Africa’s tourism season — but where are the tourists?

Africa’s tourism season — but where are the tourists?
Coronavirus restrictions have shuttered what was once the lucrative centerpiece of African tourism, the safari. (Shutterstock)
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Updated 08 September 2020

Africa’s tourism season — but where are the tourists?

Africa’s tourism season — but where are the tourists?
  • Africa will lose from $53 billion to $120 billion in contributions to its GDP in 2020 because of the crash in tourism, the World Travel and Tourism Council estimates

CAPE TOWN: Raino Bolz quickly diversified when his tourism business in South Africa’s winelands crashed to a halt in March because of the coronavirus pandemic. He sold a minibus — useless without tourists to ferry around — and bought a herd of pregnant cows.

He will have to wait for the cows to have calves and for the calves to be old enough to sell before he can make money from them. That probably won’t be until early next year, but it is his insurance policy.

Bolz hopes to see a return of some tourists in November, the start of South Africa’s tourism season. If foreign visitors — 80 percent of his income — don’t arrive for end-of-year vacations, he’ll need the profit from his cattle to stay afloat.

Africa will lose from $53 billion to $120 billion in contributions to its gross domestic product in 2020 because of the crash in tourism, the World Travel and Tourism Council estimates. Kenya expects at least a 60 percent drop in tourism revenue this year. South Africa a 75 percent drop. In South Africa, 1.2 million tourism-related jobs are already affected, according to its Tourism Business Council. 

“Devastation,” council CEO Tshifhiwa Tshivhengwa said.

South Africa’s borders, including virtually all international flights, have been closed for nearly six months and there are no signs of them reopening. COVID-19 restrictions have shuttered what was once the lucrative centerpiece of African tourism, the safari.

For nearly 40 years, Desert and Delta has sold luxury safaris in the wildlife-rich Okavango Delta in northern Botswana and their clients have always been a particular kind of tourist. From North America or Western Europe, wealthy, retired and almost always over 60 years old, said James Wilson, Desert and Delta’s marketing director. His fear is that those retirees will be the last to come back.

Jillian Blackbeard sees a silver lining. She is the CEO of a regional tourism association that represents safari operators in Botswana, Namibia, Zambia and Zimbabwe.

It will take southern Africa’s safari tourism three years to recover, Blackbeard said. But the virus could also kick-start a long overdue change. She said they have relied too much on that specific kind of client, white, elderly, North American or European. She is pressing for the whole region to use the moment to diversify. To attract their own African tourists, who have been ignored. To look to Asia and its multi-generational travelers.

“For a long, long time, the African-American diaspora has never traveled to southern Africa,” she said. “It wasn’t that they didn’t want to come. It was because when you see a brochure it was always these white elderly people. COVID has allowed us to reach into that and say, ‘OK, how do we make our industry more resilient by diversifying our market?’”

No one is untouched. Sun International, a major player with a portfolio of casinos, resorts and high-end hotels in South Africa and several other African countries, has so far kept its 8,500 employees, although on reduced salaries. It can’t last. Sun International is now “having to consider quite severe restructures,” said Graham Wood, chief operating officer for hospitality.

One of Sun International’s landmark properties, the five-star Table Bay Hotel on the Cape Town waterfront, has been closed for half the year. 

Wood does expect a bounce in domestic tourism at the end of the year from South Africans who aren’t going overseas. And domestic tourism got a boost last month when South Africa eased restrictions to allow interstate leisure travel. But the international tourist season this year is “not going to materialize,” Wood said.


Saudi Arabia digital content market to hit $5.3bn by 2030

Saudi Arabia digital content market to hit $5.3bn by 2030
Updated 41 min 55 sec ago

Saudi Arabia digital content market to hit $5.3bn by 2030

Saudi Arabia digital content market to hit $5.3bn by 2030
  • Investment in digital video in KSA to read SR1.2 billion

RIYADH: Saudi Arabia’s digital content market is expected to grow to between SR16 and SR20 billion ($5.3 billion) by 2030, according to a report by the Trend Corporation in cooperation with the Riyadh Chamber of Commerce and Industry.

