8.1.9 Sea 168 8.1.10 Tourism Infrastructure Development Requirements 168 8.2 Spatial Development Initiatives 169 8.2.1 Coastal SDls 170
SECTION 9: BEACH TOURISM POTENTIAL AND ECONOMIC IMPACT
9.1 Summary of Beach Tourism to and From International Destinations 175 9.2 Projected Number of International Beach Tourists to South Africa 178 9.3 Economic Impact of the ESSA’s Beach Tourism Industry 179 9.3.1 Scenarios 179 9.3.2 Assumptions 179 9.3.3 Growth Phases 180
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9.3.4 Multipliers 181 9.3.5 Summary of Results 181 9.3.5.1 Number of Tourists 181 9.3.5.2 Accommodation Requirements 181 9.3.5.3 Economic Impact 182 9.4 Conclusions 184 SECTION 10: THE WAY FORWARD
10.1 The Way Forward 186
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TABLES
2.1 Factors Influencing Changes in Leisure Time 2.2 Summary of the Impact of Leisure Time on Tourism in Selected Established and Future- Leading Tourism-Generating Countries 3.1 Characteristics Governing the Development of Beach Tourism, Pre and Post World War II 3.2 Differences between Scheduled and Charter Passenger Markets 4.1 Tourist Arrivals in Spain by Top 10 Markets, 1996-1998 4.2 Number of Hotels by Star Grading in Spain in 1970 and 1990 4.3 Tourist Arrivals in Portugal by Top 10 Markets 4.4 Tourist Arrivals in Greece by Main Markets, 1999 4.5 Summary of Characteristics Displayed by Tourists from the Top Generating Countries to Cyprus, 1999 4.6 Airlines Operating Routes to and from Cyprus 4.7 Geographical Distribution of Tourists to Cyprus, 1999 4.8 Tourist Arrivals in the Bahamas, 1993-1997 4.9 Scheduled and Charter Airlines to and from the Bahamas 4.10 Tourist Arrivals in Bermuda, 1996-1998 4.11 Summary of Conclusions and Recommendations to Address Bermuda’s Economic Performance 4.12 Arrivals to Kenya by Country of Residence, 1999 4.13 Hotel Bednights Occupied by Tourist Zone in Kenya, 1995-1999 4.14 Foreign Tourist Arrivals to Mauritius According to Country of Origin, 1995-1999 4.15 Hotel Trading Statistics for Mauritius 4.16 Recommendations for Tourism Development in Mauritius in the 1990s 4.17 Number of International Tourists to Thailand in 1998 4.18 TAT’s Tourism Development Objectives, 1997-2003 6.1 Types of Holidays Taken by UK Outbound Travellers 6.2 Kinds of Trips that US Travellers to South Africa would Enjoy Extremely or Very Much 6.3 Main Destinations for Holidays Abroad by German Outbound Travellers 7.1 Factors Influencing the Development of Beach Tourism in South Africa 7.2 Foreign Tourist Arrivals in South Africa 7.3 Source of South Africa’s Overseas Tourist Arrivals in 1999 7.4 Purpose of Visit According to Country of Origin 7.5 Provinces Visited by Overseas Tourists to South Africa, 1998-1999 7.6 Average Length of Stay in each Destination by Overseas Tourists, 1998-1999 7.7 Types of Accommodation used by Overseas Visitors, 1998-1999 7.8 Number of Overseas Tourists to the ESSA 7.9 Purpose of Visit to the ESSA, KwaZulu Natal and the Eastern Cape 7.10 Number of Foreign Tourists Making Use of or Visiting Attractions in KwaZulu Natal 7.11 Number of Foreign Tourists Making Use of or Visiting Attractions in the Eastern Cape 7.12 General Rating for Attractions Made Use of or Visited in KwaZulu Natal and the Eastern Cape 7.13 Expenditure by Foreign Tourists to the ESSA, KwaZulu Natal and the Eastern Cape, 1999 7.14 Categorisation of Beach Products along the ESSA
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7.15 Summary of Beach Product Categories by Coastal Region 7.16 Current State of Infrastructural Development along the ESSA 7.17 Passenger and Air Traffic Movements at DIA, PEA and ELA, 1999 7.18 Percentage Breakdown of Passenger and Air Traffic Movements at DIA, PEA and ELA, 1999 7.19 Transportation Infrastructure Development Required to Support Tourism along the ESSA 7.20 Summary of Common Characteristics for the Coastal SDIs 8.1 Summary of Beach Tourists from Selected Generating Countries 8.2 Estimated Number of Beach Tourists to Selected Destinations 8.3 Summary of the Number of Beach Tourists along the ESSA 8.4 Summary of the Number of Beach Tourists, Accommodation Requirements and Economic Impact along the ESSA during Phase 1 8.5 Summary of the Number of Beach Tourists, Accommodation Requirements and Economic Impact along the ESSA during Phase 2 8.6 Summary of the Number of Beach Tourists, Accommodation Requirements and Economic Impact along the ESSA during Phase 3
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FIGURES
2.1 International Tourism According to Purpose of Visit, 1998 3.1 Development of Beach Tourism 4.1 Arrivals to Spain, 1950-1998 4.2 Geographical Concentration of Spanish Beach Destinations 4.3 The Autonomous Regions of Spain 4.4 Number of Domestic and Foreign Visitors to Hotels in Spain, 1985 4.5 Nights Spent in Hotels, Guesthouses and Campsites in Various Tourist Regions in Spain, 1966-1990 4.6 Summary of the Development of Tourist Accommodation in Spain, 1950-2000 4.7 Growth in Foreign Tourist Arrivals to Greece, 1960-1999 4.8 Regional Distribution of Demand for Bednights in Greece, 1981-1986 4.9 Growth of Tourist Arrivals in Cyprus, 1985-1999 4.10 Breakdown of Foreign Tourists to Cyprus According to Country of Origin, 1999 4.11 Map Showing the Various Air Routes to and from Cyprus 4.12 Distribution of Bed Capacity per Tourism Region in Cyprus, 1999 4.13 Tourist Arrivals to Bermuda, 1947-1999 4.14 Tourist Arrivals in Kenya, 1963-1999 4.15 Bednights Available and Occupancy Levels in Beach, Nairobi and Game Park Hotels, 1977- 1987 5.1 Life Cycle Approach to the Development of Beach Destinations around the World 6.1 Destination of UK Outbound Trips 6.2 Types of Trips Taken by UK Outbound Travellers to South Africa, 1999 6.3 Type of Accommodated used by UK Beach Holidaymakers to South Africa, 1999 6.4 Age Structure of UK Beach Holidaymakers to South Africa in 1999 6.5 Percentage Breakdown of Social Status, Income and Education Levels of UK Beach Holidaymakers to South Africa in 1999 6.6 Popular Long-Haul Destinations for USA Outbound Travellers 6.7 Type of Accommodation Used by US Beach Holidaymakers in 1998 6.8 Likelihood of Participating in Selected Beach-Related Activities 6.9 Travel Motivations Amongst German Outbound Travellers 6.10 Types of Trips Taken by German Travellers to South Africa 6.11 Type of Accommodation Used by German Beach Holidaymakers to South Africa in 1999 6.12 Age Structure of German Beach Holidaymakers to South Africa in 1999 6.13 Percentage Breakdown of Social Status, Income and Education Levels of German Beach Holidaymakers to South Africa in 1999 7.1 Map Showing the Geographical Location of South Africa’s Eastern Coastal Regions 7.2 Overseas Tourist Arrivals 7.3 Overseas Visitors by Purpose of Visit, 1996-1999 7.4 Distribution of Foreign Tourists according to Tourist Regions in KwaZulu Natal 7.5 Country of Origin of Foreign Tourists to KwaZulu Natal 7.6 Country of Origin of Foreign Tourists to the Eastern Cape 7.7 Type of Accommodation used by Foreign Tourists to KwaZulu Natal
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7.8 Type of Accommodation used by Foreign Tourists to the Eastern Cape 7.9 Attractions Made Use of or Visited in KwaZulu Natal 7.10 Attractions Made Use of or Visited in the Eastern Cape 7.11 Booking Arrangements Made by Foreign Tourists to KwaZulu Natal 7.12 Booking Arrangements Made by Foreign Tourists to the Eastern Cape 7.13 Percentage Breakdown of Expenditure for Items Paid for in KwaZulu Natal and the Eastern Cape, 1999 7.14 Geographical Distribution of Beach Products along the ESSA 7.15 Distribution of Establishments along the ESSA 7.16 Distribution of Establishments According to Accommodation Category and Coastal Region 7.17 Percentage Breakdown of the Total Number of Establishments Available along the ESSA 7.18 Percentage Breakdown of the Total Number of Rooms Available along the ESSA 7.19 Percentage Breakdown of International Scheduled Airlines to JIA 7.20 Total Air Arrivals, 1997-1999 7.21 Map Showing the Major Road Access Routes to and Within the ESSA 7.22
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ANNEXURES
Annexure A: White Paper on the Promotion and Development of Tourism in South Africa Annexure B: Coastal Management Policies and Legislation Annexure C: Review of the Infrastructure Study Annexure D: International Scheduled Airlines flying to Johannesburg International Airport Annexure E: Economic Impact of Beach Tourism
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1.1 BACKGROUND
Roelf Meyer (“The Client”) and Tourism KwaZulu-Natal are considering initiating a national strategy to develop international beach tourism on a large scale to South Africa’s eastern coastline from around Port Elizabeth in the south, to the Mozambique border in the north. The aim is to attract to South Africa in large numbers, middle-market international tourists seeking mainly a sun, sea and sand holiday.
The Client requires a preliminary document to describe and substantiate the proposition of such large-scale, middle-market beach tourism being developed in South Africa, and has commissioned Grant Thornton Kessel Feinstein to undertake research to support a concept document that provides a vision for the project, as well as some tourism information and statistics to substantiate why and how such a strategy could work.
1.2 METHODOLOGY
Our approach to the compilation of the concept document included:
. A brief scan of global trends in leisure to ascertain the reasons for changes in leisure time and thus the propensity to travel; . An introduction to the phenomena of beach tourism, its historical roots and the typical models along which it has developed; . Insight into the development of mass beach tourism in selected destinations around the world (including Spain, Portugal, Greece, Cyprus, the Bahamas, Bermuda, Kenya, Mauritius and Thailand). In each case study we provide a brief overview of the current state of the tourism industry, the development of tourism in the selected country (in terms the growth in visitor arrivals and the various factors responsible for the growth/decline in numbers), the development of accommodation in terms of the number of establishment, bednights, etc, spatial distribution of tourism, the various government policies responsible and governing the development of tourism, as well as the various marketing strategies undertaken by each country to attract international tourists; . A summary of the factors and policies directing the development of beach tourism on an international scale, and a general overview of global best practice for the development of beach tourism in emerging destinations; . A brief analysis of three of the main tourist generating countries namely the UK, the USA and Germany, in terms of the size of their outbound market and beach holidays taken. We have also provided a brief overview of the size of the outbound beach tourism market to South Africa;
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. A situational analysis of the international tourism market in South Africa and along the eastern coastline of South Africa (taking into account the number foreign visitor arrivals, country of origin, purpose of visit, seasonality, length and place of stay). Based on our analysis we estimated the size of the beach tourism market along the eastern coastline of South Africa; . We analysed the beach tourism product in terms of the types of leisure products/activities/experiences and accommodation available along the coast, as well as the general state of tourism-support infrastructure. The potential development of beach-tourism is supported by an economic impact; . Based on levels of beach tourism to other comparable destinations and the overall size and growth of beach tourism from major generating countries, we project potential levels of beach tourism to South Africa; and, . Based on the potential for development of beach tourism in South Africa, we provide recommendations a way forward for the development of beach tourism.
1.3 ABBREVIATIONS
In the report we make use of the following abbreviations and terminology:
ACI Airports Council International ACSA Airports Company South Africa ATE Administración Turistíca Espaňola (Spain) BIA Bangkok International Airport BTDB Bermuda Trade Development Board CBSK Central Bureau of Statistics, Kenya CEAS Central Economic Advisory Service CMPP Coastal Management Policy Programme (South Africa) CTO Cyprus Tourism Organisation DEAT Department of Environmental Affairs and Tourism (South Africa) DIA Durban International Airport EATTA East African Travel and Tourism Association EC European Community ELA East London Airport EOT National Tourism Organisation of Greece ESSA Eastern Seaboard of South Africa FEDSAS Federation of the South African Self-Catering Accommodation Industry FEEE Foundation for Environmental Education in Europe FUTURES Plan Marco de Competitivdad del Turismo Espaňol (Spain) GDP Gross Domestic Product
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GHASA Guest House Association of South Africa GNTO Greek National Tourism Office IATA International Air Transport Association INI Instituto Nacional de la Industria (Spain) IUOTO International Union of Tour Operators JIA Johannesburg International Airport KTDC Kenya Tourist Development Corporation MGTO Mauritius Government Tourist Office MTPA Mauritius Tourism Promotion Agency OECD Organisation for Economic Corporation and Development ORV Off-Road Vehicles PEA Port Elizabeth Airport PDIP Product Development Incentives Programme (Cyprus) PPRTA Pilot Plan of Recuperation for Tourist Areas (Cyprus) RDP Reconstruction and Development Programme (South Africa) ROPs Regional Operational Programmes (Greece) SADC Southern African Development Community SCA Sensitive Coastal Areas SDI Spatial Development Initiative SGT Secretaría General de Turismo (Spain) SMMEs Small, Medium and Micro Enterprises SOP Sectorial Operational Programme (Greece) SPDP Southern Port Development Project (Port Elizabeth, South Africa) STATSSA Statistics South Africa TAP Tourism Activity Professionals Association (Mauritius) TAT Thailand Authority for Tourism TIWG Tourism Infrastructure Working Group TKZN Tourism KwaZulu Natal TTI Travel and Tourism Intelligence TURESPAŇA Instituto de Promocion del Turismo de Espana (Spain) The Client Roelf Meyer VFR Visiting Friends and Relatives WTO World Tourism Organisation
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2.1 INTRODUCTORY COMMENTS
Given the social nature of tourism, we believe, as a point of departure for this study, that the various factors influencing and impacting on travel and tourism should be addressed at a global level, since it is at the global level that trends will foreshadow what will happen in tourism in the future. In order to put the global changes in leisure and travel into context, we firstly provide an overview of the importance of tourism on a global scale. Secondly, we provide an overview of the main reasons for persons travelling abroad, and provide insight into how the socio-economic environments of many countries have been responsible for influencing global changes in leisure. We conclude with a brief overview of how these global trends in leisure have the capacity to work to the advantage of developing the eastern coastline of South Africa as a globally competitive beach destination.
2.2 GROWTH IN WORLDWIDE TOURISM
Tourism is the world’s largest industry and is growing significantly. According to the World Tourism Organisation (“WTO”) (up to September 2000) over the period 1990 to 2000, tourism grew by 34% to 664 million international tourist arrivals. International tourism receipts grew by 65% to US$445 billion over the same period. After two years of negative results, the Asia/Pacific region showed the highest growth in international tourism in 1999, reaching a growth rate of 11,5% and a new record total of 97,5 million international tourists. Other regions in the world that showed significant growth in 1999 included the Middle East (16,6%), Africa (7,6%) and South Asia (8,3%).
2.3 PURPOSE OF TRIP
According to WTO figures up to 1998, leisure, recreation and holidays still represent the main purpose of visit, accounting for around 62% of all international trips taken. Business travel accounts for 18% and the remaining 20% of trips are taken for “other reasons” e.g. visiting friends and relatives (“VFR”), religious purposes/pilgrimages, health treatments etc. Over the past 10 years there has been an increase in the number of trips being taken for “other reasons”. We attribute this to globalisation and a readiness to travel for many reasons and, increasing diversification in “holiday travel”. Figure 2.1 shows the breakdown of international tourism by purpose of visit to the different world regions.
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Figure 2.1: International Tourism According to Purpose of Visit, 1998
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
Africa
World
Europe
East
Americas
South Asia
Asia/Pacific
Middle East Destinations
Leisure, Recreation & Holidays Business Other
Source: WTO, 2000
2.4 CHANGING TRENDS IN TOURISM
Since the 1950s, tourism has not only developed but has also changed substantially in terms of destinations visited. For many years tourism was characterized by visits to Western Europe and North America. However, more recently there has been a diversification in tourism destinations, characterized by newly emerging destinations such Asia, North Africa, Southern Africa and Latin America. According to the WTO, in 1950, fifteen countries alone received approximately 25 million international tourist arrivals (97% of the total arrivals). By 1999, over 70 countries and territories were receiving over 1 million international tourist arrivals each. In 1999, the top fifteen tourist-receiving countries represented only 62% of the total. Some of these top fifteen destinations now include newcomers from Asia and Central and Eastern Europe.
In terms of it’s nature, travel and tourism is much more diverse nowadays than previously. Travel tends to be an all-year-round phenomenon, thanks to the fragmentation of school and work holidays, and is much more varied in terms of purpose of trip, length of stay and accommodation used. Internationally, many people are now combining shorter summer holidays with short breaks during the rest of the year. This has resulted in a substantial increase in the cultural, sports, adventure, rural and cruise tourism segments. The business sector has also benefited from the substantial growth of conference and incentive travel.
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However, despite this clear tendency towards an increased diversification of tourism flows, traditional patterns of tourism behaviour are likely to endure, meaning that sun and beach tourism will remain the most important segment of world tourism. The attitude and behaviour of tourists in the beach tourism sub-segment has changed considerably since the 1970s. Tourists are now more interested in the pursuit of various activities and in learning about their surroundings, and this has resulted in increasing sun and beach trips combined with other activities such as sports, nature and culture. The diversification of traditional beach tourism to include a wider variety of products is particularly conducive to the growth and marketing of beach tourism for South Africa.
2.5 FACTORS INFLUENCING LEISURE, RECREATION & HOLIDAY PATTERNS
Several factors have been/are responsible for shaping the level of holiday taking on a global scale. These include, amongst others:
. Globalisation and liberalization of the world economy; . Changing demographics . Changes in working time; and, . Regulation of holidays and leisure time policies.
Table 2.1 provides a summary of the various factors influencing and shaping holiday- taking patterns today.
A survey of 18 established and future leading tourism generating countries (refer to Table 2.2) has revealed how changes in leisure time (summarised in Table 2.1) have resulted in changes with regards to the type of holidays taken (i.e. domestic, intra-regional, long- haul) and the types of holiday products tourists are searching for (e.g. cruises, scuba diving, city tours, etc.).
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Section 2: Global Trends in Leisure
Table 2.1: Factors Influencing Changes in Leisure Time
Factor Affecting Implication of Change Leisure Time Demographics . Both established and future leading tourism generating countries have ageing populations. Reasonable levels of post retirement income, coupled with advances in medical treatment are resulting in a greater population of mature individuals that are fit and healthy for travel abroad. Working time . Reducing working time and increasing leisure time has been a social responsibility in many countries (particularly developed countries) with the purpose being to improve the quality of life and general well-being of employees and their families – although the trend towards longer paid leave and a shorter working week seen a decade ago, appears to have now run its course; . There is a trend towards earlier retirement; . The working hours of individuals and sectors are becoming increasingly varied. In countries where there has been a marked increase in the number of working hours, particularly in the Far East, Australia and the USA, there is a marked decrease in the amount of leisure time available, thus, the proportion of time spent on tourism and whether travel will be long- or short-haul, depends on the attractiveness of the tourism products offered by the industry; . The increased flexibility of holiday and working patterns developing in many countries is likely to accelerate the trend towards late booking and increased demand for easy and efficient services for holiday selection and purchase. Regulation of . The tradition in many countries of regulating working hours is now giving way to more flexible arrangements e.g. the 48 hour working week introduced in the working time and European Union can be averaged over several weeks and many fixed term contract staff take time off for holidays between contracts. Changes in the holidays employment market as a result of such flexible working arrangements reduce the traditional weekend and seasonal peaks of tourism demand. An equally flexible response is therefore required from the tourism industry, to take advantage of opportunities to sell appropriate products more evenly throughout the year. Many of those working flexible hours do not wish to commit themselves far ahead and will be looking for late purchases. Some will be much more short of time than money and will look for products tailored to their requirements, whereas others will be pressed for both time and money and will therefore search for good value and affordable products. Furthermore, pressure of work and job insecurity means that in a more flexible working environment, many individuals will not wish to be away from the work place for long holidays, but rather for a series of short breaks; and, . Over recent years, particularly in the USA and increasingly in Europe, there has been a move towards more flexibility in the range of employment benefits offered. Individuals may have the opportunity to choose for example, more holidays or more pay, or an extra pension contribution. This development is designed to control overall benefit costs while enabling individuals to choose according to their preferences. Life Cycle . Young people and young couples are less affected by leisure time pressures than older people. Many take the opportunity to travel widely before embarking on their careers. The increased flexibility of employment and reduced emphasis on lifetime careers encourages many to continue to take further breaks between periods of work after joining the active working population. These experienced travellers are considered to be an important future market; and, . The needs of the retired population are met by products, many of which reflect their increased leisure time e.g. winter sun destinations and cruises. Source: WTO, 1999
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Section 2: Global Trends in Leisure
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Section 2: Global Trends in Leisure
Table 2.2: Summary of the Impact of Leisure Time on Tourism in Selected Established and Future-Leading Tourism-Generating Countries
Region Travel Types of Holidays Demand for Tourism Products
haul
haul
made
-
related
-
-
related
-
hing
-
regional
Golf
-
tours
inclusive
Beach Skiing
Diving Health
-
Fis Wildlife
Cruises
Cultural
Walking
holidays holidays
Trekking
Extended
Domestic
Self DriveSelf
organized
weekends
Long
City City Tours
Short
Pilgrimage
Winter sun
Tailor Educational
All
Short breaks
Theme parks
Event
Intra
Independently Sports Coach touring
Package tours
Environmental
Special interest
Holiday frequency Holiday Brazil ~ ~ ~ ~ ~ Canada ~ ~ ~ ~ ~ USA ~ ~ ~ ~ ~ Australia ~ ~ ~ ~ China1 ~ ~ ~ ~ ~ ~ Japan ~ ~ ~ ~ The Korean Republic ~ ~ ~ ~ Malaysia ~ ~ ~ ~ ~ ~ Singapore ~ ~ ~ ~ ~ ~ ~ ~ ~ Austria ~ ~ ~ ~ ~ France ~ ~ ~ ~ Germany ~ ~ ~ Italy ~ ~ ~ Netherlands ~ ~ ~ ~ ~ ~ Sweden ~ ~ ~ ~ ~ ~ ~ Switzerland ~ ~ ~ ~ ~ ~ ~ ~ UK ~ ~ ~ ~ South Africa ~ ~ ~ ~ ~ Notes: Increase Decrease ~ No Change Demand for tourism products
1 At present, outbound tourism is at an early stage of development. Developments in government policy on outbound tourism are likely to be more important than changes in leisure time in determining the future rate of growth Source: WTO, 1999
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Section 2: Global Trends in Leisure
3.1 INTRODUCTORY COMMENTS
Mass tourism and the creation of coastal tourism spaces, oriented primarily towards the leisure needs of urban-industrial Europe, are some of the most characteristic social phenomena of modern tourism. Coastal/beach tourism is not a new a phenomenon, but it is a relatively recent one in terms of how it exists in its present form.
Beach tourism has its roots in Europe in the mid-18th century where it developed out of a need for leisure and the perceived healing properties of the sea. At the beginning of the twentieth century the European coast, with its spas and leisure resorts, ceased to be viewed as purely a place of healing, and instead began to be considered a place of fashion and pleasure, primarily designed to satisfy the leisure requirements of the wealthier class.
There is a clear difference between the coastal leisure areas that existed at the beginning of the twentieth century, and the vastly transformed areas that have arisen since World War II. Table 3.1 provides a summary of the various characteristics governing the development of beach tourism both before and after World War II.
Table 3.1: Characteristics Governing the Development of Beach Tourism, Pre- and Post World War II Pre-World War II Post-World War II . Elite tourism . Mass tourism . Spatial structure was characterised by specific . Spatial structure is geographically widespread discrete and clearly defined resorts . Mediterranean destinations . Southern latitude destinations Source: Grant Thornton Kessel Feinstein
The changes in beach tourism over time are summarised in Figure 3.1.
3.2 MODELS OF BEACH TOURISM
The typical development of beach tourism destinations is around two basic models. These may be described as follows:
3.2.1 Model 1: Niche Beach Destinations
Niche beach destinations developed as a result of traditional spa use from the second half of the nineteenth century onwards, and had specific discrete locations as opposed to
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the broad geographical characteristics that typify the mass beach tourism destinations of present day. These centres were greatly influenced by their proximity and accessibility to urban centres, and were usually towns with an elitist clientele (e.g. Nice, San Sebastian, Sorrento). Tourist affluence and consumer power, while it did not attain a level compared to what it is today, was responsible for the creation of the social image of these towns. Tourism identified itself with the summer bathing season and appeared and imposed itself on the traditional urban areas, without becoming a feature in regional planning.
Figure 3.1: Development of Beach Tourism
18th Century Invention of
Beach Tourism
Healing motivations
th 19 Century Development of
Spa Resorts
1st half of 20th Century Places of leisure, fashion and meeting points
Beach Tourism
2nd half of 20th Century Destinations
Massification of
sun and sand
Towards 21st Century New Trends in
Beach Holiday Product diversification New experiences DestinationsEnvironmental sensitivity
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Source: Grant Thornton Kessel Feinstein
3.2.2 Model 2: Mass Beach Destinations
The emergence of mass beach tourism in the 1950s was sparked by transformations taking place within the transport industries as well as the growing custom (and expectation) among the working class of taking paid holidays. By the 1960s the internationalisation of the production of mass trips, together with the rise of sun, sea and sand destinations, directed tourist flows primarily towards the Mediterranean coastline, but also to other destinations such as the Caribbean. From the 1960s onwards the overflow of tourists into beach destinations resulted in a transformation of local societies and economic bases. A linear spatial development of tourism resulted, often with a lack of planning within the greater spatial development plans of the area. After the 1980s, many of these resorts suffered problems due to a decline in demand and were forced to face restructuring processes in the environmental, economic and social arenas.
3.3 FACTORS IMPACTING ON THE DEVELOPMENT OF BEACH TOURISM WORLDWIDE
Although each destination has its own set of unique features and characteristics, which have been responsible for the development of beach tourism, we have identified three generic factors that have been instrumental in its development on a global scale. These include:
. Supply and demand factors; . Tour operators and the packaged holiday; and, . Air charters.
Each of these factors is discussed below.
3.3.1 Supply and Demand Factors
The mass market for overseas holiday taking could not have developed fully without the following enabling supply and demand factors external to the tourism industry:
Supply Factors . Technological developments in transport; . Improvements in telecommunications;
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. Development of central reservations systems; . Creativity of tourism enterprises; and, . Investment in tourism infrastructure development.
Demand Factors . Increases in the standards of living in tourism generating countries; . Increased awareness of destinations; . Lifestyle changes; and, . Demographic changes.
The level of demand for holidays has in turn, been influenced by several encouraging and discouraging factors including: Encouraging factors . Increasing propensity to travel; . Financial windfalls; . Earlier retirement; . Longer holidays; . Quality of lifestyle; . Improved access (airports); . Low cost; and, . Good quality of service and standards.
Discouraging factors . Political turmoil; . Economic depression; and, . Natural disasters.
3.3.2 Tour Operators
Tour operators providing mass-market holidays have based their business on regular programmes of flights to well-known and developed destinations and resorts. The success (from the point of view of the tour operator) has come from maintaining load factors on the travel portion, and through volume buying to negotiate very low rates with the accommodation suppliers they use.
One of the critical success factors in the promotion of packaged holidays and thus the development of mass tourism, especially mass beach tourism, has been the wide public appeal for these holidays and the ease with which they could be obtained through a network of travel agents. Flexibility in terms of the holidays available at various
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destinations and resorts is considered to be another key success factor and is viewed as being one of the key trading strengths of tour operators.
3.3.3 Air Charters
Air transport, more than any other single form of transport has been responsible for the development of modern tourism. In many beach destinations around the world, chartering has assumed a particular significance and has become a major force in the growth of international tourism following World War II2. Today worldwide charter traffic accounts for only 10% of air passengers, but within the European Civil Aviation Conference area, almost half of all journeys by air are on charter flights, thus underlining their significance in the holiday industry and the scale of the industry within Europe. Until the 1970s journeys by air were extremely costly because the smaller, slower aircraft, which operated during this period, were dedicated to business routes and provided the highest possible standards of service and comfort. More importantly, most airlines were government owned and inefficient. In addition, the pricing and standards of service were set by the International Air Transport Association (“IATA”), which resulted in airlines being exclusive, both in their standards and their pricing, until the development of charter services.
As aircraft technology developed, planes became larger and faster. In combination these two factors resulted in a major increase in the number of passengers who could be accommodated, resulting in decreasing airfares. With the introduction of jets, many major airlines sold their suddenly uncompetitive fleets of propeller and turbo-prop aircraft, thus starting a low-cost market for aircraft in good condition. This provided the opportunity for the expansion of charter operations, which in turn, resulted in the explosive development of the inclusive holiday market. However, airlines soon proliferated, and their marketplace became very competitive. Charter operations tended to regard passengers as sources of revenue, and service was kept to a minimum in order to win contracts from tour operators. As holiday taking overseas became a more established feature of many people’s lifestyle, they became less tolerant of poor conditions and service; this resulted in the opening of opportunities for new strategies in charter airline management.
2 In the case of Hawaii for example, charter airlines were the single major force in the development of the country’s tourism industry. They were the magic ingredient that converted the Hawaiian market from a limited market for the wealthy, to a mass market of middle income and low income families. A 1970 cost-benefit analysis undertaken by a Princeton University group found that for every 10% reduction in airfares (at that time) there was a 13% increase in the number of visitors to Hawaii, a 9% increase in the hotel occupancies, and a 3% rise in the average length of stay.
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Table 3.2 provides a summary of the difference between scheduled and charter passenger markets and highlights the importance of their contribution to different segments of the market.
Table 3.2: Differences between Scheduled and Charter Passenger Markets
Factor Scheduled Charter Purpose of travel Business, family, leisure Leisure, VFR Key advantage to passenger Frequent, Low cost, sold as part of a Pre-booking not required package, weekly Key disadvantage Expense Pre-booking, limited departures Who pays fare Company, passenger Passenger Motivation for purchase Need to travel Desire to travel Travel party Individual or family Couples, families, groups, friends Season of travel According to need School holidays, summer, winter, weekends Source: Grant Thornton Kessel Feinstein
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4.1 INTRODUCTORY COMMENTS
The case studies selected in this section concentrate primarily on the national and regional development of tourism, and on beach tourism specifically, where such information is available. The underlying aim of this section is to identify those elements that are common to the experiences of all or most beach destinations, and those that are unique in some way.
Our discussion of beach tourism in each of the selected countries is centered around what is available in the literature, from national tourism organizations and boards, and from other sources. In terms of the availability/lack of tourism statistics, we have experienced the following general problems:
. Tourists may stay in any one of a number of forms of accommodation ranging from hotels, through boarding houses, holiday resorts and camping sites, to rooms let in private dwellings. Statistical data tends to be more reliable for hotels and large camping sites, and least reliable for the myriad of privately let rooms and small camping sites which are found in most countries; . Each national tourist organization may record different types of information. For example, duration of stay, mode of travel, expenditure, socio-economic group and the number of accompanying persons are all important aspects of tourism, but these are not recorded in all tourism statistical sources; . There are different ways of calculating the total number of tourists to an area or country. While international borders may seem the most reliable sources (for foreign tourists), relaxation of passport controls, especially within Europe, have seriously undermined the value of such data; . Statistics on the economic aspects of tourism are even more problematic. Tourist expenditure can be estimated from social surveys, however, the information emanating from these surveys is often unreliable since they are often incomplete and under-record certain pre-paid items e.g. transport. There is also poor availability of data on most tourism-related sectors other than accommodation and catering in most countries. Therefore, unless special tourism expenditure surveys have been undertaken, estimates of the real importance of tourism to a national or regional economy can only be crude approximations; and, . In certain countries, such as Portugal, research literature on tourism is poorly represented in the English language (the same is true for the marketing strategy of Portugal). Except for some case studies of rural change in the Algarve, which touch
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upon Portuguese tourism, the industry has been virtually ignored by researchers outside Portugal. Even within the country, there are few substantive published studies, and several features of Portuguese tourism require further investigation (particularly the economic importance of the industry, spatial distribution of tourism and policies directing the development of tourism).
While each case study has been written so as to take into account the particular characteristics of tourism in each destination, certain themes recur. The most important of these are changes in tourism demand (international, by reason, by season, etc.); the spatial distribution of tourism; changes in the accommodation sector; and changes in the organization of the tourism industry and its responses to changes in demand through the instigation of various policies and pieces of legislation.
A summary of the general characteristics and general policies guiding the development of beach tourism is provided in Section 5.
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Insert Spain cover page
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4.2.1 FEATURES OF THE SPANISH TOURISM INDUSTRY
4.2.1.1 Size and Market Share
Two countries namely the UK and Germany together contributed just over 48% of Spain’s foreign tourists in 1998 (refer to Table 4.1). While the UK has shown continuous growth, the share of the German market is declining. Nevertheless, tourists from these countries is a good base for Spain’s tourism industry as they are characteristically high spenders compared to other Europeans, they are also more likely to participate in inland and quality tours (e.g. culture, golf, hunting etc.). In contrast, the “average” profile of other European tourists to Spain is more modest. They visit Spain during the peak holiday period, and generate relatively low spending, compared to the world average.
Table 4.1: Tourist Arrivals in Hotels in Spain by Top 10 Markets, 1996-1998
Origin Markets Number of Arrivals % Change 1996 1997 1998 97/96 98/97 UK 3 416 612 3 775 467 4 460 116 10,5% 18,1% Germany 4 198 942 4 151 981 4 457 412 -1,1% 7,4% France 1 777 006 1 812 493 1 932 851 2,0% 6,6% Italy 1 007 161 1 205 101 1 334 949 11,9% 10,8% USA 914 506 1 013 907 1 206 721 10,9% 19,0% Belgium 671 104 728 320 798 769 8,5% 9,7% Netherlands 614 830 656 172 736 812 6,7% 12,3% Japan 616 556 693 823 712 899 12,5% 2,7% Portugal 467 038 534 322 613 773 14,4% 14,9% Switzerland 387 505 397 142 356 929 2,5% -10,1% Total Other Markets 4 537 192 3 281 010 3 606 254 -38,3% 1,1% TOTAL 17 008 452 18 249 738 20 217 485 7,3% 10,8% Source: WTO, 2000
4.2.1.2 Gateways to Spain
Given that much of the information pertaining to airports, airlines and air frequencies is Spanish, we are unable to provide any detailed information. Spain has three international airports in Barcelona, Madrid and Malaga. Spain also has around 39 national airports, which are scattered, throughout the autonomous regions.
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4.2.2 DEVELOPMENT OF TOURISM IN SPAIN
4.2.2.1 Tourist Arrivals
The large-scale, rapid expansion of tourism supply and demand dates from about 1950 (refer to Figure 4.1). The number of international visitor arrivals increased exponentially throughout the 1950s, and reached explosive dimensions after the 1960s (at a time when no serious competitors had yet emerged). Fluctuations in arrival figures began to occur in 1965 as a result of increases in the cost of living in Spain over the period 1962 to 1973, which in turn, resulted in an increase in the prices paid by tourists for basic necessities. During the early 1970s, Spanish tourism suffered the consequences of the worldwide economic crisis. Growth recovered thereafter but increases in hotel prices caused a further recession in 1979. Probably one of the most important reasons for the decline in the industry during the 1970s was the decline in competitiveness of Spanish tourist packages (compared to direct competitors such as Tunisia, the former Yugoslavia and Turkey) as well as the negative impacts of tourism on the environment and landscape.
Growth stability was regained and maintained throughout the 1980s until 1989. By then, however, the upward trend in visitor numbers was not matched by increased income from foreign currency receipts.
Spain experienced a slow increase in the growth of tourist arrivals in the 1990s, which has been brought about through increasing awareness of the negative environmental impacts of beach tourism as well as increased leisure trends by tourists to visit more exotic destinations.
4.2.2.2 Spatial Distribution of Tourism
Tour operators are largely responsible for the geographical concentration of tourism supply and demand in Spain. The coastal regions and the Spanish archipelagos (Balearic and Canary Islands) offer a very attractive environment to northern European tourists (a dry and sunny climate, picturesque landscapes and inexpensive meals). Various promotional campaigns, emphasising the bright and pleasant climatic conditions of the Spanish coastline have contributed to this image. This image is also stressed in the official slogans of Spanish tourism (e.g. “Everything under the Sun”), while commercial names with climatic connotations (e.g. Costa del Sol) are given to many seaside resorts. Figure 4.2 indicates the geographical concentration of Spanish beach destinations. Although Figure 4.2 is slightly out of date, the geographical concentration has not changed much over the years.
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Figure 4.1: Tourist Arrivals to Spain, 1950-1998
1995
1992
1989
1986
1983
1980
1977
1974
1971
1968
1965
1962
1959
1956
1953
1950 0 10000 20000 30000 40000 50000 60000
Visitor Arrivals ('000)
Source: Ministerio de Información y Turismo (various years), WTO (years 1994-1998)
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Figure 4.2: Geographical Concentration of Spanish Beach Destinations
Source: Valenzuela, 1991
Efforts to break the dominance of tourism in the regions with the most sunshine were not very successful in the 1980s, as was evident in surveys of the motivations of foreign tourists in Spain. In 1985 for example, 82% of tourists indicated that their main reason for coming to Spain on holiday was to enjoy the climate. Although some variances in terms of motivation for coming to Spain according to country of origin was concerned, climate was the most important reason for the British and Germans, and least important for Italians.
The regional distribution of tourists is far from homogenous, as is evident for hotels at the level of the autonomous regions (provinces) in 1985. Figure 4.3 provides a spatial indication of the autonomous regions and Figure 4.4 provides a breakdown of the number of foreign and domestic visitors in hotels in each region. As before, although the latter is somewhat outdated, the trend in concentration of hotel nights taken by foreigners in the coastal regions (compared to the interior regions) has not changed significantly over the years.
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Figure 4.3: The Autonomous Regions of Spain
Source: Valenzuela, 1991
Figure 4.4: Number of Domestic and Foreign Visitors in Hotels in Spain, 1985
Notes:
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Autonomous regions correspond to those in Figure 4.3 above Source: Valenzuela, 1991 4.2.2.3 Spatial Distribution of Tourist Accommodation
The spatial distribution of tourism demand in Spain and the changes, which have occurred over time, are indicated in Figure 4.5. The data are for nights spent in hotels and guesthouse accommodation and therefore take into account the length of stay in each region. Although data for the nights which tourists spent in flats and villas are unavailable, it is likely that they are distributed in approximate accordance with the nights spent in registered accommodation.
The standard of hotel and guesthouse provision in the different tourist regions has varied over time. Whereas the number of hotels and guesthouses in Table 4.2 increased by 15% between 1970 and 1990, bedspaces increased by 70%. By 1990 5-star hotels were fairly evenly distributed between Madrid, the south coast and the islands, with 28%, 31% and 26% of the total respectively. 3- And 4-star hotels were concentrated in the islands, followed by the south coast, the interior and Madrid. 1- And 2-star hotels and guesthouses predominated on the south coast, followed by the islands. The standard of accommodation has generally risen over time. Between 1970 and 1990, the proportion of bedspaces in 4- and 5-star hotels increased from 28% to 45% in Madrid, from 8% to 13% on the south coast, from 12% to 16% in the islands, from 15% to 16% on the north coast and from 12% to 14% in the interior.
Figure 4.5: Nights Spent in Hotels, Guesthouses and Campsites in Various Tourist Regions in Spain, 1966-1990
60000
50000
40000 Madrid Med/Atlantic 30000 Islands North 20000 Interior 10000
Number of Numberof Bednights('000)
0 1966 1970 1975 1980 1985 1990
Source: Gomez & Sinclair, 1995
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Table 4.2: Number of Hotels by Star-Grading in Spain in 1970 and 1990
Madrid Med/Atlantic Islands North Interior Total 5-star 1970 11 25 16 2 7 61 1990 13 27 17 8 7 72 4-star 1970 26 66 72 24 37 225 1990 39 137 119 36 67 398 3-star 1970 40 513 263 52 90 733 1990 52 263 443 109 212 1328 1 & 2-star 1970 55 1002 533 144 313 1972 1990 39 533 468 347 572 2428 Source: Gomez & Sinclair, 1995
The different forms of tourist accommodation available in Spain show clearly differentiated distribution patterns. Self-catering and hotel accommodation for short-term visitors is concentrated in a relatively small number of resorts, where high-density land occupation is often combined with high-rise building forms. The notable examples of the latter can be found in Benidorm (with over 200 000 beds), Torremolinos, Salou, Lloret de Mar and Calvia, all of which can accommodate around 100 000 visitors each. Campsites on the other hand, occupy land adjoining long, unspoilt beaches, or alternatively, slopes leading down to unexploited coves. Second homes show a tendency towards being more widespread, extending the limits of existing coastal settlements and occupy formerly uninhabited beaches and coves, as well as wooden and even barren hill-slopes, from the coast is relatively easily accessed. The spatial impact of the low-density second homes in tourism is much greater than that of hotels in most areas.
4.2.2.4 Development of Tourist Accommodation
Accommodation was initially in the form of hotels – generally small, family-run enterprises. During the early 1960s, small apartments for short-term renting were introduced, but rapidly rising building costs soon made them an unprofitable investment. Campsites, mainly located on formerly deserted beaches, spread southward along the Mediterranean coast from the French border once the construction of the coastal highway began in 1974.
After 1970, the second home market increased rapidly, partly stimulated by foreign demand, but mainly in response to the demand from an increasingly prosperous and numerically growing middle class in the major Spanish cities. The type of construction was clearly influenced by consumer tastes and buying power. Spaniards preferred large individually designed detached residences (on part of the Girona coast) or low-density, low-rise apartment blocks (on the Tarragona coast), whereas foreigners tended to show a
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preference for small detached residences and terrace housing in condominiums (on the Valencia and Alicente coasts) or built homes to resemble “typical” villages, often dotted around golf courses (on the Malaga coast). One indicator of the hectic round of foreign purchasing in the 1980s was the emergence of new types of property acquisition such as ‘lease-back’ and timesharing.
More recently, there has been an increase in the diversification of accommodation and tourist facilities in the form of special interest resorts (mainly with a recreational element, golf facilities and marinas) along the Malaga coastline, as well as parts of Catalonia.
Figure 4.6 provides a summary of the development of various forms of accommodation in Spain and their approximate timescales.
Figure 4.6: Summary of the Development of Tourist Accommodation in Spain, 1950-2000
1950
1960
1970
1980
1990
2000
Hotels Apartment Small Aprts. Campsites Second Special Hotels to rent Homes interest resorts
Source: Grant Thornton Kessel Feinstein
4.2.2.5 Diversification of the Tourism Product
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Historically, the first measure to encourage inland travel (in an attempt to disperse the concentration of tourists away from the coast) was the construction of state-owned hotels. This policy dates back to the 1920s but was intensified in the 1960s. Although this policy made a contribution in terms of encouraging inland travel, it lacked clear objectives and criteria. It was also difficult to achieve due to powerful competition from the seaside resorts. Several examples of means of diversifying the tourism products are presented below:
. The central government was highly involved in the promotion of winter tourism and provided subsidies for tourist enterprises and for infrastructural improvements in those skiing resorts which had the greatest potential for attracting foreigners (e.g. the Pyrenees and the Sierra Nevada), or those most frequented by visitors from large cities. A number of ski resorts sprung up in the 1960s as a result of official aid, however, with very little consideration for ecological and environmental consequences. Nevertheless, the ski resorts do provide facilities which are complementary to beach tourism. At the regional level, skiing is particularly important in Andalusia, the Sierra Nevada and Catalonia;
. The interior of Spain offers high-quality tourism and a variety of attractions. The Spanish administration has recognised this and has used this as a base for developing alternative activities and generating new tourist flows. In the 1980s and 1990s the promotion of inland tourism was a preoccupation at all levels of public administration (local, regional and state) but was difficult to achieve initially;
. Each autonomous region has emphasised the promotion of ‘green’ and nature tourism through the expansion of national parks and reserves and by marketing new tourist products (e.g. hiking trails, horseriding, boating, etc.);
. In south and central Spain, consideration has been given to the promotion of tourism related to game hunting. The development of this tourism product has been considered as an option, particularly in many economically depressed and virtually unpopulated areas of the interior;
. The development of rural tourism was considered in the late 1980s and early 1990s. It was envisaged that rural tourism could lead to either the rehabilitation of country houses and hamlets or to the building of new residential facilities;
. Cultural and historic-artistic attractions have drawn many tourists to the historic cities in the interior of the country which are within easy reach of the coastal tourist centres
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(e.g. Grenada and Toledo) or areas situated along the main routes (e.g. Burgos and Trujillo). Historic and almost forgotten routes are also being opened up, with the aim of generating tourist itineraries – by car or on foot; . The provision of select sports facilities has been particularly important in attracting middle and high-income tourism. The 1990s saw a move towards linking golf courses to luxury hotels (e.g. Parador del Golf) or to large residential tourism developments (such as Nueva Andalucia in Malaga). Similarly, marinas have been a decisive promotional attraction in many residential complexes, sometimes incorporating traditional Mediterranean architecture. The supply of diversified and select sporting opportunities (regattas, polo, fishing, etc.) has played a key role in shaping tourist flows and in improving quality in certain areas; and,
. Thalasotheraphy has also been used as a means to diversify the tourism product. In Spain, thalasotheraphy has been practiced since the late nineteenth century at a number of coastal resorts. Although it is generally only the wealthiest tourists which have access to such specialised luxury facilities, such as those at the Biblos Hotel (Mijias), it is expected that there will probably be a greater demand for thalasotheraphy in the future as the European population ages and niche tourism continues to increase.
All in all, whilst the interior offers many rich and stimulating attractions, it remains to be seen whether it can compete with the attractions along the coastal areas.
4.2.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN SPAIN
Three agents have played a major role in shaping Spain’s tourism industry. These include:
. National and autonomous governments; . Municipal authorities; and, . Private investors.
The role of each agent in the development of tourism in Spain is discussed below.
4.2.3.1 National and Autonomous Governments
The development of tourism in Spain at a national and autonomous level can be broken down into two time-frames, with the first coinciding with the period of the dictatorship of
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General Franco, which lasted until his death in 1975; and the second, with the period of democratic government, which started in 1975 and continued to present day under the new Constitution.
1962-1975
Under the dictatorship of General Franco, the creation, in 1962, of a Subsecretariat of Tourism within the Spanish Ministry of Finance marked the official recognition of a regulated tourism policy. Thereafter, tourism became one of the most regulated sectors in the Spanish economy. The following provides a list of measures through which the government exerted control:
. Accommodation price authorization; . Credit and loans; . Provision of tourist accommodation; . Development of infrastructure; and, . Promotional campaigns.
Each of these controls is briefly discussed below.
Accommodation price authorisation
Although both the maximum and minimum prices for accommodation were fixed by the government, only the maximum prices established were, in fact, of significance, since they were kept low in an attempt to ensure that they were internationally competitive. Control was excessive, because annual price increases were lower than the rate of inflation. The underlying objective, in line with the tourism policy, was to achieve maximum numerical growth at any expense. This policy had far-reaching effects on the tourism product because it eventually led to the loss of economic viability of international tourism. By as early as 1971 it was clear that the costs of services consumed by tourists were no longer compensated by the foreign exchange that they brought in. Low prices tended to attract tourists with limited buying power, which was reflected in the low average spend per tourist.
Credits and Loans
Financial support of the tourism sector was generally lacking during this period. Measures typical of export sectors, such as tax rebates, export allowances and risk compensation were not applied to tourism. Loans such as the Crédito Turístico, which
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were made available to the sector, were done so at comparably unfavourable interest rates, however, only 15-35% of all requests for tourist loans were granted annually, and these only partially covered the cost of any single investment. By 1973, Crédito Turístico constituted only 6% of all governmental loans in Spain. This is possibly the reason why a large number of hotel companies fell under foreign control. Provision of Tourist Accommodation
The agencies responsible for government investment in tourist accommodation were the Instituto Nacional de la Industria (“INI”) and Administración Turística Española (“ATE”). ATE was largely responsible for establishing and managing a network of hotels (albergues and paradores nacionales) aimed at opening up new areas to tourism. These hotels were normally of a high quality and often occupied historically valued buildings. By 1971 there were 82 albergues and paradores nacionales, and although most of them were running at a loss, a further 32 were planned for the period 1972-1975.
The influence of the INI on the tourism sector was the greatest within the transport subsector. In 1954, the country’s airline company - Aviaco3 became part of the INI, and a sister company of Iberia (the national airline) in 1959. The INI also established a road transport company.
Development of Infrastructure
Government action in this area focused on two aspects: (1) on the definition of necessary infrastructures associated with tourist accommodation, and (2) on investment in social capital. These measures, however, came at a late stage of development, when the foundations of the tourist product were already in place. It was not in fact, until 1970 that minimum infrastructure requirements were established, consisting of basic necessities such as the provision of drinking water, electricity, road access, parking facilities, and the treatment and disposal of liquid and solid waste.
Promotional Campaigns
Government investment in promoting the tourism product was very limited during this period. For example in 1974 a total of 400 million pesetas (0,2% of foreign exchange earned through tourism) were allocated to promotional campaigns. Most campaigns reinforced the image of the summer sun, sea and sand attraction and the predominance
3 Aviaco’s activities focused mainly on regular passenger flights and freight services, and although it was the first charter company to exist in Spain, it was only after 1971 that it developed charter flights on any scale, by which time companies from tourist-generating countries had already captured a large share of the market.
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of tourism in certain large coastal resorts. As a consequence, these promotional campaigns did not help in counteracting the problems of high seasonality and high geographical concentration.
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1975 - Present Day
The change in the political system in Spain after Franco’s death brought a change in tourism policy. During the first years of democratic government, however, the main priority was the establishment of the constitutional basis of the system. The new Constitution was introduced in 1978, under which regional autonomous governments were set up, and many of the responsibilities of the former control government in terms of tourism policy were transferred to them.
It must be remembered, however, that the foundations and main characteristics of Spanish tourism were laid down during the Franco era - many of these characteristics were difficult to change, and several major defects were inherited (including the division of tourism services and supporting infrastructure among different sectors of the economy, as well as the poor administration and cooperation between policies making them less coherent and effective). Coordination between privately and publicly financed services was also lacking. Planning was also uncoordinated and thus uncontrolled.
Each new autonomous government has defined its own objectives and policies. Certainly the governments in the major tourist regions have been active in recognizing tourism as an important sector of the local economy, and have thus corrected the previous lack of coordination. In general, as a first rule, they have produced White Papers on Tourism, and have reorganized tourism administration in an attempt to coordinate the different elements that together make up the tourism industry. They have also recognized the need for public investment and planning, and for legislation governing the regulation of tourist supply (in order to improve and safeguard the environment), for the spatial, temporal and typological diversification of tourism, and for staff training. Each region hopes to create its own tourist image and promote its own differentiated product.
4.2.3.2 Municipal Authorities
1962-1975
Municipal tourism policies can only be understood within the context (or lack of it) of national tourism policies and legislation. The absence of adequate legislation during the Franco era meant that the quantity, quality and design of tourism facilities were largely uncontrolled. Serious spatial planning was also lacking. Urban development plans, which did exist during the Franco era, were seldom seriously implemented.
