Tourism is not entirely dependent on SAA, says tourism ministry
The airline’s woes have made the travel industry nervous, with some travel agents stopping the sale of SAA tickets
SAA’s financial woes are unlikely to result in a significant gap in revenue accruing from the tourism industry, as the sector is not entirely dependent on the national airline.
Other airlines are still operating in the country, the tourism ministry said on Tuesday.
There have been intense discussions the past week between the department of public enterprise, the Treasury and the ailing airline’s board. SAA's future hangs in the balance after a crippling strike, and it is attempting to secure a loan guarantee of at least R2bn for it to be able to continue trading.
The airline's woes has made the travel industry nervous with some travel agents stopping the sale of SAA tickets. Tourism accounts for 9.2% of total employment, and represents 8.6% of all economic activity in SA, according to data from the World Travel & Tourism Council.
SAA is insolvent, with liabilities exceeding assets by about R15bn. It has received R5.5bn in bailouts from the Treasury in 2019, as well as an undertaking to repay R9.2bn in historic debt.
The airline has not made a profit since 2011 and was a key site of state capture for ANC cronies. A close friend of former president Jacob Zuma, Dudu Myeni, who also chaired the Jacob Zuma Foundation, was SAA chair until October 2017.
On Sunday, the department of public enterprises said the national carrier was determined to remain open for business, but would go through a “radical restructuring process” to survive.
One of SA's top travel insurers, Travel Insurance Consultants, confirmed on Friday that it had withdrawn the insolvency cover benefit on all SAA tickets. This also came as Flight Centre Travel Group informed its customers and SAA of its decision to stop selling tickets for the airline.
The department of tourism said its job was to promote the country, which it continued to do diligently.
Tourism minister Mmamoloko Kubayi-Ngubane led delegations to markets such as China and Japan in October, and Ghana and Nigeria last week, as part of work to ensure people visit in their numbers and have a good experience.
Tourism department spokesperson Hlengiwe Nhlabathi said among the issues raised in these engagements was the sustainability of new routes.
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