An initiative to invest in video content creation aims to attract major companies specialized in visual content, and the investment rate in video in Saudi Arabia is expected to reach SR1 billion to SR1.2 billion.

Video generated $175 million in revenue locally, with video streaming $127 million, and the expected market size is $262 million in 2025.

Videos make up 79 percent of global Internet traffic. In the Middle East and Africa, video traffic has grown eight-fold, and the region is estimated to have created 169 billion minutes of video content every month by the end of 2020.

The Digital Media Committee was created in Saudi Arabia, and it’s meant to activate the digital media to contribute to developing the business sector, create partnerships, and to benefit from the media experts.


PIF-backed developer Roshn launches 30,000 home Saudi community

PIF-backed developer Roshn launches 30,000 home Saudi community
Updated 05 August 2021

PIF-backed developer Roshn launches 30,000 home Saudi community

PIF-backed developer Roshn launches 30,000 home Saudi community
  • 30,000-home development spread across 20 million sq m north of Riyadh
  • 4,500 of the units will be built in phase one

RIYADH: Roshn, the community developer backed by Saudi Arabia’s Public Investment Fund, has launched its first project in the Kingdom.

Sedra will be a 30,000-home development spread across an area of 20 million square meters north of Riyadh, south of King Khalid Airport, Roshn said in a statement.

More than 4,500 of the units will be built in phase one of construction, providing homes of various sizes and facades. They will be delivered ready to live in and come with kitchens, split unit ACs, water heating systems, and LED light fixtures, among other amenities.

“Our communities will represent a global exemplar in residential living and will play a vital role in further advancing the nation’s flourishing infrastructure and real estate sectors, which are crucial to the Kingdom’s economic diversification and growth goals,” said Roshn Group CEO David Grover.


SABIC second-quarter profit jumps 57 percent as prices, volume increase

SABIC second-quarter profit jumps 57 percent as prices, volume increase
Updated 05 August 2021

SABIC second-quarter profit jumps 57 percent as prices, volume increase

SABIC second-quarter profit jumps 57 percent as prices, volume increase
  • Net profit jumped 57 percent to $2.04 billion in Q2
  • Selling prices increased 10 percent, sales volumes rose 3 percent

RIYADH: Saudi Basic Industries Corp. (SABIC) reported a surge in second-quarter profit as it sold more chemicals at higher prices than the previous quarter amid an increase in crude prices.

Net profit jumped 57 percent to SR7.64 billion ($2.04 billion) in the three months to the end of June as revenue rose 13 percent to SR42.42 billion, SABIC said in a filing to the Tadawul stock exchange.

The Middle East’s largest petrochemicals producer posted a SR12.51 billion first-half profit on sales of SR79.95 billion, compared with a loss of SR3.27 billion on sales of SR54.81 billion in the same period last year.

Selling prices increased by 10 percent in the second quarter compared with the first three months of the year, while sales volumes rose 3 percent. Over the first half, sales prices were 48 percent higher and volumes were 2 percent lower compared with last year.

“SABIC’s financial performance in the second quarter was strong – continuing the margin improvement seen during the first quarter of 2021,” Yousef Abdullah Al-Benyan, vice chairman and CEO of SABIC, said in a statement to the Tadawul. “This was driven by higher sales volumes and prices, supported by a rise in oil prices and a healthy supply and demand balance for most of our key products as the global economy continued its path to recovery.”

SABIC achieved $230 million of synergies with Saudi Aramco since June 2020 when Aramco acquired a 70 percent stake in SABIC, driven by combining their purchasing power and sharing warehousing and logistics facilites.

In the second half of 2021, SABIC expects demand will continue to be strong in line with the recovery of the global economy. Margins will moderate, but remain healthy as oil prices and
feedstock costs remain elevated while existing supply constraints ease and new supply capacity comes on line, it said in the filing.