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1975 –Present Day
New urban plans, updating previous ones, were drawn up in the early 1980s. Today, municipalities have full control of urban planning, the designation of natural conservation areas and the granting of building permits.
4.2.3.3 Private Investors
In the early stages of tourism development, most of the investment in tourism was made by locals – mainly fishermen and farmers – in the form of piecemeal modifications to existing property. Very soon afterwards, outside investors moved in. Several factors were responsible for making investment attractive to investors. These included:
. Relaxed building restrictions (in terms of quality and density) which stimulated construction in certain resorts; . The inertia of the already existing tourism product i.e. the ability to be competitive; and, . Foreseeable profits based on leveraging a successful tourism base.
4.2.4 REJUVENATION OF THE TOURISM INDUSTRY
Figure 4.1 indicates that the tourism industry in Spain is experienced a decline from the late 1980s to mid-1990s through a loss of competitiveness, as well as aesthetic and environmental degradation. This decline is possibly reversing in recent years. The signs of decline in the 1980s and 1990s were such that the State has become involved in restructuring strategies, especially through its Plan Marco de Competitivdad del Turismo Espaňol (“FUTURES”). It is also coordinating its programmes with regional actions (in the case of Andalusia, for example, with the Plan DIA), and with municipal policies that play an essential role in the shaping of tourist resorts.
Within the context of the Plan FUTURES, a Pilot Plan of Recuperation for Tourist Areas (“PPRTA”) is currently being undertaken. The main objective of the PPRTA is to maintain a leading position in the tourist market for sea and sun holidays, by improving the quality of tourism infrastructures and adapting them to meet new market demands. Along these lines, and as an example of coordination between public administrations and the private sector, there have been attempts to redesign and improve the urban setting of coastal areas and to preserve the environment whilst simultaneously respecting the aims of private businesses. The coordination of public and private actions is ensured by the
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creation of a consortium consisting of the State, autonomous regions and local administrations, as well as the private sector.
Other municipalities in the Spanish Mediterranean have undertaken restructuring of the tourist product by means of quality-oriented urban initiatives (e.g. Calviá in Majorca, and Sitges on the Costa Dorada). In other areas (e.g. Benidorm) the restructuring has been based more on business strategies and commercialisation which, starting from an analysis of the aesthetics and service provision, have been able to secure their competitive positions in the sun and sea market, with prospects for further success.
4.2.5 TOURISM MARKETING
The Secretaría General de Turismo (“SGT”), through the Instituto de Promocion del Turismo de Espana (TURESPAŇA), is responsible for the promotion of Spain abroad. One of its major activities is to participate in the increasingly important tourism fairs held abroad (particularly in western Europe), such as the World Travel Market and International Trade Fair.
The body responsible for tourism promotion in the 1980s (in response to the decline in visitors arrivals to the country during this period) made attempts and serious efforts to improve the foreign image of Spanish tourism, by playing down the traditional sun and sea products and stressing the attractions and quality of inland Spain, with its wide range of natural environments and cultural centres. One example of the vigorous promotion of Spanish cultures was the “Everything under the Sun” campaign launched in 1985. The launch was accompanied by an ambitious exhibition of Spanish art. This was followed in 1989 by the more short-lived variant “Everything New under the Sun”.
In recent years a great deal of investment has been directed towards marketing Spain abroad, and the campaign launched in 1992 under the slogan “Passion for Life”, aimed to reach a wide variety of specialist customers abroad (e.g. golfers, skiers, walkers, nature conservationists and art enthusiasts), as well as the more ‘general’ tourists from a wider range of age-groups. The campaign was partially successful in addressing one of the endemic problems of Spanish (and indeed Mediterranean) tourism, namely seasonality.
In its attempt to widen the international appeal of Spanish tourism, TURESPAŇA is buying space in foreign-language magazines and journals including the widely circulated English-language journals such as Newsweek and Time.
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INSERT PORTUGAL COVER PAGE
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4.3.1 FEATURES OF THE PORTUGUESE TOURISM INDUSTRY
4.3.1.1 Size and Market Share
Compared to Spain, the number of tourist arrivals in Portugal is relatively small, but is increasing (refer to Table 4.3). The positive growth in tourist arrivals may be attributed to economic trends that are favourable to the tourism product and the mounting ecological sensitivity of the tourism consumers who generally view Portugal as being a more “environmentally-conscious” tourist destination compared to other countries, particularly Spain. This is not to say that the increase in tourist arrivals in Portugal is attributed to the increasing number of tourists substituting Portugal for Spain as a holiday destination – the significantly higher number of tourist arrivals in Spain (provided in Figure 4.1) is testament to the fact that Spain is, and will continue to be, a traditional holiday destination for a large number of tourists.
Three countries namely Spain4, the UK and Germany account for around 50% of all tourist arrivals to Portugal. While the market shares of the UK and Germany are showing signs of decline, the Spanish market is growing. The Scandinavian countries in particular are showing rapid growth in terms of visitor arrivals to Portugal.
Table 4.3: Tourist Arrivals in Hotels in Portugal by Top 10 Markets
Origin Markets Number of Arrivals % Change 1996 1997 1998* 97/96 98/97 Spain 681 864 730 933 999 900 7,2% 36,8% UK 732 335 809 185 865 000 10,5% 6,9% Germany 890 724 856 942 837 200 -3,8% -2,3% France 469 803 451 723 552 500 -3,8% 22,3% Italy 300 191 315 873 342 400 5,2% 8,4% Netherlands 257 790 286 511 310 300 11,4% 8,3% USA 201 790 227 863 261 100 12,9% 14,6% Belgium 132 720 134 700 176 200 1,5% 30,8% Sweden 78 620 93 356 106 700 18,6% 14,4% Japan 71 659 79 921 102 700 11,5% 28,5% Total Other Markets 749 209 811 349 897 100 7,6% 10,5% TOTAL 4 566 705 4 798 356 5 451 100 5,1% 13,6% Notes:
4 Several sources indicate that a significantly large proportion of the Spanish market are cross-border arrivals, but which stay for at least one night in Portugal.
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* WTO estimate Source: WTO, 2000
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4.3.2 DEVELOPMENT OF TOURISM IN PORTUGAL
4.3.2.1 Tourist Arrivals
The first significant development of tourism in Portugal was based around the thermal spas of the interior, such as Vizela, Vidago, Curia and Luso. These became popular with both foreign visitors and the emerging domestic Portuguese middle class after the mid- nineteenth century. Even by the early twentieth century beach tourism was not yet developed, and was mostly limited to day visits from large urban centers, such as Oporto, Coimbra and Lisbon to nearby beaches at Foz do Douro, Figueira de Foz and Belem, respectively. In 1933, the Algarve was virtually undeveloped; and even the best-known resort at that time, Praia da Rocha, had only one inn and a few boarding houses, which were frequented exclusively by wealthy families from Lisbon and the Alentejo. Portuguese tourism remained heavily reliant on the domestic market in the 1930s and 1940s, and there were only around 36 000 foreign visitors each year.
During the 1950s the number of foreign tourists increased from 70 700 in 1950 to 353 000 by 1960, and between 1955 and 1963 alone foreign exchange receipts quadrupled. The most significant phase in the expansion of Portugal’s international tourism industry was the period between 1963 and 1974, when its growth exceeded the average for the Organisation for Economic Corporation and Development (“OCED”) countries. Portugal benefited from the general expansion of demand for tourism in Western Europe, combined with falling costs – especially as a result of the growth of packaged holidays. Expansion was brought to a halt by the 1973 devaluation of the US dollar, a rise in transport costs and the recession that followed the 1973-1974 oil crisis. While all European tourist destinations suffered from these events, Portugal probably suffered the most because of the much-publicized political uncertainty that followed the 1974 military coup. In 1973 there were over 4 million foreign visitors to Portugal, a number that was not reached again until 1977.
The international tourism market is highly segmented. In the first instance there is a fundamental division between excursionists5 and tourists. In 1987 excursionists outnumbered tourists 10,1 million to 6,1 million. The bulk of excursionists (approximately 75%) were from Spain. Historically, this balance has been variable and in 1973 for example, tourists out numbered excursionists 1½ times. Much of the growth in excursionism in the 1980s can be attributed to rising real incomes in Spain, a more
5 Excursionists are defined as visitors who do not spend the night in a collective or private accommodation establishment in the place visited.
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relaxed political relationship between the Iberian neighbours, and price differentials for some commodities, which led to considerable cross-border movements for shopping purposes.
While excursionists usually outnumber tourists to Portugal, the latter are clearly more important in economic terms. Between 1940 and 1984, the total number of nights spent by foreign tourists in Portugal increased from 500 000 to 36 million. Overtime, the composition of the international tourist trade has changed significantly, with the dominant feature being the expanding share of the UK in the Portuguese market, which between 1960 and 1988 increased from 22% to 35%. This was matched by a decline in the relative importance of US tourists (as in many other European countries during the same period) and French tourists. Tourists from Germany and the Netherlands increased considerably in number in the 1960s and 1970s before levelling off in the 1980s. Tourists from Scandinavian countries have become more important as a source market for Portugal in the 1990s.
4.3.2.2 Development of Tourist Accommodation
The nature of the tourist accommodation industry has changed over the years, with a shift to more luxurious hotels and away from boarding houses. Together with the expansion of second homes, apartments, motels, tourist villages and camping sites, this led to considerable changes in the types of accommodation being provided in response to growing market segmentation. Over the period 1965 to 1985 for example, there was a 35% expansion in the number of hotels, most of which occurred in higher-quality hotels (i.e. 3-, 4- and 5-star hotels). The increase in high-quality hotel accommodation was complimented by increases in other forms of accommodation, including tourist apartments, motels and state-owned inns. These developments are firmly associated with the shift to beach tourism and to the rapid expansion of the Algarve. In the mid- 1980s only around 13% of boarding houses were located in coastal regions, compared with 45% and 57% of 4 and 5-star hotels respectively, and 57% of hotel apartments. In addition, there were also developments in other forms of tourist accommodation, including an increase in the number of camping sites and of second homes. Timesharing also became popular in the mid-1980s, especially in the Algarve, as well as the development of turismo de habitacão, based on short stays in historic houses in northern and central Portugal. The 1990s has witnessed an increase in the number of specialist tourism resorts mainly associated with golf and other recreational elements.
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4.3.2.3 Spatial Distribution of Tourism
Between 1974 and 1988 the main feature of the regional growth of tourism was its concentration in three main centres namely: the Algarve, Lisbon and Madeira. The number of foreign bednights spent in the Algarve quadrupled to just over 7 million during the period 1974 to 1988, while the numbers in Lisbon and Madeira increased by almost 1 million during the same period. Most of this expansion occurred during the 1970s and visitor numbers were relatively static in the early 1980s, but have subsequently increased throughout the 1990s.
The three main regional markets have developed their own set of characteristics. These characteristics are briefly summarized below.
Lisbon
Lisbon has the largest stock of accommodation (approximately 25% of the total in Portugal), but is distinctively upmarket6. Given its role as the administrative and economic capital of Portugal, it attracts a large number of foreign tourists that are either on business or take short cultural tours of the city.
Algarve
The Algarve is the second largest tourism region in Portugal with around 20% of all bedspaces in the country. The Algarve has a relatively broad spectrum of accommodation types, including both camping sites and luxury hotels. The Algarve is the primary attraction for foreign visitors to Portugal and in 1988, this region accounted for 33% of all foreign visitors to the country. The majority of foreign visitors to the Algarve came on packaged holidays and stayed for an average of 7 days. Given the relatively mild winter climate of this region, it attracts visitors throughout the year, and thus achieves comparably high average annual occupancy levels. The Algarve attracts a more upmarket segment of the tourism industry compared to other Mediterranean countries. From the very beginning there has been considerable emphasis on the development of upmarket facilities including golf courses, tennis centres and riding centres. Vale do Lobo typifies such developments, with a championship golf course, the Roger Taylor Tennis Centre, a selection of swimming pools, and 700 villas.
6 Lisbon accounts for 43% of all 5-star hotel accommodation in Portugal
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Madeira
The island of Madeira represents the elite end of the Portuguese tourism market. While it only accounts for around 10% of all bedspaces available in Portugal, these are concentrated in the upper brackets with around 25% being of a 5-star standard, and very few lower market forms of accommodation. The island’s major market is foreign visitors and, given the high costs of flying to the island, average stays are relatively long – around 9,2 days. Given the equable year-round climate the island attracts large numbers of tourists throughout the year. The industry was relatively static in the late 1970s and 1980s with little new investment until the decision by North American interests to build the US$35 million Meridian-Madeira hotel.
Rest of Portugal
The rest of Portugal has a comparably small-scale tourism industry, with domestic visitors largely out-numbering foreign ones. The coastal distritos of central and northern Portugal, such as Averio, Coimbra, Leiria, Setubal and Viana do Castelo, stand out as popular summer resorts for the domestic market, and this is reflected in their relatively large share of camping sites. These coastal resorts mainly serve their immediate hinterland, and over 50% of Portuguese tourists take their holidays in either their distrito of residence or in an adjacent distrito.
4.3.2.4 The Role of Investment in Developing Portugal’s Tourism Industry
While the Portuguese tourist industry is now firmly based on foreign tourists, direct foreign investment has played a relatively insignificant role in developing tourist facilities. Over time the role of foreign investment in tourism has diminished and there was a particularly sharp reduction in foreign investment in 1975, following the 1974 military coup. The pattern of low levels of foreign investment changed in the mid-1980s with a flood of foreign investment in the Algarve. Major investors in this region in the 1980s included Shell Oil, which spent around £6,6 million on building a 700-bed holiday village as an extension to the Vilar do Golf complex, and the UK Elliot Property and Leisure Group which built a waterpark at Porche, several golf courses and a marina in Vilamoura, near Faro. Hotels and similar accommodation establishments in Portugal were (and still are) not particularly attractive to foreign investors who, in the early 1990s for example, accounted for only 13% of the total investment in this sector.
While foreign investment was static in the late 1970s, domestic investment in tourism was high and recovered from a low point in 1977, and increased by around 300% per annum
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until the late 1980s. Domestic investment involved both personal capital, and credit from banks and other financial institutions. Some of the major investments in tourism were from industrial companies who were seeking to diversify their activities
4.3.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN PORTUGAL
The transformation of the Portuguese tourist industry has been accompanied by major shifts in the priority attached to it in government policy. In 1952, tourism was not high on the agenda of government concerns. Within a decade or so this had changed radically, as was evident in the emphasis given to tourism development in the Intermediate Development Plan and the Fourth Development Plan in the late 1960s and early 1970s respectively. In accordance with these plans, greatest priority was given to attracting foreign tourists and to developing up-market tourism, and credit was made available to build the hotels that could facilitate such development.
Over time, a comprehensive organization was created within the Secretaria de Estado do Turismo to develop Portugal’s tourist industry. During the early 1990s, the Secretaria de Estado do Turismo comprised of five divisions namely:
. Direçcao General do Turismo – which was responsible for international relations, for tourist information and with administrating the supply side of the industry (e.g. the issuing of licenses to hotels); . ENATUR – a public enterprise responsible for, amongst others, managing various forms of tourist accommodation within the industry; . Fundo do Turismo – responsible for financial assistance; . Instituto Nacional de Fromoçao Professional – responsible for professional training; and, . Instituto de Promoçao Turística (established in 1987) – responsible for promotion abroad as well as financial assistance to the industry.
In the late 1980s, a reassessment of the tourism policy to attract foreign tourists took place. The Plano Nacional de Turismo 1986-1989 set out four main objectives for the industry, including:
1. To increase tourism so as to contribute to the balance of payments by: a. Increasing external receipts; b. Increasing earnings; and, c. Increasing foreign investment.
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2. To contribute to regional development by: a. Creating priority zones for tourist development; b. Developing spa towns; and c. Implementing measures that favour regional development.
3. To contribute to the quality of life in Portugal by: a. Increasing domestic tourism; b. Increasing agritourism; and, c. Supporting social tourism.
4. To contribute to the conservation of the national and cultural heritage by: a. Organizing a more balanced approach between tourism and other needs; b. Protecting the natural environment, especially flora in the littoral areas; c. Defining the optimum numbers of tourists in particular areas; d. Protecting regional and urban traditional architecture; e. Preserving monuments; and, f. Developing arts and crafts and supporting folklore.
Although this tourism plan represented a wide range of objectives, and despite some conflicts between these aims, the government decided not to prioritise them.
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INSERT GREECE COVER PAGE
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4.4.1 FEATURES OF THE GREEK TOURISM INDUSTRY
4.4.1.1 Size and Market Share
In terms of the world classification of tourist destinations, Greece came in 17th place in 1998, receiving around 10,1 million international tourists. Table 4.4 provides a summary of international tourist arrivals for 1999. 93% Of all international arrivals in Greece are from Europe, with Germany and the UK together accounting for around 40% of all arrivals.
Table 4.4: Tourist Arrivals in Greece by Main Markets, 1999
Origin Market Number of Arrivals % Of Total Albania 673 061 5,5% Austria 501 602 4,1% France 545 981 4,9% Germany 2 450 137 20,1% Switzerland 308 138 2,5% UK 2 433 033 20,0% Italy 745 915 6,1% Netherlands 616 807 5,1% Scandinavia 1 263 431 10,3% Other Europe 1 781 908 14,6% Total Europe 11 320 013 93,1% Total Asia 434 276 3,6% Total Africa 48 040 0,4% Total Americas 305 261 2,5% Total Oceania 56 498 0,5% TOTAL 12 164 088 100,0% Source: National Statistical Service of Greece, 2000
In terms of seasonality, around 75% of all international arrivals are concentrated in the five-month period between May and September.
Steady political and social conditions, a positive economic climate, continuing growth in Gross Domestic Product (“GDP”) (of around 3,5%), expected lowering of the inflation rate, competitive prices due to the devaluation of the drachma, and positive perspectives for the main European outbound markets, provide an environment positive for tourism growth in Greece.
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4.4.1.2 Gateway to Greece
While there are several international airports scattered throughout the islands, Hellinikon international Airport in Athens is the country’s major one. The airport has recently undergone major refurbishments and now: . Serves up to 16 million passengers per year; . Has a parallel runway system allowing simultaneous take offs and landings; and, . Allows for a maximum peak handling traffic of 65 movements per hour (600 per day).
Several airlines and charter companies fly into Greece. Olympic Airways – the country’s national carrier flies to one African country (namely South Africa), 11 Middle East destinations, 36 Eastern and Western European destinations, 3 Asian/Pacific countries, and 4 American destinations.
4.4.2 DEVELOPMENT OF TOURISM IN GREECE
4.4.2.1 Tourist Arrivals
International tourist flows, as evidenced in arrivals and receipts, expanded consistently until the late 1970s. Two major exceptions were during the world recession in 1974 and in the years 1967 to 1968 (the first years of dictatorial rule). After every decline, however, the country recovered remarkably (refer to Figure 4.7). The number of foreign tourists to Greece have more than doubled every decade, and rose form 58 238 in 1951 to 471 982 in 1961 and 2 103 281 in 1971 to 5 577 109 in 1981, but have slowed down slightly in the late 1990s to around 10 million.
In terms of the origin of tourists, the largest number of tourists originated from Europe, which increased its share from 53% in 1971 to 75% in 1978 to 90% in 1987. In the 1970s this was especially due to tourists from Scandinavia and Yugoslavia and, in the 1980s, to visitors from the UK, former Federal Republic of Germany, France and Austria. Whereas in 1963-1973 Greece was dependent on the USA for the inflow of tourists, this is no longer the case. The flow of tourists from the USA in 1970 was 13 times higher than in 1953 but, thereafter, its share of arrivals dropped from 27% in 1970 to 11% in 1978, 7% in 1985 and 93% in 1999.
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Figure 4.7: Growth in Foreign Tourist Arrivals to Greece, 1960-1998
1996
1993
1990
1987
1984
1981
1978
1975 1972
1969
1966
1963
1960 0 2000 4000 6000 8000 10000 12000 Number of Foreign Vistors ('000)
Source: Statistical Yearbooks of Greece (1960-1987), WTO (1994-1998)
4.4.2.2 Spatial Distribution of Tourism
During the 1970s, there was relative stability in the regional pattern of demand. Certain flows were entrenched, and their direction was not easily modified for long periods. Demand was concentrated in Greater Athens and three tourist islands namely: Rhodes, Crete and Corfu. Domestic tourism did not compete with foreign tourism neither in regional terms nor by type of accommodation used. In the late 1980s, foreigners were over-represented in Rhodes, Crete, Corfu, Attica and Khalkidik, while the locals were more represented in the largest cities, the mainland, and islands near the Mediterranean coast such as Sporades and Euboea.
Changes since the 1970s involved a shift of foreign tourists’ preferences from the larger towns towards Corfu, northern Crete and Khalkidiki. The number of nights spent in Greater Athens declined dramatically by 2 million over the period 1981-1986. Islands near Athens, especially Attica and Euboea and the city of Salonica also lost popularity. Bedspace capacity in Attica declined proportionately in the late 1970s and, in the 1980s, three luxury hotels closed down and a central historical hotel began to rent out rooms to
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Greeks as residences. Tourist flows to Rhodes Island and Crete increased dramatically – by nearly 3 million and 2 million overnight stays respectively over the period 1981-1986. Although no literature regarding the pre-1980 spatial distribution of tourism in Greece according to nationality exists, one study has shown that in 1984 visitors from northern Europe flocked to certain localities, while Mediterranean nationalities had a more dispersed pattern of preferences, or opted for cultural tourism. The most dispersed pattern of preferences was by the Germans and Italians who opted for exploration as much as for vacation tourism, and mostly used non-organised forms of travel, and travelled between two and four different localities during their visit to Greece. Spaniards tended to prefer cultural tourism and concentrated mainly in Greater Athens. In contrast, tourists from northern Europe such as Finland and Sweden, tended to congregate in a few areas, especially on the islands of Rhodes, which was actually developed as an area for mass tourism by Swedish tour operators. US visitors displayed a greater preference for Greater Athens.
4.4.2.3 Development of Tourist Accommodation
Infrastructure and accommodation facilities improved rapidly during the post-war period throughout Greece, but especially in the largest cities and on the islands. The composition of tourist accommodation changed as follows: During the mid-1960s, the most popular form of tourist accommodation was standard lodgings, yachting appeared from the late 1960s; bungalows and apartment hotels emerged in the early 1970s, and from the mid-1970s, organized cruises and summer villas appeared, along with a strong tendency for foreigners to purchase private homes. The number of small cruiseships hired by better-off tourists grew slowly from 1 200 in 1975 to 1 700 in 1987.
As with demand, hotel capacity was sharply concentrated in Greater Athens (around 18% of all hotels in the country), Rhodes (15%), Crete (14%) and to a lesser extent, Corfu (7%). This concentration has changed little since 1963. Figure 4.8 provides an indication of the regional distribution of demand for bednights in Greece in over the period 1981- 1986.
Auxiliary accommodation, including facilities such as camping sites and rented rooms (officially registered), also increased rapidly, especially in certain areas. For example, in 1985, they provided 59% of the total number of beds in the Kaval-Thasos area, 59% in the Ionian Islands (excluding Corfu), 54% in the Cyclades and 48% in the Magnesia- Sporades area. By contrast, they were less important in the main tourist areas: Greater Athens (4%), Rhodes (11%), Crete (22%) and Corfu (23%).
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There has been a general trend for auxiliary accommodation in standard lodgings to withdraw from the market during the winter, and hotels are utilized to capacity only during the summer months. The exception to this tendency is in the hotels located in Athens, Piraeus and Salonica, where hotels operate all year round.
Figure 4.8: Regional Distribution of Demand for Bednights in Greece, 1981-1986
Source: Leontidou, 1991
4.4.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN GREECE
Although tourism-supporting infrastructure has been actively developed by the Greek government since the late 1950s, tourism only began to feature in policies and programmes in the early 1960s, when its potential for economic development was realized.
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As with Spain, the policies influencing and directing tourism development have been largely influenced by the political environment. For the purposes of our discussion, we have provided a summary of the policies affecting tourism both during and after the fall of dictatorship in Greece. 4.4.3.1 Policy During the Dictatorship – 1967 to 1974
During the mid-1960s, tourism in Greece played only a minor role in the economy compared to other European countries. For a relatively long period, especially between the years 1951 to 1964, incentives for tourism development existed, and even the most congested areas received incentives for tourism development. During this period the largest share of public investment for tourism (56%) was allocated to construction and management of accommodation.
Greater emphasis on tourism development followed the imposition of dictatorial rule in Greece in 1967, especially in the areas involving construction, financing and promotion. At the same time, emphasis on residential as well as tourism development, was used a means of developing the economy. All legislation prior to 1967 was consolidated into a single local development plan, which provided special concessions for hotels in the form of tax and depreciation allowances.
In the early 1970s, the initiative for tourist development shifted to private enterprises, and State activity was limited to the provision of infrastructure to facilitate their operation. During this time, the banking system and government incentives were mobilized to boost the private sector. Foreign investment in Greece was also important during this period – primarily from the US, although West German, Swiss and French sources were also important. Foreign investment was mostly concentrated in hotel businesses and especially within the coastal locations.
4.4.3.2 Policy Trends in 1974 to 1990
After the fall of the dictatorship in 1974, tourism was a common feature in the Five Year Plans as a means of dealing with foreign exchange problems and the chronic debt deficit, and as an appropriate strategy for economic development. Public sector participation in investment increased, especially after the nationalization of Olympic Airways on 1st of January 1975. Domestic interests were also given greater priority during this period. The 1976-1980 Five Year Plan emphasized the role of local capital and of small non-hotel tourism as a means to local development. Subsequently, the 1983-1987 Plan carried through the same policy of discouraging large hotel developments and foreign investment. The 1983-1987 Five Year Plan also set goals for public involvement where
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56% of investment would be public and 44% would be private. Legislation in this Plan also emphasized the development of small lodgings with less than 80 beds. This policy was reversed in the late 1980s, however.
In 1987, a Ministry of Tourism was established and the European Community (“EC”) policy started to have some impact alongside national policy. The Integrated Mediterranean Programmes, as well as the new Five Year Plan for Economic Development 1988-1992 was focused on the promotion of selective tourism. The essence of this policy was to attract higher-income tourists combined with decentralization strategies. Overseas promotion (in the form of advertising campaigns, pamphlets and posters) during this time was intensified with the aim of attracting off- season and higher-income tourists.
4.4.3.3 Policy Trends, 2000-2006
The guidelines taken in the 1990s7 formed the basis for the policy measures that are currently being taken in Greece. Two policies of particular importance, and which are managed and influenced to a large extent by the Greek National Tourism Office (“GNTO”), include the Sectorial Operational Programme (“SOP”) and the 13 Regional Operational Programmes (“ROPs”). A summary of the goals, priorities and expected results of the SOP and ROPs are detailed below:
Goals
The specific goals of the SOP suggested by the GNTO and adopted by the Government include the following:
1. To modernize existing tourist enterprises and enrich their product;
7 The main guidelines of the tourism policy in the 1990s were:
. To enrich the tourism product and upgrade the quality of the services provided by the public and private sector, and to preserve the level of this quality in a way that a competitive price policy becomes feasible; . To create additional infrastructure and organize theme "products", which could attract demand for alternative forms of tourism; and, . To reinforce the country's overall tourism product with the comparative advantage of cultural "reserves", through modern ways of communication and new ideas of presentation.
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2. To develop theme tourism (i.e. cultural, marine, mountaineering and trekking, ecotourism, agritourism, sport, congress and conferences, therapeutic, adventure tourism etc.); 3. To stimulate the competitiveness of Small, Medium and Micro Enterprises (“SMMEs”) in all areas of the tourism sector; 4. To improve the contribution of tourism to employment (and to create new jobs and preserve existing ones); 5. To improve the "relationship" of the tourism sector with the production of traditional goods and culture; and, 6. To increase measures of technical assistance and necessary studies.
While the above goals can also be seen as being priorities within the tourism industry, these priorities cannot be pursued by the SOP alone. Rather, they require overall effort and commitment in order to be upheld. The allocation of approximately US$600 billion to the ROPs over the period 2000 to 2006 to fulfil the goals set out above, represents the level of commitment by the GNTO and other national collective associations to the tourism industry. Furthermore, the focusing of investments (public and private) in particular fields (e.g. creation of infrastructures as far as public investments are concerned and the modernization of enterprises as far as private ones are concerned), the adjustment of the marketing policy, and the hosting of the Olympic Games in Athens in 2004, all contribute to the creation of a favourable framework to accelerate the achievement of these goals.
Expected Results
The interventions, that are being planned, are expected to bring about the following positive effects:
1. Upgrade the tourist services provided and enrich their variety; 2. Improve the organization of the tourist enterprises; 3. Preserve the competitiveness of the Greek tourism product; 4. Attract theme demand with higher return; 5. Lengthen the tourist period; 6. Develop unknown natural and cultural resources. Diversify the national product by developing groups of activities for alternative forms of tourism, which are mostly suitable to the natural and cultural resources of the mountainous, frontier and insular regions; 7. Make the country's promotion campaign abroad more effective;
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8. Upgrade and diversify the demand for developed tourist regions in an attempt to reduce seasonal variations; and, 9. Improve the role of human resources in the supply of tourism services.
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4.4.4 TOURISM MARKETING
The main executive organization for the development and promotion of tourism and for the formulation and implementation of policy has been the National Tourism Organisation of Greece (“EOT”). The EOT become an autonomous agency in 1950, but its origins can be traced back to 1929. The role of the EOT was both supervisory and developmental, involving planning, promotion, education and management of accommodation and infrastructure, and financial assistance for tourism businesses. Promotion was undertaken by a network of offices in Greece and abroad, as well as through the organization of summer festivals.
The policies of EOT were only marginally influenced by other bodies until 1983, when EOT came under the direct surveillance of the Ministry of National Economy and Planning. The Ministry of the Environment controlled the tourist police, collected data, and co-ordinated local services. The Ministry of Culture was (and still is) responsible for the maintenance of museums and monuments. Consequently, there was a highly varied administration for tourism, and policy tended to lack coordination until the mid to late 1990s. Some of the goals and expected results of the GNTO have been incorporated into the SOP and ROPs discussed above.
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4.5.1 FEATURES OF THE CYPRIOT TOURISM INDUSTRY
4.5.1.1 Size and Market Share
According to the Cyprus Tourism Organisation (“CTO”), visitor arrivals increased from 2 397 771 in 1998 to 2 577 541 in 1999, representing a 7,5% increase. Of these visitors approximately 94% of these were tourists and 6% were one-day visitors8. Figure 4.9 shows the growth of tourist arrivals over the period 1985 to 1999. The significant growth in tourist arrivals in 1999 is mainly due to the intensive efforts made by the CTO to promote and market Cyprus as a destination, but also due to the positive developments that took place in certain markets, and especially in the UK market where the Sterling/Cyprus pound made it attractive for the British to travel. Another contributory factor was the attractive prices offered by private tourism organizations to tour operators.
Figure 4.9: Growth of Tourist Arrivals in Cyprus, 1985 – 1999
2500000
2000000
1500000
1000000
500000
0
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Notes: Excludes day visitors Source: Cyprus Tourism Organisation
8 The majority of day visitors include transit passengers as well as cruise passengers. The main countries of origin of cruise passengers in 1999 were the USA, Italy, Israel, the UK, Germany, the Arab countries and France.
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According to the CTO, just over 80% of all tourists are from 7 countries namely the UK, Nordic countries, Germany, former Russia, Switzerland, Greece and Israel (refer to Figure 4.10)
Figure 4.10: Breakdown of Foreign Tourists to Cyprus According to Country of Origin, 1999
UK 3% 3% 9% Germany Nordic countries 3% Sw itzerland 3% Former Russia Greece 6% 48% Israel 4% Other European countries Other Arab countries
11% Other countries
10%
Notes: Excludes day visitors Other Arab countries include tourist arrivals from Lebanon, the Middle East and Gulf countries Source: Cyprus Tourism Organisation, 1999
Table 4.5 provides a summary of the various characteristics displayed by tourists from the main generating countries. It is interesting to note that the majority of far western European countries such as the UK, Germany, Switzerland, Belgium etc. visit Cyprus on packaged holidays compared to those from the middle European and Middle East region. It is also interesting to note that for the most part, those that visit Cyprus on an all- inclusive package stay in hotels as opposed to hotel apartments and other forms of tourist accommodation.
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Table 4.5: Summary of Characteristics Displayed by Tourists from the Top Generating Countries to Cyprus, 1999
Country of Origin % Of Ave % Staying % Staying % Stayed Ave Package Length of in Hotels in Hotel Elsewhere Spend Per Tourists Stay Apts. and Person (Days) Other Per Trip Tourist (CYP) Est. UK 78,6% 12,2 54,4% 28,6% 17,0% 499, 37 Germany 91,2% 12,0 77,6% 10,8% 5,4% 373,93 Nordic countries 96,2% 11,3 11,2% 78,8% 10,0% 316,59 Former Russia 62,1% 12,2 66,9% 9,7% 23,4% 457,02 Israel 88,2% 3,8 93,7% 5,1% 1,3% 230,24 Greece 17,5% 13,5 35,9% 4,2% 59,9% 281,61 Switzerland 86,4% 10,5 82,5% 10,7% 6,7% 456,54 Source: Cyprus Tourism Organisation, 1999
4.5.1.2 Gateway to Cyprus
The major international airport in Cyprus is Larnaca International. A smaller international airport is located in Pafos. Table 4.6 provides a summary of the various airlines operating flights to and from Cyprus. Figure 4.11 provides geographical representation of the main operable routes to and from Cyprus.
Table 4.6: Airlines Operating Routes to and from Cyprus
Airline Destination Length of Flight British Airways London 4 hours 30 minutes Virgin Atlantic London 4 hours 30 minutes Northwest/KLM Amsterdam 3 hours 30 minutes Olympic Airways Athens 1 hour 40 minutes Lufthansa Frankfurt 3 hours 30 minutes Swissair Zurich & Geneva 3 hours Finnair Helsinki Alitalia Rome Source: Grant Thornton Kessel Feinstein
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Figure 4.11: Map Showing the Various Air Routes to and from Cyprus
Source: Cyprus Tourism Organisation Website (http://www.cyprustourism.org)
Cyprus Airways – the national carrier flies to over 30 destinations including all major European and Middle East cities. Besides offering all-inclusive holiday packages to European and Middle East destinations, Cyprus Airways also offers a “SunSpot StopOver Holiday Scheme” which enables passengers travelling on Cyprus Airways flights between Europe and the Middle East/Gulf via Cyprus, to benefit from up to three nights free hotel accommodation.
Cyprus Airways has alliances and co-operation agreements with major international airlines including KLM, Gulf Air, Alitalia, Aeroflot, KLM UK and El Al which facilitate numerous possibilities for passengers to travel all over the world. Cyprus Airways also has a series of other agreements, e.g. with Swissair, Virgin Atlantic, and American Airlines that cover specific market needs.
4.5.2 DEVELOPMENT OF TOURISM IN CYPRUS
4.5.2.1 Tourist Arrivals
Until 1960 when Cyprus gained its independence from the UK, small-scale, family run businesses dominated its underdeveloped tourism industry. During that year 25 700 tourist arrivals were recorded. There were under 4 000 bedspaces of tourist
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accommodation – of which 45% were located in the hill resorts which were patronized primarily by Middle Eastern visitors. Bed capacity in the five main coastal towns during this period comprised less than a third of the total number available. Nicosia (the capital) accounted for around 26% of the total bed spaces available. Local inhabitants and repeat visitors from the UK (mainly friends and relatives of troops and colonial government officials) made up the majority of tourists at the seaside resorts.
In its Five Year Development Plan (1962-1966), the government of the newly created republic emphasized the potential for tourism growth as an activity that could boost foreign exchange earnings, thus enabling diversification from a primarily agricultural environment. By the end of the first Five Year Development-Plan period in 1966, over 54 000 tourists came to the island and contributed receipts of CYP3,6 million. The regional distribution of bed spaces, which had increased to more than 56 000 still favoured the hill resorts; although Famgusta, Kyrenia and Limassol had witnessed a substantial increase in accommodation capacity mostly in relatively small family-run hotels.
Cypriot tourism’s real ‘take-off’ did not come until the late 1960s as a result of a combination of factors including:
. With the United Nation’s designated “Year of the Tourist” in 1967, the Cypriot government and the private sector gained increasing confidence about the country’s tourism economic potential; . Both the public and private sectors became aware of the rapid growth of demand from northern Europeans for the coastal resorts in other Mediterranean destinations such as Spain and the Greek isles and, in response, emphasized developing coastal resorts and took advantage of the island’s ingredients for a successful beach tourism industry; . Foreign firms formed partnerships with Cypriot development companies and commenced the construction of major hotels in the Kyrenia and Famagusta regions; . During the same period, the government built a modern terminal for the Nicosia International Airport; . In 1969, Cyprus Airways, the national airline, which until then had only served the Middle Eastern gateways, acquired new equipment and inaugurated flights to Athens, Frankfurt and London; and, . Cyprus Airways further bolstered the island’s tourism industry by establishing a subsidiary charter company.
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From the early 1970s onward, there was an evident spatial redistribution of the industry, with the districts of Kyrenia and Famagusta taking up almost half of the island’s total bed capacity. Whereas the number of available beds in the whole country had doubled over the period 1960-1971, Famagusta experienced a five-fold increase (the majority of which was after 1967). During the period 1971-1973, arrivals to the island more than doubled. While British holidaymakers maintained their traditional market dominance, arrivals from Sweden and the former Federal Republic of Germany increased significantly. The increase in northern European arrivals was strongly related to new international tourism trends, particularly the emergence of large-scale tour operators and the evolution of inclusive tour packages enabling low tariff holidays abroad.
The war in 1974 brought the Cypriot economy, including tourism, to its knees. Due to the fact that major components of the industry and the only international airport were no longer operational, tourist arrivals in 1975 slumped to 18% of their 1973 number. However, by 1976 the tourism industry recovered remarkably with a 300% increase in arrivals over the previous year. Over the 1977-1987 period tourist arrivals increased by an average annual growth rate of 18% - exceeding that for other Mediterranean destinations during the same time.
The Cypriot government was a principal actor in promoting the growth of tourism in the immediate post-war era. In a series of Emergency Economic Action Plans following the war, it gave high priority to this sector of the economy. The 1975-1976 Emergency Plan strongly recommended continuing ties with the main players of international tourism (the tour operators and airlines) in the markets of Germany, the UK and Scandinavian countries. It also gave priority to developing Larnaka airfield into a fully operational international airport by the end of 1976. This and subsequent Economic Action Plans for 1977 and 1978 emphasised reestablishing the island’s role as an international tourism destination. The plans also provided for financial assistance to the private sector through the grant of low interest loans and/or free government land for constructing tourism accommodation and related facilities in coastal areas. Incentives included duty-free imports of equipment and other materials for the hotel industry as well as sizeable investment allowances for construction regardless of size and type.
4.5.2.2 Spatial Distribution of Tourism
The most interesting aspect of the tourism industry in Cyprus over the past 25 years or so has been its spatial relocation to coastal areas that previously had little or no such developments. Of the four main coastal resorts that evolved after 1975, only Limassol started off with a tourism industry of any significance and grew very rapidly, capitalizing
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on existing urban infrastructure and a major seaport. The seaside villages of Ayia Napa and Paralimmi grew impressively. In the mid 1970s, Ayia Napa was a small isolated village virtually unknown, even to many Cypriots. In less than a decade, it was transformed into an urban area with a clearly defined recreational business district catering almost exclusively to beach tourism. A major force behind this transformation were the strong government incentives offered to refugee hoteliers after the war to build in the region, taking advantage of its abundance of sandy beaches. Since 1984, Pafos on the southwest coast has also experienced rapid development of tourist accommodation, no doubt boosted by the nearby construction of the island’s second international airport, which caters predominantly to chartered flights by the country’s national airline as well as other foreign carriers.
4.5.2.3 Development of Tourist Accommodation
Another important feature of the development of tourism in Cyprus has been the increase in the variety of accommodation available. While before the war, hotels made up the principal type of tourist accommodation, in the 1980s self-catering accommodation in the form of apartment complexes and tourist villas increased substantially. By 1986, almost 40% of the 31 883 CTO registered bed spaces were in hotel apartments compared to 29% of the total in 1981. In addition, there was a large number of non-licensed tourist accommodation sector (almost all self-catering) roughly estimated at 30 000 bed spaces in the mid 1980s. Small scale investors and developers, recognizing the potential benefits of tourism and taking advantage of the relaxed local authority planning controls, were chiefly responsible for the emergence of non-licensed accommodation.
The trend towards the construction of self-catering accommodation reflects cheaper running and capital costs, and to a large extent, increased demand for this type of accommodation. Large-scale tour operators showed preference for this type of cheaper accommodation as a means to boost their sales of inclusive tour packages to a lower- income mass tourist market. This was especially the case with Scandinavian tour operators who targeted the younger lower-spending tourists (age 15-29) for the Cypriot tourist product.
According to the CTO, the number of beds in Cyprus has grown from 30 375 in 1985 to 89 968 in 1999. On the 31st December 1999 there were 2 211 beds under construction. In terms of the distribution of these beds (refer to Figure 4.12), Pafos accounts for around 26% of the total number of beds in Cyprus. This is followed by Lemesos with 19%. In terms of the type of accommodation available, Pafos has the most varied forms of accommodation ranging from graded and non-graded hotels and guesthouses to hotel
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apartments, tourist villages, tourist villas, tourist apartments, furnished apartments and traditional buildings. The distribution of beds in the various tourist areas corresponds closely to the distribution of tourists in these areas. Pafos for example, receives around 26% of all foreign tourist arrivals. This is followed by Lemesos and Ayia Napa.
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Figure 4.12: Distribution of Bed Capacity per Tourism Region in Cyprus, 1999
86968 90000 80000 70000 60000 50000 40000 22355 30000 19602 16249 20000 8881 15232
10000 2484 2165 0
Pafos
TOTAL
Larnaca
Lefkosia
Lemesos
Paralimini
Agia Agia Napa
Hill Hill Resorts
Source: Cyprus Tourism Organisation, 1999
In terms of star –grading, in 1999, the majority of hotels in Cyprus were of a 3- and 4-star standard. The percentage breakdown of hotel beds according to each star-grading can be summarised as follows:
. 5-star 18%; . 4-star 36%; . 3-star 35%; . 2-star 8%; and, . 1-star 3%.
In terms of the distribution of tourists according to the various areas, whereas the majority of far Western European countries visit Pafos, the majority of tourists from Israel and other Arab countries visit Lemesos (refer to Table 4.7).
The presence of transnational hotel companies has been (and still is) surprisingly minimal. In fact, only one hotel – the Sheraton in Limassol – is foreign owned, and another three transnationals are involved through management contracts. Most of the hotels on the island are owned and operated by local companies and individuals. Three Cypriot companies own around 13% of all the bed spaces on the island. The others are privately owned.
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Table 4.7: Geographical Distribution of Tourists to Cyprus, 1999
Country of Origin Paralimni Agia Larnaka Lemesos Pafos Lefkosia Hill Napa Resorts UK 16,3% 10,8% 4,5% 20,7% 37,2% 0,9% 8,0% Germany 8,5% 17,0% 11,0% 15,0% 38,6% 0,6% 6,4% Switzerland 18,1% 38,3% 4,4% 8,0% 25,7% 0,5% 2,8% France 6,7% 3,8% 15,9% 27,6% 16,2% 3,0% 7,5% Netherlands 5,9% 16,2% 13,6% 20,5% 31,4% 1,5% 3,9% Belgium/Luxemburg 0,4% 1,2% 2,72% 13,5% 75,1% 0,6% 4,8% Austria 11,6% 32,4% 22,2% 12,6% 14,0% 0,9% 3,8% Italy 18,2% 25,9% 9,5% 14,7% 12,7% 11,4% 2,6% Ireland 12,6% 43,8% 3,7% 35,05 2,9% 0,9% 0,3% Greece 2,2% 1,8% 16,2% 32,2% 5,7% 28,2% 4,9% Nordic Countries 24,3% 40,3% 10,0% 11,4% 11,2% 0,5% 1,9% Russia Federation 2,2% 7,7% 28,2% 37,4% 18,2% 3,9% 1,0% Israel 3,1% 34,0% 5,0% 31,0% 10,5% 6,1% 4,7% Arab Countries 1,0% 5,0% 27,6% 38,5% 4,6% 13,9% 1,2% Other Countries 11,4% 17,8% 12,3% 20,9% 26,0% 3,1% 4,6% Notes: Coastal regions include Paralimni, Agia Napa, Lamaka, Lemesos, Pafos and Lefkosia. Figures add up to more than 100% because tourists may stay more than one area during their trip to Cyprus Source: Cyprus Tourism Organisation, 1999
4.5.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN CYPRUS
In addition to the policies alluded to earlier, the most important recent policy decisions taken by government has been the formulation of a tourism development plan in response to the negative impact of tourism in Cyprus.
4.5.3.1 Tourism Development Plan
The continued concern regarding the “environmentally unfriendly” growth of tourism in Cyprus led to the preparation of a comprehensive tourism development plan for the country in 1988 which takes into account economic, social and environmental considerations. An important element of the planning approach towards tourism development is the environmental and planning analysis, which involved conducting of a series of carrying capacity studies for tourism, as well as an appraisal of existing
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development in each tourism area9. Based on these background analyses, major development opportunities and constraints were identified and a tourism development strategy was formulated around three major objectives10.
Based on the objectives of the tourism development plan, a controlled tourism development strategy was adopted. In essence, this strategy (as opposed to a laissez- faire approach to development) suggested that a relatively high degree of government control regarding the location, quantity and types of tourism development is required. This strategy also suggests that consolidated development can be used to intensify the built environment, to give it more form, structure and identity.
4.5.3.2 Product Improvement Strategy
The 1988 tourism development plan (detailed in Section 4.5.2.4 above) also suggested the need for tourism product enrichment and has produced a product improvement strategy that identifies the following areas for improvement:
. Encourage the diversification of accommodation and associated facilities (such as holiday villages and club-type developments offering a wide range of recreational and leisure facilities) to attract both existing and future market segments to the island; . Further improvements of archaeological sites, historic building and other cultural attractions, utilizing imaginative interpretation techniques;
9 The environmental and planning analysis is approached primarily from a tourist viewpoint i.e. what tourists expect in
terms of an interesting attractive, non-polluted and non-congested environment, and how the environmental quality of
Cyprus compares to that of competing destinations. In analyzing the environment, the tourism areas were divided into
two distinct categories namely the coastal areas and the mountain hinterlands. The mountain area was examined
generally and the coastal urban tourism area was analysed in detail. The overall social impact was also evaluated and
existing and potential problems were identified.
10 The major objectives of the tourism development included: . Growth of tourism’s contribution to GDP; . Protection of the environmental and cultural qualities of Cyprus; and, . Attraction of higher expenditure tourists. The potential conflict between the first two objectives is recognized in the plan i.e. that growth might take place at the
expense of the environment and culture. This is envisaged to be somewhat reconciled by the third objective of higher
spending tourists.
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. Greater promotional efforts directed to encourage the use of the mountainous hinterland for overnight stays, sightseeing and other activities, and the development of village tourism including village conservation programmes; . Development of yachting and sailing facilities and related marine tourism environments and golf courses; . Encouragement of the organization and promotion of festivals and special events; . Promotion of opportunities to enjoy a wide range of peripheral activities; and, . Encouragement of developments that generate higher tourist expenditure in entertainment, shopping, etc.
Although general consensus exists as to the need for product diversification, the various plans for product improvement and diversification have not been particularly successful in attracting investment. The main reasons for their lack of success are as follows:
. Uncertainty about the likely returns on investment due to its non-accommodation nature; . Large land area requirements in appropriate locations; . Lack of local knowledge and experience regarding the type of projects, their planning, organization and operations; and, . Scepticism of banks to support projects with an apparent high degree of risk.
In order to address these problems, the government has introduced a Product Development Incentives Programme (“PDIP”), which recommends that the existing Fund for Financing Priority Projects, which has been used for financing some accommodation projects, be more specifically oriented to encourage tourism product improvements. This should include permitting accommodation financing only when it involves a major ancillary facility such as a golf course, marina or watersports facility. Concurrently, disincentives have also been introduced to discourage the development of accommodation that is not compatible with the qualitative growth image. These disincentives include high licence fees for developments that do not contribute to product improvements.
4.5.4 TOURISM MARKETING
From an early stage, the government’s involvement in the promotion of tourism came in the form of allocation of funds for organizing and developing the industry, and for providing favourable interest loans. Banks and other financial institutions were skeptical of the infancy of the industry and were reluctant to heavily invest in it. However, by the
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mid 1960s, after the realization of the importance of the tourism industry, the Cypriot government came to play an important role in promoting the industry. In 1969 the government set up the CTO, which was charged with full responsibility for tourism development and passed legislation implementing guidelines for the classification of tourist accommodation according to international standards (in an attempt to make it competitive with other Mediterranean destinations).
The strategic goal of the CTO in the area of promotion and publicity in the 1990s, and the years beyond is to establish Cyprus as a unique quality destination in the Eastern Mediterranean. This goal is to be achieved through the Cypriot tourism product as more than just sun and sea, but which also reflects its cultural heritage, its traditions, character, and hospitality.
The CTO is also making special efforts to increase the number of off-season arrivals, particularly during the winter months. More emphasis is also given to developing other types of tourism such as conference and incentive tourism, agrotourism, sports tourism, archaeological, cultural and religious tourism. In addition, attention has been given to longer-term trends when preparing its long-term strategy up to the year 2010. Such trends include the increased use of electronic information, the increasing awareness of environmental issues, and an upward trend in holidays centered on education, culture, history and activities.
The CTO is also currently promoting the tourism product to the more high-spending and special interest end of the market. In order to achieve this, planners are proposing and are in the process of diversifying the product through the following strategies:
Marine Tourism
During 1999 great efforts were made to put together a legal framework that would provide for the leasing of suitable government coastal land to private individuals for the purposes of the development and operation of marinas.
Golf Tourism
Two 18-hole international standard golf courses currently exist in Cyprus namely. the Tsada Golf Course and the Secret Valley Golf Course. The construction of a third golf course as part of the Aphrodite Golf Resort in currently underway. Progress has also been achieved for the development of golf courses in Oroklini and Ayia Napa. The CTO, in its effort to promote golf tourism in Cyprus, has sponsored the publication of relevant
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articles in professional golf magazines in Europe. The CTO has also hosted journalists on educational visits for the promotion of Cyprus as a golf destination.
Agrotourism
In 1991 a financial incentives scheme for the development of agrotourism, which involves the subsidisation of the interest rate on loans taken out for the restoration of traditional buildings and their conversion to tourist enterprises was introduced. In 1998 for example, 51 agrotourist accommodation units were in operation, compared to 41 in 1998, representing an increase of 25%. The number of beds in these units also increased from 342 in 1998 to 444 in 1999 – an increase of 30%.
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4.6.1 FEATURES OF THE BAHAMIAN TOURISM INDUSTRY
4.6.1.1 Size and Market Share
According to WTO, the Americas accounted for around 87% of all foreign arrivals in to the Bahamas in 1997. The USA is the most important source market for the Bahamas, and accounted for 81% of the total number of visitors to the islands in 1997. Other important source markets include Canada (5%) and the UK (3%). International arrivals from Europe accounted for approximately 8,7% of the total in 1997. Table 4.8 provides a summary of the number of tourist arrivals in the Bahamas over the period 1993 to 1997. Although the number of tourists to the Bahamas in the 1990s has shown growth, this growth is relatively insignificant compared to other beach destinations such as Mauritius and Thailand.
