'Tourism lacks transformation'

By Zohra Time of article published Nov 25, 2015

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Durban - The outgoing chairperson of Tourism KZN, Sadha Naidoo, leaves office next month after three years. In a parting shot, Naidoo called tourism the least transformed sector of the economy.

Zohra Teke (ZT): What, in your view, needs to be done to transform the industry?

Sadha Naidoo (SN): I am of the firm view that transformation in the industry can only be accelerated if there is willingness in the private sector to participate and assist new entrants. While the government and its agencies can play a crucial facilitative role, the success of new entrants can be stymied with poor access to markets and conservative consumer behaviour.

The existing large role-players in the industry can also contribute to transformation by playing a positive role in its procurement policies, enterprise development, staff development and CSI programmes. While ownership is a key indicator in the transformation efforts of government, one must remember that the tourism industry is such that the greater beneficiaries are in the extended value chain, from the vegetable farmer to the tour operator.

Unfortunately the laager approach is still prevalent in the industry, protecting group interests and dictating consumer behaviour, resulting in limited market access for new entrants.

If one had to do an analysis of our major hotel chains, and how much have they have transformed in terms of supplier development and their service providers, the results would be quite surprising. The tour operating industry is a closed community, dominated by long-term networks and relationships built over the years. I feel a lot of empathy for previously disadvantaged individuals who invest a lot of money in a tour vehicle and the process to set up their tour company, then end up waiting with promises of filling their vehicle – which doesn’t always happen, because they can’t get their foot in the door.

 

ZT: What has Tourism KZN done to break this monopoly?

SN: As a government marketing agency, our transformation efforts have been primarily focused on assisting and monitoring new entrants, facilitating partnerships with established role-players and introducing SMMEs to markets that would enable further access. While our role is restricted to these efforts, we can realise further value by partnering with industry and encouraging additional transformation efforts in the tourism value chain.

 

ZT: You have been criticised for securing a prime spot on the Durban beachfront for your restaurant. Any regrets?

SN: First, I believe that the criticism has been unfounded, unfair and uncalled for. As a businessman in the industry for almost 20 years, my decision to invest in this particular property came with a fair amount of risk and financial investment.

I am passionate about the industry (and the Durban beachfront) and therefore took the decision to invest in a property (that was vacant for almost four years) and contribute to the tourism landscape in the industry. This was a straight tender process and we were awarded on merit.

I therefore have no regrets on this decision and believe that if anything there should be recognition of my investing in such a project and providing the region a prime facility.

 

ZT: Have you achieved your goals in tourism?

SN: Our objectives at Tourism KZN have always been aligned with provincial and national plans and in that respect we have ensured collective efforts in achieving them.

Together with my board and the partnership with other government entities, my term in office has coincided with the formulation of the KZN Tourism master plan, the establishment of the KZN Durban Convention Bureau and the introduction of new airlines to the King Shaka International Airport.

Also during my term in office, we have seen greater alignment and working together with other tourism bodies in meeting our tourism objectives. The province continues to be the leading domestic tourism market in the country and we are well poised to attract more international visitors – in leisure and business tourism.

 

ZT: Where should investors be looking to invest within tourism?

SN: Our natural resources – the beach, game parks and mountains – remain our greatest assets and would need to be further capitalised to grow and nurture our tourism environment.

In this respect, government and private sector efforts to develop a beach resort need to be accelerated to provide us with a competitive edge. Together with this, we need to actively market and profile our two World Heritage Sites and ensure that we begin to develop innovative packages for the increasingly discerning visitor. Your economy may be depressed, but the super rich will always have money. It is in these efforts that we must identify and introduce local and international investor interest.

 

ZT: Words of advice for your successor?

SN: While tourism is a major contributor to our GDP, the competition from other regions and countries is ever-increasing. It is for this reason that we have to increase the tempo in forming partnerships, aligning collective efforts and becoming innovative in how we utilise limited state resources in facilitating tourism growth and development. In all our efforts, internally and externally, we must begin to realise tangible return on investments for our shareholders and stakeholders.

The platform and framework has no doubt been established for us now to push the boundaries.

The Mercury

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