Saudi Arabia starts trial of the first wind turbine in Al-Jouf

Saudi Arabia starts trial of the first wind turbine in Al-Jouf
Updated 05 August 2021

Saudi Arabia starts trial of the first wind turbine in Al-Jouf

Saudi Arabia starts trial of the first wind turbine in Al-Jouf
  • Dumat Al-Jandal is poised to become the largest wind farm in the Middle East

RIYADH: Saudi Arabia has started the operational trial of the first wind turbine at Dumat Al-Jandal wind farm, which once fully operational will reduce CO2 emissions by nearly 1 million tons annually and supply 72,000 homes with clean energy.

The turbines comprise towers, blades, and nacelles, which will be assembled at the project site, 900 kilometers north of Riyadh in the Al-Jouf region. The project will include 99 Vestas wind turbines, each with a hub height of 130 meters and a rotor diameter of 150 meters.

The Kingdom’s first utility-scale wind-power source is being developed by a consortium led by EDF Renewables of France in partnership with Abu Dhabi-based Masdar. The Renewable Energy Project Development Office of Saudi Arabia’s Ministry of Energy awarded the project to the EDF Renewables-Masdar consortium in January 2019 after a competitive tender.

Its tariff of $21.3 per megawatt-hour (MWh), the lowest bid submitted, was reduced to $19.9/MWh at financial close, making Dumat Al-Jandal the most cost-efficient wind-energy project in the world. According to the US-Saudi Arabian Business Council, the development of Saudi Arabia’s renewable energy sector could create up to 750,000 jobs over the next decade, as the Kingdom pushes to generate 7 percent of its total electricity output from renewables by 2030.

It will also benefit from a 20-year power purchase agreement with the Saudi Power Procurement Co., a subsidiary of the Saudi Electricity Co., the Kingdom’s power generation and distribution company. Saudi Arabia’s renewable energy program aims to contribute to a sustainable future, preserve nonrenewable fossil fuel resources, and safeguard the Kingdom’s international energy leadership, according to the King Abdullah City for Atomic and Renewable Energy. That way, the program aims to ensure greater long-term global energy market stability.

Renewable energy projects, including wind and solar, are planned across more than 35 parks in Saudi Arabia by 2030.


Gulf economies expected to grow 2.2 percent this year, says World Bank

Gulf economies expected to grow 2.2 percent this year, says World Bank
Updated 05 August 2021

Gulf economies expected to grow 2.2 percent this year, says World Bank

Gulf economies expected to grow 2.2 percent this year, says World Bank
  • Most GCC countries are expected to continue to post deficits over the coming years
  • The countries that posted the largest deficits in 2020 — Bahrain, Kuwait and Oman — are expected to remain in deficit until 2023

RIYADH: Economies of the Gulf Cooperation Council (GCC) will likely grow at an aggregate 2.2 percent this year after a 4.8 percent contraction last year caused by the pandemic and lower oil prices, the World Bank said on Wednesday.

“With recent progress made with the rollout of the COVID-19 vaccine globally and with the revival of production and trade worldwide, the prospects for an economic recovery are firmer now than at the end of last year,” it said in a research report.

“Although downside risks remain, the forecast stands for an aggregate GCC economic turnaround of 2.2 percent in 2021 and an annual average growth of 3.3 percent in 2022–23.”

It remains vital for GCC countries — which include Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, the UAE — to diversify their economies, the World Bank said, as oil revenues account for over 70 percent of total government revenues in most GCC countries.

It said it expects Kuwait and Qatar to introduce a value-added tax (VAT) this year, following the example of other GCC states that have implemented the revenue-diversifying measure in different phases over the last few years.

On the fiscal side, most GCC countries are expected to continue to post deficits over the coming years, the World Bank said, after shortfalls intensified last year because of the coronavirus crisis.

The countries that posted the largest deficits in 2020 — Bahrain, Kuwait and Oman — are expected to remain in deficit until 2023, but with narrower ratios than in the 2020 downturn. While a rebound in oil prices may lift economic prospects in the short term, the World Bank said downside risks to its outlook are “extremely high” because of the region’s heavy exposure to global oil demand and the service industries.

“Mobility restrictions including for international travel may hurt attendance at future high-profile events in the GCC — the 2020 (rescheduled to 2021) World Expo in the UAE and the 2022 Federation Internationale de Football Association (FIFA) World Cup in Qatar,” it said.