Table 4.8: Tourist Arrivals in the Bahamas, 1993-1997
Origin Markets Number of Tourist Arrivals 1993 1994 1995 1996 1997 Caribbean 4 055 NA NA NA 11 735 North America 1309 935 1353 235 1 416 965 1 430 005 1 401 750 South America 8 105 NA 8 955 8 820 NA Other America 4 900 11 165 6 585 6 635 NA Total Americas 1326 995 1364 400 1 432 505 1 445 460 1 413 485 Northern Europe 44 500 31 470 38 860 50 280 57 045 Southern Europe 8 385 21 945 20 990 21 675 20 370 Western Europe 60 200 43 260 55 100 55 645 36 685 Other Europe NA 13 055 NA NA 16 265 Total Europe 133 085 109 730 114 950 127 600 130 365 East Asia/Pacific 15 580 16 300 20 450 25 680 NA Other Regions 13 020 25 605 30 230 34 365 73 745 TOTAL 1 488 680 1 516 035 1 598 135 1 633 105 1 617 595 Notes: NA – not available Source: WTO, 1998
4.6.1.2 Gateway to the Bahamas
The Bahamas - with its close proximity to Florida - is easy to reach by air or by sea. Most of the islands have at least one airport and several marinas. There are plenty of charter plane companies, so movement between the islands is easy.
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There are several large airlines and charter carriers that serve passengers flying into the Bahamas. Frequent flights are available to Nassau, Freeport and The Out Islands. Although there are no direct flights from Europe to the Bahamas, a quick stopover in Miami is easy and perfectly viable. Table 4.9 provides a summary of the scheduled and charter airlines that fly to and from the Bahamas as well as their frequency per week.
Table 4.9: Scheduled and Chartered Airlines to and from the Bahamas
Airline Frequency/Week Nassau/Paradise Grand Bahama The Out Islands Island Island Scheduled Airline AOM 3 3 Air Canada 3 3 Air Jamaica 16 16 Air Sunshine 14 American Eagle 280 35 287 BK 4 4 Bahamasair 7 63 British Airways 6 6 Comair 14 14 Continental Airlines 61 121 Continental Connection 133 133 Delta Airlines 28 28 Grand Bahamas Vacations 25 Lynx Air 2 9 Nassau/PI Express 13 13 PA Airbridge 14 TWA 5 5 US Air 7 US Airways 21 21 US Air Express 7 Charter Airline Apple Vacations 13 2 15 Apple Vacations/Funjet 2 2 Conquest Vacations/Canada 2 1 3 3000 Holidays Funjet 2 2 JMC 2 1 MLT Vacations 1 1 Sunquest Vacations/Alba Tours 2 2 TNT Vacations 2 2 4 World of Vacations 2 2 Source: Grant Thornton Kessel Feinstein
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4.6.2 DEVELOPMENT OF TOURISM IN THE BAHAMAS
4.6.2.1 Tourist Arrivals
The tourism industry began in the mid-19th century with government support for the construction of hotels and a subsidised steamship service. Tourism once again blossomed in the 1920s when Prohibition brought well-to-do American tourists to the islands. The influx of visitors increased the demand for food, lodging and other items. Consequently, the banking industry boomed as The Islands Of The Bahamas built new hotels, warehouses, bars, distilleries and wharves.
After the repeal of Prohibition, The Islands Of The Bahamas went into an economic slump that lasted until the 1940s and World War II, when it served as an air and sea way- station in the Atlantic.
However, it was only in 1961, when Cuba (with its glitzy casinos and beach resorts) was closed to American tourists, that The Islands Of The Bahamas’ good fortune began. Capitalizing on its close proximity to the USA, the government of The Islands Of The Bahamas set out to increase the number of people who visited it each year. It dredged Nassau’s harbour so it could accommodate up to six cruise ships at a time and it built a bridge connecting Nassau to Paradise Island.
4.6.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN THE BAHAMAS
Since 1992, the government has adopted a market-friendly economic policy to facilitate the expansion and diversification of the Bahamian economy and to deepen the economic benefits derived from the tourism industry. While the Bahamas tourism industry is primarily private sector driven, in 1992, around 20% of the hotel room inventory was owned by the government. Hence, privatisation became central to the government’s new economic policy. A summary of the various development and redevelopment strategies for the Bahamas is provided below.
4.6.3.1 Accommodation
The Bahamas is one of the world's most successful tax shelters. Exemptions from property tax and customs duty for companies investing in hotel and resort development have stimulated renovation and encouraged the construction of new hotels for the first
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time since 1989. A dramatic example of the successful and growing Bahamian tourism industry is the redevelopment of the Atlantis Resort on Paradise Island. A consortium of America, British and South African investors recently acquired ownership of four major hotel properties on Paradise Island. Each of the hotels and the casino are operated by Sun International which took advantage of a favourable investment environment and a cooperative government to redesign the Paradise Island resorts. Over US$250 million was invested in the redevelopment of this modern family resort, ecological/aquatic park, and gaming facility. There are also plans to construct an additional 1000 rooms on Paradise Island.
Additional opportunities exist for the development of condominiums and residential single-family homes for the expanding second home market. Especially popular locales exist in Grand Bahama, Abaco, Eleuthera, Harbour Island, and Exuma, in addition to New Providence, home of the wealthy second home enclave of the world's rich and famous at Lyford Cay.
4.6.3.2 Hotels Encouragement Act
This incentive provides for duty-free entry of approved construction materials, furnishings, and fixtures for hotel development. The Act reduces the demand on cash flow for hoteliers and encourages regular property renovations. Recent amendments to the Act have reduced the number of rooms required for new hotels to access this incentive to five rooms for hotels in the Family Islands. This reduction is expected to stimulate an expansion in small, eco-sensitive hotels and guesthouses. Total new construction and renovation programmes approved under this Act have exceeded US$200 million since January 1993.
4.6.3.3 Development of the Family Islands Ecotourism Programme
Although the majority of tourism resort development has been concentrated in the two main vacation destinations in the Bahamas, namely New Providence (Nassau/Paradise Island) and Freeport (Grand Bahama Island), low-impact, environmentally-sensitive resorts exist on virtually all of the other 29 inhabited islands of the Bahamas chain, and all present excellent opportunities for tourism development.
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Eco-tourism is a focal point for the development of the Family Islands11. These islands provide a new investment environment for hotel and resort development companies interested in providing nature theme vacation destinations for discerning travellers.
Abaco, Bimini, Cat Island, Eleuthera, Harbour Island, Exuma, San Salvador, and Long Island are some of the Family Islands that have shown an increase in tourism growth. Most of these islands are pristine, making them ideally suited for eco-hotel investment. The government is providing favourable consideration to investors who wish to establish ventures on these islands. Moreover, government is undertaking major infrastructure works on the islands, providing good roads, water and electricity supplies, telecommunications facilities and adequately maintained docks and airports. The Hotel Corporation of the Bahamas has existing conceptual plans for small resort developments for sites in Andros Town, Andros; Winding Bay/Half Sound, Eleuthera; and Mount. Pleasant Point, Exuma. The Inter-American Development Bank recently announced the availability of funding for establishing environmentally-sensitive hotel and resort ventures in the Bahamas. Such funding no longer requires government guarantees.
4.6.3.4 Infrastructure
A programme to improve the infrastructure of the Bahamas has been underway for the past three years. These improvements include:
. Development of public parks and green areas; . Expenditures of tens of millions of dollars since 1992 to improve major roadways, harbours, and water systems; . Upgrading the international airports; . Extensive electrification; . Providing a modern and dependable communications systems; and, . Redevelopment of Prince George Dock in Nassau to enhance the visitor arrival area and organize easy access to land and sea tours.
Prince George Dock Redevelopment (Nassau)
The Prince George Dock redevelopment has been designed to upgrade the experience of the cruise ship visitors' welcome to Nassau, Phase I of the redevelopment of the Prince George Dock provides a new call-up system for taxis awaiting cruise passengers, a surrey horse holding area, a hair braiders' facility, and extensive landscaping. The plan
11 Includes all Islands of the Bahamas except New Providence and Grand Bahama Island
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includes expanded cultural activities and entertainment on the dock for the enjoyment of short-stay cruise ship visitors. Phase II includes the development of a visitor’s centre, a hospitality suite, a handicraft market and staging area for cultural presentations. The redevelopment of the Dock, in the heart of downtown Nassau, is being complimented by a major upgrade of the city centre, including a road, curb and sidewalk repair, the upgrade of all public buildings, and enhanced street lighting and landscaping.
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4.7.1 FEATURES OF THE BERMUDIAN TOURISM INDUSTRY
4.7.1.1 Size and Market Share
According to WTO, the US accounted for around 78% of all foreign arrivals in Bermuda in 1998. Other important source markets include Canada (9%) and the UK (8%). Table 4.10 provides a summary of the number of tourist arrivals in Bermuda over the period 1996 to 1998. The number of tourist arrivals in Bermuda has been declining since the early 1990s for reasons that will be touched upon in the sections below.
Table 4.10: Tourist Arrivals in Bermuda, 1996-1998
Origin Markets Number of Arrivals % Change 1996 1997 1998 97/96 98/97 USA 316 588 303 248 289 980 -4,2% -4,4% Canada 34 641 33 629 33 629 2,4% -5,2% UK 22 955 24 304 30 379 5,9% 25,0% Germany 3 012 2 333 2 027 -22,5% -13,1% Italy 902 870 958 -3,5% 10,1% Switzerland 933 1 008 919 8,0% -8,8% France 777 872 692 12,2% -20,6% Japan 752 572 527 -23,9% -7,9% Australia 508 438 451 -13,8% 3,0% Sweden 404 431 334 6,7% -22,5% Austria 170 386 253 127,1% -34,5% Total Other Markets 8 753 11 969 8 607 26,9% -39,1% TOTAL 390 395 380 060 368 756 -2,6 -3,0 Source: WTO, 2000
4.7.2 DEVELOPMENT OF TOURISM IN BERMUDA
4.7.2.1 Tourist Arrivals
Following World War I, tourism grew dramatically. In 1920, 13 327 people visited the island. By 1930, visitors coming to stay in Bermuda’s hotels had more than tripled. In 1930, an additional 7 668 visitors came as part of a sea-voyage holiday – representing some of the earliest cruiseship tourists in the world. By 1937, regular visitors totalled 58 646 and a further 24 169 visitors came on cruises.
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One of the principal forces driving tourism in Bermuda was the English shipping company Furness, Withy & Co. In 1930, the company opened the Bermudan Hotel in Hamilton and several years later, the Castle Harbour Hotel and Mid-Ocean Club in Tucker’s town. These hotels formed part of the company’s integrated tourism plan in which it owned and operated both the means of transportation to Bermuda and the accommodation and amenities for visitors when they arrived. Supporting this expansion was the financial boom of the 1920s, which, in turn, made it attractive to the Americans.
The rise in tourism was matched by a corresponding decline in the importance of the island’s agricultural economy.
Before the onset of World War II, one other event of great significance for Bermuda’s tourism industry took place. In 1938, Pan American Airways teamed up with Imperial Airways to offer a flying-boat service air service to the island. Coupled with the creation of Kindley Airfield during the war by the US Airforce, and the subsequent opening of facilities for commercial traffic after 1945, this event marked Bermuda’s entry into the age of air travel.
Following World War II, Bermuda began to seriously develop its tourism industry as a matter of national policy. Tourism promotion was then the responsibility of the Bermuda Trade Development Board (“BTDB”) (an executive body of the government). In 1945, it expanded its New York office, which had officially opened in the late 1920s, and opened an office in Toronto in 1947 to respond to the potential market in Canada. Other offices opened in Chicago, London, Boston and Atlanta. In 1968 the BTDB ceased to exist and the Department of Tourism was created.
In the period from 1949 to 1979, tourist arrivals in Bermuda grew tenfold from 54 899 to 599 145. During this period, three trends were evident namely:
. The percentage of air arrivals increased; . The percentage of cruiseship arrivals increased dramatically; and, . Traditional arrivals by ship virtually disappeared.
Figure 4.13 provides a summary of the number of tourist arrivals to Bermuda over the period 1947-1999.
During the 1980s, tourism continued to dominate the island’s economy. This period saw several swings, but arrivals continued to be strong. In 1980, arrivals reached a new high of 609 556, but this was followed by five years in which arrivals decreased, with 1984
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representing the lowest level in this period at 528 871. The decrease is attributed to the period of recession in North America and was also marked by labour unrest in Bermuda, which directly affected the tourism industry. In 1987, another record high was reached with 631 314 arrivals, but the industry suffered again in the early 1990s from the effects of a declining economy, such as the Gulf War, but more importantly, from a complacent amongst Bermuda’s tourism industry that it was unique because it was not really subject to competition nor to the changes in the international tourism industry.
Figure 4.13: Tourist Arrivals to Bermuda, 1947-1999
1997
1994
1991
1988
1985
1982
1979
1976
1973
1970
1967
1964
1961
1958
1955
1952
1949 0 100000 200000 300000 400000 500000 600000 700000
Number of Tourist Arrivals
Notes: --- Grant Thornton Kessel Feinstein estimates based on general arrival trends in Bermuda Source: Bermuda Department of Tourism (1949-1989), WTO (1993-1999)
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This attitude resulted in complacency and decreasing service quality, and was accompanied by a significant downturn (6%) in the number of arrivals to the island over the period 1990 to 1991. Whereas in 1990, 434 900 visitors stayed in hotels, by 1991 the number dropped to 386 700 – a decrease of 11%. Given that hotel-based visitors in 1991 represented an average daily expenditure of US$225 compared with cruise visitors whose average daily expenditure was US$70, the downturn in hotel-based visitors was catastrophic. In 1992, the situation stabilised to some extent, but a small decrease of 11 500 in hotel-based visitors, representing a 3% decline was still experienced. Although the relaxed cruiseship policy (refer to Section 4.7.3.3) saw a small increase in 1992 of 2 800 visitors, the overall total in 1992 was still less than 1991, and amounted to 506 200 – the lowest annual visitor arrivals since 1973.
Perhaps most significantly, the total tourism expenditures decreased from US$490 million in 1990 to US$443 million in 1992. For the first time in history, Bermuda actually experienced a small level of unemployment in the hospitality sector, resulting in a decrease in the granting of work permits. The expatriate population of the island dropped by approximately 50% during the early 1990s. While this alleviated some of the unemployment concerns for Bermudans, it created other social consequences including a diminishing of rental revenues, which represents a significant source of income for a substantial number of Bermudans.
4.7.2.2 Economic Performance of the Tourism Industry
A Commission on Competitiveness was established in the early 1990s to address the economic performance of Bermuda during the 1980s and early 1990s. The Commission was made up of a wide range of stakeholders in Bermuda’s tourism industry as well as from the economy in general. The Commission formed 16 task forces that were responsible for the investigation of a number of tourism-related activities including (amongst others): air services, cruiseships, entertainment, service quality, cultural tourism, tourism research, marketing, tourism awareness etc. The outcome of these investigations has led to a series of conclusions and recommendations, which are summarised in Table 4.11.
Although visitor arrivals to Bermuda are still below that received in 1987, the active follow through of the recommendations in Table 4.11 by the Commission has paved the way to visitor arrival recovery.
4.7.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN BERMUDA
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During the 1960s and 1970s, Bermuda examined the type of tourist market it wished to continue attracting, and concluded that it would be in the best interests of the country to preserve its image as an upmarket resort destination. As a consequence, a number of policies, which would preserve this image, were adopted and continue to act as the foundation for the country’s tourism policy.
The most important policy was one which directly limited growth in carrying capacity by imposing a moratorium on the construction of new hotels and the maintenance of a 10 000-bed ceiling. This policy still forms the basis of tourism development in Bermuda and is enforced through a phasing scheme which maintains the 10 000-bed ceiling limit and allocates available space within the ceiling to the strongest properties which maintain the highest standards. Other tourism-related policies include:
Table 4.11: Summary of Conclusions and Recommendations to Address Bermuda’s Economic Performance
Conclusion Recommendation . The management of the tourism industry needs . Expansion of the role of the Department of to be changed in such a way which would result Tourism to incorporate strategic planning and in more emphasis being placed on product policy product policy issues. and development through a comprehensive planning process . The tourism product requires enhancement in . The creation of the Bermuda Development terms of accommodation, eating facilities, events, Fund to attract domestic investment in the transportation, amenities, retailing, recreation tourism industry and to provide capital for etc. small business operators to enhance their service. . Low profitability of hotels. . Profitability of hotels could be improved through efforts to expand the season (e.g. through the use of innovative packaging based on emerging travel trends such as cultural and ecotourism niches . Recognise the need to review price/value . Value-added strategies including the offering considerations. of a greater range of no-cost or sponsored activities into the island’s tourism product. . Recognised the role that the residents of the . Tourism education and awareness population play in determining the quality of the programmes through a series of human tourism product and the level of service provided resource development and national for tourists programmes of certification and recognition to influence and encourage tourism as a career choice. . Increased marketing efforts. . Greater use of database marketing techniques and cooperative advertising as well as on-going research into emerging
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niches which will provide a basis for determining whether there are market opportunities which would fit with Bermuda’s resources. Source: Commission on Competitiveness, 1993
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4.7.3.1 Grading Policy
This policy (introduced in 1988) was specifically designed to link the renewal of hotel licenses with the maintenance of high-quality standards. Under this plan, properties are required to meet high standards of cleanliness, attractiveness and offer defined levels of amenities in order to ensure the renewal of their operating licence.
4.7.3.2 Timeshare Policy
During the 1980s, two hotel properties received permission to convert to timesharing, and permission was granted in 1981 to York-Hannover, the Canadian developer, to construct a timesharing resort. Since then, a moratorium has been placed on any further timesharing development until the government can assess its role as a tourism product. This policy is contrary to that of many other island resort destinations, which have embraced the timesharing concept albeit not always with positive results. In this sense, the policy is an indicator of the control that Bermuda exercises over innovative development in addition to traditional developments.
4.7.3.3 Cruiseship Policy
Cruiseship arrivals have played a major role in Bermuda’s tourism since its inception. This segment reached its high point in 1988 when arrivals totalled 158 368. However, concern about overcrowding on the part of the hoteliers, and related impact to the island’s image resulted in Bermuda adopting a restrictive policy in 1988. This policy limited cruiseship arrivals to 120 00 during the high season of May to October, and allowed for only four scheduled cruisehips weekly between Monday and Friday. The policy also allowed for up to 12 additional occasional callers. The rationale for such a restrictive policy was to reduce the pressure on Bermuda’s tourism infrastructure and to maintain the image of the island as an upmarket destination. To further bolster these objectives, visits were only awarded to high-standard cruise operators such as the Royal Viking Line, Chandris Celebrity Cruises and Royal Caribbean. In 1989 the restrictive policy began to take effect, and cruiseship arrivals fell to 131 322 and in 1990 actually fell below the 120 000 ceiling with a total of 113 000. As a result of this decrease and the deterioration in the tourism industry generally, the government raised the ceiling in the mid-1990s to 150 000. This relaxing of the policy was designed to offset the drop in air arrivals which had been occurring since the 1987 high. This policy re-emphasises the extent to which the maintenance of a narrow approach forms the basis of tourism in Bermuda.
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INSERT KENYA COVER PAGE
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4.8.1 FEATURES OF THE KENYAN TOURISM INDUSTRY
4.8.1.1 Tourist Arrivals
According to the Central Bureau of Statistics in Kenya (“CBSK”), the total number of tourist arrivals to Kenya in 1999 increased significantly by 8,4% from 894 300 in 1998 to 969 300 in 1999. However, this number is lower than the 1 million recorded in 1996. The 18,9% increase in the third quarter of 1999 can be attributed to the stable security situation especially in the Coastal region, as well as the depreciation of the Kenya Shilling against major currencies during the second half of 1999 - making Kenya a comparably cheap destination to visit.
Table 4.12: Arrivals to Kenya by Country of Residence, 1999
Country of Residence Number of Arrivals (‘000) Germany 200,3 UK 143,9 Switzerland 25,2 Italy 29,5 France 24,1 Scandinavia 20,5 Other Europe 161,7 Total Europe 605,2 USA 52,5 Canada 17,8 Total North America 70,3 Uganda 38,8 Tanzania 41,9 Other Africa 61,4 Total Africa 142,1 India 16,3 Japan 12,4 Israel 6,9 Other Asia 18,6 Total Asia 54,2 Australia & New Zealand 16,8 All other countries 5,8 TOTAL 1 818,4 Source: Central Bureau of Statistics
Europe – particularly Germany and the UK - continued to be the main generating markets for tourism to Kenya in 1999 and accounted for just over 60% of all arrivals. The majority of tourists from Europe came to Kenya for holiday purposes – refer to Table 4.12.
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Tourists from east Africa – particularly Uganda and Tanzania - were the second most important source markets for Kenya and accounted for approximately 15% of all tourists to Kenya. Whilst holiday was the main purpose of visit for tourists from Tanzania, most of the tourists from Uganda came to Kenya on business.
4.8.2 DEVELOPMENT OF TOURISM IN KENYA
4.8.2.1 Tourist Arrivals
The increase in international tourism in the 1960s, as a result of the development of inclusive tours, permitted an ever-increasing number of Europeans and North Americans to travel to Kenya. Following in the wake of this interest, Kenya was quick to respond to the rapidly growing needs of tourism by making considerable investments in infrastructure, hotel bed accommodation, game parks and reserves, and setting up necessary services. As Figure 4.14 indicates the, decade following 1972 was a difficult period. Tourist arrivals in 1976 were 424 000. The actual number of arrivals in 1978 was only 44% of the target figure of 816 000. Between 1976 and 1983, the figure slumped to below 400 000. However, the 1984-1988 period saw a revival. A combination of factors can explain this slump. The 1972-1974 decline was undoubtedly largely due to the impact of the economic recession in the developed countries. It is also possible that the impact of the two oil shocks in 1973 and 1979 on world tourism could have partially contributed to the slowdown, since these would have made travel more expensive. The downturn affected most long-haul holiday markets, which by early 1983, had begun to recover. In Kenya’s case, however, it was lengthened; arrivals did not pick up until the end of that year. For example, between 1978 and 1983, Kenya experienced a 25% fall in UK holiday visitors.
The decline in tourism arrivals in the mid-1970s and early 1980s can also be attributed to the political turmoil in Kenya. Unrest began with the closure of the common border with Tanzania and culminated in a military coup in August 1982. Prior to this, the eastern African subregion operated as a multicentre, multidestination tourism industry, which offered the chance for Kenya and Tanzania in particular, to promote their safari products on a regional basis and to take advantage of economies of scale. For the tourists themselves, it enabled them to enrich their experience over wider areas. With time, however, relations between Kenya and Tanzania started to go sour and resulted in a closure of their common border in February 1977. The closure of this border made the countries particularly vulnerable to military confrontations and a coup attempt in Kenya brought with it political instability. During the same period, Kenya experienced similar
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problems on the Uganda border. This also had adverse effects on Kenya’s tourist trade, which included a drastic reduction in the number of tourists and hotel occupancy levels in Kenya in 1977 and 1982. Part of this slump might have been due to the adverse publicity given to crime against tourists and foreign residents in the international press. This incidents were believed to have led to cancellations of complete packages. It also brought a virtual freeze on tourism in the eastern African subregion in which American tourists had actively participated.
Figure 4.14: Tourist Arrivals to Kenya, 1963-1999
1999
1995
1991
1987
1983
1979
1975
1971
1967
1963 0 200 400 600 800 1000 1200
Tourist Arrivals ('000)
Notes: Visitor arrivals for the period 1989 to 1993 are unobtainable Source: Kenya Statistical Abstracts (various years)
Declines in the number of tourists to Kenya in the 1990s is attributed to, amongst others, the economic recession in Kenya, related declining infrastructure, increasing insecurity combined with bad press coverage12, excessively recycled tourism products (mainly beach holiday and game safaris, and a failure to diversify its range of attractions),
12 Headlines such as “British Tourists Flee Gun Battle on Beach” on the front page of The Times (12/9/1997), and several other similar articles, had a huge impact on Kenyan’s tourism industry in general, but especially the coastal areas, and resulted in cancelled bookings and reluctance to take any further holidays in Kenya and low occupancy rates (5-10%) in hotels.
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increasing competition from its eastern and particularly southern African neighbours (particularly South Africa, Zimbabwe, Namibia and Tanzania) and poor marketing in the world tourism market.
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4.8.2.2 Spatial Distribution of Tourism
While total visitor arrivals grew rapidly and steadily throughout the 1960s, the 1970s saw a shift in the regions of tourist interests in Kenya. The main growth area had been the beach hotels where bednights increased from 417 000 in 1969 to 1 654 000 in 1978, representing a 400% increase. Occupancy rates increased from 47% in 1967 to 68% in 1978. By the end of the 1980s, coastal tourism was estimated to account for between 60- 70% of the national tourism industry.
Beach holidaying occurs in four popular areas including Diani Beach on the south coast. Mombasa in the north, and Malindi/Watamu and the Lamu archipelago. In all four locations, hotels were built in response to increased tourist traffic. One competitive advantage Kenya has over rivals such as the Far East and the Caribbean is the closeness of its beaches to areas of wildlife reserve, thus enabling tourists to combine beach and safari holidays. This is a factor that is perhaps responsible for the continued upward trend in hotel bed capacity, and hence the popularity of beach tourism in the 1970s and 1980s. The distribution of hotel bed supply and bednights occupied, between 1977 and 1987 (refer Figure 4.15), provides insight into the spatial patterns of tourism in Kenya. Figure 4.15 clearly indicates that capacity in Nairobi hotels and game lodges expanded much more slowly than demand for beds in the coastal hotels, where capacity underwent rapid expansion.
In the late 1980s, Nairobi as the centre for many incoming tours, attracted a large number of visitor bednights – mainly because the game viewing tours originate and terminate in the city. As both the commercial centre and the capital city, Nairobi attracts many visiting businessmen. During the late 1980s, the Kenya coast appealed almost exclusively to the western European market. The game parks were the main attractions for North American tourists for whom beach tourism was a peripheral interest.
The growth in the number of tourists has to a large extent been matched by the growth in accommodation facilities. Over the period 1980 to 1990 there was a tremendous increase in the number of hotels and the number of beds at the coast. One source suggests that around 10 000 hotel beds have been added to the existing coastal facilities over the past 10 years – almost doubling capacity.
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Figure 4.15: Bednights Available and Occupancy Levels in Beach, Nairobi and Game Park Hotels (1977-1987)
5000 80% # Beds Beach Hotels 4500 70% 4000 # Beds Nairobi International 60% 3500 Hotels 3000 50% # Beds Game Lodges 2500 40% Occupancy Beach Hotels 2000 30% 1500 (%) Occupancy Occupancy Nairobi 20% 1000 International Hotels
Bednights Available Bednights ('000) 500 10% Occupancy Game Lodges 0 0%
1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987
Source: Kenya Statistical Abstract (various years)
The hotel sector is yet to recover from the effects of the instability in the country in 1997 and 1998. The total number of bednights sold increased slightly by 5% from 2 813 000 in 1998 to 2 951 000 in 1999. This number is still below the 5 061 000 recorded in 1996. The number of bednights available increased 9,2% in 1999 over 1998. This was due to the re-opening of several hotel establishments that had temporarily closed in 1998.
Over the period 1998 to 1999 the number of bednights occupied by Europeans increased by 7,6%. Germany and the UK continued to be the main occupiers of bednights, however, while the number of bednights occupied by the Germans increased by 28% in 1999 over the previous year, the number of bednights taken by the British dropped by 23% over the same period.
Details on hotel bednights sold in each tourist zone are shown in Table 4.13. Excluding visitors from Kenya and other African countries, the Coastal region accounted for around 83% of the total number of bednights occupied by foreign tourists. In 1999 the number of bednights occupied by tourists staying in coastal hotel establishments increased by 8%. Residents from other European countries accounted for approximately 75% of all hotel bednights occupied at the Coast. Tourists from Germany and the UK accounted for 39% and 21% respectively of all bednights occupied at the Coast. Most of the tourists from the USA and Africa preferred to stay in hotels in Nairobi.
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Table 4.13: Hotel Bednights Occupied by Tourist Zone in Kenya, 1995-1999
Zone Number of Bednights Occupied (‘000) 1995 1996 1997 1998 1999 Coastal Beach 3 226,3 3 215,8 3145,9 1614,4 1699,1 Coastal Hinterland 120,3 114,2 59,0 43,9 48,7 Nairobi 1 027,5 1 087,1 529,9 833,6 858,7 Central 275,4 253,4 218,1 92,0 77,5 Masailand 245,3 237,1 215,0 85,2 84,3 Nyanza Basin 78,6 114,3 88,2 110,8 110,1 Western 65,6 33,0 64,3 27,3 69,2 Northern 15,9 6,3 6,5 4,9 3,4 Total Occupied 5 054,8 5 061,2 4910,3 2813,0 2951,0 Total Available 11 562,2 11 354,5 9516,6 7975,7 8711,4 Occupancy 43,7% 44,5% 51,5% 35% 33,9% Achieved Source: Central Bureau of Statistics
4.8.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN KENYA
4.8.3.1 General Tourism Policies
When Kenya gained independence in 1963, it inherited several problems typical of most neo-colonial dependent economies. These problems related to reduced investment, corresponding capital shortage and serious unemployment. In an attempt to address these problems, and particularly along the coastline, a policy for tourism development was initiated. This tourism policy was concerned with the following key objectives and strategies:
1. To develop the necessary physical and social infrastructure and facilities (including roads, water, electricity, sanitation, accommodation, game parks and reserves) in order to support the tourism industry; 2. To indigenise the economy in order to give greater control to the native inhabitants than previously; and, 3. To promote private sector investment in the tourism industry. This objective was supported by an “easy going” policy on repatriation of foreign capital, profits and dividends and provided a pathway for investors who wanted to remit funds from tourism development.
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These objectives were incorporated into various national policy documents and development plans.
The Ministry of Tourism and Wildlife was created in 1966 as the main policy-making organ of the Kenyan government in tourism and wildlife matters. The initial focus of the Ministry was to allocate tourism resources to cover activities carried out by other public bodies whose responsibilities impinged on tourism. The Kenya Tourist Development Corporation (“KTDC”) was set up through an act of parliament in 1965, with the aim of closely monitoring the operation of the hotels, lodges, and other forms of accommodation as well as providing a balancing effect between the public and private sectors, along national development policy objectives. Under the KTDC, Kenya’s tourism development objectives were, amongst others, to:
. Increase tourism’s contribution to the growth of GDP . Raise the foreign exchange earning capacity; . Create more employment opportunities; . Increase Kenyan ownership and management of the industry; . Reduce any undesirable social or environmental consequences; and, . Conserve, protect and improve environmental and wildlife resources. These tourism development objectives culminated in the development of two masterplan programmes:
1 The first involved developing tourist facilities along the coast by expanding the hotel capacity to meet increasing demand through the optimal use of local resources. Based on the rapid and disjointed approached to tourism development along the coast, the government initiated two separate study groups in 1971 and 1974. Their brief was to explore possibilities of an integrated tourism planning and development framework for the coast whereby mutual understanding was to be established between tourists and residents; and, 2 The second programme was associated with wildlife development and the improvement of the facilities at the Masai Mara, Amboseli and Samburu/Buffalo Springs game reserves.
4.8.3.2 Tourism Investment Policies in Kenya
National Investment Policy
Kenya has followed a mixed economic development strategy since independence. While the respective roles of the public and private sectors have evolved over time, the country
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has experienced remarkable continuity in its underlying economic development strategy. However, there has been a shift in emphasis form public investment. Market based reforms have been introduced and more incentives for both local and foreign private investments has also been provided. The Government has outlined the nation’s broad economic development strategy in various Sessional Papers and the National Development Plans, the most notable being Sessional Paper No 1 of 1986 on Economic Management for Renewed Growth which places emphasis on an increased private sector role in the economy, and Sessional Paper No 1 of 1994 on Recovery and Sustainable Development.
Investment in Accommodation
The hotel industry in Kenya, its ownership and management structure, underpins the nature of entrepreneurship in the tourism sector. The hotel industry in Kenya includes both hotels with foreign and local entrepreneurial capital investment in them and others in which the government has an equity interest. Investment in other support services, such as tour operators, entertainment, restaurants and recreation is equally significant. Five syndicates are behind the majority of tourism investment in Kenya. These include: Kenya Hotels Properties Ltd, International Hotels Ltd, Safari Lodge Properties of Kenya Ltd, Kenya Safari Lodges and Hotels Ltd, and Robinson’s Baobab Hotel Group. Foreign equity participation accounts for about 60% of hotel beds in Kenya. In Malindi for example, it is estimated that foreign ownership is between 80% and 90% (compared to the an estimated 60% for the country as a whole).
Part of the reasons for this significant level of foreign involvement in Kenya’s hotel industry follows from the country’s investment policy, which provides the private foreign investor a place in national economic development. The “easy-going” policy referred to in Section 4.8.3 above has played a major role in the dominance of private sector investment in tourism. The predominance may also be explained by the fact that international tourism is an export industry in which the focus is on the satisfaction of the foreign customer, implying that Kenya’s hotel industry, as one component of the tourist product amalgam, must reach international, rather than domestic standards. Since the standards are largely dictated by the tourist-generating countries, the foreign partners in Kenya tend to preserve their brand image.
One important characteristic emanating from the heavy involvement of foreign investment in Kenya’s tourism industry is the impact of such involvement on the Kenyan economy and society. To a substantial degree, the market is dependent on an inflow of foreign capital. This over reliance on foreign capital and expertise has, to a certain extent,
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influenced Kenya’s tourism policy in favour of luxury tourism. The latter does not fit well with the government’s aim of encouraging domestic tourism (through the objectives and incentives of the Domestic Tourism Council) as a means of ironing out seasonal variations in tourism, given the generalisation that Africans are not leisure-minded and that Kenyans do not utilise tourist hotels as much as the foreign visitors to the country – probably because they are not able to afford the prices charged for a roomnight.
4.8.4 TOURISM MARKETING
In 1940 three Eastern Africa governments formed the East African Travel and Tourism Association (“EATTA”) to coordinate the development of tourism activities, organise promotional activities and undertake international publicity and marketing. The challenge of EATTA was to collect and convey accurate information and create statistical data on different aspects of tourism for international tour operators.
In 1951, EATTA managed to prepare a Dossier with details of travel conditions and routes to tourist destinations within east Africa. During this period the EATTA also had an affiliation with the International Union of Tour Operators (“IUOTO”) and attended the IUOTO annual conference in Europe and had a chance to meet and further market East Africa. The issue main objective of the EATTA during the 1950s was to change the travel policy from luxury safari/game hunting to cheaper tourism cantered on wildlife viewing and photography.
After the mid-1960s (after independence), each east African country began to promote its own tourism industry and the EATTA fell away. In Kenya the Ministry in charge of Tourism and Wildlife assumed the role of promotion between the period 1965 to 1997, when the Kenya Tourist Board was established to take over the marketing and promotion portfolio. The increase in tourism growth in the early 1970s and 1980s is partly explained by the promotional efforts of the KTDC. The KTDC maintains nine tourist offices outside Kenya, mainly in the USA and European and Far Eastern countries’ capitals. “The Land Out of Africa” slogan coined from the worldwide publicity gained by the Oscar-winning film, “Out of Africa”, formed the focus of the national tourism marketing campaigns in the mid 1980s. Another national theme, “Kenya – all of Africa in one country” was used in the late 1980s.
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INSERT MAURITIUS COVER PAGE
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4.9.1 FEATURES OF THE MAURITIAN TOURISM INDUSTRY
4.9.1.1 Size and Market Share
According to WTO, the number of visitors to Mauritius over the period 1995 to 1999 has steady increased with an average annual growth rate of 8,2% (refer to Table 4.13). Although not indicated in Table 4.14, Spain, Sweden and the Netherlands have shown good average annual growth rates over the period 1995 to 1999. Intraregional travel i.e. travel from the Southern African Development Community (“SADC”) countries was responsible for around 34% of all travel to Mauritius in 1995 and 27% in 1999. The decrease in intraregional travel is considered to be a consequence of the emergence of various destinations such as Thailand, which are able to offer alternative beach holidays to this market. The increase in interregional travel to Mauritius, however, is promising since it reflects the increase in long-haul travel by the major tourism generating countries.
Table 4.14: Foreign Tourist Arrivals to Mauritius According to Country of Origin, 1995-1999
Country/Region of Arrivals Market share Average Origin Annual Growth 1995 1997 1998 1999 1995 1999 99/95
Reunion 78 431 82 628 83 966 83 749 18,6% 14,5% 1,7% South Africa 42 653 51 249 49 676 46 583 10,1% 8,1% 2,2% Seychelles 7 116 8 995 859 7 893 1,7% 1,4% 2,6% Madagascar 6 885 10 143 9 213 7 880 1,6% 1,4% 3,4% Zimbabwe 2 965 4 248 3 796 2 606 0,7% 0,5% -3,2% Kenya 1 158 1 230 1 684 1 655 0,3% 0,3% 9,3% Other Intraregional 4 378 5 589 6 160 5 862 1,0% 1,0% 7,6% Intraregional 143 586 372 043 395 171 421 857 34,0% 27,0% 2,1% France 116 701 145 173 16 775 175 431 27,6% 30,3% 10,7% UK 31 324 46 022 52 299 58 683 7,4% 1,0% 17,0% Germany 41 637 43 993 43 836 45 206 9,9% 7,8% 2,1% Italy 17 384 35 255 36 614 36 675 4,1% 6,3% 20,5% Switzerland 13 815 16 105 16 178 16 281 3,3% 2,8% 4,0% India 11 225 13 220 16 269 13 583 2,7% 2,3% 4,9% Belgium 5 802 8 162 8 365 9 586 1,4% 1,7% 13,4% Austria 4 841 8 317 7 757 8 095 1,1% 1,4% 13,7% Australia 5 558 9 460 8 913 8 076 1,3% 1,4% 9,8% Other interregional 30 590 46 336 188 165 50 241 10,9% 12,5% 1,1% Total Interregional 278 877 372 043 395 171 421 857 66,0% 73,0% 10,9% TOTAL 422 463 536 125 558 195 578 085 100,0% 100,0% 8,2%
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Source: WTO, 2000
The increase in tourism growth for Mauritius is considered to be attributed to the following positive developments:
. Mauritania authorities have continued to encourage investment in hotel development. Three new hotel projects and extensions to four existing hotels were completed in 1999, accounting for an increase of 1 000 rooms; and, . Air access has recently been improved with the number of flights operating on the routes to and from the UK, France, Italy and Germany, Switzerland, India and Australia having been increased.
Some of the main findings of the 1998 Survey of Outgoing Tourists (conducted every two years by the Ministry of Tourism and Leisure) are summarised below:
. 61,5% Of all tourists came to Mauritius on a package holiday;
. The main purpose of visit to Mauritius is as follows: Holiday 75,0%; Honeymoon 10,7%; Business 9,1%; VFR 2,4%; and, Other 2,8%.
. The type of accommodation used by foreign tourists is as follows: Hotel 78,8%; Bungalow 8,8%; Boarding houses 4,1%; VFR 2,4%; and, Other 2,3%.
. Motivation for visit (for those on holiday or honeymoon only) is as follows: Advert/film 16,9%; Friends 37,3%; Incentive trips 1,7%; Tour Operators 23,5%; Previous visit 18,6%; and, Other 1,9%
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. The motivational factor behind choosing Mauritius as a destinations is as follows: Tropical image 48,8%; Beaches 26,5%; People/local culture 10,3%; Accessibility 6,2%; and, Other 8,2%.
4.9.2 DEVELOPMENT OF TOURISM IN MAURITIUS
4.9.2.1 Factors Influencing Tourism Development – Pre 1990
The depression of the 1920s and the first and second world wars had a major influence on the development of tourism in Mauritius since the island had prior to this period, tailored itself towards the middle class market of Western Europe.
Prior to 1952, all visitors to the island had to use sea transport, but this changed when in that year the Australian national airline – Quantas – started to operate the first commercial flights on a fortnightly basis between Australia, Mauritius and South Africa. In 1957, the tourism industry received a boost when South African Airways joined the same route on a weekly basis.
The development of air transport transformed the remoteness of the island and has been the most important element in the development of tourism in Mauritius. However, international tourism did not take off until 1970, when new hotels were built to accommodate the increasing number of visitors and when the national carrier – Air Mauritius started to operate to and from the island.
As far as Mauritius is concerned, tourism as a major foreign exchange earner prior to 1980 developed as a result of several factors including:
. The opening of proper air routes between Europe and Mauritius by foreign carriers on a back to back basis – an element normally only characteristic of charter operations; . The increase in accessibility offered by the national carrier operating new routes and more prominently with the acquisition of wide-bodied aircrafts thus increasing capacity to the island and releasing additional capacity on other carriers; . The vision of the government after independence to create infrastructural needs for the development of tourism and a sound traffic rights policy during negotiation with other international carriers serving Mauritius;
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. An active and dynamic marketing drive through advertising and public relations in 1978-1979 by the Mauritius Government Tourist Office (“MGTO”); . The opening up of tourism promotion offices in Western Europe and America; and, . The introduction of pioneer hotel operators including Club Mediterranee and Sun International, as well as Rogers Group – the first Mauritania chain of hotels (which during the 1980s lacked marketing clout overseas).
The abovementioned factors were particularly important in creating source markets for Mauritius. For example, the introduction of scheduled flights between Munich and Mauritius increased the island’s share of German tourists. Another increase was experienced within the UK market where the increase in seating capacity onboard scheduled Mauritania airlines, as well as the opening up of the London promotion office (and the direct participation of this office in fairs and workshops throughout the UK), resulted in a doubling of this market share, so much so that hoteliers such as Beachcomber and other hotel groups who were not previously interested in Mauritius, began to fight for a share of the market. France is another example. Following direct flights from Paris by the national carrier and the very active participation of the private sector and the MGTO, the island experienced an in an increase of 10 000 tourists from France through direct commercial activities and exposure of the product alone.
The abovementioned factors were also particularly important in meeting the needs of western European tour operators and charter operations whose clients were tired of visiting the already over-exploited western European destinations, and demanded new middle-haul travel destinations.
4.9.2.2 Factors Influencing Tourism Development - 1990s and Beyond
Although the future of tourism in Mauritius is bright at the moment, it remains vulnerable to changes in taste, fashion and pricing. The government is cognisance of these factors because of the situation in the Caribbean (where after many years of tourism growth in the Caribbean, several of the islands are facing increasing competition from other destinations) and has realised the need to diversify both the tourism and economic base because of the potential economic instability that could be caused by the heavy reliance on a single economic sector.
In an attempt to diversify the island’s tourism base, the Mauritania Tourism Promotion Agency (“MTPA”) has diversified the product base as well as the type of accommodation on offer. These are discussed briefly below.
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Diversification of Products
The demand for adventure and ecotourism-related activities has resulted in the development of the Tourism Activity Professionals Association (“TAP”), which represents excursion operators. The new concept of sports-nature-adventure, based on discovery sports activities such as canoeing, mountain-biking and outdoor excursions was recently launched in Mauritius.
Diversification of Accommodation
The number of licensed hotels in Mauritius has increased significantly over the period 1990 to 1999. Hotel occupancies had experienced a steady growth over the period 1990 to 1998, declining by one percentage point in 1999. The decline in hotel occupancies may be attributed to the growing number of bed and breakfast establishments which have become popular with repeat visitors to the island as well as those visitors staying for a longer than average period of time. Table 4.15 provides a summary of hotel trading statistics for the period 1990, 1998 and 1999.
Table 4.15: Hotel Trading Statistics for Mauritius
1990 1998 1999 Number of licensed hotels 75 90 92 Number of rooms 4 603 7 267 8 255 Number of beds 9 572 14 995 16 947 Room occupancy rate (%) 62 72 71 Bed occupancy rate (%) 54 63 62 Tourist nights 3 565 5 568 5 800 Tourist receipts (million rupees) 3 630 11 890 13 670 Average length of stay (nights) 12,2 10,3 10,0 Average expenditure per tourist (rupees) 12 500 21 300 23 600 Source: Central Statistics Office
The trend in Mauritius is moving towards smaller hotels, bed and breakfasts and self- catering resorts, especially for those who have been to the island before. From a revenue perspective, this enables travellers to enjoy longer periods on holiday, opting to spend more money on excursions. Holiday bedrooms are also becoming increasingly important, especially for tourists on long-haul trips. The bedroom, bathroom, terrace and beach form part of the holiday. The latter trend runs alongside the increased demand for dedicated spas, gyms and health centres. An increasing number of upmarket hotels are replacing standard rooms with junior suites and interleading family apartments. With the emphasis
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on a ‘family approach’, new structures, appropriate staffing and adapted programmes of activities are on the go.
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Recommendations for Future Development
In March 1998, a seminar entitled “Tourism in the 1990s” was held by the Ministry for Employment and Tourism. The main objective of this seminar was to undertake a realistic assessment of past tourism actions and to draw up a plan for future action. The seminar focused on eight broad themes within the Mauritania tourism industry. Table 4.16 provides a summary of recommendations (arising out of the issues raised during the seminar) for various categories within the tourism industry.
4.9.3 POLICIES DIRECTING THE DEVELOPMENT OF TOURISM IN MAURITIUS
The main objective of the Mauritania government and the MGTO was, and continues to be, to attract high-income visitors since the latter imparts greater economic benefits than lower-spending visitors. Unlike other small-island economies, Mauritius’s private sector has always been a key player in the economic development of the island. For over a hundred years, the private sector has been present in all sectors of the Mauritania economy. In other Indian Ocean islands (e.g. the Seychelles), it is the government that has been responsible for the development of tourism because of the weakness or absence of the private sector.
In 1960 there were very few suitable hotels of international standard. However, in 1998 there were around 92 hotels of international standard. The policy makers of the colonial government were initially sceptical about the tourism potential of the island because of the distance that exists between Mauritius and the main European tourist markets, and of the remoteness and isolation of the island. Scepticism was further strengthened by the fact that during the 1960s, Europeans had a wide choice of sea, sun and sand holidays, especially in the Mediterranean countries. Hence the plan by the private sector to build hotels with the financial assistance of the colonial government gave rise to a debate amongst decision makers. Hypothetical questions arose such as to whether the construction of hotels would be a waste of public money. Concerns also arose as to whether a first-class hotel would attract people who would have to travel great distances to get to the island. These pessimistic views were well founded during these years because of the fact that tourism was a relatively new industry in Third World countries. However, with the rapid technological development of air transport (discussed in Section 4.9.2 above), the distance between Mauritius and the main tourist-generating countries ‘decreased’. Mauritius is currently well connected with Europe, South Africa and Reunion, but connection with other mainland African countries is poor.
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Table 4.16: Recommendations for Tourism Development in Mauritius in the 1990s
Tourism Recommendations Category Tourist Product . Maintain Mauritius as an essentially resort destination; . Take active measures to encourage the cultural industry; . Build conference centres to cater for business and conference tourism; . Develop the necessary infrastructure on the outer islands to accommodate enthusiasts e.g. diving, fishing, escapism, etc.; and, . Amend tax legislation so as to allow for initial and investment allowances on road vehicles that are used in the car-hire industry. Air Access . Give active consideration to the promotion of additional route networks in the region; Policy . Take actions to maximise air transport capacities as a means of contributing to the full development of the tourism industry in terms of servicing existing and new international routes (e.g. Japan, Australia, Middle East, Malaysia, etc.). Marketing . Diversify the existing source markets and tap into new ones (e.g. Japan, South East Asia, Scandinavia, the Benelux countries, Iberian peninsula, Australia, etc.); . Increase the share of long-haul tourists in total arrivals, raise the length of stay and increase the per capita expenditure; . Earmark 3% to 5% of total tourism earnings for promotional activities; . Develop a well-defined system whereby both the public and private sectors could participate jointly in promotional campaigns; and, . Project an image of excellence in the promotion of the cultural diversity of Mauritius. Infrastructure . Earmark an appropriate budget for the implementation of infrastructure in the main tourist zones (e.g. Le Morne, Wolmar, Balaclva and Belle Mare); . Encourage the construction of marinas, especially in the Grand Baie and Port Louis areas, and introduce appropriate legislation to regulate yachting; . Encourage the construction of golf courses of an international standard; and, . Find a ‘modus operandi’ with respect to the setting up of additional duty-free shops throughout the island. Hotel Industry . Take the necessary steps to accelerate the construction of planned hotel projects; . Restrict the total number of rooms to 200 per hotel complex and to restrict the hotel complex to a 1-2 storey building; . Give priority to Mauritania entrepreneurs over foreign nationals in the re-allocation of hotel sites; . Give priority to investment for the provision of infrastructural facilities, especially at Wolmar, le Morne and Pointe aux Piments; and, . Introduce a pause of around five years in hotel construction once the already planned hotel projects are completed. Environment . Finalise a masterplan for the restoration and protection of the Grand Baie region and the creation of a marina to reduce and control further pollution of the marine environment; . Set up an appropriate body to monitor the Mauritania environment and initiate actions to prevent, reduce and control pollution from any source; . Impose quality control on all tourist resorts in the country; . Introduce necessary measures to ensure the conservation of wild flora and fauna habitats; . Take appropriate measures to preserve the social and cultural values of the population by discouraging the commercialisation of religious rites and ceremonies; and, . Introduce legislation to regulate tourism related activities e.g. yachting, ballooning, etc. Handicrafts . Given that out of Rs 200M spent by tourists on handicrafts and souvenirs in the late 1980s, only Rs 15M were spent on local handicraft, it was considered necessary to take measures to substantially raise local handicraft production; and, . Undertake an intensive promotion of handicraft in local and international markets through participation in exhibitions and advertising campaigns.
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National . Set up a committee comprising representatives of both the private and public sector to examine the Tourism Board potential of establishing a national tourism board for Mauritius. Source: Ministry for Employment and Tourism, Mauritius, 1988
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4.9.4 TOURISM MARKETING
In the 1970s, the promotion of Mauritius has emphasised the uniqueness of its beaches. However, such campaigns proved to be unproductive since potential visitors were not attracted by these campaigns because a beach was considered to be a homogeneous product that could be easily substituted.
In response to the trend by western Europeans to seek new destinations (other than the traditional Mediterranean destinations) in the 1980s, Mauritius embarked on a marketing and promotional campaign to attract European tourists to Mauritius and developed a marketing slogan - “Mauritius, the most cosmopolitan island under the sun”. This marketing campaign took into account three main motivations for travel by Europeans namely: the “wander lust”, the “sun lust” and the “sea and sand lust”. With the increasing global realisation of the effects of tourism on the environment, the marketing campaign soon included “environmental lust” in their promotions. Although during the 1980s, there was very little demand for cultural holidays by travellers to Mauritius, nevertheless, realising the potential for developing cultural experiences, adapted the marketing mix to include “exotic lust”’ which encouraged the participation of foreigners (and the Mauritania population) in cultural activities, dancing, folklore, etc.
The issue of expanding into new markets was met with reservation by some representatives of the travel and tourism industry. Whereas it was proposed that new markets in Western Europe, Japan and Australia could be considered as new marketing opportunities, others believed that marketing in so many markets would dissipate efforts and reduce effectiveness to a nil return. Supporters of the latter believed that there was plenty of scope within the present markets such as Germany, France, UK, Italy and Switzerland. Based on this argument it has been agreed that marketing efforts would be continued to be directed towards these markets, and only if additional funds were available, would there be increased marketing efforts in the Japanese and Australian markets.
The current marketing strategy for Mauritius emphasises the overall product quality experience including the friendliness of the people, the shopping experience, the quality and variety of the food and the relative safety of the visitors. The MTPA is also currently taking a more direct, hands-on approach to promoting the Indian Ocean islands as a region. Plans are also underway to promote Mauritius as a viable incentive venue for the South African corporate market and to strengthen relationships with the travel trade in South Africa who have loyally supported the island.
