The Hotel Investment Conference Africa, organised by the Tourism Business Council of South Africa, has been hosting industry buyers and investor for nine years, and it’s growing from strength to strength. Mmatšatši Ramawela gave Business Traveller Africa some feedback from the 2015 conference.
Q: What was the thinking behind starting HICA nine years ago?
A: There was a need for the TBCSA to lead the knowledge gathering and sharing space of investment in the key sectors of the tourism economy. In 2005-2007, South and sub-Saharan Africa received a lot of buzz in other sectors along the theme of ‘Africa Rising’ and the need for businesses to lead the investment drive in the continent. Buzz around the tourism sector was decidedly muted. Established hotel brands were coming in and out of the continent – scouting for opportunities but unable to launch their businesses. HICA developed out of a need for these groups to talk to the right people – a knowledge-sharing platform for public officials and emerging entrepreneurs with aspirations of getting involved in the sector.
Q: What were some of the key points you took out of this year’s conference?
A: Technology is ingrained in our day-to-day life – it is changing the continent’s hospitality landscape, the manner in which consumers interface with hotels and changing the way hotels can differentiate and market themselves. It is also changing the way in which hotels process bookings and payments.
Q:What panel topic generated the most robust discussion?
A: The panel on ‘Doing Business in Africa’ offered up lessons for the tourism and hotel sector to do better and more profitable business in Africa. ‘Africa’s Perspective in the Global Economy’ with Daniel Silke was an eye-opening session that gave the would-be investor some positive food for thought about the future of Africa. The ’Spotlight on Management Contracts and Lease Agreements’ brought into sharp focus the growing need for the asset light model to be revised.
Q: What’s your view on the state of the African hotel industry, following this year’s conference?
A: It is an exciting time to be in the industry, which has grown in substantially since we first hosted HICA in 2007. The Marriott-Protea transaction, the Four Seasons-Westcliff, the rapid expansion of the Rezidor brand across the continent, the expansion of Hilton Worldwide within and outside South Africa; the come-back of Accor with its imminent deal in Angola; and the level of investments that a South African brands are making in Kenya, Tanzania and Botswana clearly show that hotel investors recognise opportunities on the continent.
Q: Do you think the African hotel groups continue to lag behind their more aggressive international counterparts?
A: Yes, but they are fast catching up. They are also beginning to collaborate with each other – the recent announcement of Legacy taking over the running of some African Sun hotels in Zimbabwe is evidence of this.
Q: Would you say the overriding message from the conference and its delegates wasmore positive than negative?
A: The theme of the conference was ‘Growth Through Partnerships’ with emphasis being placed more on partnerships, so I would say the overriding message was positive. The African hotel entrepreneur is looking for partnership in investing in the sector and that’s the way this sector will grow – partnerships in providing other services within the hotel such as restaurants and spas. The hotel doesn’t need to provide all these services on their own
Q: What challenges lie ahead for the African hotel industry?
A: Infrastructural development, particularly in respect of air access and airlift is still a major challenge. Knowledge, skills and developing hospitality expertise, from an operational and a strategic planning and investment perspective, is lacking. The southern Africa region is blessed with hospitality expertise but this still has to filter through the rest of the sub-Saharan Africa. Persisting apathy within governments about the potential that lies in this sector and the need to develop supportive policy frameworks. The appreciation of speed in developing hotels within Africa is also key and this has to do with the need to reduce red tape.
Q: Turning to South Africa, what’s the latest on the country’s visa regulations and the inter-ministerial committee that has been meeting? Do you have any news?
A: We know that the inter-ministerial committee has met and is still considering all the information regarding the unintended consequences of the new immigration regulation. We are confident that our perspective is being considered, and we hope to have an opportunity to formally present our position in-person before the IMC concludes it work.
Q: Are you able to determine what impact these revised regulations have had on South Africa’s business travel industry?
A: The impact in terms of perceptions and tourist arrivals has been significant. We understand government’s prerogative and duty to protect our borders and tackle issues around security and the trafficking of people, especially children. However, I believe that through consultation, we will be able to come up with win-win solution which will not only safeguard our boarders, but also facilitate growth of our tourist arrivals.
Q: In your opinion, how long will it take to rectify these effects and restore tourism numbers?
A: If the regulations are changed to issuing visas on arrival and rescinding the requirement for unabridged birth certificates, the recovery should be fairly swift. A small change might push recover to anywhere between 24 and 36 months. If the regulations remain the same there is a risk of permanently loosing certain clients forever.