South Africa’s tourism sector is heading into Africa’s Travel Indaba on a wave of rising visitor numbers, but the reality is more complicated. While growth is being driven by regional travel, long-haul markets, profitability and structural constraints weigh on the industry.
New figures from South African Tourism show international arrivals climbing steadily. In March, 911,962 visitors arrived, a 12.5% increase compared with the same period last year. This follows a record 10.5-million foreign tourists in 2025. In the first three months of 2026, there were 2.9-million arrivals, with monthly growth consistently above 12%.
Tourism minister Patricia de Lille says the numbers reflect progress in rebuilding the sector.
Tourism remains a major employer. According to Stats SA, it supported 953,981 direct jobs in 2024, 5.7% of the labour force and about one in every 18 workers. The numbers point to a strong recovery, but industry experts say the detail matters more than the headline.
Lee-Anne Bac, partner in strategic development and advisory at BDO South Africa, says tourism’s recovery is incomplete. “Overall, the data shows us that South Africa’s international tourism industry is still in recovery mode,” she says.
Though total arrivals have surpassed pre-pandemic levels, growth has been driven mainly by African markets. Of the 10.5-million visitors in 2025, 8.1-million came from African countries and 2.4-million from elsewhere. That distinction matters because tourists from outside Africa tend to stay longer and spend more.
African travel has performed strongly. Visitor numbers from Ghana, Kenya and the Democratic Republic of Congo, among others, have grown sharply. This segment added an estimated R1.5bn in direct spend to the economy in 2025.
“This is a market that should not be overlooked or undervalued,” Bac says, noting that African travellers are increasingly visiting for leisure, not just business or shopping.
But the picture is less positive when it comes to long-haul markets. Key source countries such as the UK, Germany, France and Italy are still below pre-pandemic levels.
“The Chinese market is of significant concern,” Bac says. “In 2025, South Africa received only 38,000 Chinese visitors, down from a high of 117,000 in 2016.”
India is also lagging well below 2019 levels despite being a large outbound travel market with high spending potential.
The result is a gap between volume and value. While overall arrivals are up, the mix of travellers has shifted in a way that may limit total tourism revenue. The gap between visitor numbers and revenue is already visible in the data.
According to Corne Koch, chief convention bureau officer at the South African National Convention Bureau, “International arrivals in 2025 grew by 17.7%, while total spend increased by 11.6%, driven largely by the rise in arrivals, though tourists spent slightly less on average.”
That means more tourists are coming, but they are not necessarily spending more. For operators, this creates pressure on margins, especially as costs continue to rise.
Bac says accommodation prices have increased, but this does not mean hotels are making more profit. “In reality, this is more of a ‘right-sizing’ of rates,” she says. “Hoteliers have experienced beyond inflationary growth in expenses, and the rates we are seeing today are more a reflection of the need to recover increasing costs than profit going to the bottom line.”
Hotel data supports this. Average room rates have increased across categories, but occupancy levels remain low. Five-star hotels are operating at around 63% occupancy, down from pre-pandemic levels. Four-star hotels are roughly flat, while three-star hotels remain below where they were before Covid. This suggests there is still excess capacity in the system.
“Hotels are still struggling with revenue; despite rates creeping up, occupancy remains stubbornly low,” Bac says.
One of the biggest challenges facing the sector is how people get to South Africa. Bac describes it as a structural issue that has not been resolved. “Air access — being the availability of routes and seats as well as the cost of a seat — remains a significant constraint in getting tourists to South Africa.”
Leisure tourism remains the most dominant market driving tourism growth and consumption in South Africa
— Unathi Henama
South Africa’s location at the southern tip of the continent, combined with the absence of a strong national carrier, makes it difficult to expand routes or lower costs. Global factors are also adding pressure with rising fuel prices and geopolitical tensions pushing up airfares and affecting travel demand.
Bac notes that higher travel costs are likely to deter mid-market travellers — the segment that fills three- and four-star hotels and supports much of the tourism value chain.
At the same time, safety perceptions continue to influence travel decisions. “This has been, and continues to be, a significant deterrent for visitors,” she says.
Domestic tourism played a critical role in keeping the sector alive during the pandemic and remains an important part of the market. According to Koch, domestic travel is still growing.
From January to February this year, overnight trips increased by 35.6% compared with the same period last year. Day trips rose by 12.8%.
Tourism academic Unathi Henama says while domestic tourism is “under pressure, it remains robust”, pointing to economic conditions such as fuel costs, unemployment and limited disposable income.
Despite this, domestic travellers continue to move across the country in large numbers, especially from neighbouring provinces and regions. “Leisure tourism remains the most dominant market driving tourism growth and consumption in South Africa,” says Henama.
At the same time, traveller behaviour is shifting. Bac highlights several trends shaping demand, including multi-generational travel and the rise of digital nomads who combine work and leisure.
There is also growing demand for “slow travel” and authentic experiences. “The need for authenticity and experiential travel” is becoming more important, she says, with travellers wanting to connect with local culture and communities.
Sustainability is another growing focus, though Bac says it needs to be meaningful. “Sustainable travel … needs to be real and not greenwashing,” she says.
These trends are forcing operators to adapt their offerings, from accommodation to activities and services.
After a period of uncertainty, “investors are starting to look out for opportunities in the tourism sector”, Bac says.
However, investment is still uneven. Established destinations such as Cape Town continue to attract interest, but there is limited space for new developments. Other provinces, including Mpumalanga, the Eastern Cape and KwaZulu-Natal, are seen as having untapped potential.
For smaller investors, opportunities lie in creating new experiences rather than building large infrastructure projects. “We need tourists to stay longer at the destination; for that they need more to do,” Bac says.
Against this backdrop, Africa’s Travel Indaba is key for the sector. “The Indaba remains one of the continent’s most important tourism platforms,” says Koch. “It creates opportunities not only for established players, but also for emerging businesses, SMMEs and new voices within the sector.”
The economic impact is significant. Indaba 2025 generated R246.8m in direct expenditure and contributed R610.6m to GDP, while supporting more than 1,100 jobs. The event also achieved high occupancy rates, with hotels reaching up to 97%.
But the nature of its value is changing. Tourvest Destination Management CEO Martin Wiest says the focus has shifted away from immediate deal-making. “While the volume of new sales opportunities has become more limited in recent years, the value we derive is increasingly aligned to our broader strategic priorities. Success is measured less by immediate sales and more by the strength of our relationships.”
Still, there is broad agreement that Africa’s Travel Indaba needs to deliver tangible outcomes.
“Indaba is about deals,” Bac says. “We need to ensure that Indaba 2026 drives not just increased tourism numbers to South Africa but also opens up opportunities for new investment.”
The outlook for South Africa’s tourism sector is not negative. Demand is recovering, arrivals are growing and the industry continues to play a key role in the economy.
Henama describes tourism as a resilient sector with strong long-term potential. “Tourism growth reaffirms that tourism demand remains robust,” he says.
But the recovery is uneven, and risks remain. Global instability, rising travel costs, weak long-haul demand and structural constraints all continue to shape the sector’s trajectory.
The challenge now is to convert rising arrivals into sustainable growth — not just in numbers, but in revenue, jobs and investment.
Africa’s Travel Indaba will take place at the Inkosi Albert Luthuli International Convention Centre (Durban ICC) on May 11-14.