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INSERT THAILAND COVER PAGE
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4.10.1 FEATURES OF THAILAND’S TOURISM INDUSTRY
4.10.1.1Size and Share of the Market
According to the Thailand Authority for Tourism (“TAT”), Thailand received 7,76 million foreign visitors in 1998, representing an increase of 7,5% over the previous year (refer to Table 4.17). This was above the target set in the Tourism Plan of 1998, which was set at 7,72 million tourists. This target was also above that set out in the 8th National Economic and Social Development Plan which was set at not lower than 7% per year. This success is partly attributed to the continuous promotion of the “Amazing Thailand” marketing campaign, but also due to the relaxing of immigration regulations for tourists from China, Taiwan and Malaysia and for tourists who are more than 55 years old. In addition, the open policy was actively pursued to increase and facilitate incoming flights and routes.
Table 4.17: Number of International Tourists to Thailand in 1998
Region Number of Tourists Increase/Decrease over 1997 East Asia 4 282 589 -1,2% Europe 2 108 909 +21,5% Oceania 343 938 +22,4% Americas 538 293 +17,9% South Asia 265 054 +9,3% Middle East 148 597 +29,8% Africa 77 550 +35,6% TOTAL 7 764 930 +7,5% Source: Thailand Authority of Tourism, 2000
Reasons for the increase and decrease of arrivals from the various tourist regions may be attributed to the following:
East Asia
The drop in arrivals from this region can be attributed to the economic downturn in major tourist markets such as Malaysia, South Korea and Indonesia.
Europe
Arrivals from Europe increased because of the recognition of Thailand as a “cheap holiday destination”. Moreover, the TAT believes that Thailand appeals to Europeans because of the country’s high quality of tourist attractions and locations, excellent value for money and the country’s political stability. In addition, Thai beaches are popular
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among Europeans because they are viewed as being pristine unlike the beaches of the Caribbean and Bali for example.
Oceania
The devaluation of the baht and the lower rates offered by hotels and tour operators contributed to a vast reduction in travel expenses and better value for money. This aided the continuous growth from Australian tourists in particular. The main spot for Australians was Phuket which was able to compete effectively with Bali due to internal unrest in that country. Tourists from New Zealand also came to Thailand’s beaches as opposed to the islands in the South Pacific. Another factor that boosted arrivals was the increase in flights by Thai Airways along the Melbourne-Sydney-Bangkok route.
The Americas
The American market in particular, experienced good growth, partly owing to the increase of flights by United Airlines.
South Asia
The most important factor in the expansion of this market was the exchange rate factor and the interest in the Asian Games that were hosted in Thailand during 1998.
Middle East
Arrivals from every country in the Middle East increased substantially, with particular growth from countries such as Israel and the United Arab Emirates. Again, the most important factors were the exchange rate and the Asian Games.
Africa
Overall, the African tourist market experienced relatively strong growth, even with the cancellation of the Varig Airlines flight along the Johannesburg-Bangkok route. The devaluation of the baht was an important factor in attracting African tourists to Thailand, since it made long-haul travel more affordable. Furthermore, the constant promotion of Thailand through the “Amazing Thailand” campaign made Africans more aware of Thailand as a tourist destination.
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4.10.1.2 Gateway to Thailand
The Thailand Aviation Authority owns and operates 5 international airports. A brief summary of each of these international airports is provided below:
Bangkok International Airport
Statistics collected by the Airports Council International (“ACI”) indicate that among the world’s largest airports in 1983, Bangkok International Airport (“BIA”) was ranked 51st with 5,68 million passengers passing through that year. In 1998 the number of passengers passing through BIA increased to 25,62 million (and up to 28th place).
Chiang Mai International Airport
Chaing Mai represents the gateway to northern Thailand. This airport accommodated more than 2 million passengers and 15 000 flights per annum.
Hat Yai International Airport
Hat Yai is located in southern Thailand. In addition to serving the south of Thailand for business and leisure purposes, it is also an important gateway for Muslims on their annual pilgrimage to Mecca. 3 Airlines (all regional) operate from this airport, with more than 800 000 passengers and 9 500 flights passing through each year.
Phuket International Airport
This airport ranks second in the country in terms of passenger volume. The airport serves 10 airlines, with 2,9 million passengers and 20 000 flights passing through each year. The airlines are primarily regional, with only Finnair and Britannia Airways being the only international airlines operating through this airport.
Chiang Roi International Airport
This airport is located in northern Thailand, and is one of the smallest international airports in Thailand – operating only 2 airlines, 500 000 passengers and 3 900 flights.
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4.10.2 DEVELOPMENT OF TOURISM IN THAILAND
We have been unable to obtain any information regarding the overall pattern of development of tourism in Thailand. However, we are able to provide a summary of the reasons for development and the various policies directing the growth and development along the coastal regions of Thailand, namely the East Coast and Southern Thailand. Although the Central Plains region boasts a relatively small coastline, beach tourism is not the key focus in this area. Rather urban/city tourism in the country’s capital city – Bangkok - is the main form of tourism.
4.10.2.1 Spatial Distribution of Tourism
East Coast
The East Coast of Thailand has been labelled optimistically as Thailand’s Riviera, however, many sources cite the east coast as a 500km string of predominantly dull, grey beaches blotched with expensive, over-packaged family resorts. The discovery of oil and natural gas fields in these coastal waters has turned pockets of the first 100km stretch into an unsightly industrial landscape of refineries and depots. Offshore, however, it is an entirely different story, with island beaches as peaceful and unsullied as many of the more celebrated southern retreats.
Pattaya
After landing in Bangkok, much of the package holiday traffic flows east to Pattaya, the country’s first and most popular beach resort. Born as a rest-and-recreation base for the US military during the Vietnam War, it has grown into a mass of hotels. The international tourists to Pattaya are predominantly middle-aged western males who are enticed by the area’s sex-market reputation, and are undeterred by its notoriety as the country’s most polluted beach. Pattaya is also host to the country’s largest gay scene, with several exclusive gay hotels and sex bars.
Tempted by foreign investment in the mid 1970s, local landowners were forced out, and the fishing village of Pattaya was transformed. Almost 50% of the bars, cafes and restaurants are Western-run and specialize in home-from-home menus of English breakfasts and hamburgers and chips. More recently there has been an influx of criminal gangs from Europe and Japan, who reportedly find Pattaya a haven for passport and credit card fraud as well as child pornography and prostitution.
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Pattaya, however, does have it good points, besides it’s “sin city” reputation, Pattaya’s watersport facilities are among the best in the country, and although holidaying in the area may not be cheap (with no low-budget accommodation), there are several relatively mid-market hotels.
Pattaya, tiring of its reputation as the most polluted beach in Thailand, has constructed several water treatment plants, and is trying to entice more family holidaymakers to the area by building new theme parks and shopping plazas.
Ko Sameth
Attracted by its proximity to Bangkok and its powdery white sand, backpackers, package tourists and Thai students flock to the island of Ko Samet, 80km southeast of Pattaya. Ko Samet was declared a national park in 1981, but typically the ban on building has been ignored and there are now over thirty bungalow operations here. Inevitably this has had a huge impact on the island’s resources. Though the authorities did try closing the island to overnight visitors in 1990, they have since come to an (controversial) agreement with the island’s bungalow operators who now pay rent to the Royal Forestry Department.
Southern Thailand
Southern Thailand (the Gulf Coast) is most famous for the Samui archipelago, which consists of three small islands lying off the most prominent hump of the coastline. The Gulf Coast is Thailand’s most popular destination for independent beach travellers.
Topographically, the land in southern Thailand is characterized by a mountainous spine and lime karst formations which appear both as cliffs and offshore islets, while the coastline is indented with coves and beaches. Numerous islands, including the country’s largest – Phuket, dot the coastal waters. Culturally, southern Thailand is divided into two i.e. the upper and lower south. The former, which extends down to Chumpon, faces the Gulf of Thailand to the east and is bordered to the west by Myannar (Burma). Most of the coastline has been taken over by beach resorts, notably Cha-am and Hua Him, which are within easy driving distance of Bangkok, although the traditional occupation of fishing still provides the main livelihood for coastal villages.
The low south is best known as the country’s top tourist attraction. Phuket island and Krabi, on the Andaman coast, and Samui island in the Gulf claim tropical beaches that are considered to rank amongst the best in the world.
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Phuket
Until 1972 before the prolonged recession in the metals industry Phuket island had been rich in tin and rubber and tourism was of no importance. Despite the fact that until recently Phuket regularly contributed more than any other province to the national revenue, it remained for many years an obscure and isolated southern province. Roads in southern Thailand were scarce, infested with gangsters, and often impassable during the rainy season. The only reliable way of getting to or from the island was by boat. A major road building program, the opening of regular air service, and most of all the opening of the Sarasin Bridge connecting the island with the mainland dramatically changed this state of affairs. In the mid-70s "Newsweek" magazine, in a special feature, listed Phuket as a destination for travellers seeking something special and undiscovered. Within a short time, people begun flocking to Phuket’s splendid west-coast beaches and a significant new industry was born. Today, the island hosts over one million visitors annually.
After a period of astonishing growth Phuket is now grappling with the dilemma of how to sustain growth without destroying the environment that makes Phuket so desirable. Without a master plan to channel the growth and to develop the island into an integrated tourist destination much of the recent growth has been haphazard and counterproductive. Traditionally, it has been the awesome beauty of Phuket the white sandy beaches, the balmy air, and warm sea that has been the principal attraction to the island, but the current trend seems to favour the continued development of glitzy and expensive tourist resorts that require massive environmental changes to the island.
For Phuket to enhance and maintain it’s status as a world class travel destination it will need a greater level of cooperation between the local government and the business community, and attention to the environment.
4.10.3 POLICIES DIRECTING TOURISM DEVELOPMENT IN THAILAND
The main focus of tourism development in Thailand is to make Thailand the centre of tourism in South East Asia. It is proposed that this will be achieved by using the country’s geographical location and developing a communications network with neighbouring countries to facilitate access. At the same time, it is envisaged that the quality of destinations must be maintained to preserve Thailand’s historical and natural identities,
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and facilities must be developed to provide security for tourists. TAT’s tourism development policy 1997-2003 is divided into 9 areas, comprising a total of 69 projects. These areas for development and some examples of tourist projects are summarized in Table 4.18.
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Table 4.18: TAT’s Tourism Development Objectives, 1997-2003
Area of Development Description Selected Projects Tourism Service Involves the development and improvement of tourist services, facilitating travel, . Providing international cooperation with other countries; determining and implementing tourist business regulations, providing knowledge . Organising regional training courses, meetings, seminars, etc. to develop tourism manpower, and increasing service efficiency with other to develop tourist business manpower; and, countries for tourists and keep abreast of tourism technology . Promoting hotel and restaurant standards. Tourism Information Gathering & Involves the surveying, collection, analysis and planning tourism information and . Jointly investing with the private sector to produce information Dissemination statistics. The data obtained is used to determine and plan the most effective which can benefit tourist businesses; and, tourism development and promotion projects. . Studying and surveying international tourist arrivals to Thailand. Tourist Destination Development This involves the collection, surveying, study and analysis of information on tourist . Surveying and developing destinations; and, Planning destinations to assist in planning the direction, form and priority of destinations in . Coordinating and following up development projects in every region of the country. government areas. Tourist Destination Conservation & This area involves the inspection, preservation and development of tourist . Campaigning and publicizing environmental conservation in Development destinations and public utilities and facilities in major destination that are spread tourist destinations by producing educational tools to create throughout the country. understanding and awareness. Festival Promotion in Provinces This area involves the conservation and revival of arts, culture, traditions, . Supporting regional and provincial festivals; handicrafts and traditional ways of life in every region so that they remain national . Organizing activities to promote tourism, arts, culture and identities and are well-known among Thai and foreign tourists. traditions; and, . Holding Thai and international food festivals. Tourism Development and Promotion The loan for tourism development and promotion by the Overseas Economic Loan Fund Cooperation Fund is used for developing the various regions of the country. The loan concentrates on developing tourist destinations with high potential, providing easy access to regional and intra-regional destinations, and establishing gateways to destinations in other countries. Hotel and Tourism Training Institute The institute serves to develop manpower for the tourism industry. Tourist Facilitation & Safety This involves facilitating, providing safety to and helping tourists by coordinating . Developing tourist police personnel; with public and private offices to solve problems experienced by tourists as quickly . Offering foreign language courses to officers; as possible. . Organising various training programmes e.g. English listening and speaking for communications and orientation for persons concerned with international affairs. Tourist Business & Guide Registration This involves ensuring that tourists and tourist businesses are protected under the Tourist Business and Guide Act of 1992. Source: TAT, 2000
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4.10.4 TOURISM MARKETING
Tourism marketing in 1998 emphasised promoting the image of Thailand as a quality, safe and diverse destination for Thai and foreign tourists. The primary objective of the “Amazing Thailand” 1998-1999 marketing and promotional campaign was to get quality tourists to come to Thailand, to have them stay longer and spend more. In addition to focusing on the main generating markets of Thailand (and the domestic market), the TAT also concentrated on tourism cooperation with countries in ASEN, East Asia, the Mekong Sub-Region (Laos, Cambodia, Vietnam, Myanmar, southern China and Thailand), the Indonesia-Malaysia-Thailand Growth Triangle, and the Sub- Continent Group (Bangladesh, India, Myanmar, Sri Lanka and Thailand).
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5.1 INTRODUCTORY COMMENTS
Since the 1980s important changes have taken place at traditional beach destinations, particularly along the Mediterranean coastline and in the Caribbean. Initially these changes arose from changes in travel motivations and the desire to travel to more exotic places as opposed to traditional beach destinations. However, the most important changes in beach tourism have occurred since the beginning of the 1990s, with a decline in the number of arrivals when the negative environmental consequence of mass beach tourism became clear. The “unfashionable” beach destinations along the Mediterranean coastline and some of the islands in the Caribbean have diverted beach tourists to newly emerging and competitive destinations such as Thailand and the Dominican Republic, as well as to other destinations that are able to diversify their product base to incorporate new cultural/historical/adventure experiences in addition to traditional sun, sea and sand products.
These changes have resulted in rejuvenation strategies in the traditional beach tourist destinations and a redefining of tourism objectives and strategies that are better adapted to achieving future sustainable development whilst simultaneously improving their competitive positioning.
5.2 OVERVIEW OF THE DEVELOPMENT OF BEACH TOURISM
If a life cycle approach is applied to the development of beach tourism at selected destinations around the world, it shows several common trends (refer to Figure 5.1). Each of these trends is described below. The timescale applied to each stage in Figure 5.1 should only be taken as a general indication of the timescale of different stages of development, because whilst some destinations such as Thailand and Mauritius are still experiencing good levels of growth, others find themselves trying to rejuvenate their industry.
5.2.1 Initial Stage
Before World War II, the number of international tourists to beach destinations was relatively low, and was dominated by the wealthier classes. The number of accommodation establishments and available bednights was low.
5.2.2 Growth Stage
After World War II, the number of tourists to beach destinations increased. Improvements in aviation and the phenomenon of mass beach tourism (directed by the growth of packaged holidays) were/are the main agents responsible for growth. A
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definite geographical distribution of tourist accommodation and facilities began to occur. As a general indication26, for every 5% increase in the number of tourists to beach destinations over a 10-year period, there was an average increase of 35% in bedspaces in the coastal regions and a 17% average increase in the number of coastal establishments. In countries such as Spain and Portugal, the coastal regions account for around 35% of the total number of bedspaces available.
Figure 5.1: Life Cycle Approach to the Development of Beach Destinations Around the World
ce, Cyprus, Cyprus, ce,
Bahamas
e.g. Kenya, Mauritius and Thailand and Mauritius Kenya, e.g.
e.g. Spain and Cyprus, Bermuda Cyprus, and Spain e.g.
e.g. Spain, Cyprus and Bermuda, Bermuda, and Cyprus Spain, e.g.
e.g. Spain, Portugal, Gree Portugal, Spain, e.g. Kenya, Bahamas, the Bermuda, Thailand and Mauritius Cyprus, Greece, Portugal, Spain, e.g. Bahamas the and Bermuda,
Growth in Tourist Tourist in Growth & Facilities Arrivals, Accommodation
Initial Growth Decline Rejuvenation
Pre Post WWII - Ma 199 21st WWII 1980s tur 0s Centu Source: Grant Thornton Kessel Feinstein e ry 5.2.3 Mature Stage 19 80 For many beach destinations, the 1980s represented as slowing down of the growth in the number of international tourists, partly due to the increased promotion and thus increased awareness of other emerging beach destinations, and partly due to the negative environmental and social impacts that been brought about by virtue of the nature of mass tourism. Although Figure 5.1 does not indicate that Kenya, Mauritius and Thailand have entered the mature phase of beach tourism growth, they are nevertheless incorporating the issues of sustainable development and product diversification into their tourism policies and masterplans.
26 This rule only applies to those beach destinations that have already passed through their growth stage of development
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5.2.4 Declining Stage
This stage represents a continuation of the slowdown of the 1980s.
5.2.5 Rejuvenation Stage
Although several destinations are experiencing a decline in the number of tourists to coastal areas, a few countries namely Spain, Cyprus and the Bahamas have taken an active role in trying to counteract the declining state of tourism through the application and incorporation of sustainable and rejuvenation strategies into their overall tourism development plans at both local and national levels.
5.3 THE IMPORTANCE OF PLANNING FOR TOURISM
One of the most important outcomes of the international case studies presented in Section 4 is the necessity of planning for tourism. The experience of many tourism destinations around the world has demonstrated that, on a long-term basis, the planned approach to developing tourism can bring benefits without significant problems, and secure and maintain satisfied tourism markets. Places that have allowed tourism to develop without the benefit of planning are now suffering environmental and social problems. These are detrimental to residents and unpleasant for many tourists, resulting in market difficulties and decreasing economic benefits. These uncontrolled tourism destinations cannot effectively compete with planned tourist destinations elsewhere. Certain coastal areas of the Mediterranean coastline and the island of Bermuda for example, are now in the process of formulating and undertaking restructuring policies to redevelop their tourism bases.
5.4 RESTRUCTURING POLICIES FOR BEACH DESTINATIONS
In the Mediterranean, an assessment of the improvements necessary to rejuvenate the tourism industry have resulted in the formulation of new policies with public and private participation in several areas, namely:
. Seeking improvements in the quality of existing mass tourism through improved and regulated urban planning, as well as measures to ensure the preservation of the environment, improved facilities, etc. The main objective is to continue to attract the destination’s main source markets, by reorienting (mostly existing) facilities to meet the requirements of medium-income segments of demand which, had previously over the years, progressively declined in favour of lower- income segments;
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. Creating high-quality areas, which can function independently of mass tourism. Conditions necessary for the implementation of such actions include respect for the environment, high-quality infrastructure and complementary service provision; and,
. Sensitivity regarding the prices of beach tourism packages given the limited purchasing power of a large part of the lower-middle and working-class market in Europe for the sun and sea product.
The redefinition of established coastal areas will depend on the ability to analyse the complex processes that are responsible for reshaping the industry. If the tourism sector is to satisfy the emerging patterns of needs, then investment in the services and products demanded by tourists, as well as improvements in infrastructure (especially access to coastal areas), is required. These requirements are particularly pressing within a leisure economy, which is becoming more and more complex and structured as a result of emerging and diverse tourist segments.
5.5 SUSTAINABLE TOURISM DEVELOPMENT
A common theme running through all the international case studies (in Section 4) as well as in the rejuvenation strategies alluded to above, is the notion of an integrated and sustainable development approach to developing tourism for the future. The tourism development policies of certain countries e.g. Spain, the Bahamas and Cyprus, place great focus on balancing environmental, socio-cultural and economic objectives. At the same time, they are also realistic in recognising the importance of developing tourism that will meet certain market demands, and recognise that new and imaginative products are required in any attempt to diversify the product base and to develop their own tourist markets and specialised niches.
Where sustainable tourism developmental practices have been implemented, the case studies reflect the need to establish firm controls. Several more specific conclusions can be drawn from the case studies. These can be summarised as follows:
. Carefully planned and managed tourist destinations are much more likely to be successful on a long-term basis than unplanned areas. Planning maintains the viability of tourism resources and ensures community participation and “buy-in” to achieve the expected market results.
. Effective planning should be based upon sound methodological approaches. A basic technique in planning sustainable tourism is the notion of a carrying capacity analysis, which although far from being a perfect analytical tool,
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provides invaluable guidelines in establishing appropriate types and levels of development for a region.
. Much emphasis is now being given to the development of quality tourism. This concept implies protecting the environment, maintaining cultural identity and integrity, and achieving a high level of tourist satisfaction, while still generating substantial economic benefits.
. Some basic planning principles are applicable in all tourism areas. These principles include establishing tourist gateways, clustering attractions and staging development. Adequate transportation facilities are essential to provide proper access to the country or region, as well as convenient travel within the tourism areas themselves. Other infrastructure for tourism – water supply, electricity, sewage and solid waste disposal, and telecommunications – must be properly developed in order to provide adequate facilities and services for tourists and prevent environmental problems from arising. . Marketing and product development go hand-in-hand, and must be carefully coordinated to achieve successful tourism development. Tourist markets are becoming increasingly fragmented, and a diversity of imaginative tourism products are currently being developed. A tourism area should consider all forms of tourism, and select the combination that is most suitable for the environment, society and economy. It is also necessary to realise that the most appropriate forms of tourism may change through time.
. Effective approaches for implementation must be emphasised in the planning and development process. Implementation requires not only procedures and techniques, but also political commitment and strong leadership. Organisational structures for tourism must be carefully established, with emphasis on coordination among government agencies and between the public and private sectors. Public-private sector coordination is an essential ingredient of successful implementation. In most countries the national and provincial governments have taken the initiative in setting development and quality standards for tourism development, in order to ensure that the actual development is implemented properly. However, in most instances, local tourism area governments have also been involved in setting and applying appropriate standards.
. Demonstration or pilot projects can be an excellent way of showing how new forms of tourism and development approaches can work. Such projects also provide the opportunities to refine approaches and techniques.
. Investment incentives – and disincentives – can be a very useful technique in implementing development strategies. However, incentives should be applied on a selective basis and modified through time based on changing
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circumstances. Section 5.6 provides a more in-depth discussion of tourism investment incentives.
. All types of education and training are necessary for tourism. Persons working in the tourism industry must be properly trained. The general public and people living in tourism areas must be educated about tourism. Tourists must be informed about their destination – its geography, history, cultural patterns and society – and must be encouraged to respect it.
. Continuous monitoring and management of tourism is essential. Monitoring techniques and procedures should be established early in the development process, and be applied to the development plan, implementation of the plan, and the on-going process of tourism. Problems and changing circumstances inevitably arise from tourism development, and monitoring can detect these at an early stage so that appropriate action can be taken. Effective management of tourism is on going and the responsibility of both the public and private sectors.
The above approaches to tourism planning provide an indication of “best practice” not only for the development of beach destinations, but for tourism development in general. However, while it would be “first-prize” to develop South Africa as a beach destination along these planning guidelines, it must be realised that the implementation of these “best practices” involves some experimentation to determine the best specific approaches to be applied in each area/region. Nevertheless, regardless of the planning principals/approaches adopted for beach tourism development in South Africa, it is important that these approaches must be flexible and reflect basic principles such as achieving sustainable development, respecting cultural values and spreading economic benefits.
5.6 TOURISM INVESTMENT POLICIES AND INCENTIVES
As indicated in several international case studies, the government has been typically involved in the provision of infrastructure such as roads and airports. However, other than under exceptional circumstances where accommodation establishments are state-owned, the financing of tourism-specific infrastructure is typically the responsibility of the private developer, or a public corporation if one is involved.
Some of the most common forms of investment incentives arising from the case studies are summarised below. These financial incentives represent either single investment incentives or a combination of incentives:
. Provision of development land, and assembly of the required amount of land, at moderate or no cost at suitable sites;
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. Provision of off-site infrastructure (which is usually the case) or provision of on- site infrastructure at no cost to the investor; . Complete or partial exemption from customs duties on imported items used in the development and operation of tourist facilities and services. These may include building materials, machinery, equipment and supplies, and transportation vehicles e.g. tour buses; . Complete or partial exemption from company and/or property taxes for a specified number of years, and offering favourable depreciation allowances to reduce taxes; . Provision of financial assistance e.g. loans at regular or low interest rates, extended periods of repayments of loans, subsidies for payments made on interest on private loans, or guarantee by the government for private loans made. Outright grants of money, in some instances, have also been provided; and, . Unrestricted repatriation of all or part of foreign capital, profits, dividends and interest, after taxes have been paid.
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6.1 UK OUTBOUND MARKET
6.1.1 Size and Market Share of the UK Outbound Market
The number of holidays taken abroad by the UK market has been growing consistently, with only a few exceptions, since 1981. The UK Office of National Statistics reported that there were a total of 53,8 million visits abroad by UK residents in 1999– representing a 5,8% increase over the previous year. The majority of British travellers are leisure tourists. In 1999, approximately 64% of all outbound visits were holiday or vacation trips, with an additional 13% VFR trips.
The majority (81%) of outbound trips in 1999 were short-haul or intra-European. 23% Of all short-haul trips in 1999 were to destinations within the European Union. France and Spain held a 22% and 20% market share of trips to Europe in 1999 respectively (refer to Figure 6.1). Only 19% of UK outbound trips in 1999 were to long-haul destinations. The USA is the number one long-haul destination for British travellers, capturing 39% of the market share. Other top destinations include Africa and the Middle East (17%); Latin America and the Caribbean (11%); Canada (7%); and Australia/New Zealand (6%).
Figure 6.1: Destination of UK Outbound Trips
Spain Long-haul 19% 20% Canada Other long- Latin America/ 7% haul Caribbean 20% 11% Other Europe 8% Oceania Africa/M iddle 6% France East 17% 22% Other EU Ireland Europe USA 39% 8% 23%
Source: UK Office of National Statistics, 1999
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6.1.2 Long-Haul Destinations
The market share of long-haul holiday trips has grown from 14% in 1994 to 19% in 1999. The size and share of UK outbound tourism to various long-haul destinations (i.e. excluding Europe) are briefly discussed below.
USA
In terms of long-haul destinations, the USA holds greatest market share, with around 3,5 million visits in 1998 – an increase of 17% over the previous year. Strong employment and a strong pound have been the main impetus behind this growth. However, the rate of UK growth for the US market is expected to slow down with the UK economy, but still maintain an annual increase of around 5%, closing the gap on other major source markets for the US such as Japan.
Africa
After an upsurge in 1997 visits to Africa has subsequently levelled out. The political uncertainty and instability in many African countries has made it an unattractive proposition to UK visitors. The recovery of Egypt (recently an unpopular destination following terrorist attacks in Luxor in November 1997), has contributed to the steady growth of the North African sightseeing and ‘winter sun’ markets.
Middle East
The Middle East market has shown an average annual growth of 4,5% from the UK market between 1996 and 1999. This growth reflects a renewed consumer confidence after a period of relative political calm. The promotion of Jordan and Israel as ‘winter sun’ destinations is partly responsible for this increase. The recent problems in Israel may well have reversed this trend.
Australia and New Zealand
The average annual growth (10,3%) of UK travellers to Australia and New Zealand has been aided by increased salaries for the British and declining flight fares to this long-haul destination.
Asia Pacific
Asia’s average annual growth rate over the period 1996 to 1999 has been modestly low compared to other long-haul destinations, however, as the region experiences economic recovery, the number of visits by UK travellers is expected to increase. The Travel and Tourism Intelligence’s (“TTI”) Asia Pacific Tourism Forecasts 2000-2004
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predicts that UK visits to Thailand and China for example, are expected to increase by 94% and 96% respectively over that period.
6.1.3 Long-Haul Traveller Behaviour and Attitudes
According to a long-haul study undertaken by Mintel Consulting in 1999, the British population generally has positive attitudes towards long-haul holidays. Some of these attitudes include:
. Over one-third believe that it is becoming cheaper to travel to long-haul destinations; . 34% agree that it’s more interesting to travel outside Europe on holiday; . 26% have friends or relatives in faraway places that they would like to visit; and, . 23% expect to be taking long-haul holidays more often in the future. However, the study also revealed that some travellers perceive obstacles to long-haul travel. These include:
. 12% feel that having a family restricts where you can go outside of Europe; . 12% believe that faraway holidays are nothing but a dream for them (i.e. too expensive.); . 11% are not interested in going on a long-haul holiday; . 10% are put off by long flights.
Over the past decade, inclusive packages have served to broaden the long-haul market for families and couples to destinations such as Florida and the Caribbean. Today only about one-third of UK long-haul holidays are inclusive packages. The overall use of packages among UK travellers is lower than that of other markets, such as Japan and Germany. This is due in part to the increased sophistication of the UK traveller and in part to increasingly inexpensive self-catering options.
6.1.4 Types of Holidays Taken
Since 1992, the breakdown of holiday types (by percentage) has not changed significantly in the total outbound holiday market. There is some evidence, however, that the popularity of touring holidays in the total outbound market is decreasing and that the popularity of “city breaks” are increasing because they are short and relatively inexpensive.
Table 6.1 provides a percentage breakdown of the type of holidays taken by UK outbound travellers.
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Table 6.1: Types of Holidays Taken by UK Outbound Travellers
Type of Holiday All Leisure Trips Short-Haul Trips Long-Haul Trips Sun/Beach Holiday 39% 47% 30% Touring holiday 21% 9% 33% Country holiday 7% 9% 4% City break 8% 13% 3% Cruise/boat trip 1% 1% 1% Sporting holiday 2% 2% 2% Snow holiday 3% 4% 2% Other holiday 18% 11% 25% Source: IPK International, 1998
Sun and beach holidays are by far the most popular type of holiday taken by UK outbound travellers, accounting for nearly half of all outbound short-haul travel. Given that there were a total of 53,8 million visits abroad by UK residents, and that 18% of all leisure trips in 1998 were long-haul holidays, this equates to around 2,9 million long-haul sun and beach holidays.
According to British tour operators, sun and beach is the motivation behind 80% of the demand for international holidays. Growth in the market share of long-haul holidays in the 1990s has not been due to an increase in demand for exploratory and adventurous holidays but due to the introduction of long-haul sun and beach destinations in holiday brochures. Of the top 15 long-haul destinations for UK outbound tourists, 9 are to sun and beach destinations.
Within the short-haul market, the most popular beach destinations for Britons are Spain, Portugal and others around the Mediterranean. The most popular long-haul beach destinations include the Dominican Republic, Cuba, Thailand, India and Mexico.
6.1.5 UK Outbound Beach Holiday Travellers to South Africa
According to IPK International, South Africa received approximately 1% of the total UK outbound market in 1999. Of these trips to South Africa, 15% of these were sun and beach holidays27.
Figure 6.2 provides a summary of the types of holidays taken by UK travellers to South Africa.
27 IPK International indicates that 39% of all holidays to Africa by UK outbound travellers are sun and beach holidays.
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Figure 6.2: Types of Trips Taken by UK Travellers to South Africa in 1999
70% 62% 60% 50% 40% 30% 18% 15% 20% 4% 10% 1% 0%
Sun&
beach
Other Other
Touring
City holiday City
Recreational Recreational
Source: IPK International, 1999
IPK International indicates that UK outbound travellers to South Africa on a sun and beach holiday in 1999 stayed for an average of 10,7 nights in the country and spent a total of EUR15,4 billion (R112,1 billion) (EUR110 (R800,8) per night) during their stay. Approximately 95% of beach holidaymakers stayed for more than 4 nights in South Africa. In terms of the type of accommodation used by UK beach holidaymakers, 48% of beach holidaymakers stayed in hotels in 1999, followed by holiday homes and “other” accommodation (refer to Figure 6.3). Approximately 89% of accommodation was paid for prior to leaving the UK.
Figure 6.3: Type of Accommodation used by UK Beach Holidaymakers to South Africa, 1999
Notes: Other accommodation includes: boat/cruise/yacht, youth hostels and holiday resorts. Source: IPK International, 1999
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With respect to travel arrangements, 90% of UK travellers came to South Africa in 1999 on pre-paid trips, 66% of which were inclusive trips.
75% Of all sun and beach holiday trips by UK outbound travellers to South Africa were taken between the British summer months of May to October, and 25% were taken during the British winter months.
In terms of demographics the mean age of beach holidaymakers from the UK is 44 years. Figure 6.4 provides a breakdown of beach holidaymakers according to various age categories. Figure 6.5 provides a breakdown of the social status, income and education level of UK beach holiday travellers. The majority (58%) fall into the middle class social status group and 52% fall into the upper income group.
Figure 6.4: Age Structure of UK Beach Holidaymakers to South Africa in 1999
60% 53% 50% 47% 40% 30% 19% 19% 21% 20% 16% 9% 10% 3% 3%
0%
Male
Female
75+years
15-24 years 15-24
25-34 years 25-34
25-44 years 25-44
45-54 years 45-54
55-64 years 55-64 65-74 years 65-74
Source: IPK International, 1999
Figure 6.5: Percentage Breakdown of Social Status, Income and Education Levels of UK Beach Holidaymakers to South Africa in 1999
Source: IPK International, 1999
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6.2 USA OUTBOUND MARKET
6.2.1 Size and Share of the US Outbound Market
In 1999 approximately 37,4 million Americans (18,5% of the US population) travelled outside the North American continent for pleasure trips – representing an increase of 15% over 1997. Growth in long-haul travel (i.e. excluding travel to destinations other than Alaska, Hawaii, Canada, Mexico, the Caribbean and Bermuda) has been even more pronounced. The number of long-haul travellers increased by nearly 25% from 1997 to 1999.
Europe is the most popular destination for USA long-haul travellers. This is followed by trips to Asia/South Pacific and South and Central America. The market share for Africa is only 5% (refer to Figure 6.6)
Figure 6.6: Popular Long-Haul Destinations for USA Outbound Travellers
57% 60%
50%
40%
30% 19% 20% 11% 12% 12% 10% 10% 5%
% Long-Haul Travellers USA Of 0%
Asia
South
Africa
Pacific
Europe
South
Central
America
America
Middle Middle East
Notes: Percentages add up to more than 100% because USA long-haul travellers visited more than one destination Source: Travel Styles, 1999-2000, Menlo Consulting
6.2.2 Long-Haul Traveller Behaviour and Attitudes
The main behaviour and travel characteristics of long-haul travellers include:
. There has been a 45% increase in trips abroad in the last decade; . The use of travel agents is declining. According to Travel Styles (1999-2000), 69% of all outbound travellers indicated that they are extremely likely or very likely to use a travel agent when making an international trip. This percentage has declined from 1993 when 78,7% of travellers were likely to use an agent. The latter may be attributed to, in part, the desire for more customised trips, the
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growth in the use of the Internet as a travel source, and the offer of trips organised by associations, colleges and clubs; . 50% Of outbound travellers are willing to forego the comforts of a full-service hotel to stay in unique local accommodation (historic buildings, small hotels with charm, lodges, etc.); . The average length of all outbound trips is 4,5 days; and, . As a mature market the American market is becoming more and more segmented. There is an increasing demand for experience-based tourism with focus on culture, nature, sports, adventure or hobbies.
6.2.3 US Outbound Beach Holiday Travellers
According to the Travel Industry Association of America (“TIA”) Travel Poll conducted in 1998, approximately 35% (13 million) of all US outbound travellers took an international beach holiday. The survey also showed that a higher share of men than women are beach-bound and that beach appeal is also high for those with children at home and travellers between the ages of 18 and 34.
Around 45% (5,8 million travellers) of travellers on a beach holiday stayed overnight in hotel/motel accommodation and around 29% stayed with friends or families. Other forms of accommodation used by US beach holidaymakers included rented apartments, second homes, campsites and B&Bs (refer to Figure 6.7).
Figure 6.7: Type of Accommodation Used by US Beach Holidaymakers in 1998
45% 45% 40% 35% 29% 30% 25% 17% 20% 15% 10% 9% 10% 6% 5% 0%
B&Bs
Rented
Owned
Campsites
Hotel/motel
condo/home condo/home
Family/Friends
Source: TIA, 1998
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6.2.4 Sun and Beach Related Activities
Diving
Scuba diving in the USA is rapidly growing with over 500 00 new certified divers per year. A brief summary of trends for US divers can be summarised as follows:
. There are over 5 million scuba divers in the US; . A significant proportion of divers take 2-3 dive trips per year, whilst 30% take 4-6 trips per year; and, . Over activities engaged upon when on a diving vacation include cultural highlights, fine dining, photography and other watersports.
Surfing
Surfing is a popular sport in the USA with around 12 million surfers. Top destinations currently visited by surfers from the USA include: Indonesia, Australia, Reunion, Mauritius, Fiji and Costa Rica. The duration of their stay is approximately 14 days and they spend an average of US$150 per day (1999 figures).
6.2.5 US Outbound Beach Holiday Travellers to South Africa
Information on the US beach holidaymakers to South Africa is sketchy. The only information available to us regarding this market, is that from Menlo Consulting as part of the Travel Styles 1999-2000 survey, which examines the potential market leisure travel from the USA to South Africa. Although Travel Styles indicates that approximately 59% of all US outbound travellers to South Africa wish to come for a sun and beach holiday, we do not believe that this is a true reflection of the potential size of the US beach holiday market to South Africa because, in reality, if Americans want to travel for a beach holiday, they are probably more likely to take a trip to Hawaii or to the Caribbean, which although possibly costing the same in travel expenses, is a shorter trip.
Table 6.2 provides a breakdown of the type of trips that potential US travellers to South Africa would enjoy extremely or very much.
In terms of outdoor activities related to beach holidays in South Africa, US outbound travellers indicated that of all the most popular outdoor activities that could possibly be available/associated with a beach destination in South Africa, swimming, snorkelling and lying on the beach rank the highest – refer to Figure 6.8.
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Table 6.2: Kinds of Trips that US Travellers to South Africa would Enjoy Extremely or Very Much
Type of Trip % US Travellers Demanding Trip General sightseeing trip 75% Educational trip 73% Ocean cruise 63% Sun and beach holiday 59% Ecotour with ‘close to nature’ activities 55% Adventure activities 36% Source: Menlo Consulting, Travel Styles, 1999-2000
Figure 6.8: Likelihood of Participating in Selected Beach-Related Activities
M ountain biking 17%
Sea kayaking 17%
Golf 24%
Scuba diving 25%
Cycling 35%
Sailing 40%
Horseback riding 41%
Hiking 52%
Lie by the pool 55%
Snorkeling 59%
Lie on beach 70%
Swimming 74%
0% 10% 20% 30% 40% 50% 60% 70% 80% Source: Menlo Consulting, Travel Styles, 1999-2000
6.3 GERMAN OUTBOUND MARKET
6.3.1 Size and Market Share of the German Outbound Market
Germany is the world’s leading tourism generator in terms of trips and nights spent abroad. It is second only to the USA in terms of spending.
Germans have an enormous appetite for travel. In 1970, 20 million Germans travelled. By 1999, some 50 million Germans travelled, resulting in 66 million trips. For the last three decades, Germans have also been holidaying more abroad than at home (two thirds of all Germans opt to travel abroad rather than to holiday at home). Of the 66 million trips in 1999, 60 million of these are holiday trips and around 10% of these are long-haul.
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German travel demand has been fuelled by a strong economy, a comparably larger number of paid holidays than other countries, the ‘opening up’ of new destinations (e.g. South Africa, Eastern Europe, China), declining travel costs, increasingly experienced travellers and the sheer desire to travel.
In terms of the outbound holiday travel by Germans, 87% is to Europe, 3% to North America, and 2% to Asia, Africa and the Caribbean and South America. Table 6.3 provides a summary of the percentage of holiday trips abroad.
Table 6.3: Main Destinations for Holidays Abroad by German Outbound Travellers
Region Destination % Holiday Trips Abroad Europe 86,6% France 19,6% Spain 11,6% Austria 10,0% Italy 8,7% UK 3,2% Switzerland 2,2% Other Europe 4,7% North America 3,2% Asia 1,8% Caribbean and South America 1,9% Africa 1,9% TOTAL 100% Source: FUR Reiseanalyse 98 and European Travel Monitor 1998
Measured by rate of growth over the period 1988 to 1998, the top three regions include:
. The Caribbean (including the Dominican Republic and Cuba); . Southern Africa (including South Africa and Namibia); and, . Central and South America (including Brazil and Venezuela).
6.3.2 Travel Motivation
Figure 6.9 provides an indication of the most important travel motivations amongst German outbound travellers. 44% Of German travellers are interested in beach holidays. However, sources indicate that growth in special interest holidays will be strong. Approximately 50% of long-haul demand is for active holidays.
Within the context of beach tourism for South Africa, the following travel motivations yield some interesting and positive trends:
. Experience nature and landscape 45%; . New experiences, learn something new 35%;
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. Contact with local people 15%; . Cultural experience 18%; . Easy sports and activities 10%; and, . Something unusual, take a risk, challenge 8%.
Figure 6.9: Travel Motivations Amongst German Outbound Travellers
Cruises 1%
M eetings and conventions 2%
Exotic and adventure 3%
Touring 4%
Participate in active sports 8%
Something unusal 8%
Easy sports 10%
Cities 12%
Contact with local people 15%
Amusement 15%
Cultural experience 18%
Visit friends and family 24%
New experiences 35%
Relax 36%
Sun and beach 44%
Experience nature and landscape 45%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Source: FUR Reiseanalyse 98
6.3.3 German Outbound Beach Holiday Travellers
More than 12,8 million Germans (40% of the population) took a beach holiday in 1998. Although several sources cite that Germans will continue to be interested in beach holidays, the growth in this holiday segment is only expected to register a 5,2% increase between 1999 and 2001.
6.3.4 Sun and Beach Related Activities
Diving
As a rule, one-week diving vacations are booked as second or third vacations. However, amongst experienced divers the dive is the main focus of the trip. The top
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diving destinations among German tour operators include the Red Sea and the Maldives. Up and coming destinations are Caribbean, Indonesia, Thailand, the Philippines and Australia.
The typical German diver tends to have an average to high income, travels mostly with a partner and dives exclusively on holidays. Two important trends observed in the diving market include:
. The increase in the number of couples taking diving holidays abroad (as opposed to the large number of single divers taking independent holidays abroad); and, . The number of Germans seeking to acquire their diving certificate abroad is on the increase.
Surfing
Surfing in Germany is one of the more popular sports. There are approximately 1,5 million surfers in Germany. True surfers tend to be younger and spare neither costs nor effort to find good surfing haunts. Among the exotic surfing destinations for Germans are Hawaii, Barbados and the west coast of Australia.
6.3.5 German Outbound Beach Holiday Travellers to South Africa
According to IPK International South Africa received just less than 1% of the total German outbound market in 1999. Of these trips to South Africa, 11% of these were sun and beach holidays28.
Figure 6.10 provides a summary of the types of holidays taken by German travellers to South Africa.
28 IPK International indicates that 44% of all holidays to Africa by German outbound travellers are sun and beach holidays.
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Figure 6.10: Types of Trips Taken by German Travellers to South Africa in 1999
80% 73% 70% 60% 50% 40% 30%
20% 11% 7% 5% 10% 4% 0%
Sun&
beach
Touring
Special
occasion
City holiday City
Recreational Recreational
Source: IPK International, 1999 IPK International indicates that German outbound travellers to South Africa on a sun and beach holiday stayed for an average of 12 nights in the country and spent a total of EUR18,7 billion (R135,6 billion) (EUR74 (R538,7) per night) during their stay. Approximately 94% of beach holidaymakers stayed for more than 4 nights in South Africa. In terms of the type of accommodation used by German beach holidaymakers, 46% of beach holidaymakers stayed in hotels in 1999. The second most popular type of accommodation is holiday homes (refer to Figure 6.11). Approximately 90% of accommodation was paid for prior to leaving Germany.
With respect to travel arrangements, 84% of German travellers came to South Africa in 1999 on pre-paid trips, 47% of which were inclusive trips.
83% Of all sun and beach holiday trips by German outbound travellers to South Africa were taken during the northern hemisphere summer months between May and October, and 17% were taken during the winter months.
In terms of demographics the mean age of beach holidaymakers from Germany is 42 years. Figure 6.12 provides a breakdown of beach holidaymakers according to various age categories. Figure 6.13 provides a breakdown of the social status, income and education level of German beach holiday travellers. 50% Fall into the middle class social status group and 53% fall into the upper income group.
Figure 6.11: Type of Accommodation Used by German Beach Holidaymakers to South Africa in 1999
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Notes: Other accommodation includes: B&Bs and youth hostels. Source: IPK International, 1999
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Figure 6.12: Age Structure of German Beach Holidaymakers to South Africa in 1999
60% 49% 51% 50%
40%
30% 25% 20% 17% 20% 16% 15%
10% 7% 1% 0%
Male
Female
75+years
15-24 years 15-24 years 25-34 years 25-44 years 45-54 years 55-64 years 65-74
Source: IPK International, 1999
Figure 6.13: Percentage Breakdown of Social Status, Income and Education Levels of German Beach Holidaymakers to South Africa in 1999
Source: IPK International, 1999
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7.1 INTRODUCTORY COMMENTS
South Africa is particularly well poised to meet the needs of international beach tourists for the reasons provided in Table 7.1 below.
Table 7.1: Factors Favouring the Development of Beach Tourism in South Africa
Beach tourist desires South Africa’s role in fulfilling these desires . Want to discover new destinations . South Africa has never been viewed as beach destination . Want to discover new experiences . South Africa has a rich diversity of natural and cultural attractions . Want a good value for money holiday . The devaluation of the Rand makes South Africa a “value for money destination” . Want to travel to destinations with as much . South Africa is, on average, a 10 hour direct ease as possible flight from most destinations in the world and the crossing of only a few time zones from most European countries . Want to travel throughout the year and not be . South Africa’s warm coastal climate makes affected by seasonality beach destinations Source: Grant Thornton Kessel Feinstein
7.2 TOURISM IN SOUTH AFRICA – A STRATEGIC PERSPECTIVE
Given that South Africa has several qualitative factors favouring the development of beach tourism, in order to assess the quantitative feasibility of developing this industry, cognisance of tourism from a strategic perspective needs to be taken. The White Paper (1996) on the Promotion and Development of Tourism in South Africa provides clear aims and objectives for the development of tourism from environmental, social and economic viewpoints. These aims and objectives provide the framework and for our various recommendations regarding the development of beach tourism along the ESSA.
The 1996 Tourism White Paper and Tourism In GEAR have been used as a basis for this study. Annexure A provides a summary of the White Paper on the Promotion and Development of Tourism in South Africa.
The general GEAR strategy was instituted by Government in 1996 and builds on the fundamentals of the Reconstruction and Distributions Programme (“RDP”) insofar as it is an integrated economic strategy to achieve growth and development throughout the country. Although Tourism in GEAR lists the vision and objectives as per the Tourism White Paper and proposes international tourism arrivals growth targets, these target have not been met.
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7.3 THE NEED FOR COASTAL MANAGEMENT IN DEVELOPING BEACH TOURISM
As indicated in Section 4 and Section 5, the environment of many coastal areas around the world has been adversely affected by tourism. In many of the major resorts in the Mediterranean area for example, the population more than doubles during the summer tourist season, and local government is hard put to provide the resources required. As a result, in several areas of the Mediterranean, bathing water is polluted, the sea is over-fished, natural wetlands are drying up, and disposal of wastewater and sewage presents difficult problems.
Realising the need for environmental management along South Africa’s coastal areas, government has formulated various policies and legislation, which, although not specifically formulated with tourism in mind, nevertheless seeks to maintain environmental, social and economic integrity. Although much of the legislation relating to the environment is not coastal specific, it nevertheless applies in the general sense.
Annexure B provides a summary of the various management policies and legislation affecting South Africa’s coastal environment.
7.3.1 South African Blue Flag Campaign
The international Blue Flag campaign is an incentive scheme that encourages local authorities along the coast to manage their beaches in an environmentally friendly manner. Beaches that meet specific criteria on safety, cleanliness, services, water quality, amenities, environmental education and monitoring of beach profiles are annually awarded a blue flag, which can be flown as part of the local authorities’ tourism marketing strategy. The main objectives of the Blue Flag are to improve the understanding of the coastal environment and to promote the incorporation of environmental issues in the decision-making processes of local authorities and their partners.
In South Africa, Blue Flag is currently being implemented in a pilot phase. The aim of the pilot phase is to introduce Blue Flag on a small scale for a limited period in order to finalise the South African criteria and their specifications. Beaches currently involved in the Blue Flag pilot phase include:
. South Beach, Durban; . Margate Main Beach; . Orient Beach, East London; . Kelly’s Beach, Port Alfred; . Humewood Beach, Port Elizabeth; . Jeffreys Bay Main Beach; and, . Lookout Beach, Plettenberg Bay.
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The Blue flag campaign is coordinated internationally by the Foundation for Environmental Education in Europe (“FEEE”), and is supported by the United Nations Environment Programme and WTO. In South Africa, CoastCARE is taking a lead role in bringing together the Department of Environmental Affairs and Tourism, local authorities, the tourism industry, schools and educational organisations, and scientists.
7.4 THE COASTAL REGIONS OF SOUTH AFRICA
Given the opportunity for South Africa to meet the needs of foreign beach holidaymakers, no part of the coastline is better poised to fulfil these needs than the ESSA. Compared to the other coastal regions of South Africa i.e. the Namaqualand, West Coast, Cape Metro, Agulhas and Garden Route coastal areas, the coastal regions of the Eastern Cape and KwaZulu Natal are able to offer tourists the opportunity to enjoy the warm waters of the Indian Ocean, and experience an “Out of Africa” wildlife or cultural experience all during the course of the same day. The diversity of the coastal regions of the ESSA provides unique opportunities to cater for all interests of beach holidaymakers. For example:
The Sunshine Coast is a beautiful stretch of the coastline that is lapped by the waters of the warm Indian Ocean, and is so-called because it offers more sunshine hours per year than anywhere else in South Africa;
The Wild Coast is a wilderness area where the tourist has the opportunity to enjoy the landscape and cultural heritage;
The South Coast/Hibiscus Coast, although possibly less dramatic than other parts of South Africa, offers plenty of beaches, many golf courses and great surfing and scuba diving spots;
The Durban Metro, with its warm ocean and dedicated surfers, Indian markets, waterside bars and great music scene, is a city that is always on holiday;
The Dolphin Coast, although currently catering for the more upmarket tourist, offers the tourist some shopping or the opportunity to try their luck on the gambling tables;
The Zululand Coast is largely undeveloped with vast expanses of untouched beaches and prolific wildlife; and,
The Maputaland Coast is also largely undeveloped and is home to a world heritage site and one of the top scuba diving sites in the world.
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Figure 7.1 provides a summary of the various coastal regions along the ESSA as well as a brief overview of their inherent characteristics.
7.5 FEATURES OF THE SOUTH AFRICAN TOURISM INDUSTRY
7.5.1 Foreign Tourist Arrivals
At a national level, tourism to South Africa has always been extremely sensitive to the level of social stability in the country. In the past, even a depreciating Rand was insufficient to counteract the debilitating effect of social ructions that began to exert a serious impact on tourism flows in the mid-1970s. By 1986, the number of overseas arrivals had declined to a very low level as is shown in Figure 7.2. Since then, however, there has been a sustained recovery in foreign tourism, and 1999 marked the thirteenth successive year of increases in the number of arrivals. The aggregates are still low by world standards – South Africa’s 5,8 million foreign tourists in 1999 (excluding workers and contract workers) (see Table 7.2) represented marginally more than 1% of the global market, and is similar to countries such as Indonesia and Singapore. The 1,5 million overseas arrivals is even more insignificant in world terms.
According to WTO figures, in terms of all arrivals to Africa, South Africa remained the most visited country in 1999 for the fifth successive year. South Africa attracted 23% of all arrivals to Africa in 1998.
