Friday, 24 April 2020

South Africa’s President Cyril Ramaphosa said on Thursday the government will allow a partial reopening of the economy on May 1, with travel restrictions eased and some industries allowed to operate under a five-level risk system.

Ramaphosa said the National Coronavirus Command Council decided restrictions will be lowered from level 5 - the strictest lockdown stage - to level 4 from next Friday. International borders will remain closed while travel will be only allowed for essential services.

“We cannot take action today that we will deeply regret tomorrow, we must avoid a rushed reopening that could risk a spread which would need to be followed by another hard lockdown,” Ramaphosa said in a televised address.

South Africa has spent nearly month under restrictions requiring most of the population to stay at home apart from essential trips, leaving many struggling without wages and short of supplies.

The country has recorded 3,953 confirmed cases including 75 deaths with 143,570 people tested for the virus. Thursday saw the highest one-day leap in infections with 318 new cases, though the health ministry said this was largely due to intensified screening.

“We have to balance the need to resume economic activity with the imperative to contain the virus and save lives,” Ramaphosa said.

He did not give details, as expected, on the 500-billion rand ($26 billion) rescue package he announced on Tuesday. But in the speech he said it was a priority to get the economy restarted and that testing would continue to be ramped up while social distancing rules remained in place.

Under the “risk-adjusted” system, authorities will identify which sectors can operate under various risk scenarios.

“We will implement what we call a risk-adjusted strategy, through which we take a deliberate and cautious approach to the easing of current lockdown restrictions,” said Ramaphosa.

 

Reuters

Published in Economy

Tourism has become an important economic sector for most African countries in the last two decades. There has been increased investments in product development and enhancement, aggressive marketing, coupled with appropriate business-friendly socio-political reforms.

The World Bank reports that one in 20 jobs in sub-Saharan Africa is in the travel and tourism sector. The United World Tourism Organisation estimated that about 67 million international tourists visited Africa in 2018, generating about US$38 billion for the continent.

The organisation also estimated an increase of 4.2% in international arrivals for the continent in 2019. And before the outbreak of the COVID-19 pandemic a further increase of between 3% to 5% had been predicted for 2020. Factors driving the growth included favourable economic growth, strong demand for air travel, improvement in digital technologies, and easier visa processes.

Like other sectors, tourism, especially international tourism, is vulnerable to external shocks and crisis. Time and again, events have set back the sector. These have included recessions, safety and security threats including terrorist attacks, natural disasters, and epidemics and pandemics. There’s also the problem of negative international media reporting.

The ongoing COVID-19 pandemic is one such threat – albeit at an entirely new level. African countries should draw from past experience to put together plans to manage the post-COVID-19 void.

COVID-19’s impact on tourism

Tourism has been one of the hardest hit sectors since the disease was first detected in Wuhan, China in Dec 2019. The World Travel and Tourism Council has warned that the COVID-19 pandemic could cost up to 50 million jobs worldwide in the travel and tourism industry.

Even when the outbreak is over, it could take up to 10 months for the tourism sector to recover. For emerging destinations like those in Africa, it could take well over a year.

Additionally, the travel body estimates that the 2020 global international tourist arrivals in Africa could decline to between 1% to 3%. This could translate into a loss of $30 to $50 billion in spending by international visitors. The Asia and the Pacific region is expected to be the most affected. But Africa is equally expected to suffer, perhaps even more so.

All over the continent attractions have closed. Hotels are operating at single digit occupancy rates and in some cases have closed down. Countries have closed their airspaces, and food and beverage businesses are mostly closed as a result of social distancing guidelines.

This has resulted in massive lay-offs and workers being furloughed. Governments have also seen a loss of revenue and foreign exchange.

China, the US and Europe are the largest generating markets for Africa’s tourism. They are also among the hardest hit by the pandemic. These countries have in place partial and complete lockdowns as well as other travel restrictions. The impact on the tourism sector in Africa is expected to be far reaching and long lasting given that it will take time for them to recover and put their economies back on track.

Resilience and recovery

The tourism sector is resilient and has often overcome crises.

Strategies to cope with crises include preparedness, rapid development and deployment of a response network. It also includes managing mainstream and social media, and introducing measures to promote swift recovery.

These measures provide assurance for early detection and management of the disease, including provision of protective equipment. They should be put in place and properly communicated through well-coordinated and targeted marketing advertisements and campaigns.

This kind of persuasive advertisement was credited with helping to revamp travel to the US some four weeks after the tragic 9/11 events. This is because strategies focus on immediate recovery to get people to resume visiting even if only in small numbers.

This kind of post-crisis marketing should also consider clearing misconceptions about the scale of the pandemic in Africa. This should include the number of infected persons and how these numbers compare to other destinations outside the continent. This will help restore confidence and even project African countries as potential alternative holiday destinations.

