Johannesburg - Hilton Worldwide, one of the world’s top hotel groups, is in talks with potential partners to build between three and five new hotels in major cities in South Africa, underscoring its confidence in the local tourism sector.
Jan van der Putten, the vice-president for Hilton Worldwide in Africa, yesterday told journalists about the group’s expansion plans on the sidelines of Careers@Hilton Live at the Hilton Sandton, an annual event that seeks to promote tourism among students.
He said the group was optimistic about the future and that the construction of the new hotels was under discussion and details on their location, size and facilities would be disclosed when the deals were signed.
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“We will grow new hotels in South Africa. I cannot give you locations, but I think it will likely be major cities. This underscores our confidence in South Africa,” Van der Putten added.
Van der Putten said the Hilton’s strategy was to find partners for the construction of the hotels. He said the average price of constructing a hotel was between R250 million and R350m.
Van der Putten said there was notable growth among leisure travellers from Asia to South Africa, and conference tourism and business meetings was also a big reason international tourists visited the country.
“I think South Africa is definitely a growth area. Having said that we have confidence in Kenya and Nigeria,” Van der Putten said.
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The group opened its first hotel in Chad in January, the latest addition to the portfolio of 4 660 hotels, resorts and timeshare properties comprising more than 765 000 rooms in 102 countries around the world.
Tourism Minister Derek Hanekom, who was also at the event, said the domestic tourism sector was expecting a bumper year ahead after recovering from major hurdles last year.
The sector declined by 7 percent on the outbreak of Ebola in west Africa, which sparked health fears and the introduction of new visa regulations.
The regulations required children to travel with full birth certificates and for visitors from some countries, including China, to appear in person at a South African embassy.
The government relaxed the rules in October.
“The issues are behind us and we are seeing a recovery in the sector,” Hanekom said.
Hanekom described the tourism sector as being a “treasure” for the economy despite a shrinking economic growth rate.
This as tourism grew 15 percent in January as compared with January 2015 and 18 percent in February versus the same period last year.
Hanekom said the number of tourists from China had doubled this year, and numbers from the US and India were looking good.
One out of 11 South Africans was employed in tourism-related industries, and the sector supported 1.5 million employees. It also accounted for 9 percent of economic output.
Mike Schussler, the chief economist at Economists.co.za, last month said until commodity prices recovered, there was little hope for older economic sectors – manufacturing, electricity, mining, construction and transport – to create jobs.
Schussler said the spotlight should, therefore, be on industries such as tourism, education, and food production for future job creation opportunities.
BUSINESS REPORT