Figure 7.2: South Africa’s Overseas Tourist Arrivals
1600
1400
1200
1000
800
600
Annual Annual (000s) Arrivals 400
200
0
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Source: Grant Thornton Kessel Feinstein
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Figure 7.1: Map Showing the Geographical Location of South Africa’s Eastern Coastal Regions SOUTH COAST
The South Coast is a popular holiday MAPUTALAND destination that extends 127km from the Umtamvuna River to the Ilovu River, south of The Maputaland coastal region the Durban Metro. A large proportion of the is well known for its natural economic activity in this region is due to features and scenic beauty. It tourism and recreation. Scuba diving, based stretches 179km from the mainly on the offshore reefs, has emerged as mouth of the St Lucia estuary an important industry, with around 400 000 to the border between South divers visiting Aliwal Shoal annually. Charter- Africa and Mozambique, just boat fishing is also emerging as an north of Kosi Bay. The increasingly popular activity. While tourism beautiful scenery and natural infrastructure is well developed, there is features, such as the lakes, concern that development has not always reefs and wildlife, give this been pursued in an environmentally region considerable potential responsible manner. for nature-based tourism. WILD COAST ZULULAND The Wild Coast is a rugged and undeveloped region, extending 270km northwards from the The Zululand coastal region Great Kei River to the boundary between the extends 134km from the Tugela Eastern Cape and KwaZulu Natal. Most of the River in the south to the St region’s population is located inland of the Lucia estuary in the north. The coast. A number of holiday resort coast is dominated by long settlements have been established at places sandy beaches, backed by such as Trennerys, Mazeppa Bay and Coffee high-forested dunes, and Bay. broad coastal plains with many rivers, coastal lakes and wetlands.
SUNSHINE COAST NORTH COAST The Sunshine Coast extends 538km from the The North Coast is a sub- boundary of the Western and Eastern Cape tropical region, extending provinces to the Kei River. It is primarily a 70km from Tongaat River to mixture of undeveloped coastal areas and the Tugela River mouth. This small towns, with the cities of Port Elizabeth DURBAN METRO region is reputed to have the and East London dominating the region. fastest growing real estate The Durban Metro region is dominated by the Durban Metropolis and extends 52km from the Ilovo River to the industry along the South Tongaat River. The region has a wide range of natural and human-made attributes that make the area an African coast. Many private attractive destination. The region’s affordability and accessibility from other parts of the country ensure that holiday homes and a few Infrastructure is good and tourism and Durban will remain one of the premier holiday destinations (at least in terms of the domestic market). hotels are situated in this recreational development and services are region. significant in the region. Many resort towns offer a range of outdoor activities, including watersports, hiking, whale-watching and fishing. There are several marinas in the region.
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Table 7.2: Foreign Tourist Arrivals in South Africa
Overseas Visitors African Visitors Total Annual Increase 1995 1 061 766 3 427 506 4 488 272 22,3% 1996 1 172 394 3 772 036 4 944 430 10,1% 1997 1 273 936 3 702 413 4 976 349 0,7% 1998 1 428 401 4 303 638 5 732 039 15,2% 1999 1 491 059 4 399 455 5 890 514 2,6% Source: STATSSA
7.5.2 Country of Origin
According to Statistics South Africa, the UK is South Africa’s single biggest source of overseas tourists with 343 934 arrivals in 1999, representing 22% of the total number of visitors from overseas. The UK, USA and Germany together account for almost 47% of all South Africa’s overseas tourists (see Table 7.3).
Table 7.3: Source of South Africa’s Overseas Tourists in 1999
Country of Origin Number of Arrivals % Of Total Overseas Arrivals UK 334 478 22% Germany 206 109 14% France 84 215 6% Rest of Europe 374 157 25% USA 165 390 11% Rest of North America 27 157 2% Central & South America 42 316 3% Australasia 68 213 5% Middle East 28 528 2% Asia 147 518 10% Indian Ocean Islands 12 979 1% TOTAL 1 491 060 100% Notes: Excludes workers and contract workers Source: STATSSA
7.5.3 Purpose of Visit
According to the South African Tourism Foreign Tourist Surveys (a survey of overseas air departures conducted biannually – in summer and winter) and STATSSA, the main purpose of visit for international tourists coming to South Africa is holiday. Figure 7.3 shows that the breakdown of international visitors to South Africa by main purpose of visit has remained steady over the period 1996 to 1999. Based on the 1999 South African Tourism surveys of international arrivals, approximately 42% of international tourists came to South Africa for holiday purposes, 28% came for business purposes, 20% came for VFR purposes and 10% came to South Africa for other purposes. Given the relatively constant trend, (refer to Figure 7.3) we expect this to continue. In terms of country of origin, a significantly large proportion of foreign visitors (excluding those from Africa and the Indian Ocean
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Table 7.2: Foreign Tourist Arrivals in South Africa
Overseas Visitors African Visitors Total Annual Increase 1995 1 061 766 3 427 506 4 488 272 22,3% 1996 1 172 394 3 772 036 4 944 430 10,1% 1997 1 273 936 3 702 413 4 976 349 0,7% 1998 1 428 401 4 303 638 5 732 039 15,2% 1999 1 491 059 4 399 455 5 890 514 2,6% Source: STATSSA
7.5.2 Country of Origin
According to Statistics South Africa, the UK is South Africa’s single biggest source of overseas tourists with 343 934 arrivals in 1999, representing 22% of the total number of visitors from overseas. The UK, USA and Germany together account for almost 47% of all South Africa’s overseas tourists (see Table 7.3).
Table 7.3: Source of South Africa’s Overseas Tourists in 1999
Country of Origin Number of Arrivals % Of Total Overseas Arrivals UK 334 478 22% Germany 206 109 14% France 84 215 6% Rest of Europe 374 157 25% USA 165 390 11% Rest of North America 27 157 2% Central & South America 42 316 3% Australasia 68 213 5% Middle East 28 528 2% Asia 147 518 10% Indian Ocean Islands 12 979 1% TOTAL 1 491 060 100% Notes: Excludes workers and contract workers Source: STATSSA
7.5.3 Purpose of Visit
According to the South African Tourism Foreign Tourist Surveys (a survey of overseas air departures conducted biannually – in summer and winter) and STATSSA, the main purpose of visit for international tourists coming to South Africa is holiday. Figure 7.3 shows that the breakdown of international visitors to South Africa by main purpose of visit has remained steady over the period 1996 to 1999. Based on the 1999 South African Tourism surveys of international arrivals, approximately 42% of international tourists came to South Africa for holiday purposes, 28% came for business purposes, 20% came for VFR purposes and 10% came to South Africa for other purposes. Given the relatively constant trend, (refer to Figure 7.3) we expect this to continue. In terms of country of origin, a significantly large proportion of foreign visitors (excluding those from Africa and the Indian Ocean Islands) come to South Africa for holiday purposes. Table 7.4 provides a breakdown of the purpose of visit according to country of origin in 1999.
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Figure 7.3: Overseas Visitors by Purpose of Visit, 1996 – 1999
1999 42% 28% 20% 10%
Holiday
1998 42% 30% 20% 9% Business
VFR 1997 45% 28% 20% 8% Other
1996 40% 31% 19% 10%
0% 20% 40% 60% 80% 100%
Source: South African Tourism Foreign Tourist Surveys
Table 7.4: Purpose of Visit According to Country of Origin, 1999
Country of Origin Purpose of Visit Holiday Business VFR UK 46% 20% 34% Germany 61% 16% 23% Holland 64% 21% 15% France 63% 23% 14% Scandinavia 36% 49% 15% Rest of Europe 57% 28% 15% North America 50% 32% 18% South America 50% 31% 18% Middle East 36% 40% 24% Far East Asia 40% 43% 17% Australasia 44% 22% 34% Overall Average 50% 27% 23% Africa & Indian Ocean Islands 22% 54% 24% Source: South Africa Tourism Foreign Tourist Survey, summer & winter 1999
7.5.4 Average Length of Stay
South African Tourism Foreign Tourist Surveys indicate that the average length of stay of all foreign visitors travelling by air (including African and Indian Ocean island visitors) was 17,4 nights in summer 1999 and 15,1 nights in winter 1999. This compares with an overall average length of stay of 17,0 nights in summer 1998 and 16,7 nights in winter 1998. On average, visitors from Africa and the Indian Ocean islands stayed for 13 nights in 1999, whilst overseas visitors stayed for 16,2 days. In terms of country of origin, tourists from Holland, the UK and Germany have the longest average length of stay, with very little deviation between summer and winter. The average length of stay of tourists from North America is increasing and in 1999, they had the highest average spend per day (R1 223) compared to the UK and Germany with average spends of R739 and R806 per day respectively.
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7.5.5 Most Visited Provinces
According to South Africa Tourism Foreign Tourist Surveys, Gauteng, the Western Cape and KwaZulu Natal were the most visited provinces in 1999 (refer to Table 7.5). Although Gauteng is one of the most visited provinces, it does not attract visitors for any significant period of time (refer to Table 7.6). This is because the majority of long- haul holiday travellers merely arrive and depart at Johannesburg International Airport and spend more time in other areas of the country.
Table 7.5: Provinces Visited by Overseas Tourists to South Africa, 1998-1999
Province Summer Winter Summer Winter 1998 1998 1999 1999
Gauteng 56% 62% 53% 59% Western Cape 59% 46% 58% 48% KwaZulu Natal 24% 31% 25% 27% Mpumalanga 20% 23% 14% 13% Eastern Cape 16% 12% 3% 5% Northern Province 5% 8% 19% 22% North West 5% 6% 6% 7% Free State 5% 5% 5% 6% Northern Cape 5% 5% 4% 4% Notes: Totals add up to more than 100% due to tourists visiting more than one province Source: South Africa Tourism Foreign Tourist Surveys, 1998 & 1999
Table 7.6: Average Length of Stay in Each Destination by Overseas Tourists, 1998 – 1999
Province Average Length of Stay (nights) Summer Winter Summer Winter 1998 1998 1999 1999 Johannesburg 6,2 5,8 5,4 5,9 Rest of Gauteng 1,3 1,2 1,6 1,1 Cape Town 8,2 7,9 8,4 6,4 Rest of Western Cape 2,7 1,3 2,3 1,3 Durban 5,2 5,5 4,2 7,7 Rest of KwaZulu Natal 5,5 3,9 4,7 5,3 Kruger Park 2,3 2,3 2,1 2,2 Rest of Mpumalanga 1,8 2,3 3,6 2,8 Eastern Cape 13,9 11,1 5,8 11,6 North West Province 3,2 5,5 2,0 1,7 Northern Cape 4,3 6,8 5,7 4,7 Northern Province 6,0 12,6 5,6 5,5 Free State 8,8 5,5 9,5 11,0 Source: South Africa Tourism Foreign Tourist Surveys, Summer 1998 & 1999, Winter 1998 & 1999
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7.5.6 Type of Accommodation Used
Table 7.7 below gives an indication of the type of accommodation used by international visitors to South Africa over the period summer 1997 to winter 1999. Although the South African Tourism survey accommodation categories changed in 1998, trends regarding the type of accommodation used have remained relatively constant. Hotels are by far the most preferred form of accommodation, followed by VFR.
Table 7.7: Types of Accommodation used by Overseas Visitors, 1997 – 1999
Province Summer Winter Summer Winter Summer Winter 1997 1997 1998 1998 1999 1999 Hotels 65% 67% 61% 64% 63% 63% VFR 39% 38% 37% 32% 33% 29% Game Lodges N/A N/A 24% 24% 20% 25% Bed & Breakfasts 20% 19% 20% 20% 20% 17% Guest Houses N/A N/A 19% 18% 19% 20% Self-Catering 20% 19% 18% 17% 14% 15% Country Houses N/A N/A 12% 11% 10% 9% Holiday Resorts 14% 14% 11% 11% 8% 9% Farms 11% 10% 8% 7% 6% 5% Notes: In Summer and Winter 1998 surveys, the category “guest houses/lodges” was replaced with “game lodges”, “guest houses” and “country houses” Totals add up to more than 100% due to tourists staying in more than type of accommodation Source: South Africa Tourism Foreign Tourist Surveys, Winter, 1996,1997,1998, 1999 & Summer 1996,1997 1998, 1999
7.6 FEATURES OF TOURISM ALONG THE ESSA
For this analysis, we have examined statistics for KwaZulu Natal and the Eastern Cape using the data available from the South African Tourism Foreign Summer and Winter Surveys.
7.6.1 Foreign Tourist Arrivals
Using the South African Tourism foreign surveys as a base, and the tourism and migration statistics released by STATSSA, we are able to extrapolate the number of number of overseas tourists to the ESSA (refer to Table 7.8). The ESSA receives a significantly large proportion of foreign tourists considering the fact that only 2 provinces are taken as representing the ESSA. The exact number of overseas tourists to the ESSA cannot be determined since the South African Tourism foreign surveys do not differentiate between tourists visiting only one or both of KwaZulu Natal and the Eastern Cape. The totals in Table 7.8 therefore include double counting since some foreign tourists will have visited both KwaZulu Natal and the Eastern Cape during their trip to South Africa. Table 7.8 also does not take indicate
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the number of visitors to the coastal regions as provides an indication of the total number of overseas tourists to the whole of the provinces.
In the absence of any indication of how many foreign air tourists visit both provinces, we tentatively assume that at least 50% of tourists to each province would visit the other province.
Table 7.8: Number of Overseas Tourists to the ESSA
Number of Overseas Visitors Total to KwaZulu Natal and the Eastern Cape 1996 519 811 1997 565 906 1998 598 611 1999 590 905 Total to ESSA 1996 259 906 1997 282 953 1998 299 301 1999 295 452 Notes: The total number of overseas visitors to the ESSA is assumed to be 50% of the total number of tourists to KwaZulu Natal and the Eastern Cape Source: South African Tourism Foreign Tourist Surveys, Summer 1996, 1997, 1998 & 1999 and Winter 1996, 1997, 1998 & 1999
A survey of KwaZulu Natal’s international tourism market conducted in 1998 provides an indication of the percentage of overseas tourists visiting various coastal regions (refer to Figure 7.4). It is important to note that Figure 7.4 includes African and overseas air arrivals and all purposes of visit. Nevertheless, despite difficulties in quantifying the number of foreign tourists to each coastal region, Figure 7.4 provides a good indication of the popularity of the coastal regions over inland regions.
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Figure 7.4: Distribution of Foreign Tourists According to Tourist Regions in KwaZulu Natal
78% 78% 80% 70% 60% 50% 40% Sep-98 32%32% 28% 28% 28% 26% Jan-98 30% 26% 22% 20% 18% 18% 20% 16% 14%14% 8% 10% 7% 0%
Durban
East
Zululand
Griqualand
Battlefields
Maputaland
North Coast North
SouthCoast
Drakensberg
PMB/Midlands
Source: KwaZulu Natal International Tourism Market
7.6.2 Country of Origin
According to the South African Tourism Foreign Surveys, the majority of foreign tourists to the ESSA come from the rest of Europe (i.e. all countries in Europe excluding the UK, Germany, Scandinavian countries, France and Holland). The UK is the single most important tourism generating country for international tourism along the ESSA, followed by Germany. North America, especially the USA is also an important market (refer to Figure 7.5 and Figure 7.6). There is no significant difference between KwaZulu Natal and the Eastern Cape as far as foreign generating markets are concerned.
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Figure 7.5: Country of Origin of Foreign Tourists to KwaZulu Natal
100% 90% Australasia Far East 80% Mid East 70% Central/South America 60% North America 50% Rest of Europe 40% Holland
30% France 20% Scandinavia Germany 10% UK 0% 1996 1997 1998 1999
Source: South African Tourism Foreign Tourist Surveys, Summer 1996, 1997, 1998 & 1999 and Winter 1996, 1997, 1998 & 1999
Figure 7.6: Country of Origin of Foreign Tourists to the Eastern Cape
100% 90% Australasia Far East 80% Mid East 70% Central/South America 60% North America 50% Rest of Europe 40% Holland
30% France 20% Scandinavia Germany 10% UK 0% 1996 1997 1998 1999
Source: South African Tourism Foreign Tourist Surveys, Summer 1996, 1997, 1998 & 1999 and Winter 1996, 1997, 1998 & 1999
7.6.3 Purpose of Visit
Table 7.9 provides a summary of the main purpose of visit to the ESSA. It is evident that the main purpose of visit by foreign tourists to the ESSA is for holiday purposes, followed by VFR, business and other reasons. A somewhat higher proportion of foreign tourists come to the Eastern Cape for holiday purposes compared to KwaZulu Natal.
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Table 7.9: Purpose of Visit to the ESSA, KwaZulu Natal and the Eastern Cape
Purpose of Visit 1996 1997 1998 1999 KwaZulu Natal VFR 23% 24% 20% 23% Holiday 48% 53% 50% 50% Business 16% 15% 20% 17% Other 13% 8% 10% 9% Eastern Cape VFR 19% 17% 18% 21% Holiday 56% 64% 58% 53% Business 13% 13% 13% 19% Other 11% 6% 11% 8% South African Tourism Foreign Tourist Surveys, Summer 1996, 1997, 1998 & 1999 and Winter 1996, 1997, 1998 & 1999
7.6.4 Type of Accommodation Used
Figure 7.7 and 7.8 indicates that hotels are the most common form of accommodation used by foreign tourists to the ESSA (used by 52% in 1999). This is followed by staying with friends and family (22%) and B&Bs (15%). This distribution of accommodation corresponds to the national trends in accommodation use in Table 7.7. There is very little deviation (only a few percentage points) between the accommodation used by foreign tourists to KwaZulu Natal and the Eastern Cape.
Figure 7.7: Type of Accommodation Used by Foreign Tourists to KwaZulu Natal
100% Other Accommodation Friends / Family 80% Holiday Resorts Farm Houses 60% Self Catering
40% Game Lodges Bed & Breakfast 20% Country Houses Guest Houses/Lodges 0% Hotels 1996 1997 1998 1999
Notes: In Summer and Winter 1998 surveys, the category “guest houses/lodges” was replaced with “game lodges”, “guest houses” and “country houses”. Percentage of foreign tourists staying in accommodation establishments adds up to more than 100% because foreign tourists make use of more than one type of accommodation. Source: South African Tourism Foreign Tourist Surveys, Summer 1996, 1997, 1998 & 1999 and Winter 1996, 1997, 1998 & 1999 Figure 7.8: Type of Accommodation Used by Foreign Tourists to the Eastern Cape
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100% Other Accommodation 90% Friends / Family 80% Holiday Resorts 70% Farm Houses 60% Self Catering 50% 40% Game Lodges 30% Bed & Breakfast 20% Country Houses 10% Guest Houses/Lodges 0% Hotels 1996 1997 1998 1999
Source: South African Tourism Foreign Tourist Surveys, Summer 1996, 1997, 1998 & 1999 and Winter 1996, 1997, 1998 & 1999
7.6.5 Attractions Made Use of or Visited
In terms of attractions made use of or visited by foreign visitors to KwaZulu Natal and the Eastern Cape, in both provinces over the period 1997 to 1999, restaurants were the most visited “attraction” (refer to Figure 7.9 and 7.10). In KwaZulu Natal, the second most visited/used attraction was shopping, followed by the Durban beachfront. Visits to game reserves and the Shakaland cultural village fluctuated in fourth and fifth positions. In the Eastern Cape, the second most visited attraction was Port Elizabeth. Shopping, visits to game reserves and the beaches in the Eastern fluctuated over the years in third, fourth and fifth positions.
In terms of seasonality, there is very little difference between the percentage of foreign tourists to KwaZulu Natal and the Eastern Cape visiting beaches. There is also very little difference in seasonality between foreign visitors visiting or making use of any of the attractions in KwaZulu Natal and the Eastern Cape.
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Figure 7.9: Attractions Made Use of or Visited in KwaZulu Natal
90.0% Restaurants 80.0% 70.0% Shopping 60.0% 50.0% Durban 40.0% Beachfront 30.0% Shakaland 20.0% Cultural Village 10.0% Game 0.0% Reserves
Winter 97 Winter
Winter 98 Winter
Winter 99 Winter
Summer97
Summer98
Summer99
Notes: Percentage of foreign tourists visiting or making use of attraction adds up to more than 100% in each season because foreign tourists make use of or visit more than one attraction. Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999
Figure 7.10 Attractions Made Use of or Visited in the Eastern Cape
80.0% Restaurants 70.0% Shopping 60.0% Port Elizabeth 50.0% East London 40.0% The Beaches 30.0% The Wild Coast 20.0% 10.0% Game/Nature Reserves 0.0%
Winter97
Winter98
Winter99
Summer97
Summer98
Summer99
Notes: Information on the percentage of foreign visitors visiting East London is not available for summer and winter 1997. Percentage of foreign tourists visiting or making use of attraction adds up to more than 100% in each season because foreign tourists make use of or visit more than one attraction. Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999
Table 7.10 and Table 7.11 translates the percentage of foreign tourists visiting the different attractions in KwaZulu Natal and the Eastern Cape into numbers. Table 7.10: Number of Foreign Tourists Making Use of or Visiting Attractions in KwaZulu Natal
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Year Attraction %KZN Foreign Number of Foreign % Total Foreign Tourists to Tourists to Tourists to Attraction Attraction Attraction 1997 Restaurants 86% 314 969 25% Shopping 64% 234 783 18% Beachfront 37% 210 629 17% Shakaland 34% 125 850 10% Game Reserves 33% 120 520 9% 1998 Restaurants 77% 304 162 21% Shopping 57% 224 279 16% Beachfront 55% 216 142 15% Shakaland 28% 111 877 8% Game Reserves 33% 130 101 9% 1998 Restaurants 78% 304 889 21% Shopping 57% 221 517 16% Beachfront 55% 212 517 15% Shakaland 32% 125 344 8% Game Reserves 36% 140 107 9% Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999, STATSSA
Table 7.11: Number of Foreign Tourists Making Use of or Visiting Attractions in the Eastern Cape Year Attraction %EC Foreign Number of Foreign % Total Foreign Tourists to Tourists to Tourists to Attraction Attraction Attraction 1997 Restaurants 75% 149007 12% Shopping 42% 83653 7% Port Elizabeth 49% 96211 8% East London - - - Beaches 44% 87608 7% Wild Coast 22% 43308 3% Game/nature reserve 41% 80386 6% 1998 Restaurants 74% 149827 10% Shopping 42% 85726 6% Port Elizabeth 47% 96390 7% East London 22% 44602 3% Beaches 41% 84208 6% Wild Coast 19% 38765 3% Game/nature reserve 47% 95016 7% 1999 Restaurants 70% 141270 9% Shopping 38% 75659 5% Port Elizabeth 425 84500 6% East London 16% 32555 2% Beaches 35% 70735 5% Wild Coast 18% 37076 2% Game/nature reserve 45% 91132 6% Notes: Information on the percentage of foreign visitors visiting East London is not available for summer and winter 1997. Percentage of foreign tourists visiting or making use of attraction adds up to more than 100% in each season because foreign tourists make use of or visit more than one attraction.
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Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999, STATSSA
7.6.6 Rating of Attractions Used or Visited
In terms of tourist ratings of the attractions made use of or visited in KwaZulu Natal and the Eastern Cape (between 1 and 10, with 1 the being lowest score and 10 the highest) all attractions generally received high scores (of not less than 7 in any category). Table 7.12 provides a summary of simple average of ratings for the various attractions made use of or visited in KwaZulu Natal and the Eastern Cape over the period 1997 to 1999.
In general, those products (especially game reserves), which are ancillary to the beach tourism product, obtain the highest ratings. In KwaZulu Natal, the beachfront obtained the lowest rating by foreign tourists for any of the attractions made use of or visited. In comparison, beaches in the Eastern Cape receive a significantly higher rating.
Table 7.12: General Rating for Various Attractions Made Use of or Visited in KwaZulu Natal and the Eastern Cape
KwaZulu Natal Eastern Cape Attraction Rating Attraction Rating Game reserves 9,5 Game reserves 9,4 Shakaland 8,8 Wild Coast 9,4 Restaurants 8,7 Beaches 9,1 Shopping 8,4 Restaurants 8,6 Beachfront 7,8 Shopping 8,2 Port Elizabeth 7,8 East London 7,7 Notes: The general rating represents a simple average over the period 1997 to 1999. The general rating for East London represents a simple average over the period 1998 to 1999 only. Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999
7.6.7 Factors Influencing Decision to Travel
According to the South African Tourism Foreign Surveys, word of mouth remains the most important factor influencing foreigners to travel to the ESSA (refer to Table 7.13). This is followed by promotion and good value for money. We expect that, in the future, “promotion” should become a more important influencing factor because of the significant amount of money being allocated for through the Tourism Action Plan (“TAP”)15. We also believe that “good value for money” will also continue to be an
15 The Tourism Action Plan is a product of a public-private partnership between government and the tourism industry that has two important focuses: In the short term it will run marketing campaigns (above the line, below the line and cooperative marketing campaigns) mainly in the traditional “big six” markets viz. UK, USA, Germany, Italy, Netherlands and France, in an attempt to increase South Africa’s share of the international tourists. The Tourism
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important factor as the South African Rand continues to slide against other international currencies – making South Africa a value for money destination to travel to.
7.6.8 Booking Arrangements
Figure 7.11 and 7.12 indicates that booking through a travel agent in the country of origin is the most popular booking arrangement, and has increased by a few percentage points over the period 1997 to 1999.
Table 7.13: Factors Influencing Decision to Travel to the ESSA
Influencing Factor 1997 1998 1999 Word of Mouth 62% 53% 52% Promotion 20% 28% 29% Good Value for Money 11% 13% 13% Curiosity 2% 2% 2% Other 5% 3% 4% Notes: Word of mouth includes the following: personal experience from previous visits, advice from friends/relatives in their own country, advice from friends/relatives in South Africa, advice from business associates, business and VFR. Promotion includes the following: tourist brochures, advice from travel agent, advertisements for South Africa in newspapers, editorial material and publicity on South Africa, internet and information from South Africa Tourism offices Other reasons for coming to South Africa include the following: Education/study/research, medical treatment, sports spectator, religious reasons, to see the country after the political change, used to live in South Africa, incentive travel, has no choice but to come to South Africa. Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999
Action Plan will also serve to gather comprehensive information on the international tourist market so that South Africa can gear itself in the medium to longer term for strategic marketing campaigns.
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Figure 7.11: Booking Arrangements Made by Foreign Tourists to KwaZulu Natal
2% 2% 1% 100% 5% 3% 3% 11% 14% 15% 90%
80% 19% 27% 70% 30% 60% 50%
40% 64% 30% 54% 51% 20% 10% 0% 1997 1998 1999
Word of mouth Promotion Good value of money Curiosity Other
Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999
Figure 7.12: Booking Arrangements Made by Foreign Tourists to the Eastern Cape
5% 4% 5% 100% 2% 3% 2% 9% 90% 12% 13% 80% 21% 28% 70% 29% 60% 50% 40% 60% 30% 51% 55% 20% 10% 0% 1997 1998 1999
Word of mouth Promotion Good value of money Curiosity Other
Source: South African Tourism Foreign Tourist Surveys, Summer 1997, 1998 & 1999 and Winter 1997, 1998 & 1999
7.6.9 Expenditure
According to the South African Tourism Foreign Tourist Surveys, the total weighted average spend by foreign tourists during their stay in KwaZulu Natal and the Eastern Cape in 1999 is R10 053 and R10 031 respectively in 1999. Figure 7.13 provides a
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summary of the breakdown of these amounts on accommodation, transport, food and drink, recreational/cultural/sporting activities, shopping and other items. Table 7.14 provides a summary of the average spend by foreign tourists to KwaZulu Natal and the Eastern Cape both prior and during their trip.
Figure 7.13: Percentage Breakdown of Expenditure for Items Paid for in KwaZulu Natal and the Eastern Cape, 1999
Accommodation 35% 30% 29% 30% Local transport
22% 23% 25% 21% 19% Food & Drink 20%
15% Recreation/culture/sport 9% 10% 10% 10% 9% activities 10% 8% Shopping/souvenirs/sho 5% pping
0% Other Kw aZulu Natal Eastern Cape
Source: South African Tourism Foreign Tourist Surveys, Summer and Winter 1999
Table 7.14: Expenditure by Foreign Tourists to the ESSA, KwaZulu Natal and Eastern Cape, 1999
Item of Expenditure Expenditure per Province/Region (Rand) KwaZulu Natal Eastern Cape ESSA* Pre-paid airline tickets R8 950 R11 425 R10 188 Pre-paid holiday R6 827 R7 595 R7 211 Total pre-paid R15 778 R19 021 R17 399 Accommodation R3 031 R2 958 R2 994 Local transport R947 R958 R952 Food & drink R2 230 R2 322 R2 276 Recreational/cultural activities R795 R957 R876 Shopping R2 079 R1 885 R1 982 Other R971 R952 R962 Total paid in South Africa R10 053 R10 032 R10 043 Notes: * Weighted average Source: South African Tourism Foreign Tourist Surveys, Summer and Winter 1999
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8.1 BEACH TOURISM PRODUCTS
For the purposes of our discussion into the various beach tourism products offered along the ESSA, we define a “beach tourism product” as an ensemble of tangible and intangible components including: . Leisure activities (i.e. things to do see) AND . Services (i.e. accommodation, catering, transport) AND . Facilities and infrastructure (i.e. airports, roads, etc.). . which offer benefits that may draw certain types of consumers as they appeal to their specific travel needs and motivations.
Each component of the beach tourism product is discussed below.
8.1.1 Beach Leisure Products
All coastal regions along the ESSA have the potential to offer a sand and sea holiday (with the exception of Zululand and Maputaland which offer a limited number of accessible beaches) - however need to stress that Lubombo SDI intends developing resorts at St Lucia and Cape Vidal. Also intend improving infrastructure at Kosi and Sodwana. However, given the international trend towards the diversification of beach products to incorporate other elements, e.g. a cultural experience, adventure element, etc. we have undertaken a scan of existing products along the ESSA and have categorised them into various segments (refer to Table 8.1).
Table 8.1 provides an indication of existing and potential products along the ESSA. Figure 8.1 provides a summary of the geographical distribution of these products.
Table 8.1: Categorisation of Beach Products along the ESSA
Product Description Products included in Category Category Sand and . Lying on the beach and taking . Beaches . Fun fair/theme park Sea part in the watersports available . Shopping . Snake park at the beach and the attractions . Surfing . Waterworld parks nearby are of primary importance . Windsurfing . Aquarium and motivation . Swimming . Zoo . Pier/ Quay . Herbarium . Botanical & scenic . Animal farm gardens . Crocodile farm . Casino . Research centre History . Interest is in the arts, history and . Craft market . Battlefield and cultural experiences of the . Route/meander . National monument Culture region. . Cultural village . Museum . Art gallery . Paleontological features
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Activity . Little physical risk; and, . Boat/fishing trip . Marine fishing . Little or no experience required . Hiking/walking trail . Golf . Horse trail . Horseriding . Freshwater fishing . Sailing Adventure . Some previous experience is . 4X4 . Abseiling generally required; . Canoeing . Aviation . Some risk; and, . Mountain bike riding . River rafting . For reasonably physically and . Hunting . Scuba diving mentally fit. Nature . Has an exploratory component; . Forest . Mangrove swamp Tourism and, . Bird sanctuary . Marine reserve . Focus is on natural flora and . Biosphere reserve . Nature reserve fauna. . Game reserve . Wetland . Lagoon reserve . Coastal reserve Source: Grant Thornton Kessel Feinstein
Table 8.2: Summary of Beach Product Categories by Coastal Region
Coastal Region Product Categories Sand & Sea History & Activities Adventure Ecotourism Culture Sunshine Coast Wild Coast South Coast Durban Metro North Coast Zululand Maputaland Notes: = High abundance of products = Medium abundance of products = Low abundance of products = High potential for development Source: Grant Thornton Kessel Feinstein
I am of the opinion that Durban Metro should be classified as having a medium abundance of adventure activities - particularly if one takes into account the fact that there are a number of key scuba diving sites of the coast of the Uni-City, which now includes Umkomaas as well as a multitude of adventure activities in the Valley of a 1000 hills - abseiling, paragliding, microlighting. There are also a number of dam resorts within 20 km of the centre of the city - Hazelmere, Inanda and Shongweni - all offering the opportunity for a range of 'power' water sports.
The Umgeni is also popular for canoeing - Duzi etc.
8.1.2 Existing and Potential Products
A summary of existing and potential products satisfying each leisure segment in each coastal region is provided below.
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Sunshine Coast
Sand & Sand In terms of sun and sea products, this coastal region is well endowed and offers of the order of 15 swimming beaches all of which offer great spots for windsurfing, boardsailing and fishing. Attractions along the Sunshine Coast include, amongst others, the aquariums in Port Elizabeth and East London, the snake park and crocodile farms.
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The Sunshine Coast is a popular surfing spot especially at Jefferey's Bay, St Francis Bay, Port Elizabeth, East London and Port Alfred. Surfing, either as a specialist beach holiday or an activity holiday has the potential to become an important leisure activity in this coastal region. Although we believe that experienced international surfers searching for some of the world's best waves would be a primary market, potential also exists for non-experienced surfers to learn the sport. The recent growth in the number of surfing tour operators e.g. Drum Africa Travel and Tours and Aloe Afrika Adventures, is testament to the growing increase in popularity of the sport. We classify surfing as falling into the activity category.
The development of residential complexes with marinas and golfing estates is becoming a popular feature along the southern portion of the Sunshine Coast, particularly at St Francis Bay and Port Alfred.
History and Culture The Sunshine Coast is home to several museums and national monuments. African culture appears to be lacking, with the cultural village at Shamwari being the most visited attraction of this nature in the region.
Activities The Sunshine Coast offers a wide range of activities for tourists, ranging from fishing trips, horseriding to golf (on any one of the region's 10 golf courses, with the East London and Humewood courses being of a particularly high international standard).
Although mixed emotions are associated with hunting as a tourism product, potential for the development and promotion of hunting as a tourism activity exists, especially in the Eastern Cape where there has been a 14% growth in this activity over the period 1999 to 2000. Given the fact that the hunting is generally limited to the South African winter months, the combination of hunting with a beach holiday (winter sun package) may be feasible.
According to South African Tourism Foreign Tourist Survey (Winter 1999) whale watching was more popular amongst foreign tourists than the Kruger National Park. According to a representative from MTN Whale Route, whale watching in South Africa has grown by 112% per annum since 1994. An international survey conducted in 1998 rated South Africa amongst the top five fastest growing whale watching destinations in the world. From a US$504 million industry in 1994, global whale watching revenues grew to US$1 billion by 1998. This translates into an estimated 10 million people going on whale watching trips in 1998. South Africa's share of this revenue was approximately US$300 000 in 1998 and thus indicates that there is great potential and scope for growth along the Sunshine Coast.
Adventure
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Although the water is a bit cooler than the more tropical waters of the northern ESSA, Port Elizabeth has a few designated dive sites with the SAS Haerlem wreck offering particularly interesting diving. Port Alfred also offers some good diving spots.
Ecotourism The Sunshine Coast is home to the Addo Elephant National Park as well as several other private game reserves - the most famous being Shamwari Game Reserve and the Schotia Lion Park.
Wild Coast
Sand and Sea Although there are around 9 swimming beaches along the Wild Coast and popular surf spots at Cinsta, Coffee Bay, Mpande and Port St Johns, there are very few attractions. The Fish River Sun casino is probably the most visited attraction along the Wild Coast.
History and Culture Although the Wild Coast does not appear to offer a significant number of historical and cultural products, we believe that there is great potential in this region, especially through the development of interpretation centres containing information about the archaeological sites, rock art, fossils, chief's meeting places, historic mission settlements, graves and burial sites, battlefields, colonial architecture and fortifications in the area. We believe that the development and interpretation of the Xhosa culture (as opposed to the Zulu culture in Zululand) and a Mandela historical route, have enormous potential.
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Figure 8.1: Geographical Distribution of Beach Products along the ESSA
Sand & Sea History & Culture Activities Adventure Ecotourism
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Activities Although golfing is popular at the Fish River Sun, hiking and walking are the main activities along the Wild Coast.
Adventure Although the adventure products in the Wild Coast region are currently limited, potential exists for the development of mountain biking and 4x4 trails.
Ecotourism The Wild Coast boasts several nature reserves (as opposed to game reserves) including Dwesa, Cwebe, Hululeka, Silaka and Mkambati nature reserves.
South Coast
Sand and Sea The South Coast boasts the highest number of swimming beaches along the ESSA. This region has an estimated 59 beaches, of which 38 are safe for swimming and surfing and 16 prohibit windsurfing and other watersports.
History and Culture The South Coast has a fairly limited range of historical and cultural products. However, potential exists for the development of historical or cultural interpretation centres along the Southern Explorer meander.
Activities The South Coast has around 11 golf courses, with Southbroom, San Lameer and Selborne being the most popular. Angling, fishing charters and walking and hiking trails are other popular activities in the region.
Now part of MTN Whale Route. Charters to spot dolphins.
Adventure Recreational scuba diving is popular at Aliwal Shoal, which hosts around 40 000 divers per annum. Other popular recreational dive spots are found at Hibberdene, Shelly Beach, Umkomaas, Scottburgh and Park Rynie. More adventurous diving for advanced and experienced divers is found at Protea Banks (between Shelly Beach and Margate). Canoeing, white water rafting and abseiling can be experienced at Oribi Gorge
Ecotourism Although the South Coast is not home to many game reserves, it nevertheless has around 4 nature reserves and two coastal reserves, which are more-or-less evenly spread along the coastline.
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Durban Metro
Sand and Sea The Durban Metro coastal region comes second in terms of the number of swimming beaches along the ESSA. The Durban Metro has around 39 beaches, 21 of which are safe for swimming. Surfing is a well-known activity in this region, especially at North Beach which attracts many crowds during the Gunston 500 - now Mr Price Pro annual surfing event. Popular attractions in the region include the aquarium, snake park, waterworld fun fair/theme parks and shopping.
History and Culture Durban Metro has some cultural attractions and villages and is rich in museums, national monuments, craft markets and art galleries.
Activities Durban Metro offers a wide range of activities including walking trails, boat trips and golf (there are around 16 golf courses in the Durban Metro region of which Royal Durban Golf Club, Durban Country Club (Beechwood) and Kloof are the most prestigious).
Adventure Adventure products are fairly limited - not the case - particularly in Valley of 1000 hills!!! See my comments on below table 8.2 in the Durban Metro region, however, given the high number of attractions and activities in the region, we do not believe that this product category requires heavy development.
Ecotourism The Durban Metro region is rich in ecotourism products, ranging from bird sanctuaries to game and nature reserves and to lagoon reserves and mangrove swamps.
North Coast
Sand and Sea Although the North Coast does not have many swimming beaches compared to the South Coast and Durban Metro for example, the 8 swimming beaches that it does have are well-known. Umhlanga Rocks, Balitto and Salt Rock are the most well- known beaches along the North Coast. The North Coast has traditionally attracted the more wealthier tourist. The development of residential estates along this part of the coastline are becoming an increasingly popular feature. Zimbali Country Estate and Mount Edgecombe are the most well-known estates along the North Coast.
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Shopping is becoming a popular attraction along the North Coast, with Umhlanga Rocks being the most popular area. The completion of a new shopping complex at Umhlanga is expected to increase the area's popularity.
History and Culture Historical and cultural products along the North Coast are limited.
Activities Angling and golfing are the most popular activities along the North Coast.
Adventure Besides a dive site (T-Barge) just off Umhlanga Rocks, adventure activities are fairly limited along the North Coast. There are more dive sites other than T Barge on the North Coast - Lemonfish Reef Big Bream Reef Sheffield Reefs
Ecotourism The North Coast is fairly limited from an ecotourism perspective. Nevertheless, the presence of two nature reserves in the region provides an opportunity for tourists to experience some of the natural elements of the area.
Although the North Coast may appear to be deficient in certain products compared to other coastal regions, the relative close proximity to Durban Metro and Zululand which are rich in historical and ecotourism products respectively, provides opportunities for tourists to the North Coast to experience these products if desired.
Zululand and Maputaland
Sand and Sea Zululand and Maputaland are not considered to be a beach destination because while these regions have around 16 accessible beaches, only 5 of these are suitable for swimming. A number of beach resorts have been planned for St Lucia and Cape Vidal. Sodwana Bay facilities to be upgraded.
History and Culture Although Maputaland is fairly limited as far as the number of historical and cultural products is concerned, Zululand is quite the opposite. Zululand is steeped in British and Zulu history. Shakaland, Simunye, Stewarts Farm and DumaZulu Cultural Villages are popular attraction for many tourists searching for a true cultural experience.
Adventure
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Adventure sports and activities in Zululand and Maputaland take the form of 4x4 trails, wilderness trails in the game reserves and scuba diving at Sodwana, Cape Vidal and Kosi (which attracts approximately 600 000 divers annually). Africa's southern most coral reefs are found in this area. Although these coastal regions are recognised as being eco-sensitive, we believe that potential exists for the development of future adventure activities.
Ecotourism The majority of game and nature reserves in KwaZulu Natal are located in Zululand and Maputaland. Hluhluwe-Umfolozi, The Greater St Lucia Wetaland Park (a world heritage site which incorporates Mapelane, Lake St Lucia, Sodwana, Mkuzi, Lake Sibayi and Kosi) , Itala, Phinda, Ndumo and the Tembe Elephant Park Game Reserves are the most popular inland reserves in the area.
Whale watching - now part of MTN whale route. Turtle spotting.
Special Interest Products
Based on existing products along the ESSA which have the potential to contribute to a “complete” beach experience. Beach-golf, beach-ecotourism, beach-cruising in particular have the potential to contribute to the overall beach experience.
Special interest tourism products are difficult to categorise because of the difficulty of definition i.e. although we have classified scuba diving within the adventure leisure segment, it could also fall into the special interest segment. Thus, for the purposes of our discussion, we have classified special interest as being an activity that could appeal to a relatively small and niche market segment.
Golf
South Africa in general is becoming an important golfing destination for foreign tourists because of the relatively good value for money compared to other international golfing destinations.
South Africa Tourism Foreign Surveys indicate that golf tourists to South Africa are generally from the UK, Germany and the rest of Europe. The relatively few American golfers to South Africa can be attributed to be the extensive choice of American golf resorts, resulting in many preferring to stay within the USA rather than travelling abroad for a golfing holiday.
The ESSA has the potential to offer specialist beach-golf holidays. The ESSA has certain advantages over other areas of South Africa since the weather along the
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ESSA allows for all-year-round playing. Winter rain and the dreaded south-easter in the Western Cape often cause for cancellation of play. On the highveld, late afternoon summer storms can also cause cancellations of play.
Many of the golf courses on the ESSA - Wild Coast,San Lammeer, Selbourne, Durban Country Club etc. are rated as being in the top 20 golf courses in the country!!
Ocean Cruising
Ocean cruising is the fastest-expanding segment of the international travel industry, with an annual growth rate of 10%. Despite this growing demand, there are no significant passenger cruise liners operating off the South African coast. There is capacity at most of the ports along the ESSA to accommodate cruise liners, however, if cruising is to become a popular component of the beach tourism industry, then the creation of passenger terminals at some of the ports may be required.
According to Richards’s Bay Tourism Association, 6 international passenger liners visited the area between January and March 2000.
A survey undertaken by the East London Tourism Authority in Summer 1999 indicates that 1 cruiseship visit to the city generated revenue of around R1,25 million from day-trippers on shore. Thus, given the large amount of potential revenue that can be generated from cruising, we recommend that the development of this “beach- product” should not be ignored.
Durban is the point of departure for a number of luxury cruises - e.g. Starlight Cruises - Monterey cruises to Mauritius and Bazeroto - 2-3 departures per month.
8.1.3 Tourist Accommodation along the ESSA
In order to determine the type of accommodation available along the ESSA, we have assessed accommodation in the following categories:
. Hotels; . Guesthouses and B&Bs; . Camping and caravanning facilities; . Self-catering establishments and chalets; . Backpacking lodges . Lodges (including country lodges, country estates, country houses); . Game lodges; and, . Other (including facilities at health spa resorts, in caves, etc.).
8.1.4 Type of Accommodation Available
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There are no formal statistics available ??? - TKZN Tourism Asset Database regarding the numbers and size of accommodation facilities of any type. The number of establishments in each category (refer to Figure 8.2) may not necessarily be accurate (due to a number of establishments that may be operating with no affiliation to organised bodies such as the Guest House Association of South Africa (“GHASA”), The Federation of the South African Self-Catering Accommodation Industry (“FEDSAS”), etc. but the overall picture of accommodation available is unlikely to be insignificantly different to this. Figure 8.2, 8.3, 8.4 and 8.5 provide an indication of the range of accommodation available along the ESSA compiled from our analysis of databases, guides and accommodation listings.
Overall, guesthouses and B&Bs provide around 42% of the total number of establishments along the ESSA, this is followed by self-catering establishments (22%), hotels (12%) and lodges (9%) (refer to Figure 8.4).
Our scan of the accommodation sector along the ESSA indicates that there are around 28 494 rooms/units/sites available. As indicated in Figure 8.2, Durban Metro has by far the largest number of rooms (39%) along the ESSA, followed by the Sunshine Coast (16%) and the South Coast (15%).
Figure 8.2: Distribution of Establishments along the ESSA
1% 4% 16% 12%
13%
39% 15%
North Coast Maputaland Durban South Coast Zululand Sunshine Wild Coast
Source: Grant Thornton Kessel Feinstein - Was this data nor derived from TKZN and ECTB?? I know I provided the KZN data - please acknowledge these data sources!
Due to the various grading systems currently available in South Africa, we are unable to provide an indication of the percentage of establishments falling into the various star gradings. However, based on our - was this data not derived from TKZN and East Cape Tourism Boards data bases compilation of accommodation establishments along the ESSA, we are able to generalise that there is a stronger presence of 4- and 5-star establishments in the main city centres of Durban, Port Elizabeth, East London
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and Uitenhage compared to other areas. The game lodges in Zululand and Maputaland (except for the national and provincial parks) are also of a high standard. Self-catering and guesthouse/B&B establishments are generally of a 3-star standard, whilst backpacking lodges and caravan and camping sites generally offer budget accommodation.
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Figure 8.3: Distribution of Establishments According to Accommodation Category and Coastal Region
100% 9% 3% 14% 14% 90% 10% 37% 30% 10% 18% 80% 50% 25% 23% 14% 24% 70% 8% 24% 5% 60% 32% 2% 15% 12% 9% 10% 50% 7% 7% 17% 20% 16% 5% 40% 26% 37% 9% 30% 5% 28% 36% 24% 10% 20% 4% 17% 37% 13% 9% 9% 10% 25% 5% 3% 17% 9% 1% 0% 6%
Durban
Zululand
Sunshine
Wild Wild Coast
Maputaland
North Coast North
SouthCoast
B&B/Guesthouse Hotel Camping/Caravan Lodge Self Catering Backpackers Other Timeshare
Source: Grant Thornton Kessel Feinstein
Figure 8.4: Percentage Breakdown of the Total Number of Establishments Available along the ESSA
4% 4% 1% 6% 42%
12%
22% 9% B&B/Guesthouse Lodge Self Catering Hotel Camping/Caravan Timeshare Backpackers Other
Source: Grant Thornton Kessel Feinstein
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Figure 8.5: Percentage Breakdown of the Total Number of Rooms Available along the ESSA by Accommodation Type
2% 1% 0.4% 10% 23%
5% 38%
21%
B&B/Guesthouse Hotel Camping/Caravan Lodge Self Catering Backpackers Other Timeshare
Source: Grant Thornton Kessel Feinstein
In the absence of detailed market surveys, we are unable to determine the occupancy level of establishments by accommodation type and coastal region. However, based on our knowledge of the accommodation industry along the ESSA, we estimate the average occupancy to be around 43%, with higher occupancies being achieved during peak holiday seasons, and lower occupancies being achieved during the low seasons. In terms of accommodation type, hotels and self-catering establishments achieve the highest occupancies (between 40% and 60%). Lodges, backpackers lodges, B&Bs/guesthouses, camping and caravanning and other accommodation generally achieve occupancies lower than 50%.
8.1.5 Tourism-Support Infrastructure
As a point of departure for our scan of tourism-supporting infrastruture along the ESSA, we undertook a review of a study commissioned by the Tourism Infrastructure Working Group and the Department of Environment and Tourism Affairs (refer to Annexure C). This provides an overview of tourism gateways and clusters and the linkages between them. It is also provides an indication of the areas requiring further development.
The level of infrastructural development along the ESSA is generally good. Table 8.3 provides a summary of the current state of development in the various coastal regions. More detailed information on the different modes of transport supporting tourism along the ESSA is provided below.
8.1.6 Air Travel
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International sources indicate that air transport remains one of the fastest growing sectors of the world economy, with IATA predicting a 53% global increase in the number of passenger journeys between 2000 and 2010. As a result, the worldwide fleet of aircraft is expected to grow from around 10 000 in 1995 to 18 000 in 2015. Aircraft are also expected to have more capacity than before.
According to the Airports Company South Africa (“ACSA”) air traffic landings declined by 1,4% in 2000 over 1999, with international aircraft landings down from 10 011 to 9 725 and domestic landings down from 57 924 to 56 516. The decrease in international air traffic can be attributed to the ceasing of certain operations such as Turkish Airlines, Sabena and Austria Airlines – which although achieving good load factors, were losing money due to a combination of poor Rand/dollar exchange rates, limited frequencies and rising fuel prices – have also attributed to the decline in international aircraft landings.
Airports
ACSA owns and manages 3 international and 6 national airports and is responsible for the handling of approximately 90% of South Africa’s aviation requirements. Along the ESSA, ACSA is responsible for the management of Durban International Airport (“DIA”), Port Elizabeth Airport (“PEA”) and East London Airport (“ELA”). Table 8.4 provides a summary of the number of passengers passing through DIA, PEA and ELA, the number of air traffic movements and the average number of passengers per flight. Table 8.5 clearly indicates that flight capacity and/or load factors are low.
Table 8.3: Current State of Infrastructural Development along the ESSA
Coastal Region State of Infrastructural Development Sunshine Coast Although the level of infrastructural development is relatively high (in terms of transport, telecommunications, power and water and sanitation), widespread poverty, and increasing unemployment as well as the influx of people from the former Ciskei and Transkei to Port Elizabeth has resulted in the need for large-scale industrial projects, such as the proposed Ceoga deep-water port and Industrial Development Zone. The development of the proposed Westbank Industrial Development Zone in the East London area is also expected to act as a vehicle for reducing widespread poverty. Plans for the development of a high-speed rail link between East London and Umtata are currently underway1. This rail link is planned to cover 230km between the two cities in a time of between 2-3 hours. A feasibility study is currently underway to determine what kind of rolling stock would be required to cover the distance within the proposed journey time. Wild Coast Infrastructure along the Wild Coast is generally poor, with Port St John’s and Coffee Bay being the only towns in the region that are served by a tarred road. South Coast Infrastructure, road and other communication networks and services are well developed along the coast. However, infrastructure further inland is fairly limited with poor roads and levels of service.
