THE burgeoning business tourism industry is spurring investments into new hotels and conferencing facilities across South Africa.
Business tourism — conferencing combined with leisure activities — is fairly new to South Africa and has become a key focus of the Department of Tourism.
It established the South African National Conventions Bureau about a year ago, which has proved successful in attracting bids.
South African Tourism CEO Thulani Nzima says that 88 secured bids for major events between 2013 and 2017 “will generate upwards of R2.6bn into our economy”. “The results that we are registering now are quite impressive, but we are just at the beginning of the process.”
Mr Nzima says South Africa has the hotel and facilities capacity to host far more events. South Africa got “a shot in the arm” in 2010 with a number of hotel and bed and breakfast investments ahead of the World Cup.
Durban’s International Convention Centre has faced increasing competition from venues in Sandton, Cape Town, and most recently Port Elizabeth.
The Cape Town International Convention Centre is undergoing an expansion set to double its capacity and its contribution to gross domestic product.
“My call to the industry is to sit up and look at how this segment of business tourism can benefit us all. One successful event leads to the next successful event,” Mr Nzima says.
Tourism Business Council of South Africa (TBCSA) CEO Mmatsatsi Ramawela, said last month that the TBCSA FNB tourism business index for the second quarter of this year had confirmed the industry had returned to normal trading levels.
Ms Ramawela says business tourism had sustained the index at near-normal levels during the winter months, when the index usually declined.
She says there is significant scope for South Africa to host more international conferences and events, which will be a “major boost” for tourism and the economy.
Hosting more African association events is a major opportunity and is also necessary in that it proves to the rest of the world that South Africa can successfully hold such events, she says.
Along with a number of other companies targeting the lucrative meetings, incentives, conventions and exhibitions (MICE) industry, Premier Hotels and Resorts last week opened a new business-focused hotel in Midrand, which it said it viewed as “a key area for growth in terms of business tourism”.
In addition to the new hotel, the company has recently carried out a multimillion-rand refurbishment of the Premier Hotel Pinetown and has begun refurbishing the Premier Hotel Cape Manor property. MD Samuel Nassimov says the proximity of the new hotel in Midrand to the Grand Central Gautrain station and Gallagher Estate is expected to make it a sought-after accommodation and conferencing venue in the area.
Hilton Cape Town City Centre GM Markus Fritz says the city has “seen a healthy increase in business travel over recent years”. The industry has enjoyed “substantial growth”, with Cape Town International Convention Centre reporting last year that 45% of international association meetings in South Africa were hosted in Cape Town, Mr Fritz says.
“Hilton Cape Town City Centre is a case in point as the hotel has enjoyed a noticeable increase over the past 12 months in business-related bookings for both accommodation and meetings.”
Mr Fritz says there is “a tremendous opportunity to further grow the business events industry in Cape Town”. The expanded Cape Town International Convention Centre is playing “a significant role” in attracting large events, he says.
“The extended stays, return visits and recommendations for the city are together playing a key role in feeding the entire business community and driving tourism revenue for the city,” he says. Last year, the Cape Town convention centre reported a 163% increase in profits.
Danny Bryer, director of sales, marketing and revenue for the Protea Hospitality Group, says one of the fastest-growing inbound tourism segments “has been the MICE market — which people underestimate”.
He says the top performing areas are Johannesburg and Cape Town, and to a smaller degree Durban. “We have seen huge success in Century City” in Cape Town, where the group’s African Pride Crystal Towers Hotel Spa has reported strong business travel growth.
Mr Bryer says one of the biggest opportunities for the South African business tourism industry is the incentives market, where companies send staff to South Africa as part of a performance-incentive scheme. This is a big industry in India, he says.
Pepper Club Hotel Spa GM Matthew Cornall says recent investments in South Africa’s conference facilities are having a positive effect on the number of events in the country.