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Durban Metro The Durban Metro area has a well developed transport and communications infrastructure, however, the high levels of population in this region has resulted on a huge strain being placed upon the infrastructure. North Coast Due to the region’s proximity to Durban, transport and infrastructure is well developed. The growth in real estate in this region is responsible for continued improvements in infrastructure. The proposed new airport at La Mercy, near Tongaat, has the potential to benefit the area and increase the number of visitors to the region. Zululand The only coastal city in the region is Richard’s Bay, which has an important deep water harbour. The region also has airport facilities and a well developed road network. Maputaland Of all the coastal regions along the ESSA, Maputaland has the lowest level of infrastructure (with only around 5% of the population having access to proper sanitation). Notes: 1These plans follow a controversial announcement by Spoornet in March 2000 that it was planning to curtail its rail services in the eastern half of the Eastern Cape. Source: Grant Thornton Kessel Feisntein
Table 8.4: Passenger and Air Traffic Movements at DIA, PEA and ELA, 1999
Airport Number of Air Traffic Number of Passengers Movements Passengers per Flight Durban International 1 262 841 23 944 52,7 Airport Port Elizabeth Airport 425 341 13 404 31,7 East London Airport 173 044 8 742 19,8 Source: ACSA, 2001
Table 8.5 provides a percentage breakdown of passenger and air traffic movements through DIA, PEA and ELA on international, regional, domestic and unscheduled flights.
Other private and public (owned by municipal and/or local authorities) airports along the ESSA include:
. Richard’s Bay; . Ulundi . Margate; and, . Umtata.
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Table 8.5: Percentage Breakdown of Passenger and Air Traffic Movements at DIA, PEA and ELA, 1999 DIA PEA ELA Passenger Movement International 2,3% 0,0% 0,0% Regional 0,1% 0,0% 0,0% Domestic Scheduled 97,4% 99,5% 99,0% Unscheduled 0,2% 0,5% 1,0% Air Traffic Movement International 16,0% 0,0% 0,0% Regional 1,3% 0,0% 0,0% Domestic Scheduled 75,3% 59,3% 67,2% Unscheduled 7,5% 40,7% 32,8% Source: ACSA, 2001
New Developments/Expansions
Durban International Airport: ACSA are currently upgrading DIA so that the airport will be able to accommodate forecasted increases in passenger traffic for the next five to six years. This upgrade is considered to be an interim measure while the proposed La Mercy airport is being planned and developed. This upgrade will result in the airport being able to accommodate approximately the 3,2 million passengers forecasted for 2006/2007. However, should the proposed La Mercy Airport not be developed, according to ACSA, there is sufficient space to upgrade DIA to accommodate forecasted demand for the next 20 or more years.
Richard’s Bay Airport: is to undergo a major facelift. Terminals will be upgraded and a business centre and restaurants are to be constructed. Other facilities such as the airport’s navigational system and lighting are also to be improved.
La Mercy Airport: The proposed La Mercy airport is to be located approximately 15km inland of Ballito. The airport would be the first international airport along the North Coast. Facilities at the airport will be comparable to those of global international airports and will include a full-length runway that will be able to accommodate wide-bodied aircraft. Development of the airport will be in two phases, which will allow the airport to handle a capacity of 15 million passengers once fully developed. The airport is expected to contribute an estimated R9 million per annum to the GDP of KwaZulu Natal, resulting in 21 000 new direct and indirect jobs. The Durban Metropolitan Council’s Economic Development division has recently announced that the future of La Mercy airport will be decided before the end of the second quarter of 2001.
Scheduled Airlines
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According to ACSA, there are a total of 45 international scheduled airlines (approximately 67 international flights per day) flying into Johannesburg International Airport16 (“JIA”) (refer to Annexure D). Figure 8.6 provides a breakdown of the percentage of flights from each world region.
Figure 8.6: Percentage Breakdown of International Scheduled Airlines to JIA
68% 70%
60%
50%
40%
30% 20% 20% 6% 10% 3% 3%
0%
Africa
Europe
East
Americas
Middle Middle East
Asia/Pacific
Source: Grant Thornton Kessel Feinstein
Although the majority of international airlines flying to South Africa originate from Africa we do not consider that these airlines will play a particularly important role in attracting beach holidaymakers to South Africa for two main reasons i.e.:
. A large percentage of African air arrivals come to South Africa on business; and . The proportion of African air arrivals is relatively small compared to overseas air arrivals (refer to Figure 8.7).
The comparably high percentage of airlines from Europe flying to South Africa is not surprising, given the fact that over 50% of all foreign tourists to South Africa are from Europe (refer to Figure 8.6). There is relatively low servicing of international routes rom the USA and the Far East that are becoming increasingly important source markets for tourism in South Africa. However, considering the fact that Europe represents a major hub for international flights from the USA the impact of not having direct flights from the USA to South Africa could be minimal as US tourists can fly via Europe to South Africa.
16 We have used JIA as a base for estimating the number of international airlines flying into the country since JIA represents the major point of arrival for international tourists into the country. Cape Town International Airport whilst it may have some direct international flights does not represent the primary international hub for the country.
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Intensive Air is currently looking into the feasibility of operating a Durban/Cape Town service. It is proposed that daily flights would be operated using its 75-seater aircraft on Fridays and Sundays, and possible extending this to Monday if feasible. Intensive Air is also looking at forming an alliance with Fresh Air, to operate daily flights between Richard’s Bay and Johannesburg. If it fails to form an alliance with Fresh Air, Intensive Air will consider using its own aircraft to fly to northern KwaZulu Natal.
Figure 8.7: Total Air Arrivals, 1997-1999
1600000 1400000 1200000 1000000 Africa 800000 Overseas 600000 400000 200000 0 1997 1998 1999
Source: STATSSA, 2000
The relatively small number of international scheduled flights to Durban is cause for concern, if the ESSA is to develop as mass-beach tourism destination. The reasons for the limited number of international flights is not due to insufficient demand, but is rather due to infrastructural limitations at the airport – the runway is simply not long enough to accommodate wide-bodied 747 aircraft.
According to international standards, in order to accommodate Boeing 737 and 767 wide-bodied jets in a coastal region, the runway needs to be approximately 3 - 3,5km in length. DIA, PEA and ELA have runway lengths shorter than 3,5km.
We believe that there is scope to increase the number of wide-bodied charter flights to the coastal regions. Given the existing infrastructure (and the proposed airport infrastructural developments), we believe that potential exists for the introduction of charter aircraft at PEA and at the proposed La Mercy Airport in the future, as well as future flights into DIA.
Charter Airlines
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Charter flights in South Africa are not common. Although there have been some foreign charters serving South Africa in past e.g. Britannica, the country has never benefited from the effect they have had on other destinations in the world (refer to Section 4). Since the beginning of 2000, the Department of Transport has approved 130 permits to foreign charters wishing to operate air services on a non-scheduled basis to and from South Africa.
To date, only two of these permits have been put into practice – Hungary has already started to operate a charter service between Budapest and Durban. Negotiations are currently underway for the operation of charter services between the UK and Durban. Details of these charters are provided below.
UK Charters
Negotiations between DIA and an international UK charter company (Airtours17) to operate bi-monthly flights (26 flights per year) between London and Durban began in August 2000.
Hungarian Charters
Following months of negotiations between Tourism KwaZulu Natal (“TKZN”), Durban based SCA Tours and Malev Hungarian Airline Charters, a deal has been signed which will seen at least 5 charter tours servicing Durban direct from Budapest in 2001, with the option of bringing in another two if there is enough interest. In an attempt to encourage interest in this new product, over 150 billboards will be erected throughout Hungary, advertisements for the charters have also been placed in newspapers, and 40 000 pamphlets have been distributed.
The charter package for Hungarians is around R6 300 and consists of a beach-based holiday in Durban of more than one week, with day trips organised to other parts of the KwaZulu Natal province such as the Greater St Lucia Wetland Park, Shakaland and the Umfolozi Hluhluwe Game Reserves.
8.1.7 Roads
Figure 8.8 shows a map of the major road access routes along the ESSA.
17 Airtours is one of the world’s largest charter companies, which has been responsible for turning around several world-class destinations, including Acapulco in Mexico, where, shortly after entering the market, tourism increased significantly in that country.
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Figure 8.8: Map Showing the Major Road Access Routes to and Within the ESSA
N 3 N 2
N N 1 3 N N 6 2 N N 2 2
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Road Access to the ESSA
The ESSA is covered by a reasonably extensive road network. The N2 national road runs along the length of the ESSA although frequently inland from the coast particularly through the Wild Coast, and connects all the major towns. The main road access to the ESSA (taking Johannesburg and Cape Town as the main points of departure) is into Richard’s Bay, Durban, East London and Port Elizabeth and can be summarised as follows:
From Johannesburg
N1 South → Bloemfontein → N1 South → Colesberg →Middleburg → N10 → Port Elizabeth
N1 South → Bloemfontein → N6 →Queenstown → East London
N3 → Durban
N17 → Ermelo → N2 → Pongola → St Lucia →Richard’s Bay
From Cape Town
N2 East →George → Knysna → Port Elizabeth
Road Access within the ESSA
All road routes described above are along national roads. There are several coastal roads which, to a large extent, run parallel to the N2 national coastal road. The main coastal roads (from north to south) are along the following routes:
Richard’s Bay →just south of Empangani → Gingindlovu (Zululand) → Stanger → Balito → Durban
Winklespruit (south of Amanzimtoti) → Catalina Bay (just north of Hibberdene)
Port Shepstone →Port Edward
There are no main coastal roads between Umtata and East London
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East London → Kidds Beach → inland for ± 80km →Wesley →Great Fish Point → Port Alfred → Bushmans River Mouth → then inland to join up with the N2 South
There is no coastal road between Port Elizabeth and the entrance to the Garden Route at Plettenberg Bay.
In all areas, the coast is served relatively well by a series of secondary roads branching off from the national roads.
The relatively poor condition of the roads in the Wild Coast and Maputaland coastal areas is cause for concern, however, the SDIs (refer to Section 7.8) - in these regions should address these problems and develop the infrastructure to a level that is more suitable to support tourism activities.
8.1.8 Rail
Although South Africa is generally well covered by its rail network, the railways primarily serve the major urban areas and are fairly limited along the ESSA. From a tourism perspective, the use of rail transport is fairly limited, however, a line does exist between Durban and Richard’s Bay. Although a line exists between Port Elizabeth and Port Alfred and between East London and Umtata, none of these lines run along the coast.
Spoornet operates the following routes to and from the coast:
. Algoa Route: Johannesburg → Bloemfontein → Port Elizabeth (daily service); . Amatola Route: Johannesburg → Bloemfontein → East London (daily service); and, . Trans Natal Route: Johannesburg → Pietermaritzberg → Durban (daily service).
The Blue Train operates a 2-night service between Cape Town and Port Elizabeth four times a week, however, most of the emphasis is placed on a small section of the Garden Route. The main emphasis of the Blue Train is placed on the winelands region and interior of the Western Cape. Although Rovus Rail does not operate any services along the ESSA, it has recently introduced a service between Pretoria and Durban. The latter, if marketed effectively, could provide an opportunity for upmarket international tourists to experience some of South Africa’s hinterland before arriving at the coast.
Based on the use of rail as a niche form of tourism18, we believe that there is potential to develop a rail/beach experience using existing infrastructure – especially along the Durban – Richard’s Bay line.
18 The UK and Germany for example, is a nation of lovers of train travel – the ESSA is therefore particularly well positioned to exploit this mode of transportation into a beach-related product. A survey of brochures from the UK has
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8.1.9 Sea
Although the ports and harbours along the ESSA are not used specifically for tourism (cruising), several have recently recognised the potential for the development of the habour to accommodate passenger liners.
Port Elizabeth has realised the potential for developing facilities to accommodate cruisehip passengers and has embarked upon a 6-year development (under the Southern Port Development Project (“SPDP”) - to improve the services and facilities of the harbour in general. The first phase of the SPDP will involve the development of retail and commercial components, followed by the development of a marina and residential complex. Richard’s Bay in response to the increase in the number of cruiseship passengers has also considered the development of the harbour to accommodate cruise liners.
Although potential apparently exists for the development of the cruise industry along the ESSA, special consideration will have to be given to the environmental consequences19 associated with this related form of beach tourism.
8.1.10 Tourism Infrastructure Development Requirements
Transport to accommodate the movement of tourists to the ESSA is highly varied in terms of the level of development required to an expected influx of tourists to the ESSA on a beach holiday. Table 8.6 provides a summary of the level of development required in each coastal area, based upon our scan of existing infrastructure. The developmental requirements for each mode of transportation is discussed below:
Table 8.6: Transportation Infrastructure Development Required to Support Tourism along the ESSA
International Domestic Coastal Region Scheduled Scheduled Charter Road Rail Sea Airlines Airlines Airlines Sunshine Coast High Medium High Medium High High Wild Coast Low High Low High High Low
revealed that almost all tour operators offer the Blue Train or Rovus Rail to clients. In addition to the more luxurious way to travel (i.e. abroad the Blue Train or Rovus Rail), we believe that potential exists to use Spoornet routes (with slightly upgraded trains) as a mode of transport along the ESSA e.g. between Port Elizabeth and East London and between Durban and Richard’s Bay. 19 In the Cayman Islands the local watersports association has complained to the government about the damage caused by cruiseships dropping anchor on the reefs. Government scientists have acknowledged that more than 300 acres of coral reef have already been lost to cruiseship anchors in the harbour at George Town (the capital of Grand Cayman). Proposals to increase the number of cruiseship moorings continue to threaten the reefs, and by destroying the reefs, the tourist industry is being destroyed.
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South Coast Low High High Low High Low Durban Metro High Low High Low High High North Coast High Medium High Low High Low Zululand Low High Medium Medium High High Maputaland Low Medium Low Medium Low Low Source: Grant Thornton Kessel Feinstein
International scheduled airlines: Provided that upgrades in terms of runway length are addressed, DIA, PEA and ELA have the potential to accommodate international scheduled airlines.
Domestic scheduled airlines: The regional airports of Richard’s Bay, Margate and Umtata have the potential to attract additional domestic scheduled airlines to accommodate for the expected influx of beach tourists to the ESSA.
Charter airlines: All international and regional airports have the potential to attract charter airlines of varying capacities
Road: Whilst the state of the roads along the ESSA are generally in good condition, the infrastructural projects highlighted by the coastal SDIs, have the potential to improve conditions and access, particularly along the Wild Coast and in Maputaland.
Rail: Potential exists for the improvement of rail linkages along all coastal regions (except in Maputaland where no rail infrastructure currently exists).
Sea: Potential for improvements in seas transportation and the development of passenger terminals is limited to the Sunshine Coast, Durban Metro and Zululand.
8.2 SPATIAL DEVELOPMENT INITIATIVES
SDIs represent a programme of strategic initiatives by government which are aimed at unlocking the inherent and under-utilised economic developmental potential of specific spatial locations in South Africa. The SDIs are aimed at economic development, in which international competitiveness, regional cooperation, and a more diversified ownership base are paramount.
The key objectives of the regional tourism led SDIs (including the Wild Coast and Lubombo SDIs) are:
. To generate sustainable economic growth and development;
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. To generate sustainable long term employment; . To maximise the extent to which private sector investment and lending can be mobilised into the process; and . To exploit the opportunities that arise from the development of tourism and ecotourism developments for the leveraging upstream and downstream business opportunities, and for the empowerment of local communities.
There are currently 12 SDIs in South Africa, at varying stages of delivery.
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8.2.1 Coastal SDIs
We have identified the following SDIs along the ESSA:
. Fish River SDI; . Wild Coast SDI; . Lubombo SDI; and . Richards Bay/Empangeni SDI.
A summary of the SDI locations, key economic sectors identified for tourism development and the various opportunities for development and investment is given in the following tables.
Table 8.7 provides a summary of common characteristics for the coastal SDIs. The development and promotion of tourism in these areas is common to all regions. The development of transportation, tourist accommodation and tourist products to support tourism promotion are also common.
Table 8.7: Summary of Common Characteristics for the Coastal SDIs Characteristics Fish River Wild Coast Richard’s Lubombo Bay Tourism Forestry Agriculture
Key Key Industry
Sectors
Economic Economic Infrastructure Minerals Road
Rail Sea ture Air Infrastruc Electricity, telecomms Hotel Self-catering
Lodge
on Backpacker Lodge Tourist Tourist Camping/Caravan Accommodati Other 1 1 History & Culture
Ecotourism
ts Activities
Tourist Tourist
Produc Adventure Notes: 1 Golf estate Source: Grant Thornton Kessel Feinstein
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FISH RIVER SDI
Location
The Fish River SDI area extends roughly from east to west along the coast between Port Elizabeth and East London.
Key Economic Sectors
. Tourism . Forestry . Agriculture . Industry . Infrastructure . Minerals
Tourism Development and Investment Opportunities
The following tourism developments are proposed for each of the tourism nodes in the Fish River SDI:
. Development of a heritage trail; . Expansion and extensions to the Addo Elephant National Park; . African curio and culture centre for the establishment of craft production - to set up a curio production industry with master craftsmen overseeing production in a tourism African cultural experience environment; . Development of a canoe and hiking trail on the Bushmans River; . Development of an agri-tourism farm at Brakfontein with traditional crafts such as hut building & decoration, beadwork, weaving, basketry, pottery, printmaking, wood carving, needlework, photography, wirework, hairdressing, sangomas and herbalists; . Development of an ecotourism and game farm at Cintsa West; . Evelyn valley enviropark – potential hotel development. Concept using the trout industry, hiking & tourism. Consists of three components: hotel complex, sport fishery, aquaculture and enviro-education. Opportunity for appropriately designed thatch hotel bordering the Rooikraans Dam, having conference facilities and a floating restaurant, amenities for fly fisherman and other environ recreational activities; . Development of an 18-hole Gary Player golf course at Coral Valley Golf and Country Club; . Ezakwantu cultural and tourist centre in Port Elizabeth - tourist and cultural centre, including restaurant, auditorium, museum, art gallery, traditional tavern, and an open air theatre; . Gondwanaland prehistoric theme park; . Inxuba craft and curio development – rural black empowerment initiative; . Phased development of resort hotel, recreation and entertainment complex as part of the Marina Park development; . Nomakwezi craft – training unemployed women in craft making in the Port Elizabeth/Uitenhage area in basic and advanced sewing skills, beadwork and craftmaking. Traditional crafts and utility items, corporate logos with emphasis on items that appeal to tourist market; . Development of a resort and conference centre at Port St Francis; . Stormberg Ecoventure Reserve; . Storm River Adventures – mountain bike trails, horseriding, river excursions; . Tsitikamma forest village market; . Ukhozi conference centre and a game reserve; . Yellowwoods resort and golf estate; . Yarrow game lodge – development of a game lodge, including 26 bed guest accommodation, hunting, hiking trails, watersports, historical tours, horseriding;
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Wild Coast SDI
Location
The Wild Coast SDI area extends some 280km between the Mtamvana River in the north and the Great Kei River in the south.
Key Economic Sectors
. Tourism . Forestry . Agriculture
Developmental Considerations
. Natural environment . Human resource development . Safety and Security . Partnering . Infrastructure . Land Issues
Tourism Development and Investment Opportunities
The following tourism developments are proposed for each of the tourism nodes along the Wild Coast:
Coffee Bay
. Self-catering log cabins in the Milkwood Forest . A middle market hotel with conference . Camping facilities and ablution blocks; . Hiking trails and basic hiking huts modelled on the local Xhosa huts; . A cultural centre where Xhosa crafts could be sold; and, . Facilities to cater for day trippers visiting the beach.
Dwesa/Cwebe Nature Reserve
. A middle market accommodation (hotel and self-catering) establishment on the existing hotel site . An upmarket lodge of international standard at Dwesa Point . A complex of basic rustic rondawels for hikers and backpackers; . A fly-fishing lodge or similar development at Nqabara River Mouth; . Nature trails, guided hikes, game drives and hide visits; . Facilities for beach, rock and offshore angling; and, . Upgrade of the existing 9-hole gold course.
Hluleka Nature Reserve
Redevelop the existing chalets to be sold to a consortium of investors as a suite hotel on a share lock basis. Magwa and Mbotyi.
Mkambati Game Reserve
Since Mkambati has been declared a national park, it must remain accessible to all members of the public and cannot therefore accommodate a fully exclusive development concept. The Mkambati Game Reserve is a sufficiently large and diverse area to cater upmarket, middle market and affordable
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RICHARDS BAY/EMPANGENI SDI
Location
The Richards Bay/Empangeni SDI is centered in the Richards Bay/Empangeni area in northern KwaZulu Natal coast
Key Economic Sectors
. Tourism . Industry . Infrastructure
Tourism Development and Investment Opportunities
The following tourism developments are proposed as part of the Richards Bay/Empangeni SDI
Lake Mzingazi
. Golf course residential estate within the existing golf course with services; . Nursery node – residential and light commercial providing direct access to the lake shore; and, . Greenhill node – Hotel, residential, light commercial, and office park in 15 ha clearing in coastal forest overlooking the lake.
Community Park
. Convention / exhibition centre; . Accommodation facility for visiting school groups; . Children’s camp for holidays; and, . Hotel for convention centre.
Borough Marina
. An attractive development is envisaged with restaurants, offices , services, residential and entertainment components.
Passenger Terminal at Richard’s Bay Port
. A terminal which will handle both general cargo and passengers. The terminal will provide a "one stop shop" to provide for tourists’ needs.
Cultural & Craft Village
. Establishment of a number of kiosks all selling a particular traditional commodity or craft. The centre would also serve as a depot where a trading company could acquire the local craft in bulk and retail it to businesses locally and internationally. A meander would be developed to the various craft making locations.
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Conference, Information and Tourist Centre
. A conference facility has been planned linked to an expansion of the visitor facilities and a training school for local craftsmen and artists.
LUBOMBO SDI
Location
The Lubombo SDI takes its name from the Lubombo Mountains which run through an area of South-East Africa that includes Eastern Swaziland, Southern Mozambique and the Northern part of South African province of KwaZulu/Natal.
Key Economic Sectors
. Ecotourism . Agriculture
Tourism Development and Investment Opportunities
The following tourism developments are proposed as for South Africa, Swaziland and Mozambique:
South Africa
St Lucia Node . Cape Vidal (Beach) - Bed Limit 500 - Prime coastal site on the eastern shores suitable for a large resort-style development; . Cape Vidal (Bhangazi Lake) - Bed Limit 50 - Exclusive site on Bhangazi Lake suitable for a boutique hotel or similar development; . Cape Vidal (Heritage) - Bed limit 50 - Site on the shores of Bhangazi Lake with strong cultural significance; . Perrier's Rock - Bed Limit 60 - Exclusive coastal site overlooking three secluded sandy bays; . Mpate River - Bed limit 40 - A site on the confluence of the Mpate River and St Lucia Estuary; . Ndlozi Peninsula - Bed Limit 200 - Exclusive and spectacular peninsula jutting into Lake St Lucia; and, . Estuary View - Bed Limit 300 - A prime site in the tourist hub of St Lucia Village. Kosi Bay Node . Amanzinyama Camp - The site is nestled in a patch of dry coastal forest on the edge of the lake in an isolated and wild setting. The site is zoned for a small development of no more than 30 tourist beds; . Bhanga Nek - this is an existing trails camp of approximately 2,3ha situated in the coastal forest just off the main Kosi beach. It offers a wide range of activities such as turtling, swimming, fishing, boating, wildlife viewing, and so on. Bhanga Nek is zoned for a small facility of no more than 30 tourist beds; . Kwadapha Camp - This site of approximately 2ha is situated on a saddle of land between the ocean and the largest of the Kosi lakes. Although the site is within the Coastal Forest Reserve, there are local communities living in the area. The site is zoned for a small to medium-sized development; and, . eNkovukeni Lake - This is a site of approximately 2ha on the northeastern corner of Makawulani Lake and is the present location of a small trails camp. The site is zoned for a small development of no more than 30 beds. Sibaya Node . Nine Mile - Bed Limit 100 - Coastal site north of Sodwana and just south of Sibaya Lake. . Baya Camp - Bed Limit 60 - Spectacular site on a headland jutting into southern part of Lake Sibaya. . Sibaya South - Bed Limit 60 - Spectacular site on a headland jutting into southern part of Lake Sibaya.
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Swaziland Nsubane-Pongola Transfrontier Conservation & Resource Area Lubombo Conservancy Goba Transfrontier Conservation & Resource Area
Mozambique Ponta do Oura Site Resort development including a major hotel, chalets or villas and a range of support facilities that could include a golf course and rehabilitation of a regional airport
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9.1 SUMMARY OF BEACH TOURISM TO AND FROM INTERNATIONAL DESTINATIONS
The international case studies presented in Section 4 provide some indication of the volume of beach tourists to various destinations throughout the world. Although deficiencies in statistical data exist (for several reasons already indicated in Section 4.1) to enable conclusions to be made, we have made some assumptions with respect to the number and market share of beach tourists to international beach destinations and drawn conclusions on market size. Table 9.1 provides a summary of the main long-haul beach tourist generators; the UK, Germany and USA.
Table 9.1: Summary of Beach Tourists from Selected Generating Countries
Long-Haul Tourists Long-Haul Beach Tourists % Number % Number UK 18% 9,6 million 30% 3.0 million Germany 10% 6 million 35% 2,2 million USA 29% 17,3 million 35% 6 million
From our understanding of selected beach destinations, we have estimated the size of the beach tourism industry to various countries (refer to Table 9.2) based on a variety of assumptions including:
. 60% Of all tourists to Spain are beach tourists; . Excluding Spanish tourists, 60% of all tourists to Portugal are beach tourists; . 60% Of all tourists to Greece are beach tourists; . 45% Of all tourists to Cyprus are beach tourists; . Excluding the Caribbean and North America, 90% of all tourists to the Bahamas are beach tourists; . Excluding the USA, 90% of all tourists to Bermuda are beach tourists; . Excluding tourists from African countries, 50% of all tourists to Kenya are beach tourists; . Excluding tourists from Reunion, Seychelles and Madagascar, 90% of all tourists to Mauritius are beach tourists; and, . Excluding tourists from East Asia, 50% of all tourists to Thailand are beach tourists.
According to IPK International, South Africa attracts around 1% of all long-haul beach tourists from the UK and Germany. This equates around to 29 000 and 21 000 beach tourists from the UK and Germany respectively already visiting South Africa.
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Table 9.2: Estimated Number of Beach Tourists to Selected Destinations
Beach Destination Number of Total Number of Estimated Number of Tourists to “Leisure” Beach Tourists Destination* Tourists to Destination** Spain (1998) 47 403 000 41 973 000 25 200 000 Portugal (1998) 11 295 000 5 873 400 3 500 000 Greece (1998) 11 077 000 9 622 600 5 770 000 Cyprus (1998) 2 222 706 2 222 706 1 222 500 Bahamas (1998) 1 540 000 1 232 000 200 000 Bermuda (1998) 368 756 78 776 70 000 Kenya (1999) 1 818 400 1 676 300 830 000 Mauritius (1999) 578 085 478563 430 000 Thailand (1998) 7 842 760 3 560 171 1 500 000 Notes: *According to WTO **Refer to assumptions
Europe is the major generator of beach tourists, and due to its relatively easy access ( 10 hours flight and no jet lag) to South Africa, we believe that Europe will be the major source market for South Africa for beach tourism. In Table 9.3 below we provide estimates of the total international beach tourism market out of Europe and the proportion of that which is long haul. At this stage we only have some statistics for the UK and Germany, but we have utilized average ratios for Germany and the UK and applied these to the major, mature European generators. These ratios are that 40% of outbound tourists are seeking a beach experience and 4,3% of all outbound tourists are taking a long haul beach holiday. We have excluded eastern Europe and most Mediterranean countries (which have reasonable amounts of sun, sea and sand). We believe that it is realistic to assume similar ratios for most European countries and that by excluding a number of countries our overall totals are probably conservative.
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Table 9.3: Summary of Beach Tourists from Various Source Markets
MILLION MILLION Country Total Number of Number of Beach Number of Long-Haul Outbound Tourists Tourists Beach Tourists France 18.08 7.23 0.78 Germany 69.02 27.61 2.97 Netherlands 13.55 5.42 0.58 Switzerland 12.21 4.89 0.53 UK 50.87 20.35 2.19 Belgium 7.77 3.11 0.33 Austria 3.78 1.51 0.16 Denmark 4.97 1.99 0.21 Finland 4.74 1.90 0.20 Italy 19.35 7.74 0.83 Sweden 11.42 4.57 0.49 Norway* 0.81 0.33 0.03 Total 216.59 86.64 9.31
Based on these assumptions the European outbound beach market totaled some 87 million tourist trips in 1998, of which 9,3 million (about 11%) are long haul.
In addition, although available data is limited, we have postulated the estimated market share of German and UK, outbound beach tourism which is achieved by Mauritius and Kenya. Table 9.4 indicates that Kenya captures around 3,3% of the outbound long haul beach holiday markets from the UK and Germany. Mauritius captures a lower 1,4% of the German long-haul beach market and 1,8% of the UK market. Mauritius however, captures more than 18% of the long-haul beach market out of France.
We do not have detailed figures from Thailand, but can postulate based on its overall European tourism numbers that it is capturing much higher market shares of European long-haul beach markets than Kenya.
Table 9.4: Summary of Beach Tourist Market Shares of Key Source Markets
Generator: UK Germany Destination Mkt Share % No. 000’s % No. 000’s Kenya 3.29 72 3.37 100 Mauritius 1.78 53 1.37 40
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In addition a factor which bodes well for the development of long haul beach holidays is the general increased propensity to take a long haul holiday. In the USA the percentage of the population taking long haul holidays went from 7,4% in 1997 to 8,5% in 1999 and represented 11% annual average growth in outbound long haul travel.
In the UK the overall outbound market increased by 5,8% in 1999, but the proportion traveling long haul has been growing. It was 14% in 1994, and grew to 19% in 1999. Most of the long-haul travel growth in the UK is attributed to the increasing popularity of long-haul beach destinations.
The total German international beach holiday market is projected to be growing at about 2,3% annually. The propensity of Germans to take long haul trips is however remaining static at around 10%.
9.2 PROJECTED NUMBER OF INTERNATIONAL BEACH TOURISTS TO SOUTH AFRICA
Based on the levels of beach tourism to each of the selected destinations (and the factors influencing and directing their development), we believe that the ESSA would be able to attract numbers of beach tourists somewhere around the levels achieved by Kenya and Mauritius.
Given our estimate that Mauritius and Kenya attract between 430 000 and 830 000 beach tourists per annum respectively, we believe that the ESSA could attract similar numbers. Specifically we believe that the ESSA could attract around 400 000 beach tourists per annum relatively comfortably. This equates to a 4% market share of the outbound European long haul beach market, ie 1/25th of these long haul beach markets. Taking account of the number of recognized long haul beach markets which is less than 25 ( ie the Carribean, Cuba, Dominican Republic, Indian Ocean Islands, Kenya, Thailand, etc), and the fact that many would do better than South Africa we believe that a 1/25th market share is not unreasonable.
We also believe that an average market share per country of 4% is acceptable, and will indicate shares achieved in South Africa which are better than Kenya’s, but lower than Thailand.
Further the 400 000 tourists is projected numbers within a three to five year time frame, whilst the market share calculation is based on 1998 outbound figures. It is expected that by 2004 – 2006 the size of the outbound, outbound long haul and outbound beach markets will have grown and therefore the target market share for South Africa will be less than 4%.
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Ultimately therefore we believe that, with the proper enabling environment, there is a good chance that South Africa could develop beach tourism to levels well above the 400 000 per annum. Thailand is a destination which appears to have achieved this, promoting its exotic and cultural uniqueness along with idyllic beaches and sun, sea and sand. South Africa has an excellent climate, superb beaches and an excellent range of supporting unique and special attractions and activities and should be able to develop and promote beach tourism to good levels.
9.3 ECONOMIC IMPACT OF THE ESSA’S BEACH TOURISM INDUSTRY
Annexure E provides a summary of the quantification of the ESSA beach tourism industry as well as its associated economic impact. Annexure E ignores inflation and therefore all figures are in present day terms.
9.3.1 Scenarios
We project that the ESSA could attract around 400 000 beach tourists per annum. We have, however, examined three scenarios i.e. 200 000 beach tourists per annum (LOW ROAD SCENARIO), 400 000 beach tourists per annum (MIDDLE ROAD SCENARIO) and 800 000 beach tourists per annum benchmark (HIGH ROAD SCENARIO).
9.3.2 Assumptions
These three scenarios are based upon the following general assumptions and rationales:
. Beach tourists will stay for an average of 8,3 days along the ESSA. This assumption takes into account the average length of stay by beach tourists on package holidays to other destinations as well as the part-days on arrival and departure; . We assume that accommodation utilization will be at an average of 100% double occupancy. This assumption is based on the belief that package holidays are mostly enjoyed by couples and families. Although some travelers may travel independently, the probability also exists that more than two people may occupy a room (especially in the case of family package holidays staying on a self- catering basis); . The average price of a package holiday including hotel accommodation is estimated to be around R8 000 per tourist; . The average price of a package holiday including self-catering accommodation is estimated to be around R7 300; . The average package cost of a return airfare is estimated to be around R2 700 per person;
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. The estimated cumulative rate of commission taken by overseas travel agents and wholesalers for beach holiday packages is 25%; . The estimated ratio of airfare spending which accrues to South Africa ( mainly South African carriers) is 25% of all airfare spending’ . The daily average spend per tourist for food and drink, entertainment, activities, etc. is estimated to be around R150 per day; . 60% Of beach tourists will use hotel accommodation; . 40% Of beach tourists will use self-catering accommodation; and, . The average cost to build an accommodation room is R450 000. This assumption is based upon the average cost per room for middle market hotels provided by construction and engineering consultants.
9.3.3 Growth Phases
We have divided each scenario into three phases, namely:
3 - Phase 1: 5years Base number of beach tourists (according to each scenario).
Phase 2: 5 –8 Base number of beach tourists + 25% growth in the number of beach years tourists to the ESSA.
Phase 3: 8-10 Phase 2 number of beach tourists + 10% growth in the number of beach years tourists to the ESSA.
Table 9.5 provides a summary of the annual number of beach tourists attracted to the ESSA according to the differing scenarios and growth phases.
Table 9.5: Summary of the Number of Beach Tourists along the ESSA
Scenario Phase 1 Phase 2 Phase 3 Low Road 200 000 250 000 275 000 Middle Road 400 000 500 000 550 000 High Road 600 000 750 000 825 000 Source: Grant Thornton Kessel Feinstein
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9.3.4 Multipliers
The expected direct expenditure by beach tourists represents the first round of spending in the economy. These incomes will induce further increases in consumer and business spending. The economic contribution of this second round of income is typically measured through the application of a multiplier. At this stage we have ignored the income multiplier and concentrated on direct spending generated in the economy only.
Additional expenditure in South Africa also induces demands in the labour market. The national employment multipliers released by the Central Economic Advisory Service (“CEAS”) in 1996, imply that for every R1 million of direct expenditure, 26,02 jobs are created in the trade and catering sector and 31,93 jobs are created in the construction sector. Taking inflation into consideration, we project that for every R1 million of additional, direct expenditure in South Africa, 19,1 and 23,4 jobs will be created in the trade and catering and construction sectors respectively in 2001.
9.3.5 Summary of Results
In order to avoid repetition, the following discussion concentrates on the middle road scenario. Tables 9.6, 9.7 and 9.8 provide a summary of beach tourism along the ESSA for each scenario under phase 1, phase 2 and phase 3 respectively.
9.3.5.1 Number of Tourists
The basic premise of the middle road scenario is that the ESSA could attract around 400 000 beach tourists in phase 1, increasing to 500 000 in phase 2 and 550 000 in phase 3. This equates to around 1 096, 1 370 and 1 507 beach tourists per day during phases 1, 2 and 3 respectively. Based on the assumption that a wide-bodied jet has a capacity of 300 seats per aircraft, this equates to around 3,7, 4,6 and 5,0 aircraft movements per day for the three phases.
9.3.5.2 Accommodation Requirements
Based on the assumption that beach tourists will stay in the ESSA for an average of 8,3 days, this equates to a total of 3,2 million, 4,0 million and 4,4 million bednights or 1,6 million, 2,0 million and 2,2 million roomnights sold per day (assuming 100% double occupancy) for phase 1, 2 and 3 respectively. Based on an average accommodation occupancy of 75%, this equates to a room requirement of 5 845, 7 306 and 8 037 over the 3 phases. This does not mean to say that 5 845 rooms must be constructed to accommodate the expected number of beach tourists to the ESSA in phase 1.
The exact number of rooms that should be constructed is difficult to determine because of the wide range and geographical dispersion of accommodation currently
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available along the ESSA (refer to Section 7.7.2). As per our ESSA accommodation analysis, there are a total of 28 494 rooms of which 17 214 are in hotels and self- catering establishments, achieving an average occupancy of 43% per annum, ie on average almost 10 000 rooms are available per day. Since we do not expect beach tourists on a package tour to stay in B&Bs, guesthouses, backpacking lodges, lodges, camping and caravanning sites and other forms of accommodation, we have not included them in our room requirement analysis. Also the accommodation establishments identified in Section 7.7.2 are not necessarily a true reflection of the total number of establishments along the coast, since some of the establishments included in the totals are located inland. Finally current seasonal demand for the existing accommodation and demand from new international beach tourists will coincide and in many instances much less than 10 000 rooms will be available to the new markets For these reasons, we estimate that about an average of 2 000 rooms of the current room supply could be used to meet the accommodation demands of new international beach tourists, and the balance of the rooms required would have to be developed.
9.3.5.3 Economic Impact
Based on the assumptions provided in Section 9.3.2 above (and detailed in Annexure E), approximately R1 608 million, R2 009 million and R2 210 million will be generated by beach tourists during phase 1, 2 and 3 respectively. Taking the expected number of rooms required to accommodate beach tourists into account, we estimate that around R1 730 million, R658 million and R329 million will be spent (incrementally) on construction during the three phases. Direct tourist and construction expenditure equates to a total of R3 338 million, R2 009 million and R2 210 million in phase 1, 2 and 3 respectively. This spending excludes other spending on infrastructure such as roads, airports etc.
Taking the trade and catering and construction employment multipliers into account, direct expenditure is expected to generate a total of 71 273, 37 694 and 32 215 jobs during the three phases. The decrease in total spending and jobs is due to the lower additional accommodation rooms required to satisfy demand growth only in phases 2 and 3.
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Table 9.6: Summary of the Number of Beach Tourists, Accommodation Requirements and Economic Impact along the ESSA during Phase 1
Low Road Middle Road High Road Tourist Numbers Target number of beach tourists 200 000 400 000 600 000 Average number of tourist 548 1 096 1 644 arrivals/departures per day
Accommodation Requirements Expected number of bednights sold 1 600 000 3 200 000 4 800 000 Total number of rooms required 2 922 5 845 8 767 Total number of rooms to be constructed 922 3 845 6 767
Economic Impact Total direct expenditure R1 219 mil R3 338 mil R5 646 mil Total number of jobs created 25 087 71 273 124 985 Source: Grant Thornton Kessel Feinstein
Table 9.7: Summary of the Number of Beach Tourists, Accommodation Requirements and Economic Impact along the ESSA during Phase 2
Low Road Middle Road High Road Tourist Numbers Target number of beach tourists 250 000 500 000 750 000 Average number of tourist 685 1 370 14 384 arrivals/departures per day
Accommodation Requirements Expected number of bednights sold 2 000 000 4 000 000 6 000 000 Total number of rooms required 3 653 7 306 10 959 Total number of rooms to be constructed 1 653 5 306 8 959
Economic Impact Total direct expenditure R1 333 mil R2 667 mil R3 112 mil Total number of jobs created 26 902 53 805 63 740 Source: Grant Thornton Kessel Feinstein
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Table 9.8: Summary of the Number of Beach Tourists, Accommodation Requirements and Economic Impact along the ESSA during Phase 3
Low Road Middle Road High Road Tourist Numbers Target number of beach tourists 275 000 550 000 825 000 Average number of tourist 753 1 507 2 055 arrivals/departures per day
Accommodation Requirements Expected number of bednights sold 2 200 000 44 000 000 6 600 000 Total number of rooms required 4 018 8 037 12 055 Total number of rooms to be constructed 2 018 6 037 10 055
Economic Impact Total direct expenditure R1 270 mil R2 539 mil R2 832 mil Total number of jobs created 24 968 49 936 56 240 Source: Grant Thornton Kessel Feinstein
9.4 CONCLUSIONS
The above analysis indicates a feasible middle road scenario for South Africa to attract a base of around 400 000 beach tourists, mainly from Europe, to its shores.
Although we have referred to “mass” beach tourism, in the context of worldwide destinations and South Africa’s levels of tourism 400 000 tourists per annum is not a huge incremental increase in tourism numbers. Therefore, while requiring additional infrastructure and environmental management, these numbers will not, if managed correctly, impact negatively on the environment, the infrastructure or on spatial planning. When the domestic market is taken into account the ESSA is already hosting millions of holiday trips, and an additional 400 000 foreign visitors can be readily absorbed. The additional room requirement of 4 000 to 6 000 represents only a 14% to 21% increase on the existing 28 500 rooms available in the ESSA area.
However, in order to effectively develop international beach tourism to South Africa on this scale a number of interventions will be required.
Of critical importance will be the following:
. Proper spatial planning – including careful identification of two or three zones for the development of additional hotel/self-catering rooms; . Excellent environmental management; . Improved air access – airports and charter services; . Some key improvements to other infrastructure – certain key roads and other basic provisions eg water, electricity, sewerage etc; . Cooperation of key international tour operators; . An excellent beach tourism destination marketing campaign; and
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. Appropriate targeted incentives to promote investment in rooms and other tourism facilities.
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10.1 THE WAY FORWARD
Successful development of mass international beach tourism to South Africa is possible on two or more levels. Level one is the incremental approach, where current facilities, attractions and infrastructure are incrementally sold into the international market, and air access develops largely to meet demand. The Hungarian and possible Airtours charters, and some of the SDI projects represent this approach.
Alternatively South Africa can develop a serious, meaningful, high-level beach tourism strategy, which should move the country from its current very modest levels to a destination attracting significant levels of international beach tourists within a three to five year timeframe. This is more of a “Big Bang” or “Big Splash” approach.
The incremental approach is happening and will continue to happen on an ad-hoc basis, and could possibly be more coordinated and focussed. However, the approach we recommend from the basis of this research is the Big Bang strategy. In spite of excellent international tourism growth in the last few years, it has not been at the desired levels and has not yet had the desired impact on our economy. South Africa will in any event be able to continue growing foreign leisure tourism in the future, but its growth will largely follow our current tourism base, with hoped-for levels of around 10% per annum growth, probably declining to closer to the worldwide average of 4% - 5% per annum as the base grows. The Big Slash approach to beach tourism could add a further 300 000 – 400 000 tourists to our annual numbers, growth of some 50% to 64% over say four years on our current base of 627 000 overseas holiday tourists. Thereafter these beach tourism numbers should at least continue to grow at the worldwide 4% - 5% level.
In spite of the trend towards “new age” tourism where educational, experiential and special interests become important tourism motivators, sun sea and sand, and particularly winter-sun, remain huge holiday motivators for tourists in many major generating countries. In South Africa we perhaps forget our fortunate climatic position, and do not realise the strength of a sun motivation for those who spend much of their time under grey skies.
South Africa has the opportunity to enter the beach tourism market at a later stage and therefore benefit from the extensive experience and lessons learnt by many destinations worldwide in developing and promoting their sun sea and sand product. The appropriate planning for sustainability and the ongoing development and refinement of products to meet market trends will not be ignored here.
South Africa is also entering the beach market at a stage when pure sun sea and sand is being replaced by beach “plus” - plus adventure, culture, nature etc -; when new beach destinations are being sought and when long haul beach holidays are on the increase. South Africa is perfectly positioned to enter the market with a carefully
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packaged range of beach products which fit with the developing market for beach tourism trends worldwide. How should South Africa take the Big Bang Beach tourism strategy forward?
We foresee three main phases to moving forward, viz;
. National Task Team . Masterplanning . Implementation
The phases are depicted in figure X.
A key tenet of the process through-out is that both the private sector and the public sector should be involved.
Phase 1 - National Task Team
Initially the process would be semi-formal and require the formation of a national task team to progress the process to the formal level. Such a team would require some or all of the following participation:
. Participation from the Department of Environmental Affairs and Tourism (“DEAT”); . Provincial support, and possibly participation, from KwaZulu-Natal and the Eastern Cape; . Two or three tourism/general business/civil society leaders; . Possible representatives from other national government departments.
The main goal of this team would be to move the project to develop mass beach tourism to South Africa into a formal phase with a “home” and with funding. It is envisaged that this would require:
. Obtaining high level national government and provincial government support; . Obtaining support from key tourism industry players and influencers including South African Tourism; . Further testing – more detailed feasibility – for the concept; . Developing a common vision and goals for the development of mass beach tourism; . Obtaining funding for Phase 2 – Masterplanning;
This process should be led by the DEAT but would also be well-served by one or two private sector champions. A marketing/lobbying approach and skills will be required to obtain the buy-in needed.
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Insert Figure 10.1
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The process should take three to six months, and would require a budget for inter alia:
. A secretariat/project manager; . Expanded feasibility work including purchase of international research, and interviews with key international beach tour operators and with possible scheduled and charter operators; . Lobbying costs – presentations, meetings and travel etc.
Our preliminary estimate is that a budget of around R500 000 should be sufficient.
The overall aim is to gain support and conclude on the nature and location of a temporary institutional structure to handle the management of Phase 2, Masterplanning and to obtain the funding for same.
Phase 2 – Masterplanning
This is a detailed planning stage aimed at ensuring that South Africa embarks on developing and promoting beach tourism in a coordinated, planned and sustainable manner, avoiding the pitfalls which other destinations have experienced, and optimising products for markets and implementing effective promotion strategies. Again this stage should be driven by the public sector.
The institutional structure that manages this phase could be:
. A Department of Trade and Industry (“DTI”)/Development Bank of South Africa structure similar to the SDIs; . An across-government level and department entity/council specifically created for the project; . A new department/team within the DEAT; . A new department/team within the DTI.
Although the above are all primarily public sector entities and we believe that the public sector should drive the process, wherever the entity locates and however it is constituted, it must ensure that private sector participation and input at a high level is also obtained eg private sector representatives on a board or council directing the entity.
The major objectives of this phase are to produce detailed, integrated, short, medium and long-term plans for the development of mass beach tourism. The plans must include the budgets and institutional structures required for implementation. It is essential that the plans integrate the following aspects of developing beach tourism:
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. Tourism market demand and needs . Tourism product development including investment policy and incentives . Tourism marketing strategy . Tourism quality assurance . Environmental management & capacity carrying limits . Infrastructure development . Land-use, spatial planning and node identification . Community involvement and empowerment . Institutional structures and capacity required . Identify and obtain funding requirements for implementation
In addition we recommend that preliminary development actions are undertaken during this phase, to start relationship building and negotiations with major international tour operators and possible charter air service providers. This will assist with the detailed market needs assessment and also be the preliminary steps in mobilising these two important elements of the tourism chain for beach tourism development in South Africa.
Through-out the masterplanning process it will be important to involve stakeholders at all levels, and also to provide information to the general public and communities in the areas in a controlled manner.
We envisage that the above process would involve contracting out the actual masterplanning work to a consortium of consulting companies with the necessary skills in the various areas. This would be similar to some of the masterplanning that has been/is being undertaken for SDIs, World Heritage Sites, Transfrontier Park development etc.
We expect that this process should take about 12 months and would require a budget of R10 million.
Key Elements of the Plans
The Tourism Marketing Strategy will be a very important component for the successful development of beach tourism. The marketing function must be adequately funded and the marketing strategy must include:
. Assessment of potential target markets . Competitive destination assessment . Detailed product assessment . Identification and prioritisation of market segments . Matching of a nucleus of products to market segments . Clear positioning and branding
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. An Integrated communication and promotion strategy, including servicing the travel trade, and use of technology . Ongoing monitoring and evaluation
Also of vital importance are elements of the product development strategy. From the various international case studies and our experience of the process of raising finance for tourism projects, we recommend that significant targeted tourism investment incentives are provided in order to stimulate the development of the required tourism products. This will particularly apply to accommodation and certain attractions which often require public sector support eg cultural, heritage and conservation products. In addition incentives and capacity building and support will be required to stimulate the PDI-owned SMME sector.
The tourism industry is viewed as high risk by investors worldwide, as it can be easily influenced by exogenous factors such as generating country economic conditions, instability and wars, crime and violence, disease, strikes (air traffic) etc. Investors therefore require higher than average returns to invest in tourism. In contrast many tourism projects, including major hotels, show only modest returns which are insufficient to attract investment, particularly in a world where the competition for global capital is intense. To realise mass beach tourism in South Africa on the scale envisaged, investment incentives will be required.
The institutional structures required for implementation and their effectiveness will also be critical to the overall successful development of beach tourism. One structure may be appropriate to handle the two main legs of the implementation; product (and other) development, and marketing strategy. On the other hand the marketing could be divorced from the development function.
Marketing would ideally be housed with South African Tourism, however we caution that for it to successfully market beach tourism it will require an approach and structuring based on product specialisation; ie a Beach Tourism marketing director with overall responsibility for marketing the beach products. This product specialisation in national marketing entities is being adopted in a number of countries, sometimes in concert with a geographic (by country) dimension and an overall matrix structure.
Alternatively a new, intermediate level (between provinces and national) marketing entity for beach tourism could be created. Such an entity would be in a fairly unique situation, but could also be used to house the other major leg of the implementation, ie product development.
Product development initiatives along the lines envisaged here would not normally be the domain of Tourism South Africa. It would probably be practical, given the needs and interventions required for beach tourism development, that the same or a similar
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structure as handled the masterplanning phase continue with the development leg of the implementation phase.
Whichever institutional structures are finally determined, appropriate mechanisms to ensure private sector involvement and input will also be required.
Phase 3 – Implementation
Following on from the masterplanning stage, the implementation will involve the actioning of the various plans developed during the masterplanning stage. In addition an ongoing monitoring and evaluation process will be required to ensure that products meet market needs and that any threats or weaknesses are addressed and opportunities and strengths maximised.
We envisage that a first phase implementation would take about three to five years. It is particularly difficult to determine a budget/cost to the fiscus at this stage, however, bearing in mind the requirement for marketing (allowed for say 4 years), some infrastructure development, some incentives with a cash-outflow, and SMME capacity building, we make a very preliminary guestimate that about R1,5 billion would be adequate.
On this basis, if the estimated costs of the three phases are totalled, it would cost R50 000 to create one permanent job (based on the first phase only of the middle road scenario and excluding construction and infrastructure jobs). This cost is against significant income to government from taxes which we have not quantified and a strong positive impact on the balance of payments from the direct foreign spending in the economy of R1,6bn annually by tourists.
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1. CONCLUSION
After an examination of key international beach tourism source markets and trends, a sample of international beach tourism destinations and the potential South African tourism products on the Eastern Seaboard, we conclude that:
. South Africa has the product base to attract international beach tourists, including additional supporting attractions to supplement the beach product which are in line with market demand trends; . International outbound beach tourism is a major market, particularly from Europe where some 87 million international beach holidays are taken annually, of which 9,3 million are long-haul beach holidays; . International tourism markets are growing and although the proportion of beach holidays taken remains steady, the proportions of long haul holidays, and the proportions of beach long haul holidays taken, are growing, therefore the long haul beach market is increasing; and . Long haul beach destinations (from Europe) are hosting from 70 000 to 1 500 000 beach tourists per annum.
Based on the detailed research we conclude that South Africa could host around 400 000 foreign beach tourists annually, and that this base would grow into the future.
This level of beach tourism would generate foreign spending of R1,6 billion annually and some 30 000 permanent jobs, as well as R1,7billion in capital spending on accommodation developments and a further 40 000 construction jobs. These levels of spending and job creation would increase in the future as beach tourism grows.
South Africa would be hosting an additional 8 800 tourists per day, and an average of 1 100 extra foreign arrivals and departures daily requiring 4 new daily international flight frequencies.
Around 4 000 extra hotel or self-catering rooms/units would be required to support this demand in addition to the 28 500 rooms available in the Eastern Seaboard area.
In order to realize this type of tourism development, the following planning and interventions would be required: Proper spatial planning – including careful identification of two or three zones for the development of additional hotel/self-catering rooms; Excellent environmental management; Improved air access – airports and charter services; Some key improvements to other infrastructure – certain key roads and other basic provisions eg water, electricity, sewerage etc;
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Cooperation of key international tour operators; An excellent beach tourism destination marketing campaign; and Appropriate targeted incentives to promote investment in rooms and other tourism facilities.
In order to progress the development of this level of beach tourism we recommend a three phase approach which is depicted in Figure 10.1 below. In addition we have provided very preliminary estimates of the costs that might be required to support the process.
Although we have referred to “mass” beach tourism, in the context of worldwide destinations and South Africa’s current levels of tourism 400 000 tourists per annum is not a huge incremental increase in tourism numbers. Therefore, while requiring additional infrastructure and environmental management, these numbers will not, if managed correctly, impact negatively on the environment, the infrastructure or on spatial planning. When the domestic market is taken into account the Eastern Seaboard is already hosting millions of holiday trips, and an additional 400 000 foreign visitors can be readily absorbed.
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2. BEACH TOURISM TO AND FROM INTERNATIONAL DESTINATIONS
We have made some assumptions with respect to the number and market share of beach tourists to international beach destinations and drawn conclusions on market size presented in Table 9.1 and 9.2
Table 9.1: Summary of Beach Tourists from Selected Generating Countries Long-Haul Tourists Long-Haul Beach Tourists % Number % Number UK 18% 9,6 million 30% 3,0 million Germany 10% 6 million 35% 2,2 million USA 29% 17,3 million 35% 6,0 million
Table 9.2: Estimated Number of Beach Tourists to Selected Destinations
Beach Destination Number of Total Number of Estimated Number of Tourists to “Leisure” Beach Tourists Destination* Tourists to Destination** Spain (1998) 47 403 000 41 973 000 25 200 000 Portugal (1998) 11 295 000 5 873 400 3 500 000 Greece (1998) 11 077 000 9 622 600 5 770 000 Cyprus (1998) 2 222 706 2 222 706 1 222 500 Bahamas (1998) 1 540 000 1 232 000 200 000 Bermuda (1998) 368 756 78 776 70 000 Kenya (1999) 1 818 400 1 676 300 830 000 Mauritius (1999) 578 085 478563 430 000 Thailand (1998) 7 842 760 3 560 171 1 500 000
In addition we have considered the total outbound beach market from Europe, which we identify as the major beach source market for South Africa (see Table 9.3). We have used statistics and research ratios for the UK and Germany, and applied these to the major, mature European generators. These ratios are that 40% of outbound tourists are seeking a beach experience and 4,3% of all outbound tourists are taking a long haul beach holiday. We have excluded Eastern Europe and most Mediterranean countries (which have reasonable amounts of sun, sea and sand). We believe that it is realistic to assume similar ratios for most European countries and that by excluding a number of countries our overall totals are probably conservative.
Based on these assumptions the European outbound beach market totaled some 87 million tourist trips in 1998, of which 9,3 million (about 11%) are long haul.
We have also postulated the market share of German and UK, outbound long haul beach tourism which is achieved by Mauritius and Kenya. Table 9.4 indicates that Kenya captures around 3,3% of the outbound long haul beach holiday markets from the UK and Germany. Mauritius captures a lower 1,4% of the German long-haul beach market and 1,8% of the UK market. Mauritius however, captures more than 18% of the long-haul beach market out of France.
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Table 9.3: Summary of Beach Tourists from Various Source Markets
MILLION MILLION Country Total Number of Number of Beach Number of Long-Haul Outbound Tourists Tourists Beach Tourists France 18.08 7.23 0.78 Germany 69.02 27.61 2.97 Netherlands 13.55 5.42 0.58 Switzerland 12.21 4.89 0.53 UK 50.87 20.35 2.19 Belgium 7.77 3.11 0.33 Austria 3.78 1.51 0.16 Denmark 4.97 1.99 0.21 Finland 4.74 1.90 0.20 Italy 19.35 7.74 0.83 Sweden 11.42 4.57 0.49 Norway* 0.81 0.33 0.03 Total 216.59 86.64 9.31
We do not have detailed figures from Thailand, but can postulate based on its overall European tourism numbers that it is capturing much higher market shares of European long- haul beach markets than Kenya.
Table 9.3: Summary of Beach Tourist Market Shares of Key Source Markets
Generator: UK Germany Destination Mkt Share % No. 000’s % No. 000’s Kenya 3.29 72 3.37 100 Mauritius 1.78 53 1.37 40
In addition a factor which bodes well for the development of long haul beach holidays is the general increased propensity to take a long haul holiday. In the USA the percentage of the population taking long haul holidays went from 7,4% in 1997 to 8,5% in 1999 and represented 11% annual average growth in outbound long haul travel.
In the UK the overall outbound market increased by 5,8% in 1999, but the proportion traveling long haul has been growing. It was 14% in 1994, and grew to 19% in 1999. Most of the long- haul travel growth in the UK is attributed to the increasing popularity of long-haul beach destinations.
The total German international beach holiday market is projected to be growing at about 2,3% annually. The propensity of Germans to take long haul trips is however remaining static at around 10%, but beach holiday taking growth is projected at 5,2% per annum.
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3. PROJECTED NUMBER OF INTERNATIONAL BEACH TOURISTS TO SOUTH AFRICA
We believe that the ESSA would be able to attract numbers of beach tourists around the levels achieved by Kenya and Mauritius, which receive between 430 000 and 830 000 beach tourists per annum respectively.
Specifically we believe that the ESSA could attract around 400 000 beach tourists per annum relatively comfortably. This equates to a 4% market share of the outbound European long haul beach market, ie 1/25th of these long haul beach markets. Taking account of the number of recognized long haul beach markets which is less than 25 ( ie the Carribean, Cuba, Dominican Republic, Indian Ocean Islands, Kenya, Thailand, etc), and the fact that many would do better than South Africa we believe that a 1/25th market share is not unreasonable.
Further the 400 000 tourists is projected numbers within a three to five year time frame, whilst the market share calculation is based on 1998 outbound figures. It is expected that by 2004 – 2006 the size of the total outbound, outbound long haul and outbound beach markets will have grown and therefore the targeted market share for South Africa will have reduced to less than 4%.
Ultimately therefore we believe that, with the proper enabling environment, there is a good chance that South Africa could develop beach tourism to levels well above the 400 000 per annum. Thailand is a destination which appears to have achieved this, promoting its exotic and cultural uniqueness along with idyllic beaches and sun, sea and sand. South Africa has an excellent climate, superb beaches and an excellent range of supporting unique and special attractions and activities and should be able to develop and promote beach tourism to these levels.
4. ECONOMIC IMPACT OF THE ESSA’S BEACH TOURISM INDUSTRY
A detailed analysis of the projected impact of these levels of beach tourism is included in Annexure E. We included a low road (200 000 beach tourists) and a high road (600 000 beach tourists) in the calculations and projected a second and third phase of beach tourism development for each scenario. All the calculations of impact are in 2001 rands.
The following general assumptions and rationales are used:
. Average stay of 8 nights and 8,3 days; . 100% Double occupancy of accommodation units; . Average price of a hotel package holiday at R8 000 and of a self-catering package holiday at R7 300; . Average package return airfare cost of R2 700 per person; . Cumulative commission taken by overseas travel agents and wholesalers at 25%; . A ratio of airfare spending which accrues to South Africa of 25%; . A daily average spend per tourist of R150; . 60% Of beach tourists will use hotel accommodation;
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. 40% Of beach tourists will use self-catering accommodation; and, . The average cost to build an accommodation room is R450 000.
The growth phases applied are depicted below.
3 - Phase 1: 5years Base number of beach tourists (according to each scenario).
Phase 2: 5 –8 Base number of beach tourists + 25% growth in the number of beach years tourists to the ESSA.
Phase 3: 8-10 Phase 2 number of beach tourists + 10% growth in the number of beach years tourists to the ESSA.
The projections ignore the income multiplier and provide indications of direct spending in the economy only. However to estimate job creation, employment multipliers have been applied, and therefore the employment numbers projected include indirect employment.
The total spending excludes capital investment on infrastructure such as roads, airports etc.
The exact number of rooms that should be constructed is difficult to determine because of the wide range and geographical dispersion of accommodation currently available along the ESSA. There are a total of 28 494 rooms in the ESSA region of which 17 214 are in hotels and self-catering establishments, achieving an average occupancy of 43% per annum, ie on average almost 10 000 rooms are available per day. The 17 214 rooms are not the total number of establishments along the coast as some of the establishments included in the totals are located inland. Finally current seasonal demand for the existing accommodation and demand from new international beach tourists will coincide and in many instances much than 10 000 rooms will be available to the new markets For these reasons, we estimate that about an average of 2 000 rooms of the current room supply could be used to meet the accommodation demands of new international beach tourists, and the balance of the rooms required would have to be developed.
A summary of the results of the economic analysis for the middle road scenario are shown in the table below.
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Summary of the Number of Beach Tourists, Accommodation Requirements and Economic Impact along the ESSA for the Middle Road Scenario Phase 1 Phase 2 Phase 3 Tourist Numbers Target number of beach tourists 400 000 500 000 750 000 Average number of tourist 1 096 1 370 14 384 arrivals/departures per day Additional daily aircraft frequencies 3.7 4.6 5.0 required
Accommodation Requirements Expected number of bednights sold 3 200 000 4 000 000 6 000 000 Total number of rooms required 5 845 7 306 10 959 Total number of rooms to be constructed 3 845 5 306 8 959
Economic Impact Total spend by beach tourists R1 608mil R2 009 mil R2 210mil Total construction costs R1 730 mil R658 mil R329mil Total direct expenditure R3 338 mil R2 667 mil R3 112 mil
Total tourism jobs 30 712 38 390 42 229 Total construction jobs 40 561 15 415 7 708 Total jobs 71 273 53 805 49 936
Although we have referred to “mass” beach tourism, in the context of worldwide destinations and South Africa’s levels of tourism 400 000 tourists per annum is not a huge incremental increase in tourism numbers. Therefore, while requiring additional infrastructure and environmental management, these numbers will not, if managed correctly, impact negatively on the environment, the infrastructure or on spatial planning. When the domestic market is taken into account the ESSA is already hosting millions of holiday trips, and an additional 400 000 foreign visitors can be readily absorbed. The additional room requirement of 4 000 to 6 000 represents only a 14% to 21% increase on the existing 28 500 rooms available in the ESSA area.
However, in order to effectively develop international beach tourism to South Africa on this scale a number of interventions will be required.
Of critical importance will be the following:
. Proper spatial planning – including careful identification of two or three zones for the development of additional hotel/self-catering rooms; . Excellent environmental management; . Improved air access – airports and charter services; . Some key improvements to other infrastructure – certain key roads and other basic provisions eg water, electricity, sewerage etc; . Cooperation of key international tour operators; . An excellent beach tourism destination marketing campaign; and . Appropriate targeted incentives to promote investment in rooms and other tourism facilities.
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5. THE WAY FORWARD
Successful development of mass international beach tourism to South Africa is possible on two levels. Level one is the incremental approach, where current facilities, attractions and infrastructure are incrementally sold into the international market, and air access develops largely to meet demand. The Hungarian and possible Airtours charters, and some of the SDI projects represent this approach.
Alternatively South Africa can develop a serious, meaningful, high-level beach tourism strategy, which should move the country from its current very modest levels to a destination attracting significant levels of international beach tourists within a three to five year timeframe. This is more of a “Big Bang” or “Big Splash” approach.
We recommend the Big Splash strategy which could add a further 300 000 – 400 000 tourists to our annual numbers, growth of some 50% to 64% over say four years on our current base of 627 000 overseas holiday tourists. Thereafter these beach tourism numbers should at least continue to grow at the worldwide 4% - 5% level.
We foresee three main phases to moving forward which are depicted in Figure 10.1, viz;
National Task Team Masterplanning Implementation
A key tenet of the process through-out is that both the private sector and the public sector should be involved.
Phase 1 - National Task Team
Initially the process would be semi-formal and require the formation of a national task team to progress the process to the formal level. Such a team would require some or all of the following participation:
Participation from the Department of Environmental Affairs and Tourism (“DEAT”); Provincial support, and possibly participation, from KwaZulu-Natal and the Eastern Cape; Two or three tourism/general business/civil society leaders; Possible representatives from other national government departments.
The main goal of this team would be to move the project to develop mass beach tourism to South Africa into a formal phase with a “home” and with funding. It is envisaged that this would require:
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obtaining high level national government and provincial government support; obtaining support from key tourism industry players and influencers including South African Tourism; further testing – more detailed feasibility – for the concept; developing a common vision and goals for the development of mass beach tourism; obtaining funding for Phase 2 – Masterplanning;
This process should be led by the DEAT but would also be well-served by one or two private sector champions. A marketing/lobbying approach and skills will be required to obtain the buy-in needed.
The process should take three to six months, and would require a budget for inter alia:
a secretariat/project manager; expanded feasibility work including purchase of international research, and interviews with key international beach tour operators and with possible scheduled and charter operators; lobbying costs – presentations, meetings and travel etc.
Our preliminary estimate is that a budget of around R500 000 should be sufficient.
The overall aim is to gain support and conclude on the nature and location of a temporary institutional structure to handle the management of Phase 2, Masterplanning and to obtain the funding for same.
Phase 2 – Masterplanning
This is a detailed planning stage aimed at ensuring that South Africa embarks on developing and promoting beach tourism in a coordinated, planned and sustainable manner, avoiding the pitfalls which other destinations have experienced, and optimising products for markets and implementing effective promotion strategies. Again this stage should be driven by the public sector.
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The institutional structure that manages this phase could be:
a Department of Trade and Industry (“DTI”)/Development Bank of South Africa structure similar to the SDIs; An across-government level and department entity/council specifically created for the project; A new department/team within the DEAT; A new department/team within the DTI.
Although the above are all primarily public sector entities and we believe that the public sector should drive the process, wherever the entity locates and however it is constituted, it must ensure that private sector participation and input at a high level is also obtained eg private sector representatives on a board or council directing the entity.
The major objectives of this phase are to produce detailed, integrated, short, medium and long-term plans for the development of mass beach tourism. The plans must include the budgets and institutional structures required for implementation. It is essential that the plans integrate the following aspects of developing beach tourism:
Tourism market demand and needs Tourism product development including investment policy and incentives Tourism marketing strategy Tourism quality assurance Environmental management & capacity carrying limits Infrastructure development Land-use, spatial planning and node identification Community involvement and empowerment Institutional structures and capacity required Identify and obtain funding requirements for implementation
In addition we recommend that preliminary development actions are undertaken during this phase, to start relationship building and negotiations with major international tour operators and possible charter air service providers. This will assist with the detailed market needs assessment and also be the preliminary steps in mobilising these two important elements of the tourism chain for beach tourism development in South Africa.
Through-out the masterplanning process it will be important to involve stakeholders at all levels, and also to provide information to the general public and the communities in the areas in a controlled manner.
We envisage that the above process would involve contracting out the actual masterplanning work to a consortium of consulting companies with the necessary skills in the various areas. This would be similar to some of the masterplanning that has been/is being undertaken for SDIs, World Heritage Sites, Transfrontier Park development etc.
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We expect that this process should take about 12 months and would require a budget of R10 million.
Key Elements of the Plans
The Tourism Marketing Strategy will be a very important component for the successful development of beach tourism. The marketing function must be adequately funded and the marketing strategy must include:
Assessment of potential target markets Competitive destination assessment Detailed product assessment Identification and prioritisation of market segments Matching of a nucleus of products to market segments Clear positioning and branding An Integrated communication and promotion strategy, including servicing the travel trade, and use of technology Ongoing monitoring and evaluation
Also of vital importance are elements of the product development strategy. From the various international case studies and our experience of the process of raising finance for tourism projects, we recommend that significant targeted tourism investment incentives are provided in order to stimulate the development of the required tourism products. This will particularly apply to accommodation and certain attractions which often require public sector support eg cultural, heritage and conservation products. In addition incentives and capacity building and support will be required to stimulate the PDI-owned SMME sector.
The tourism industry is viewed as high risk by investors worldwide, as it can be easily influenced by exogenous factors such as generating country economic conditions, instability and wars, crime and violence, disease, strikes (air traffic) etc. Investors therefore require higher than average returns to invest in tourism. In contrast many tourism projects, including major hotels, show only modest returns which are insufficient to attract investment, particularly in a world where the competition for global capital is intense. To realise mass beach tourism in South Africa on the scale envisaged, investment incentives will be required.
The institutional structures required for implementation and their effectiveness will also be critical to the overall successful development of beach tourism. One structure may be appropriate to handle the two main legs of the implementation; product (and other) development, and marketing strategy. On the other hand the marketing could be divorced from the development function.
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Marketing would ideally be housed with South African Tourism, however we caution that for it to successfully market beach tourism it will require an approach and structuring based on product specialisation; ie a Beach Tourism marketing director with overall responsibility for marketing the beach products. This product specialisation in national marketing entities is being adopted in a number of countries, sometimes in concert with a geographic (by country) dimension and an overall matrix structure.
Alternatively a new, intermediate level (between provinces and national) marketing entity for beach tourism could be created. Such an entity would be in a fairly unique situation, but could also be used to house the other major leg of the implementation, ie product development.
Product development initiatives along the lines envisaged here would not normally be the domain of Tourism South Africa. It would probably be practical, given the needs and interventions required for beach tourism development, that the same or a similar structure as handled the masterplanning phase continue with the development leg of the implementation phase.
Whichever institutional structures are finally determined, appropriate mechanisms to ensure private sector involvement and input will also be required.
Phase 3 – Implementation
Following on from the masterplanning stage, the implementation will involve the actioning of the various plans developed during the masterplanning stage. In addition an ongoing monitoring and evaluation process will be required to ensure that products meet market needs and that any threats or weaknesses are addressed and opportunities and strengths maximised.
We envisage that a first phase implementation would take about three to five years. It is particularly difficult to determine a budget/cost to the fiscus at this stage, however, bearing in mind the requirement for marketing (allowed for say 4 years), some infrastructure development, some incentives with a cash-outflow, and SMME capacity building, we make a very preliminary guestimate that about R1,5 billion would be adequate.
On this basis, if the estimated costs of the three phases are totalled, it would cost R50 000 to create one permanent job (based on the first phase only of the middle road scenario and excluding construction and infrastructure jobs). This cost is against significant income to government from taxes which we have not quantified and a strong positive impact on the balance of payments from the direct foreign spending in the economy of R1,6bn annually by tourists.
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BACKGROUND SECTIONS
6. INTERNATIONAL OUTBOUND MARKETS
The UK
The share of long-haul holiday trips has grown from 14% in 1994 to 19% in 1999, and accounted for 2,2 million holidays that year. The USA is the top long-haul destination with a 39% of the market share. Other top destinations include Africa and the Middle East (17%); Latin America and the Caribbean (11%); Canada (7%); and Australia/New Zealand (6%). The most important aspects of long-haul growth are the predominance of inclusive tours versus independent travel and the important role of sun and beach holidays.
The UK population generally have positive attitudes towards long-haul holidays including:
. Over one-third believe that it is becoming cheaper to travel to long-haul destinations; . 34% agree that it’s more interesting to travel outside Europe on holiday; . 26% have friends or relatives in faraway places that they would like to visit; and, . 23% expect to be taking long-haul holidays more often in the future.
The table below provides a breakdown of the types of holidays taken by the UK outbound market. This breakdown has not changed significantly since 1992, and is not likely to change except for an expected decline in the popularity of touring holidays and an increase in “city break” holidays.
Type of Holiday All Short-Haul Long-Haul Leisure Trips Trips Trips Sun/Beach 39% 47% 30% Holiday Touring holiday 21% 9% 33% Country holiday 7% 9% 4% City break 8% 13% 3% Cruise/boat trip 1% 1% 1% Sporting holiday 2% 2% 2% Snow holiday 3% 4% 2% Other holiday 18% 11% 25% Source: IPK International, 1998
The most popular long-haul beach destinations include the Dominican Republic, Cuba, Thailand, India and Mexico.
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According to IPK International, South Africa received approximately 1% of the total UK outbound market in 1999. Of these trips to South Africa, 15% of these were sun and beach holidays. UK beach holidaymakers to South Africa spent an average of 10,7 nights and spent a total of total of EUR15,4 billion (EUR110 per night). The most popular form of accommodation used by these tourists was hotels (48%), followed by holiday homes. 90% Of these UK travellers came to South Africa in 1999 on pre-paid trips, 66% of which were inclusive trips.
The USA
In 1999 approximately 37,4 million Americans (18,5% of the US population) travelled outside the North American continent for pleasure trips – representing an increase of 15% over 1997. Growth in long-haul travel (excluding travel to destinations other than Alaska, Hawaii, Canada, Mexico, the Caribbean and Bermuda) has been even more pronounced. The number of long-haul travellers increased by nearly 25% from 1997 to 17,3 million in 1999. Europe is the most popular destination for USA long-haul travellers. This is followed by trips to Asia/South Pacific and South and Central America. The market share for Africa is only 5%.
According to the Travel Industry Association of America Travel Poll conducted in 1998, approximately 35% of all US outbound travellers took a trip of more than 100 miles or more away from home to visit a beach. The figure below indicates that around 45% (22,1 million) of travellers on a beach holiday stayed overnight in hotel/motel accommodation and around 29% stayed with friends or families.
45% 45% 40% 35% 29% 30% 25% 17% 20% 15% 10% 9% 10% 6% 5% 0%
B&Bs
Rented
Owned
Campsites
Hotel/motel
condo/home
condo/home
Family/Friends
Source: TIA, 1998
The Menlo Consulting Travel Styles 1999-2000 survey examined the potential leisure travel market from the USA to South Africa. According to Travel Styles, approximately 59% of all potential US outbound travellers to South Africa would wish to come for a sun and beach holiday. The table below provides an indication of the type of trips that potential US travellers to South Africa would enjoy extremely or very much.
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Type of Trip % US Travellers
Demanding Trip
General sightseeing trip 75%
Educational trip 73%
Ocean cruise 63%
Sun and beach holiday 59%
Ecotour with ‘close to nature’ 55%
activities
Adventure activities 36%
Source: Menlo Consulting, Travel Styles, 1999-2000
Germany
Germans have an enormous appetite for travel. By 1999, some 50 million Germans travelled abroad, resulting in 66 million trips. For the last three decades, Germans have also been holidaying more abroad than at home (two thirds of all Germans opt to travel abroad rather than to holiday at home). Of the 66 million trips in 1999, 60 million of these are holiday trips and around 10% of these are long-haul.
In terms of the outbound holiday travel by Germans, 87% of trips are to Europe, 3% to North America, and 2% to Africa, Asia and the Caribbean and South America. Measured by the rate of growth over the period 1988 to 1998, the top three regions include:
. The Caribbean (including the Dominican Republic and Cuba); . Southern Africa (including South Africa and Namibia); and, . Central and South America (including Brazil and Venezuela).
In terms of travel motivations, 44% Of German travellers are interested in beach holidays. Although the growth in beach holidays is expected to be around 5,2% between 1999 and 2001, statistical sources indicate that growth in special interest holidays will be stronger. Approximately 50% of long-haul demand is for active holidays.
According to IPK International South Africa received just less than 1% of the total German outbound market in 1999. Of these trips to South Africa, 11% of were sun and beach holidays. German beach holidaymakers to South Africa stayed for an average of 12 nights in the country and spent a total of EUR 18,7 billion (EUR74 per night). 46% Of German beach holidaymakers stayed in hotels, followed by holiday homes. With respect to travel arrangements, 84% of German travellers came to South Africa in 1999 on pre-paid trips, 47% of which were inclusive trips.
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7. TOURISM TO SOUTH AFRICA AND THE EASTERN SEABOARD
Of South Africa’s 5,9 million foreign tourist arrivals in 1999, approximately 4,4 million of these are from other African countries. Of the remaining 1,5 million, the UK is South Africa’s biggest source of overseas tourists and accounts for approximately 22% of the total. The UK, USA and Germany together account for almost 47% of all South Africa’s overseas tourists
The ESSA hosted around 20% of the total number of overseas arrivals to South Africa in 1999. The majority of foreign tourists to the ESSA come from the rest of Europe (i.e. all countries in Europe excluding the UK, Germany, Scandinavian countries, France and Holland). The UK is the single most important tourism generating country for international tourism along the ESSA, followed by Germany and the USA.
Based on the 1999 South African Tourism surveys of international arrivals, approximately 42% of international tourists came to South Africa for holiday purposes, 28% came for business purposes, 20% came for VFR purposes and 10% came to South Africa for other purposes. Given the relatively constant trend since 1996, this trend is expected to continue. The ESSA receives significantly more holidaymakers and VFR visitors compared to the national average.
Whilst the average length of stay of was 16,2 days in 1999, Holland, the UK and Germany have the longest average length of stay, with very little deviation between the summer and winter. Seasons. The average length of stay of tourists from North America is increasing and in 1999, they had the highest average spend per day (R1 223) compared to the UK and Germany with average spends of R739 and R806 per day respectively. On average, foreign tourists to the ESSA spend an average of R10 000 per trip.
The type of accommodation used by foreign visitors to the ESSA corresponds very closely with that of national trends. Hotels are the most common form of accommodation used by foreign tourists to the ESSA (accounting for 52% in 1999). This is followed by staying with friends and family (22%) and B&Bs (15%).
Word of mouth remains the most important factor influencing foreigners to travel to the ESSA. This is followed by promotion and good value for money. Booking through a travel agent in the country of origin is the most popular arrangement, and has increased by a few percentage points over the period 1997 to 1999.
8. TOURISM AND RELATED INFRASTRUCTURE IN THE ESSA
Attractions
In terms of leisure products, the ESSA is able to offer traditional sand and sea products as well as a variety of activities, adventure sports, culture and wildlife experiences and special interest products in certain locations. The table below provides a summary of the available products in each coastal location.
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Leisure Coastal Regions Segment Sunshine Wild South Durban North Zululand Maputaland Sun & Sea 1 1 1 1 2 3 5 History & 3 3 5 3 3 4 2 Culture Activities 2 2 2 2 1 2 3 Adventure 4 4 4 6 6 5 6 Ecotourism 4 5 3 4 4 1 1 Special 6 6 6 5 5 6 4 interest 1=Highest abundance of products, 7=Lowest abundance of products
In addition to the products already available, potential exists for the development/improved promotion of the following beach-related products:
. Ocean cruises . Xhosa culture . Whale watching . Golf tourism . Ecotourism . Surfing . Scuba diving . Charter-boat fishing . Hunting
Figure 7.1 overleaf shows the various coastal regions of ESSA and briefly describes their characteristics.
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Figure 7.1: Map Showing the Geographical Location of South Africa’s Eastern Coastal Regions SOUTH COAST
The South Coast is a popular holiday MAPUTALAND destination that extends 127km from the Umtamvuna River to the Ilovu River, south of The Maputaland coastal region is well the Durban Metro. A large proportion of the known for its natural features and economic activity in this region is due to scenic beauty. It stretches 179km tourism and recreation. Scuba diving, based from the mouth of the St Lucia estuary mainly on the offshore reefs, has emerged as to the border between South Africa an important industry, with around 400 000 and Mozambique, just north of Kosi divers visiting Aliwal Shoal annually. Charter- Bay. The beautiful scenery and natural boat fishing is also emerging as an features, such as the lakes, reefs and increasingly popular activity. While tourism wildlife, give this region considerable infrastructure is well developed, there is potential for nature-based tourism. concern that development has not always been pursued in an environmentally responsible manner. ZULULAND WILD COAST The Zululand coastal region extends The Wild Coast is a rugged and undeveloped 134km from the Tugela River in the region, extending 270km northwards from the south to the St Lucia estuary in the Great Kei River to the boundary between the north.The coast is dominated by long Eastern Cape and KwaZulu Natal. Most of the sandy beaches, backed by high- region’s population is located inland of the forested dunes, and broad coastal coast. A number of holiday resort plains with many rivers, coastal lakes settlements have been established at places and wetlands. such as Trennerys, Mazeppa Bay and Coffee Bay.
NORTH COAST
SUNSHINE COAST The North Coast is a sub-tropical region, extending 70km from Tongaat The Sunshine Coast extends 538km from the River to the Tugela River mouth. This boundary of the Western and Eastern Cape region is reputed to have the fastest provinces to the Kei River. It is primarily a growing real estate industry along the mixture of undeveloped coastal areas and South African coast. Many private small towns, with the cities of Port Elizabeth DURBAN METRO holiday homes and a few hotels are and East London dominating the region. situated in this region. The Durban Metro region is dominated by the Durban Metropolis and extends 52km from the Ilovo River to the Tongaat River. The region has a wide range of natural and human-made attributes that make the area an attractive destination. The region’s affordability and accessibility from other parts of the country ensure that Infrastructure is good and tourism and Durban will remain one of the premier holiday destinations (at least in terms of the domestic market). recreational development and services are significant in the region. Many resort towns offer a range Aprilof outdoor 2001 activities, including Page 34 watersports, hiking, whale-watching and fishing. There are several marinas in the region.
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The pie charts in Figures 8.2 and 8.4 indicate the distribution of tourism accommodation along the ESSA.
Figure 8.2: Distribution of Establishments along the ESSA
1% 4% 16% 12%
13%
39% 15%
North Coast Maputaland Durban South Coast Zululand Sunshine Wild Coast
Source: Grant Thornton Kessel Feinstein
Figure 8.4: Percentage Breakdown of the Total Number of Establishments Available along the ESSA
4% 4% 1% 6% 42%
12%
22% 9%
B&B/Guesthouse Lodge Self Catering Hotel Camping/Caravan Timeshare Backpackers Other
Source: Grant Thornton Kessel Feinstein
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Accommodation
Our scan of the accommodation sector along the ESSA indicates that there are around 28 494 rooms/units/sites available. As indicated in Figure 7.17, Durban Metro has by far the largest number of rooms (39%) along the ESSA, followed by the Sunshine Coast (16%) and the South Coast (13%).
Overall, guesthouses and B&Bs provide around 34% of the total number of establishments along the ESSA, this is followed by country and bush lodges (26%), self-catering establishments (18%) and hotels (10%).
On average we estimate that the accommodation facilities run at average occupancies of around 43%, with higher occupancies being achieved during peak holiday seasons, and lower occupancies being achieved during the low seasons. In terms of accommodation type, hotels and self-catering establishments achieve the highest occupancies (between 40% and 60%). Lodges, backpackers lodges, B&Bs/guesthouses, camping and caravanning and other accommodation generally achieve occupancies lower than 50%.
Tourism-supporting infrastructure
Tourism-supporting infrastructure in terms of road and air transportation and power and communications networks, are generally of a high standard along the Sunshine, South, Durban Metro and North coastal regions. Although various coastal spatial development initiatives are currently underway to address the improvement of basic and tourism-supporting infrastructure in the Wild Coast, Zululand and Maputaland, the impact of these has not yet been felt. Table 8.3 below summarises the state of infrastructure along the ESSA.
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Table 8.3: Current State of Infrastructural Development along the ESSA
Coastal Region State of Infrastructural Development Sunshine Coast Although the level of infrastructural development is relatively high (in terms of transport, telecommunications, power and water and sanitation), widespread poverty, and increasing unemployment as well as the influx of people from the former Ciskei and Transkei to Port Elizabeth has resulted in the need for large-scale industrial projects, such as the proposed Ceoga deep-water port and Industrial Development Zone. The development of the proposed Westbank Industrial Development Zone in the East London area is also expected to act as a vehicle for reducing widespread poverty. Plans for the development of a high-speed rail link between East London and Umtata are currently underway1. This rail link is planned to cover 230km between the two cities in a time of between 2-3 hours. A feasibility study is currently underway to determine what kind of rolling stock would be required to cover the distance within the proposed journey time. Wild Coast Infrastructure along the Wild Coast is generally poor, with Port St John’s and Coffee Bay being the only towns in the region that are served by a tarred road. South Coast Infrastructure, road and other communication networks and services are well developed along the coast. However, infrastructure further inland is fairly limited with poor roads and levels of service. Durban Metro The Durban Metro area has a well developed transport and communications infrastructure, however, the high levels of population in this region has resulted on a huge strain being placed upon the infrastructure. North Coast Due to the region’s proximity to Durban, transport and infrastructure is well developed. The growth in real estate in this region is responsible for continued improvements in infrastructure. The proposed new airport at La Mercy, near Tongaat, has the potential to benefit the area and increase the number of visitors to the region. Zululand The only coastal city in the region is Richard’s Bay, which has an important deep water harbour. The region also has airport facilities and a well developed road network. Maputaland Of all the coastal regions along the ESSA, Maputaland has the lowest level of infrastructure (with only around 5% of the population having access to proper sanitation). Notes: 1These plans follow a controversial announcement by Spoornet in March 2000 that it was planning to curtail its rail services in the eastern half of the Eastern Cape. Source: Grant Thornton Kessel Feisntein
Air Transport
Domestic air links between Johannesburg International Airport and the major coastal towns are good, but none of the international airports (except in the case of Durban International Airport where only four international airlines operate frequent flights) along the ESSA namely Port Elizabeth and East London accommodate international scheduled flights.
Developments to lengthen the runways at these three airports are required in order to accommodate the landing and take-off of wide-bodied jets and facilitate direct charter services.
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The introduction of charter flights is happening. A Hungarian charter company operates a twice-monthly flights to and from Budapest, and advanced stages of negotiation are underway with a UK-based charter operation – Airtours, as well as Belgium and sub-Saharan operators. However, we believe that many more opportunities exist for the introduction of charter services to and from all international airports along the ESSA.
Planned airport developments include:
Durban International Airport: ACSA are currently upgrading DIA so that the airport will be able to accommodate forecasted increases in passenger traffic for the next five to six years. This upgrade is considered to be an interim measure while the proposed La Mercy airport is being planned and developed. This upgrade will result in the airport being able to accommodate approximately the 3,2 million passengers forecasted for 2006/2007. However, should the proposed La Mercy Airport not be developed, according to ACSA, there is sufficient space to upgrade DIA to accommodate forecasted demand for the next 20 or more years.
Richard’s Bay Airport: is to undergo a major facelift. Terminals will be upgraded and a business centre and restaurants are to be constructed. Other facilities such as the airport’s navigational system and lighting are also to be improved. La Mercy Airport: The proposed La Mercy airport is to be located approximately 15km inland of Ballito. The airport would be the first international airport along the North Coast. Facilities at the airport will be comparable to those of global international airports and will include a full-length runway that will be able to accommodate wide-bodied aircraft. Development of the airport will be in two phases, which will allow the airport to handle a capacity of 15 million passengers once fully developed. The Durban Metropolitan Council’s Economic Development division has recently announced that the future of La Mercy airport will be decided before the end of the second quarter of 2001.
Roads
The ESSA is covered by a reasonably extensive road network. The N2 national road runs along the length of the ESSA although frequently inland from the coast (particularly through the Wild Coast), and connects all the major towns. The main road access to the ESSA (taking Johannesburg and Cape Town as the main points of departure) is into Richard’s Bay, Durban, East London and Port Elizabeth.
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Rail Transport
Railways exist along the Sunshine Coast (between Port Elizabeth and East London), Wild Coast (with the construction of a high-speed rail link between East London and Umtata), South Coast (Banana Express), Durban Metro, North Coast and Zululand (through a link between Richard’s Bay and Durban). Opportunities exist for the development of these railways for tourism use either as an alternative mode of transport or for niche “train tourism” (which is especially popular amongst British and German tourists).
Sea Transport
Potential exists for the use of sea transport to support tourism (e.g. ocean cruise liners) along the Sunshine, Duban Metro and Zululand coasts. A survey undertaken by the East London Tourism Authority in Summer 1999 indicates that 1 cruiseship visit to the city generated a revenue of around R1,25 million from day-trippers on shore. The Sunshine and Zululand coastal regions have already responded to the revenue opportunities presented by cruise tourism through the development of passenger terminals at Port Elizabeth and Richard’s Bay harbours.
Infrastructure Improvements
Our very preliminary conclusions on infrastructure improvements required to support beach tourism developments are:
Longer runways to support wide-bodied aircraft at one or two points on the coast Certain additional coastal access roads Probable provision of water, electricity etc services to certain additional coastal areas
Of critical importance will be international aircraft frequencies, probably a mix of scheduled and charter.
9. LESSONS FROM ABROAD
Since the 1980s important changes have taken place at traditional beach destinations, particularly along the Mediterranean coastline and in the Caribbean. Initially these changes arose from changes in travel motivations and the desire to travel to more exotic places as opposed to traditional beach destinations. However, the more significant changes occurred since the beginning of the 1990s, with a decline in the number of arrivals when the negative environmental consequence of mass beach tourism became clear.
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The “unfashionable” beach destinations along the Mediterranean coastline and some of the islands in the Caribbean have diverted beach tourists to newly emerging and competitive destinations such as Thailand and the Dominican Republic, as well as to other destinations that are able to diversify their product base to incorporate new cultural/historical/adventure experiences in addition to traditional sun, sea and sand products.
A common, often new theme in selected beach destinations around the world is the notion of integrated sustainable development, which places great focus on balancing environmental, socio-cultural and economic objectives. Many beach destinations – including those such as Mauritius which have not suffered from decline – are moving forward with extensive demand driven planning for markets and products, supported by sustainable management principals in terms of the environment and spatial issues, and developing various repositioning and rejuvenation strategies.
A selection of best practices for sustainable tourism development from various beach destinations around the world includes:
Much emphasis is given to the development of quality tourism; Marketing and product development go hand-in-hand, and must be carefully coordinated ands effective to achieve successful tourism development; Continuous monitoring and management of tourism is essential; Effective integrated approaches for planning and implementation must be emphasised in development process to ensure sustainability; Demonstration or pilot projects can be an excellent way of showing how new forms of tourism and development approaches can work; Investment incentives – and disincentives – are an important technique in implementing development strategies; and, All types of education and training for the broader public and tourism employees are necessary for tourism.
In virtually all beach destinations the state has played an important role in beach tourism development, which has not always been positive. However, where beach tourism has developed successfully in total or in part, the State has had a pivotal role. This has involved recognising the importance of tourism and facilitating its development with proactive support including positive investment policies and incentives, rigorous planning, significant commitment to marketing, and in a number of instances participation in the tourism industry either 100% or in partnerships in elements such as airlines and accommodation.
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The final lesson that is evident from the study of other beach tourism destinations, is that tourism flows are fickle and can be affected by dictatorships, coups, was and instability, recessions, fuel prices etc as well as fashion and changing tourist preferences. Against this background careful planning and actions to minimise the possible negative influences such as instability are critical.
South Africa has the opportunity to enter the beach tourism market at a later stage and therefore benefit from the extensive experience and lessons learnt by many destinations worldwide in developing and promoting their sun sea and sand product. The appropriate planning for sustainability and the ongoing development and refinement of products to meet market trends will not be ignored here.
10. INTERNATIONAL BEACH TOURISM DESTINATIONS
10.1 Mass Beach Tourism
The birth of mass beach tourism was sparked in the 1950s by transformations in aviation technology and paid leisure time. The internationalization of mass tourism in the 1960s, together with the emergence of popular sand and sea destinations along the Mediterranean coastline and in selected islands in the Caribbean, directed tourist flows to these areas. Although mass beach tourism throughout the 1960s and 1970s grew at exponential rates many traditional beach destinations in the 1980s began to show signs of decline in terms of tourist arrivals and receipts. These were largely brought about by negative impacts on the environment, transformations the generating economic and social bases and changes in tourists’ perceptions of destinations and tourism needs/demands.
In beach destinations such as Spain and Bermuda, the lack of coordinated spatial planning left many coastal resorts picking up the pieces and developing restructuring and rejuvenation strategies in the environmental, social and economic arenas, in order to stay competitive.
10. 2 Spain
Two countries, the UK and Germany, contributed just over 48% of Spain’s foreign tourists in 1998. While the UK has shown continuous growth, the share of the German market is declining. Tourists from these countries are characteristically high spenders compared to other Europeans, they are also more likely to participate in inland and quality tours (e.g. culture, golf, hunting etc.). In contrast, the “average” profile of other European tourists to Spain is more modest. They visit Spain during the peak holiday period, and generate relatively low spending, compared to the world average.
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The rate of international visitor arrivals to Spain increased significantly throughout the 1950s, and reached explosive dimensions after the 1960s (at a time when no serious competitors had yet emerged). During the early 1970s, Spanish tourism suffered the consequences of the worldwide economic crisis. Growth recovered thereafter but increases in hotel prices caused a further recession in 1979. Growth stability was regained and maintained throughout the 1980s until 1989. Since their peak in 1989 at about 54 million, Spanish tourism levels declined to 38 million in 1995, and have since recovered to 47 million in 1998.
The decline in the growth of the Spanish tourism industry in the 1990s and into the 21st century is due to a loss of competitiveness, as well as aesthetic and environmental degradation. The signs of decline in the 1980s and 1990s led to the State becoming involved in restructuring strategies. Improvements in the quality of tourism infrastructure and adapting it to meet new market demands, as well as the redesigning and improvement of the urban setting of coastal areas and measures to preserve the environment, represent some of the actions undertaken to rejuvenate the country’s tourism.
Tour operators are seen as having been largely responsible for development of tourism to Spain and the geographical concentration of tourism supply and demand along the Spanish coastline and archipelagos (incorporating the Balearic and Canary islands). They sold the dry and sunny climate and picturesque landscapes. Various promotional campaigns (e.g. “Everything under the Sun”), emphasizing the bright and pleasant climatic conditions of the Spanish coastline have also contributed to this image.
Accommodation along the Spanish coast was initially in the form of hotels – generally small, family-run enterprises. During the early 1960s, small apartments for short-term renting were introduced, but rapidly rising building costs soon made them an unprofitable investment. Campsites spread southward along the Mediterranean coast from the French border once the construction of the coastal highway began in 1974. Foreign investors moved into the Spanish hotel market during the late sixties and seventies with large developments, as they saw profit opportunities through economies of scale and relaxed building regulations.
After 1970, the second home market increased rapidly, partly stimulated by foreign demand, but also in response to the demand from an increasingly prosperous and growing Spanish middle class. The 1980s saw the emergence of new types of property acquisition such as ‘lease-back’ and timesharing to encourage second home purchases. More recently, there has been an increase in the diversification of accommodation and tourist facilities in the form of special interest resorts (mainly with recreational elements, golf facilities and yachting marinas) along the Malaga coastline, as well as parts of Catelonia.
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Government Policies Shaping Tourism
Spain has tried repeatedly to diversify tourism to encourage inland travel but the objectives of the inland tourism policy were difficult to achieve due to powerful competition from seaside resorts. Recent examples of diversifying the tourism products include: the promotion of winter tourism in skiing resorts; the promotion of ‘green’ and nature tourism through the expansion of national parks and reserves; rural tourism; thalasotherapy; cultural and historic-artistic attractions and sports tourism.
During the Franco era of dictatorship, whilst tourism was recognised as a powerful means of diversifying the economic base of the country, the policies enforced during the period 1962- 1975 did not encourage growth – if anything else, they achieved the opposite. The dictatorial government exerted control on tourism in the following areas:
Accommodation price authorization - top hotel prices were kept low to ensure they were internationally competitive. Annual price increases were lower than inflation and ultimately resulted in poor financial performance; Provision of accommodation – the INI and ATE government agencies were responsible for establishing and managing a network of hotels; Provision of transport – the INI owned Aviaco a sister company of Iberia operating scheduled flights and charters; Credit and loans which were not readily available; Development of infrastructure was lacking – it came too late to compensate for the already over-utilised water and sanitation services; and, Promotional campaigns – budgets were kept to a bare minimum – at around 0,2% of the total amount received through tourism receipts.
The Current Situation
After the fall of dictatorship, although the Constitution paved the way for more freedom in terms of policies and the organisation of tourism into autonomous regions and local municipalities, the policies laid down during the Franco era were still dominant. Each autonomous region is now responsible for tourism and has, as a first rule, produced White Papers on Tourism, and have reorganized tourism administration in the hope of creating improved coordination within the industry. They have also recognized the need for public investment and planning, and for legislation governing the regulation of tourist supply (in order to improve and safeguard the environment). Each region hopes to create its own tourist image and promote its own differentiated product.
Currrently Spain is following a Pilot Plan of Recuperation for Tourist Areas (“PPRTA”). The main objective of the PPRTA is to maintain a leading position in the tourist market for sea and sun holidays, by improving the quality of tourism infrastructure and adapting it to meet new market demands. It is to be implemented through the coordination of public and private action
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Tourism Marketing
The Secretaría General de Turismo (“SGT”), through the Instituto de Promocion del Turismo de Espana (TURESPAŇA), is responsible for the promotion of Spain abroad.
The body responsible for tourism promotion in the 1980s (in response to the decline in visitors arrivals to the country during this period) made attempts and serious efforts to improve the foreign image of Spanish tourism, by playing down the traditional sun and sea products and stressing the attractions and quality of inland Spain, with its wide range of natural environments and cultural centres. One example of the vigorous promotion of Spanish cultures was the “Everything under the Sun” campaign launched in 1985. The launch was accompanied by an ambitious exhibition of Spanish art. This was followed in 1989 by the more short-lived variant “Everything New under the Sun”.
In recent years a great deal of investment has been directed towards marketing Spain abroad, and the campaign launched in 1992 under the slogan “Passion for Life”, aimed to reach a wide variety of specialist customers abroad (e.g. golfers, skiers, walkers, nature conservationists and art enthusiasts), as well as the more ‘general’ tourists from a wider range of age-groups. The campaign was partially successful in addressing one of the endemic problems of Spanish (and indeed Mediterranean) tourism, seasonality.
10.3 Portugal
11,3 Million foreign tourists visited Portugal in 1998 of which 5,5 million stayed in hotels (see Table 4.3). In 1994 arrivals in Portugal were 9,1 million and the country is showing steady ongoing growth in foreign tourism. Portugal is generally viewed as a more “environmentally- conscious” tourist destination compared to other countries, particularly Spain.
Three countries, Spain, the UK and Germany, account for around 50% of all tourist arrivals to Portugal. While the market shares of the UK and Germany are showing signs of decline, the Spanish market is growing. The Scandinavian countries in particular are showing rapid growth in terms of visitor arrivals to Portugal.
During the 1950s the number of foreign tourists increased from 70 700 in 1950 to 353 000 by 1960. The most significant phase in the expansion of Portugal’s international tourism industry was the period between 1963 and 1974, when Portugal benefited from the general expansion of demand for tourism in Western Europe, combined with falling costs – especially as a result of the growth of packaged beach holidays.
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Expansion stopped with rise in transport costs and the recession that followed the 1973-1974 oil crisis. While all European tourist destinations suffered from these events, Portugal probably suffered the most because of the much-publicized political uncertainty that followed the 1974 military coup. In 1973 there were over 4 million foreign visitors to Portugal, a number that was not reached again until 1977.
Table 4.3: Tourist Arrivals (in Hotels) in Portugal by Top 10 Markets
Origin Markets Number of Arrivals % Change 1996 1997 1998* 97/96 98/97 Spain 681 864 730 933 999 900 7,2% 36,8% UK 732 335 809 185 865 000 10,5% 6,9% Germany 890 724 856 942 837 200 -3,8% -2,3% France 469 803 451 723 552 500 -3,8% 22,3% Italy 300 191 315 873 342 400 5,2% 8,4% Netherlands 257 790 286 511 310 300 11,4% 8,3% USA 201 790 227 863 261 100 12,9% 14,6% Belgium 132 720 134 700 176 200 1,5% 30,8% Sweden 78 620 93 356 106 700 18,6% 14,4% Japan 71 659 79 921 102 700 11,5% 28,5% Total Other Markets 749 209 811 349 897 100 7,6% 10,5% TOTAL 4 566 705 4 798 356 5 451 100 5,1% 13,6% Notes: * WTO estimate Source: WTO, 2000
Overtime, the composition of the international tourist trade has changed significantly, with the dominant feature being the expanding share of the UK in the Portuguese market, which between 1960 and 1988 increased from 22% to 35%. This was matched by a decline in the relative importance of US tourists (as in many other European countries during the same period) and French tourists. Tourists from Germany and the Netherlands increased considerably in number in the 1960s and 1970s before levelling off in the 1980s. Tourists from Scandinavian countries have become more important as a source market for Portugal in the 1990s.
The nature of the tourist accommodation industry has changed over the years, with a shift to more luxurious hotels and away from boarding houses. Together with the expansion of second homes, apartments, motels, tourist villages and camping sites. The considerable changes in the types of accommodation provided are in response to growing market segmentation. The bulk of development is firmly associated with beach tourism and to the rapid expansion of the Algarve. Timesharing also became popular in the mid-1980s, especially in the Algarve, as well as the development of turismo de habitacão, based on short stays in historic houses in northern and central Portugal. The 1990s has witnessed an increase in the number of specialist tourism resorts mainly associated with golf and other recreational elements.
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Between 1974 and 1988 the main feature of the regional growth of tourism was its concentration in three main centres namely: the Algarve, Lisbon and Madeira. The number of foreign bednights spent in the Algarve quadrupled to just over 7 million during the period 1974 to 1988, while the numbers in Lisbon and Madeira increased by almost 1 million during the same period. Most of this expansion occurred during the 1970s and visitor numbers were relatively static in the early 1980s, but have subsequently increased throughout the 1990s.
The three main regional markets have developed their own set of characteristics. Those for the Algrave and Madeira and briefly summarized below.
Algarve
The Algarve is the second largest tourism region in Portugal (after Lisbon) with around 20% of all beds in the country and a broad spectrum of accommodation types, including camping sites and luxury hotels. The Algarve is the primary attraction for foreign visitors to Portugal and in 1988, this region accounted for 33% of all foreign visitors to the country. The majority of foreign visitors to the Algarve came on packaged holidays and stayed for an average of 7 days. The relatively mild winter climate of this region attracts visitors throughout the year. The Algarve attracts a more upmarket segment of the tourism industry compared to other Mediterranean countries. From the beginning the emphasis has been on the development of upmarket facilities including golf courses, tennis centres and riding centres. Vale do Lobo typifies such developments, with a championship golf course, the Roger Taylor Tennis Centre, a selection of swimming pools, and 700 villas.
Madeira
The island of Madeira represents the elite end of the Portuguese tourism market. While it only accounts for around 10% of all beds available in Portugal, these are concentrated in the upper brackets with around 25% being of a 5-star standard, and very few lower market forms of accommodation. The island’s major market is foreign visitors and, given the high costs of flying to the island, average stays are relatively long – around 9,2 days. The equable year- round climate attracts large numbers of tourists throughout the year.
The Role of Investment in Developing Portugal’s Tourism Industry
Direct foreign investment has historically played a relatively insignificant role in developing tourist facilities and over time its has diminished. There was a particularly sharp reduction in foreign investment in 1975, following the 1974 military coup. The pattern of low levels of foreign investment changed in the mid-1980s with an inflow of foreign investment in the Algarve. Hotels and similar accommodation establishments in Portugal were (and still are) not particularly attractive to foreign investors who, in the early 1990s for example, accounted for only 13% of the total investment in this sector.
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Domestic investment in tourism was always high and involved both personal capital, and credit from banks and other financial institutions. Some of the major investments in tourism were from industrial companies seeking to diversify their activities The growth of the Portuguese tourist industry has been accompanied by major shifts in the priority attached to it in government policy. In 1952, tourism was not high on the agenda of government. Within a decade this had changed radically, as was evident in the emphasis given to tourism development in the Intermediate Development Plan and the Fourth Development Plan in the late 1960s and early 1970s respectively. In accordance with these plans, greatest priority was given to attracting foreign tourists and to developing up-market tourism, and credit was made available to build the hotels that could facilitate such development.
A comprehensive organization was created within the Secretaria de Estado do Turismo to develop Portugal’s tourist industry. During the early 1990s, the Secretaria de Estado do Turismo comprised of five divisions namely:
Direçcao General do Turismo – which was responsible for international relations, tourist information and administrating the supply side (e.g. licenses for hotels); ENATUR –responsible for managing tourist accommodation; Fundo do Turismo – responsible for financial assistance; Instituto Nacional de Fromoçao Professional – responsible for training; and, Instituto de Promoçao Turística (established in 1987) – responsible for promotion abroad as well as financial assistance to the industry.
In the late 1980s, a reassessment of the tourism policy to attract foreign tourists took place. The Plano Nacional de Turismo 1986-1989 set out a number of objectives to increase tourism, to contribute to regional development, to contribute to quality of life, and to contribute to the conservation of the national and cultural heritage.
10.4 Greece
Size and Market Share
Greece received 12,1 million international tourists in 1999 (see Table 4.4). 93% Of all international arrivals in Greece are from Europe, with Germany and the UK together accounting for around 40% of all arrivals.
The largest number of tourists originated from Europe, which increased its share from 53% in 1971 to 75% in 1978 to 90% in 1987. In the 1970s this was especially due to tourists from Scandinavia and Yugoslavia and, in the 1980s, to visitors from the UK, Germany, France and Austria.
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From 1963-1973 Greece was dependent on the USA for tourists but this is no longer the case. Tourists from the USA dropped from 27% in 1970 to 11% in 1978, 7% in 1985 and less than 3% in 1999.
Table 4.4: Tourist Arrivals in Greece by Main Markets, 1999
Origin Market Number of Arrivals % Of Total Albania 673 061 5,5% Austria 501 602 4,1% France 545 981 4,9% Germany 2 450 137 20,1% Switzerland 308 138 2,5% UK 2 433 033 20,0% Italy 745 915 6,1% Netherlands 616 807 5,1% Scandinavia 1 263 431 10,3% Other Europe 1 781 908 14,6% Total Europe 11 320 013 93,1% Total Asia 434 276 3,6% Total Africa 48 040 0,4% Total Americas 305 261 2,5% Total Oceania 56 498 0,5% TOTAL 12 164 088 100,0% Source: National Statistical Service of Greece, 2000
International tourist flows expanded consistently until the late 1970s. Two exceptions were during the world recession in 1974 and in the years 1967 to 1968 (the first years of dictatorial rule). The number of foreign tourists to Greece has more than doubled every decade, and rose form 58 000 in 1951 to 472 000 in 1961, 2,1 million in 1971 and 5,6 million in 1981. Growth has slowed down in the late 1990s.
75% Of all international arrivals are concentrated in the five-month period between May and September.
Steady political and social conditions, a positive economic climate, continuing growth in Gross Domestic Product (“GDP”) (of around 3,5%), expected lowering of the inflation rate, competitive prices due to the devaluation of the drachma, and positive perspectives for the main European outbound markets, provide an environment considered positive for tourism growth in Greece. However overall arrival growth has been modest in 1998 and 1999, coming after a number of static years with arrivals at 10,6 million in 1994 and dropping to 9,2 million in 1996.
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Gateways to Greece
There are several international airports scattered throughout the Greek islands, but Hellinikon International Airport in Athens is the country’s major one and has recently undergone major refurbishments. Several airlines and charter companies fly into Greece. Olympic Airways – the country’s national carrier flies to 54 destinations around the world.
Tourism Development
During the 1970s demand was concentrated in Greater Athens and three tourist islands namely: Rhodes, Crete and Corfu.
Changes since the 1970s involved a shift of foreign tourists’ preferences from these areas to include Corfu, northern Crete and Khalkidiki. The number of nights spent in Greater Athens declined dramatically by 2 million over the period 1981-1986. Islands near Athens, especially Attica and Euboea and the city of Salonica also lost popularity.
Tourist flows to Rhodes Island and Crete increased dramatically – by nearly 3 million and 2 million overnight stays respectively over the period 1981-1986.
Development of Tourist Accommodation
During the mid-1960s, the most popular form of tourist accommodation was standard hotel lodgings, yachting appeared from the late 1960s; bungalows and apartment hotels emerged in the early 1970s, and from the mid-1970s, organized cruises and summer villas appeared, along with a strong tendency for foreigners to purchase private homes. The number of small cruiseships hired by better-off tourists grew slowly from 1 200 in 1975 to 1 700 in 1987.
As with demand, hotel capacity was sharply concentrated in Greater Athens (around 18% of all hotels in the country), Rhodes (15%), Crete (14%) and to a lesser extent, Corfu (7%). This concentration has changed little since 1963.
Auxiliary accommodation, including facilities such as camping sites and rented rooms (officially registered), also increased rapidly, especially in certain areas.
There has been a general trend for some standard accommodation to withdraw from the market during the winter, and hotels are utilized to capacity only during the summer months. The exception to this tendency is in the hotels located in Athens, Piraeus and Salonica, where hotels operate all year round.
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Policies Directing The Development Of Tourism In Greece
Although tourism-supporting infrastructure was actively developed by the Greek government since the late 1950s, tourism only began to feature in policies and programmes in the early 1960s, when its potential for economic development was realized.
As with Spain, the policies influencing and directing tourism development have been largely influenced by the political environment. During the mid-1960s, tourism in Greece played only a minor role in the economy compared to other European countries.
For a relatively long period, especially between the years 1951 to 1964, incentives for tourism development existed, and even the most congested areas received incentives for tourism development. During this period the largest share of public investment for tourism (56%) was allocated to construction and management of accommodation.
Greater emphasis on tourism development followed the imposition of dictatorial rule in Greece in 1967. All legislation prior to 1967 was consolidated into a single development plan, which provided special concessions for hotels in the form of tax and depreciation allowances.
In the early 1970s, the initiative for tourist development shifted to private enterprises, and State activity was limited to the provision of infrastructure to facilitate their operation. During this time, the banking system and government incentives were mobilized to boost the private sector. Foreign investment in Greece was also important during this period – primarily from the US, although West German, Swiss and French sources were also important. Foreign investment was mostly concentrated in hotel businesses and especially within the coastal locations.
After the fall of the dictatorship in 1974, tourism was a common feature in the Five Year Plans. Public sector participation in investment increased, especially after the nationalization of Olympic Airways on 1st of January 1975. Domestic interests were also given greater priority during this period. The 1976-1980 Five Year Plan emphasized the role of local capital and of small non-hotel tourism as a means to local development. Subsequently, the 1983-1987 Plan carried through the same policy of discouraging large hotel developments and foreign investment. The 1983-1987 Five Year Plan also set goals for public involvement where 56% of investment would be public and 44% would be private. Legislation in this Plan also emphasized the development of small lodgings with less than 80 beds. This policy was reversed in the late 1980s, however.
In 1987, a Ministry of Tourism was established and the European Community (“EC”) policy started to have some impact alongside national policy. The Integrated Mediterranean Programmes, as well as the new Five Year Plan for Economic Development 1988-1992 was focused on policy to attract higher-income tourists combined with decentralization strategies.
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Overseas promotion (in the form of advertising campaigns, pamphlets and posters) during this time were intensified with the aim of attracting off-season and higher-income tourists.
The policy measures that are currently being taken in Greece are managed and influenced to a large extent by the Greek National Tourism Office (“GNTO”), and include the Sectorial Operational Programme (“SOP”) and the 13 Regional Operational Programmes (“ROPs”). The goals of the SOP and ROPs are to modernize tourist enterprises, to develop theme tourism, to stimulate the competitiveness of small, medium and micro enterprises, to improve the contribution of tourism to employment, to improve the "relationship" of the tourism sector with the producers of traditional goods and culture and to increase technical assistance.
The hosting of the Olympic Games in Athens in 2004, is seen as contributing to the creation of a favourable environment to accelerate the achievement of these goals.
Tourism Marketing
The main executive organization for the development and promotion of tourism and for the formulation and implementation of policy was the National Tourism Organisation of Greece (“EOT”) which became an autonomous agency in 1950. The role of the EOT was both supervisory and developmental, involving planning, promotion, education and management of accommodation and infrastructure, and financial assistance for tourism businesses. Promotion was undertaken by a network of offices in Greece and abroad, as well as through the organization of summer festivals.
In 1983 the EOT came under the direct surveillance of the Ministry of National Economy and Planning and the Ministry of the Environment controlled the tourist police, collected data, and co-ordinated local services. The Ministry of Culture was (and still is) responsible for the maintenance of museums and monuments. Consequently, there was a highly varied administration for tourism, and policy tended to lack coordination until the mid to late 1990s.
10.5 Cyprus
Size and Market Share
International visitor arrivals to Cyprus increased 7,5% from 2,4 million in 1998 to 2,6 million in 1999. Of these visitors approximately 94% were tourists and 6% were one-day visitors20. Figure 4.9 shows the growth of tourist arrivals over the period 1985 to 1999. The growth in tourist arrivals in 1999 is considered to be mainly due to the intensive efforts of the Cyprus Tourism Organisation (“CTO”) to promote and market Cyprus as a destination.
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Just over 80% of all tourists are from 7 countries namely the UK, Nordic countries, Germany, former Russia, Switzerland, Greece and Israel. The majority of western European countries such as the UK, Germany, Switzerland, Belgium etc. visit Cyprus on packaged holidays.
Figure 4.9: Growth of Tourist Arrivals in Cyprus, 1985 – 1999
2500000
2000000
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1000000
500000
0
1985
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1989
1990
1991
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Notes: Excludes day visitors Source: Cyprus Tourism Organisation
Gateways to Cyprus
The major international airport in Cyprus is Larnaca International. A smaller international airport is located in Pafos. 8 Airlines operate flights to and from Cyprus.
Cyprus Airways – the national carrier flies to over 30 destinations including all major European and Middle East cities and offers all-inclusive holiday packages to European and Middle East destinations.
Development of Tourism
Until 1960 when Cyprus gained its independence from the UK, small-scale, family run businesses dominated its underdeveloped tourism industry. During that year 25 700 tourist arrivals were recorded. There were under 4 000 bedspaces of tourist accommodation – of which 45% were located in the hill resorts which were patronized primarily by Middle Eastern visitors. Nicosia (the capital) accounted for around 26% of the total beds.
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In its Five Year Development Plan (1962-1966), the government of the new republic emphasized the potential for tourism growth and by the end of the first five year period in 1966, over 54 000 tourists came to the island.
Cypriot tourism’s real ‘take-off’ did not come until the late 1960s as a result of a combination of factors. With the UN “Year of the Tourist” in 1967, the Cypriot government and the private sector gained confidence about tourism and became aware of the rapid growth of tourism demand from northern Europeans for warm coastal resorts. Foreign firms formed partnerships with Cypriot development companies and commenced the construction of major hotels in the Kyrenia and Famagusta regions and Government built a modern terminal for the Nicosia International Airport.
In 1969, Cyprus Airways, the national airline, which until then had only served the Middle Eastern inaugurated flights to Athens, Frankfurt and London and further bolstered the island’s tourism industry by establishing a subsidiary charter company.
From the early 1970s onward the coastal districts of Kyrenia and Famagusta took up almost half of the island’s total bed capacity. The number of available beds in the country doubled between 1960-1971 and Famagusta experienced a five-fold increase. During the period 1971- 1973, arrivals to the island more than doubled. British holidaymakers were dominant but arrivals from Sweden and Germany increased significantly. The emergence of large-scale tour operators and the evolution of inclusive tour packages enabling low tariff holidays abroad fueled the growth.
The war in 1974 abruptly ended the growth and tourist arrivals in 1975 slumped to 18% of their 1973 number. However 1976 saw a 300% increase in arrivals over the previous year and between 1977-1987 tourist arrivals increased by an average annual growth rate of 18%.
The Cypriot government was a principal actor in promoting the growth of tourism in the immediate post-war era. In a series of Emergency Economic Action Plans following the war, it gave high priority to this sector of the economy. The 1975-1976 Emergency Plan strongly recommended continuing ties with the main players of international tourism (the tour operators and airlines) in the markets of Germany, the UK and Scandinavian countries. It also gave priority to developing Larnaka airfield into a fully operational international airport by the end of 1976. This and subsequent Economic Action Plans for 1977 and 1978 emphasised reestablishing the island’s role as an international tourism destination. The plans also provided for financial assistance to the private sector through the grant of low interest loans and/or free government land for constructing tourism accommodation and related facilities in coastal areas. Incentives included duty-free imports of equipment and other materials for the hotel industry as well as sizeable investment allowances for construction regardless of size and type.
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Development of Tourist Accommodation
Another important feature of the development of tourism in Cyprus has been the increase in the variety of accommodation available.
While before the war, hotels made up the principal type of tourist accommodation, in the 1980s self-catering accommodation in the form of apartment complexes and tourist villas increased substantially. By 1986, almost 40% of the 31 883 CTO registered beds were in hotel apartments compared to 29% of the total in 1981. In addition, there was a large non- licensed tourist accommodation sector (almost all self-catering) roughly estimated at 30 000 bed spaces in the mid 1980s. Small scale investors and developers, recognizing the potential benefits of tourism and taking advantage of the relaxed local authority planning controls, were chiefly responsible for the emergence of non-licensed accommodation.
The trend to self-catering reflects cheaper running and capital costs and increased demand for this type of accommodation with large-scale tour operators showed preference for this cheaper accommodation as a means to boost their sales of inclusive tour packages to a lower-income mass tourist market. This was especially the case with Scandinavian tour operators who targeted the younger lower-spending tourists (age 15-29) for the Cypriot tourist product.
The number of beds in Cyprus has grown from 30 375 in 1985 to 89 968 in 1999 with a further 2 211 beds under construction at the end of the year. The distribution of these beds is shown in
Figure 4.12. Figure 4.12: Distribution of Bed Capacity per Tourism Region in Cyprus, 1999
86968 90000 80000 70000 60000 50000 40000 22355 30000 19602 16249 20000 8881 15232
10000 2484 2165 0
Pafos
TOTAL
Larnaca
Lefkosia
Lemesos Paralimini
Agia Agia Napa
Hill Hill Resorts
Source: Cyprus Tourism Organisation, 1999
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In terms of star –grading, in 1999, the majority of hotels in Cyprus are of a 3- and 4-star standard.
The presence of transnational hotel companies has been (and still is) surprisingly minimal. In fact, only one hotel – the Sheraton in Limassol – is foreign owned, and another three transnationals are involved through management contracts. Most of the hotels on the island are owned and operated by local companies and individuals. Three Cypriot companies own around 13% of all the bed spaces on the island.
Policies Directing The Development Of Tourism
Recently government has formulated a tourism development plan in response to the negative “environmentally unfriendly” impact of tourism in Cyprus. The Plan includes an environmental and planning analysis with carrying capacity studies for tourism, as well as an appraisal of existing development in each tourism area. It has resulted in a controlled tourism development strategy with a relatively high degree of government control regarding the location, quantity and types of tourism development is required.
The 1988 Tourism Development Plan also produced a product improvement strategy to encourage the diversification of accommodation and associated facilities, improvements of archaeological sites, historic building and other cultural attractions and greater promotional efforts. It also covers the development of yachting, sailing, marine tourism environments and golf courses, the promotion of festivals and special events and encourages developments that generate higher tourist expenditure in entertainment, shopping, etc.
To-date the Plan has not been particularly successful in attracting investment due to uncertainly of returns for the unusual projects and skepticism of banks to lend to high risk projects. Government has therefore introduced a Product Development Incentives Programme (“PDIP”), which provides incentives for some accommodation projects and tourism product improvements. Disincentives have also been introduced to discourage the development of accommodation that is not compatible with the qualitative growth image.
Tourism Marketing
In 1969 the government set up the CTO, which was charged with full responsibility for tourism development and passed legislation implementing guidelines for the classification of tourist accommodation according to international standards (in an attempt to make it competitive with other Mediterranean destinations).
The strategic goal of the CTO is to establish Cyprus as a unique quality destination in the Eastern Mediterranean through a Cypriot tourism product that is more than just sun and sea and also reflects its cultural heritage, its traditions, character, and hospitality.
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The CTO is promoting to increase the number of off-season arrivals and more emphasis is given to developing other types of tourism such as conference and incentive tourism, agrotourism, sports tourism, archaeological, cultural and religious tourism.
To attract more high-spending and special interest end of the market the CTO is planning to diversifying the product through marine tourism, golf tourism and agrotourism.
10. 6 Bahamas
Size and Market Share
The Americas accounted for 87% of all foreign arrivals in to the Bahamas in 1997. The USA is the most important source market for the Bahamas (81%) with Canada (5%) and the UK (3%) next. International arrivals from Europe accounted for approximately 8,7% of the total in 1997. In 1993 the Bahamas recorded 1,5 million arrivals which grew to 1,6 in 1997; fairly limited growth.
Gateways to the Bahamas
The Bahamas - with its close proximity to Florida - is easy to reach by air or by sea. Most of the islands have at least one airport and several marinas. There are plenty of charter plane companies, so movement between the islands is easy. Several large airlines and charter carriers serve passengers flying into the Bahamas. There are no direct flights from Europe to the Bahamas, but a stopover in Miami is perfectly viable.
Development Of Tourism In The Bahamas
In 1961, when Cuba (with its glitzy casinos and beach resorts) was closed to American tourists, The Islands Of The Bahamas’ began to capitalise on its close proximity to the USA, and the Government set out to increase tourism. Nassau’s harbour was dredged so it could accommodate up to six cruise ships and a bridge connecting Nassau to Paradise Island was built.
Since 1992 the government has adopted a market-friendly economic policy to facilitate the expansion and diversification of the economy and to improve the economic benefits of tourism. While the Bahamas tourism industry is primarily private sector driven, in 1992, around 20% of the hotel room inventory was owned by the government and privatisation became central to the government’s new economic policy.
Exemptions from property tax and customs duty for companies investing in hotel and resort development have stimulated renovation and encouraged the construction of new hotels for the first time since 1989. A dramatic example of the successful and growing Bahamian tourism industry is the redevelopment of the Atlantis Resort on Paradise Island by a consortium of America, British and South African investors. The Hotels Encouragement Act April 2001 Page 56
Beach Tourism Summary Report provides for duty-free entry of approved construction materials, furnishings, and fixtures for hotel development. Recent amendments to the Act have reduced the number of rooms required for new hotels to access this incentive to five rooms for hotels in the Family Islands.
The Development of the Family Islands Ecotourism Programme covers all the Islands except New Providence and Grand Bahamas. These Islands are pristine, making them ideally suited for eco-hotel investment. The government is providing favourable consideration to investors for ventures on these islands and is undertaking major infrastructure works providing good roads, water and electricity supplies, telecommunications facilities and adequately maintained docks and airports.
A programme to improve the infrastructure of the Bahamas has been underway for the past three years and covers development of public parks and green areas, improvements to major roadways, harbours, and water systems, upgrading the international airports, extensive electrification, a modern communications systems, and redevelopment of Prince George Dock in Nassau.
10.7 Bermuda
Size and Market Share
The US accounted for around 78% of all foreign arrivals in Bermuda in 1998. Other important source markets include Canada (9%) and the UK (8%). The number of tourist arrivals in Bermuda has been declining since the early 1990s and dropped from 390 000 in 1996 to 369 000 in 1998.
Following World War II, Bermuda began to seriously develop its tourism industry as a matter of national policy. Tourism promotion was then the responsibility of the Bermuda Trade Development Board (“BTDB”) (an executive body of the government). In 1945, it expanded its New York office, which had officially opened in the late 1920s, and opened an office in Toronto in 1947 to respond to the potential market in Canada. Other offices opened in Chicago, London, Boston and Atlanta. In 1968 the BTDB ceased to exist and the Department of Tourism was created.
In the period from 1949 to 1979, tourist arrivals in Bermuda grew tenfold from 54 899 to 599 145. During this period the percentage of air and cruise ship arrivals increased dramatically whilst traditional arrivals by ship virtually disappeared.
In 1980, arrivals reached a new high of 609 556, but this was followed by five years in which arrivals decreased, with 1984 representing the lowest level in this period at 528 871.
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The decrease is attributed to the period of recession in North America and was also marked by labour unrest in Bermuda. In 1987, another record high was reached with 631 314 arrivals, but the industry suffered again in the early 1990s from the effects of a declining economy and the Gulf War, but also from a complacency in the tourism industry that it was unique and not really subject to competition nor to the changes in the international tourism trends.
The was a significant downturn (6%) in the number of arrivals to the island in 1991 and the industry did not recover during the 1990s.
A Commission on Competitiveness was established in the early 1990s to address the economic performance of Bermuda. The outcome of the investigations led to a series of conclusions and recommendations, which are summarised in Table 4.11.
Although visitor arrivals to Bermuda are still below that received in 1987, the active follow through of the recommendations in Table 4.11 by the Commission has paved the way to visitor arrival recovery.
Policies Directing The Development Of Tourism In Bermuda
During the 1960s and 1970s, Bermuda concluded that it would preserve its image as an upmarket resort destination. As a consequence, a number of policies, which would preserve this image, were adopted and continue to act as the foundation for the country’s tourism policy.
The most important policy limited growth in carrying capacity by imposing a moratorium on the construction of new hotels and imposed a 10 000-bed ceiling. This policy still forms the basis of tourism development in Bermuda and is enforced through a phasing scheme which maintains the 10 000-bed ceiling limit and allocates available space within the ceiling to the strongest properties which maintain the highest standards.
A grading policy was introduced in 1988 to link the renewal of hotel licenses with the maintenance of high-quality standards. A timeshare policy prevents further timeshare development while a cruiseship policy limits cruiseship arrivals to 120 00 during the high season of May to October, and allows for only four scheduled cruiseships weekly between Monday and Friday. Cruiseship arrivals fell to 131 322 and in 1990 actually fell below the 120 000 ceiling with a total of 113 000. As a result of this decrease and the deterioration in the tourism industry generally, the government raised the ceiling in the mid-1990s to 150 000.
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Table 4.11: Summary of Conclusions and Recommendations to Address Bermuda’s Economic Performance Conclusion Recommendation . The management of the tourism industry needs to be . Expansion of the role of the Department of changed in such a way which would result in more Tourism to incorporate strategic planning and emphasis being placed on product policy and product policy issues. development through a comprehensive planning process . The tourism product requires enhancement in terms of . The creation of the Bermuda Development accommodation, eating facilities, events, transportation, Fund to attract domestic investment in the amenities, retailing, recreation etc. tourism industry and to provide capital for small business operators to enhance their service. . Low profitability of hotels. . Profitability of hotels could be improved through efforts to expand the season (e.g. through the use of innovative packaging based on emerging travel trends such as cultural and ecotourism niches . Recognise the need to review price/value considerations. . Value-added strategies including the offering of a greater range of no-cost or sponsored activities into the island’s tourism product. . Recognised the role that the residents of the population . Tourism education and awareness programmes play in determining the quality of the tourism product and through a series of human resource the level of service provided for tourists development and national programmes of certification and recognition to influence and encourage tourism as a career choice. . Increased marketing efforts. . Greater use of database marketing techniques and cooperative advertising as well as on-going research into emerging niches which will provide a basis for determining whether there are market opportunities which would fit with Bermuda’s resources. Source: Commission on Competitiveness, 1993
10.8 Kenya
The total number of tourist arrivals to Kenya in 1999 increased significantly by 8,4% from 894 300 in 1998 to 969 300 in 1999. However, this number is lower than the 1 million recorded in 1996. The 18,9% increase in the third quarter of 1999 can be attributed to the stable security situation especially in the Coastal region, as well as the depreciation of the Kenya Shilling against major currencies during the second half of 1999 - making Kenya a comparably cheap destination to visit.
Europe – particularly Germany and the UK - are the main generating markets for tourism to Kenya in 1999 and accounted for just over 60% of all arrivals. The majority of tourists from Europe came to Kenya for holiday purposes. Tourists from east Africa – particularly Uganda and Tanzania - were the second most important source markets for Kenya and accounted for approximately 15% of all tourists to Kenya. Whilst holiday was the main purpose of visit for tourists from Tanzania, most of the tourists from Uganda came to Kenya on business.
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Development Of Tourism In Kenya
The increase in international tourism in the 1960s, as a result of the development of inclusive tours, permitted an ever-increasing number of Europeans and North Americans to travel to Kenya. Kenya was quick to respond to the rapidly growing tourism by making considerable investments in infrastructure, hotel bed accommodation, game parks and reserves, and setting up necessary services. The decade following 1972 was a difficult period. The actual number of arrivals in 1978 was only 44% of the target figure of 816 000. Between 1976 and 1983, the figure slumped to below 400 000. However, the 1984-1988 period saw a revival.
The decline in tourism arrivals in the mid-1970s and early 1980s can partially be attributed to the political turmoil in Kenya. Unrest began with the closure of the common border with Tanzania and culminated in a military coup in August 1982. During the same period, Kenya experienced similar problems on the Uganda border. These adversities resulted in a drastic reduction in the number of tourists and hotel occupancy levels in Kenya in 1977 and 1982. Part of this slump might have been due to the adverse publicity given to crime against tourists and foreign residents in the international press.
Declines in the number of tourists to Kenya in the 1990s is attributed to, amongst others, the economic recession in Kenya, related declining infrastructure, increasing insecurity combined with bad press coverage21, excessively recycled tourism products (mainly beach holiday and game safaris), and a failure to diversify its range of attractions, increasing competition from its eastern and particularly southern African neighbours (particularly South Africa, Zimbabwe, Namibia and Tanzania) and poor marketing in the world tourism market.
While total visitor arrivals grew rapidly and steadily throughout the 1960s, the 1970s saw a shift in the regions of tourist interests in Kenya. The main growth area had been the beach hotels where bednights increased from 417 000 in 1969 to 1 654 000 in 1978, representing a 400% increase. Occupancy rates increased from 47% in 1967 to 68% in 1978. By the end of the 1980s, coastal tourism was estimated to account for between 60-70% of the national tourism industry.
Beach holidaying occurs in four popular areas including Diani Beach on the south coast. Mombasa in the north, and Malindi/Watamu and the Lamu archipelago. In all four locations, hotels were built in response to increased tourist traffic. One competitive advantage Kenya has over rivals such as the Far East and the Caribbean is the closeness of its beaches to areas of wildlife reserve, thus enabling tourists to combine beach and safari holidays. This is a factor that is perhaps responsible for the continued upward trend in hotel bed capacity, and hence the popularity of beach tourism in the 1970s and 1980s.
21 Headlines such as “British Tourists Flee Gun Battle on Beach” on the front page of The Times (12/9/1997), and several other similar articles, had a huge impact on Kenyan’s tourism industry in general, but especially the coastal areas, and resulted in cancelled bookings and reluctance to take any further holidays in Kenya and low occupancy rates (5-10%) in hotels.
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The growth in the number of tourists has to a large extent been matched by the growth in accommodation facilities. Over the period 1980 to 1990 there was a tremendous increase in the number of hotels and the number of beds at the coast. One source suggests that around 10 000 hotel beds have been added to the existing coastal facilities over the past 10 years – almost doubling capacity. The hotel sector is yet to recover from the effects of the instability in the country in 1997 and 1998. The total number of bednights sold increased slightly by 5% from 2 813 000 in 1998 to 2 951 000 in 1999. This number is still below the 5 061 000 recorded in 1996.
Over the period 1998 to 1999 the number of bednights occupied by Europeans increased by 7,6%. Germany and the UK continued to be the main occupiers of bednights, however, while the number of bednights occupied by the Germans increased by 28% in 1999 over the previous year, the number of bednights taken by the British dropped by 23% over the same period.
Excluding visitors from Kenya and other African countries, the Coastal region accounted for around 83% of the total number of bednights occupied by foreign tourists. Tourists from Germany and the UK accounted for 39% and 21% respectively of all bednights occupied at the Coast.
Policies Directing The Development Of Tourism In Kenya
With independence in 1963, Kenya inherited problems related to reduced investment, capital shortage and serious unemployment. In an attempt to address these problems, and particularly along the coastline, a policy for tourism development was initiated to develop the necessary physical and social infrastructure and facilities (including roads, water, electricity, sanitation, accommodation, game parks and reserves) in order to support the tourism industry. In addition it sought to indigenise the economy and to promote private sector investment in the tourism industry. It included an “easy going” policy on repatriation of foreign capital, profits and dividends.
The Ministry of Tourism and Wildlife was created in 1966 as the main policy-making organ of the Kenyan government in tourism and wildlife matters. The Kenya Tourist Development Corporation (“KTDC”) was set up through an act of parliament in 1965, with the aim of closely monitoring the operation of the hotels, lodges, and other forms of accommodation.
Under the KTDC, Kenya’s tourism development objectives were to increase tourism’s contribution to the growth of GDP, raise foreign exchange earning capacity, create employment opportunities and increase Kenyan ownership and management of the industry. Objectives also covered reduction of undesirable social and environmental consequences and conserving and improving environmental and wildlife resources.
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These tourism development objectives culminated in the development of two masterplan programmes.
The first involved developing tourist facilities along the coast by expanding the hotel capacity to meet increasing demand through the optimal use of local resources and the second programme was associated with wildlife development and the improvement of the facilities at the Masai Mara, Amboseli and Samburu/Buffalo Springs game reserves.
Tourism Investment Policies in Kenya
Kenya has followed a mixed economic development strategy since independence. The Government has outlined the nation’s broad economic development strategy in various Sessional Papers and the National Development Plans, the most notable being Sessional Paper No 1 of 1986 on Economic Management for Renewed Growth which places emphasis on an increased private sector role in the economy, and Sessional Paper No 1 of 1994 on Recovery and Sustainable Development.
The hotel industry in Kenya includes both hotels with foreign and local entrepreneurial capital investment and others in which the government has an equity interest. Five syndicates are behind the majority of tourism investment in Kenya. These include: Kenya Hotels Properties Ltd, International Hotels Ltd, Safari Lodge Properties of Kenya Ltd, Kenya Safari Lodges and Hotels Ltd, and Robinson’s Baobab Hotel Group. Foreign equity participation accounts for about 60% of hotel beds in Kenya. In Malindi for example, it is estimated that foreign ownership is between 80% and 90% (compared to the an estimated 60% for the country as a whole).
The heavy reliance on foreign capital and expertise has, to a certain extent, influenced Kenya’s tourism policy in favour of luxury tourism which does not fit well with the government’s aim of encouraging domestic tourism.
Tourism Marketing
After the mid-1960s (after independence) the Ministry in charge of Tourism and Wildlife assumed the role of promotion until 1997 when the Kenya Tourist Board was established.
The increase in tourism growth in the early 1970s and 1980s is partly explained by the promotional efforts of the KTDC. The KTDC maintains nine tourist offices outside Kenya, mainly in the USA and European and Far Eastern countries’ capitals.
“The Land Out of Africa” slogan coined from the worldwide publicity gained by the Oscar- winning film, “Out of Africa”, formed the focus of the national tourism marketing campaigns in the mid 1980s. The film is credited as a major factor in Kenya’s tourism development. Another national theme, “Kenya – all of Africa in one country” was used in the late 1980s.
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10.9 Mauritius
Size and Market Share
The number of visitors to Mauritius from 1995 to 1999 has steadily increased with an average annual growth rate of 8,2%. Spain, Sweden and the Netherlands have shown good average annual growth rates over the period 1995 to 1999. Travel from the Southern African Development Community (“SADC”) countries was responsible for around 34% of all travel to Mauritius in 1995 and 27% in 1999.
Table 4.14: Foreign Tourist Arrivals to Mauritius According to Country of Origin, 1995-1999
Country/Region of Arrivals Market share Average Origin Annual Growth 1995 1997 1998 1999 1995 1999 99/95
Intraregional 143 586 372 043 395 171 421 857 34,0% 27,0% 2,1% France 116 701 145 173 16 775 175 431 27,6% 30,3% 10,7% UK 31 324 46 022 52 299 58 683 7,4% 1,0% 17,0% Germany 41 637 43 993 43 836 45 206 9,9% 7,8% 2,1% Italy 17 384 35 255 36 614 36 675 4,1% 6,3% 20,5% Switzerland 13 815 16 105 16 178 16 281 3,3% 2,8% 4,0% India 11 225 13 220 16 269 13 583 2,7% 2,3% 4,9% Belgium 5 802 8 162 8 365 9 586 1,4% 1,7% 13,4% Austria 4 841 8 317 7 757 8 095 1,1% 1,4% 13,7% Australia 5 558 9 460 8 913 8 076 1,3% 1,4% 9,8% Other interregional 30 590 46 336 188 165 50 241 10,9% 12,5% 1,1% Total Interregional 278 877 372 043 395 171 421 857 66,0% 73,0% 10,9% TOTAL 422 463 536 125 558 195 578 085 100,0% 100,0% 8,2% Source: WTO, 2000
The increase in tourism growth for Mauritius is attributed to the Mauritanian authorities continued encouragement of investment in hotel development and the recent improvements in air access.
Some of the main findings of the 1998 Survey of Outgoing Tourists (conducted every two years by the Ministry of Tourism and Leisure) are summarised below:
61,5% Of all tourists came to Mauritius on a package holiday;
The main purpose of visit to Mauritius is as follows: o Holiday 75,0%; o Honeymoon 10,7%; o Business 9,1%;
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o VFR 2,4%; and, o Other 2,8%.
The type of accommodation used by foreign tourists is as follows: o Hotel 78,8%; o Bungalow 8,8%; o Boarding houses 4,1%; o VFR 2,4%; and, o Other 2,3%.
The motivational factor behind choosing Mauritius as a destinations is as follows: o Tropical image 48,8%; o Beaches 26,5%; o People/local culture 10,3%; o Accessibility 6,2%; and, o Other 8,2%.
Development Of Tourism In Mauritius
The development of air transport transformed the remoteness of the island and has been the most important element in the development of tourism in Mauritius. International tourism took off after 1970 and when the national carrier – Air Mauritius started to operate to and from the island. Foreign carriers opened air routes between Europe and Mauritius on a back to back basis – an element normally only characteristic of charter operations.
In addition Mauritian government’s vision after independence to create infrastructure for the development of tourism and a sound traffic rights policy during negotiation with other international carriers serving Mauritius was instrumental in its tourism development. The Mauritius Government Tourist Office (“MGTO”) active and dynamic marketing drive through advertising and public relations from 1978-1979 and opening up of tourism promotion offices in Western Europe and America was also seen as pivotal to growth.
Finally new hotels were built to accommodate the increasing number of visitors The introduction of pioneer hotel operators including Club Mediterranee and Sun International, as well as Rogers Group – the first Mauritania chain of hotels stimulated tourism growth in the 70s and beyond. The abovementioned factors were particularly important in developing source markets for Mauritius. For example, the introduction of scheduled flights between Munich and Mauritius increased the island’s share of German tourists. Another increase was experienced with the UK market where the increase in seating capacity onboard scheduled Mauritania airlines, as well as the opening up of the London promotion office (and the direct participation of this office in fairs and workshops throughout the UK), resulted in a doubling of this market share. After this Beachcomber and other hotel groups who were not previously interested in
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Mauritius, began to fight for a share of the market. France is another example. Following direct flights from Paris by the national carrier and the very active participation of the private sector and the MGTO, the island experienced an in an increase of 10 000 tourists from France through direct commercial activities and exposure of the product alone.
The needs of western European tour operators and charter operations whose clients were tired of visiting the already over-exploited western European destinations, and demanded new middle-haul travel destinations were also met through the development of the Mauritian destination.
Although the future of tourism in Mauritius is bright at the moment, it remains vulnerable to changes in taste, fashion and pricing. The government is cognisant of these factors because of situations elsewhere in the wolrd ie the Caribbean, and has realised the need to diversify both the tourism and economic base. The Mauritania Tourism Promotion Agency (“MTPA”) plans to diversify the product base as well as the type of accommodation on offer include:
Diversification of Products
The demand for adventure and ecotourism-related activities has resulted in the development of the Tourism Activity Professionals Association (“TAP”), which represents excursion operators. The new concept of sports-nature-adventure, based on discovery sports activities such as canoeing, mountain-biking and outdoor excursions was recently launched in Mauritius.
Diversification of Accommodation
The trend in Mauritius is moving towards smaller hotels, bed and breakfasts and self-catering resorts, especially for those who have been to the island before. Holiday bedrooms are also becoming increasingly important, especially for tourists on long-haul trips. The bedroom, bathroom, terrace and beach form part of the holiday. There is also ncreased demand for dedicated spas, gyms and health centres. An increasing number of upmarket hotels are replacing standard rooms with junior suites and interleading family apartments. With the emphasis on a ‘family approach’, new structures, appropriate staffing and adapted programmes of activities are happening.
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Table 4.16: Recommendations for Tourism Development in Mauritius in the 1990s
Tourism Recommendations Category Tourist Product . Maintain Mauritius as an essentially resort destination; . Take active measures to encourage the cultural industry; . Build conference centres to cater for business and conference tourism; . Develop the necessary infrastructure on the outer islands to accommodate enthusiasts e.g. diving, fishing, escapism, etc.; and, . Amend tax legislation so as to allow for initial and investment allowances on road vehicles that are used in the car-hire industry. Air Access . Give active consideration to the promotion of additional route networks in the region; Policy . Take actions to maximise air transport capacities as a means of contributing to the full development of the tourism industry in terms of servicing existing and new international routes (e.g. Japan, Australia, Middle East, Malaysia, etc.). Marketing . Diversify the existing source markets and tap into new ones (e.g. Japan, South East Asia, Scandinavia, the Benelux countries, Iberian peninsula, Australia, etc.); . Increase the share of long-haul tourists in total arrivals, raise the length of stay and increase the per capita expenditure; . Earmark 3% to 5% of total tourism earnings for promotional activities; . Develop a well-defined system whereby both the public and private sectors could participate jointly in promotional campaigns; and, . Project an image of excellence in the promotion of the cultural diversity of Mauritius. Infrastructure . Earmark an appropriate budget for the implementation of infrastructure in the main tourist zones (e.g. Le Morne, Wolmar, Balaclva and Belle Mare); . Encourage the construction of marinas, especially in the Grand Baie and Port Louis areas, and introduce appropriate legislation to regulate yachting; . Encourage the construction of golf courses of an international standard; and, . Find a ‘modus operandi’ with respect to the setting up of additional duty-free shops throughout the island. Hotel Industry . Take the necessary steps to accelerate the construction of planned hotel projects; . Restrict the total number of rooms to 200 per hotel complex and to restrict the hotel complex to a 1-2 storey building; . Give priority to Mauritania entrepreneurs over foreign nationals in the re-allocation of hotel sites; . Give priority to investment for the provision of infrastructural facilities, especially at Wolmar, le Morne and Pointe aux Piments; and, . Introduce a pause of around five years in hotel construction once the already planned hotel projects are completed. Environment . Finalise a masterplan for the restoration and protection of the Grand Baie region and the creation of a marina to reduce and control further pollution of the marine environment; . Set up an appropriate body to monitor the Mauritania environment and initiate actions to prevent, reduce and control pollution from any source; . Impose quality control on all tourist resorts in the country; . Introduce necessary measures to ensure the conservation of wild flora and fauna habitats; . Take appropriate measures to preserve the social and cultural values of the population by discouraging the commercialisation of religious rites and ceremonies; and, . Introduce legislation to regulate tourism related activities e.g. yachting, ballooning, etc. Handicrafts . Given that out of Rs 200M spent by tourists on handicrafts and souvenirs in the late 1980s, only Rs 15M were spent on local handicraft, it was considered necessary to take measures to substantially raise local handicraft production; and, . Undertake an intensive promotion of handicraft in local and international markets through participation in exhibitions and advertising campaigns. National . Set up a committee comprising representatives of both the private and public sector to examine Tourism Board the potential of establishing a national tourism board for Mauritius. Source: Ministry for Employment and Tourism, Mauritius, 1988
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In March 1998, a seminar entitled “Tourism in the 1990s” was held by the Ministry for Employment and Tourism and Table 4.16 above provides a summary of recommendations arising out of the issues raised during the seminar. The main objective of the MGTO continues to be to attract high-income visitors. There is a continued push for Mauritius’s private sector which has always been a key player in the economic development of the island to remain involved.
Tourism Marketing
In the 1970s, the promotion of Mauritius has emphasised the uniqueness of its beaches however, these were not totally successful as a beach was considered to be a homogeneous product, easily substituted.
In the 1980’s Mauritius embarked on a marketing and promotional campaign to attract European tourists to Mauritius using the slogan - “Mauritius, the most cosmopolitan island under the sun”. This took into account three main motivations for travel by Europeans; “wander lust”, the “sun lust” and the “sea and sand lust”. The marketing campaigns soon moved to include “environmental lust” in their promotions, and finally “exotic lust”’ which encouraged the participation of foreigners in cultural activities, dancing, folklore, etc.
The current marketing strategy for Mauritius emphasises the overall product quality experience including the friendliness of the people, the shopping experience, the quality and variety of the food and the relative safety of the visitors. The MTPA is also currently taking a more direct, hands-on approach to promoting the Indian Ocean islands as a region. Plans are also underway to promote Mauritius as a viable incentive venue for the South African corporate market and to strengthen relationships with the travel trade in South Africa who have loyally supported the island.
10.10 Thailand
Size and Share of the Market
Thailand received 7,76 million foreign visitors in 1998, representing an increase of 7,5% over the previous year. This was above the target of 7,72 million set in the Tourism Plan of 1998. The success is partly attributed to the continuous promotion of the “Amazing Thailand” marketing campaign, but also due to the relaxing of immigration regulations for tourists from China, Taiwan and Malaysia and for tourists who are more than 55 years old. In addition, an open policy was actively pursued to increase and facilitate incoming flights and routes.
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Table 4.17: Number of International Tourists to Thailand in 1998
Region Number of Tourists Increase/Decrease over 1997 East Asia 4 282 589 -1,2% Europe 2 108 909 +21,5% Oceania 343 938 +22,4% Americas 538 293 +17,9% South Asia 265 054 +9,3% Middle East 148 597 +29,8% Africa 77 550 +35,6% TOTAL 7 764 930 +7,5% Source: Thailand Authority of Tourism, 2000
Arrivals from Europe increased because of the recognition of Thailand as a “cheap holiday destination”. Moreover, the TAT believes that Thailand appeals to Europeans because of the country’s high quality of tourist attractions and locations, excellent value for money and the country’s political stability. In addition, Thai beaches are popular among Europeans because they are viewed as being pristine unlike the beaches of the Caribbean and Bali for example.
Gateways to Thailand
The Thailand Aviation Authority owns and operates 5 international airports. Bangkok International Airport is one of the world’s largest airports with 25,62 million passengers in 1998. Chiang Mai International Airport represents the gateway to northern Thailand. This airport accommodated more than 2 million passengers and 15 000 flights per annum.
Hat Yai International Airport is located in southern Thailand. In addition to serving the south of Thailand for business and leisure purposes, it is also an important gateway for Muslims on their annual pilgrimage to Mecca. 3 Airlines (all regional) operate from this airport, with more than 800 000 passengers and 9 500 flights passing through each year.
Phuket International Airport ranks second in the country in terms of passenger volume. The airport serves 10 airlines, with 2,9 million passengers and 20 000 flights passing through each year. The airlines are primarily regional, with only Finnair and Britannia Airways being international airlines operating through this airport. Chiang Roi International Airport is located in northern Thailand, and is the smallest international airports in Thailand – operating only 2 airlines, 500 000 passengers and 3 900 flights.
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Beach Tourism Summary Report
Development Of Tourism In Thailand
East Coast
The East Coast of Thailand has been labelled as Thailand’s Riviera, however although many sources cite the east coast as predominantly dull, grey beaches with expensive, over- packaged family resorts. The discovery of oil and natural gas fields in these coastal resulted in an unsightly industrial landscape of refineries and depots on loarts of this coast. Offshore however there are pristine beaches.
After landing in Bangkok, much of the package holiday traffic flows east to Pattaya, the country’s first and most popular beach resort, now said to be polluted. Born as a rest-and- recreation base for the US military during the Vietnam War, it has grown into a mass of hotels. The international tourists to Pattaya are predominantly middle-aged western males who are enticed by the area’s sex-market reputation. Pattaya is also host to the country’s largest gay markets. Ko Sameth is close to Bangkok and popular with backpackers, package tourists and Thai students. Ko Samet was declared a national park in 1981, but the ban on building has largely been ignored and there are now over thirty bungalow operations here. Inevitably this has had a huge impact on the island’s resources.
Southern Thailand
Southern Thailand (the Gulf Coast) is most famous for the Samui archipelago, which consists of three small islands lying off the most prominent hump of the coastline. The Gulf Coast is Thailand’s most popular destination for independent beach travellers. Numerous islands, including the country’s largest – Phuket, dot the coastal waters. Most of the coastline has been taken over by beach resorts, notably Cha-am and Hua Him.
The “low” south ist known as the country’s top tourist area with Phuket island and Krabi, on the Andaman coast, and Samui island in the Gulf claiming tropical beaches that rank amongst the best in the world.
Phuket
A major road building program, the opening of regular air service, and most of all the opening of the Sarasin Bridge connecting the island with the mainland dramatically changed this islands economy from little more than a ganster ridden mining backwater. In the mid-70s "Newsweek" magazine, in a special feature, listed Phuket as a destination for travellers seeking something special and undiscovered. Within a short time, people begun flocking to Phuket’s splendid west-coast beaches and a significant new industry was born. Today, the island hosts over one million visitors annually.
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Policies Directing Tourism Development In Thailand
Table 4.18: TAT’s Tourism Development Objectives, 1997-2003
Area of Development Description Selected Projects Tourism Service Involves the development and improvement of tourist . Providing international services, facilitating travel, determining and implementing cooperation with other countries; tourist business regulations, providing knowledge to . Organising regional training develop tourism manpower, and increasing service courses, meetings, seminars, etc. to efficiency with other countries for tourists and keep abreast develop tourist business manpower; of tourism technology and, . Promoting hotel and restaurant standards. Tourism Information Involves the surveying, collection, analysis and planning . Jointly investing with the Gathering & tourism information and statistics. The data obtained is private sector to produce information Dissemination used to determine and plan the most effective tourism which can benefit tourist businesses; development and promotion projects. and, . Studying and surveying international tourist arrivals to Thailand. Tourist Destination This involves the collection, surveying, study and analysis . Surveying and developing Development of information on tourist destinations to assist in planning destinations; and, Planning the direction, form and priority of destinations in every . Coordinating and following up region of the country. development projects in government areas. Tourist Destination This area involves the inspection, preservation and . Campaigning and publicizing Conservation & development of tourist destinations and public utilities and environmental conservation in tourist Development facilities in major destination that are spread throughout the destinations by producing educational country. tools to create understanding and awareness. Festival Promotion in This area involves the conservation and revival of arts, . Supporting regional and Provinces culture, traditions, handicrafts and traditional ways of life in provincial festivals; every region so that they remain national identities and are . Organizing activities to well-known among Thai and foreign tourists. promote tourism, arts, culture and traditions; and, . Holding Thai and international food festivals. Tourism Development The loan for tourism development and promotion by the and Promotion Loan Overseas Economic Cooperation Fund is used for Fund developing the various regions of the country. The loan concentrates on developing tourist destinations with high potential, providing easy access to regional and intra- regional destinations, and establishing gateways to destinations in other countries. Hotel and Tourism The institute serves to develop manpower for the tourism Training Institute industry. Tourist Facilitation & This involves facilitating, providing safety to and helping . Developing tourist police Safety tourists by coordinating with public and private offices to personnel; solve problems experienced by tourists as quickly as . Offering foreign language possible. courses to officers; . Organising various training programmes e.g. English listening and speaking for communications and orientation for persons concerned with international affairs. Tourist Business & This involves ensuring that tourists and tourist businesses Guide Registration are protected under the Tourist Business and Guide Act of 1992. Source : TAT,2000
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After a period of astonishing growth Phuket is now grappling with the dilemma of how to sustain growth without destroying the environment that makes Phuket so desirable. Without a master plan to channel the growth and to develop the island into an integrated tourist destination much of the recent growth has been haphazard and counterproductive. Traditionally, it has been the awesome beauty of Phuket the white sandy beaches, the balmy air, and warm sea that has been the principal attraction to the island, but the current trend seems to favour the continued development of glitzy and expensive tourist resorts that require massive environmental changes to the island.
Tourism Marketing
Tourism marketing in 1998 emphasised promoting the image of Thailand as a quality, safe and diverse destination for Thai and foreign tourists. The primary objective of the “Amazing Thailand” 1998-1999 marketing and promotional campaign was to attract quality tourists to come to Thailand, to have them stay longer and spend more. In addition to focusing on the main generating markets of Thailand (and the domestic market), the TAT also concentrated on tourism cooperation with countries in ASEN, East Asia, the Mekong Sub-Region (Laos, Cambodia, Vietnam, Myanmar, southern China and Thailand), the Indonesia-Malaysia- Thailand Growth Triangle, and the Sub-Continent Group (Bangladesh, India, Myanmar, Sri Lanka and Thailand).
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TABLE OF CONTENTS
Index Page
1. CONCLUSION 1
BEACH TOURISM TO AND FROM INTERNATIONAL 3 2. DESTINATIONS
PROJECTED NUMBER OF INTERANTIONAL BEACH 5 3. TOURISTS TO SOUTH AFRICA
ECONOMIC IMPACT OF THE ESSAS BEACH TOURISM 5 4. INDUSTRY
5. THE WAY FORWARD 8
BACKGROUND SECTIONS
6. INTERNATIONAL OUTBOUND MARKETS 14
TOURISM TO SOUTH AFRICA AND THE EASTERN 17 7. SEABOARD
8. TOURISM AND RELATED INFRASTRUCTURE IN THE ESSA 17
9. LESSONS FROM ABROAD 24
10. INTERNATIONAL BEACH TOURISM DESTINATIONS 26 10.1 Mass Beach Tourism 25 10.2 Spain 26 10.3 Portugal 29 10.4 Greece 32 10.5 Cyprus 36 10.6 Bahamas 41 10.7 Bermuda 42 10.8 Kenya 44 10.9 Mauritius 48 10.10 Thailand 52
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Index Page
FIGURES 10.1 Establishing South Africa as a Beach Tourism 2
Destination 7.1 Map Showing the Geographical Location of South 19
Africa’s Eastern Coastal Regions 8.2 Distribution of Establishments along the ESSA 20 Percentage Breakdown of the Total Number of 20 8.4 Establishments Available along the ESSA
TABLES 9.1 Summary of Beach Tourists from Selected Generating 3
Countries 9.2 Estimated Number of Beach Tourists to Selected 3
Destinations 9.3 Summary of Beach Tourists from Variious Source 4 Markets and Summary of Beach Tourist Market Shares of Key Source Markets 8.3 Current State of Infrastructural Development along the 22
ESSA 4.3 Tourist Arrivals (In Hotels) in Portugal by Top 10 30
Markets 4.4 Tourist Arrivals in Greece by Main Markets, 1999 33 4.9 Growth of Tourist Arrivals in Cyprus, 1985-1999 37 4.12 Distribution of Bed Capacity per Tourism Region in 39
Cyprus, 1999 4.11 Summary of Conclusions and Recommendations to 44
Address Bermuda’s Economic Performance 4.14 Foreign Tourist Arrivals to Mauritius According to 48
Country of Origin, 1995-1999 4.16 Recommendations for Tourism Development in 51
Mauritius in the 1990’s 4.17 Number of International Tourists to Thailand in 1998 53 4.18 TAT’s Tourism Development Objectives, 1997-2003 55
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