In disseminating such messages, both the traditional and non-traditional media could be used including social media, YouTube and other digital platforms. This should be done to complement the usual channels employed in the promotion and marketing of African destinations.

Further, African destinations should provide financial inducements to tourism and related businesses to stay afloat. These should for example include tax incentives and waivers, insurance, bailouts and special businesses support schemes.

Relatedly, education and sensitisation campaigns should be undertaken among residents in tourist districts. These should encourage them to be welcoming to tourists and not to stigmatise tourists from regions severely affected by the pandemic.

Importantly , African countries should focus on increasing their promotion of domestic and intra-African tourism and travel. This will serve as a catalyst for triggering recovery and stimulating growth in the industry.

This has not always been the case, with most destination management and marketing organisations in Africa preferring marketing campaigns targeted at international visitors out of Africa whilst neglecting the purchasing power and potential contributions of the growing African middle-higher income classes to the industry.The Conversation

 

Issahaku Adam, Senior Lecturer, Hospitality and Tourism Management, University of Cape Coast and Albert N. Kimbu, Senior Lecturer in Hospitality & Tourism, University of Surrey

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Published in Opinion & Analysis

American streaming platform, Netflix has gained about 15.77 million new users in the first three months of 2020 as millions of people opting for internet entertainment while stuck at home due to the coronavirus pandemic.

The recorded growth doubled the initial growth prediction of the company, as it had earlier forecasted 7 million net new subscribers growth for Q1 before the virus outbreak.

With the addition of the new subscribers, Netflix now has a total of 182.86 million paid subscribers.

Netflix also reported total revenue of $5.77 billion in Q1, revealing that the dollar rising sharply reduced its international revenue. It also added that the shutting down of production due to the pandemic delayed cash spending, which consequently increased cash flow.

In a letter to investors, Netflix wrote: “First, our membership growth has temporarily accelerated due to home confinement. Second, our international revenue will be less than previously forecast due to the dollar rising sharply. Third, due to the production shutdown, some cash spending on content will be delayed, improving our free cash flow, and some title releases will be delayed, typically by a quarter.”

The company also disclosed that it’s earning per share stood at $1.57.

Meanwhile, Netflix is viewing the huge spike of new users in Q1 as short term. The company is forecasting an addition of just 7.5 million net users globally in Q2, as it is expecting growth to decline as governments lift lockdowns.

However, in Nigeria for instance where the spread of the virus has not reached its peak and is increasing exponentially daily, the growth of new users on the platform may continue to increase as the growing number shows that the lockdown may not be lifted soon.

Talking about the post-COVID effect of Netflix growth, CEO Reed Hastings expressed that it was hard to say but emphasized that internet entertainment be more and more important in the next five years

“We don’t use the words ‘guess’ and ‘guesswork’ lightly,” he said. “We use them because it’s a bunch of us feeling the wind, and it’s hard to say. But again, will internet entertainment be more and more important in the next five years? Nothing’s changed in that,” Reed Hastings stated.

The company has also revealed that the global halt to movie and TV production might affect content plans on the platform. However, it has said the impact on Q2 will be “modest”.

“No one knows how long it will be until we can safely restart physical production in various countries, and, once we can, what international travel will be possible, and how negotiations for various resources (e.g., talent, stages, and post-production) will play out,” the investor letter said.

According to Chief Content Officer, Ted Sarandos, the company now runs production and post-production remotely.

“Our productions, our post-productions, our offices are now distributed into people’s living rooms and bedrooms and kitchens around the world,” Mr Sarandos said.

“It’s just an incredible testimony to the innovation that literally within a few hours, but certainly within a few days of the shutdowns, we had production up and running remotely, post-production up and running remotely, animation up and running remotely, pitch meetings happening virtually, writers rooms assembling virtually.”

Netflix’ earning report for Q1 shows that the company has benefited hugely from the current pandemic. The huge increase in usage and revenue shows that more people are opting for Netflix as a go-to platform for entertainment while stuck at home.

Although Netflix is predicting a drop in growth with government lifting lockdown, the popularity and familiarity the crisis has created for the platform may see the growth rate increase even after COVID-19.

 

Credit: PM News

Published in Business

A company whose fuel was blocked from entering the country has denied reports that its products are of low quality.

A ship with 75 million litres of super petrol, imported by Asharami Synergy Ltd, was turned away from the Mombasa port on April 1 when its fuel was rejected by Kenya Pipeline Company (KPC).

A source at KPC said that after tests, the quality of the fuel did not match the paperwork presented by the firm.

While the records indicated that the cargo was within the required parameters and met the Kenya Bureau of Standards (Kebs) final boiling point of 200 degrees Celsius, KPC tests showed 204 degrees Celsius.

Another test, by Kebs, reportedly returned similar findings.

In a statement, Asharami insists that its cargo met the required standards and demands a retest by an independent ISO-certified agency.

REQUIRED CERTIFICATION

“Such a test will provide an outcome that will be acceptable to all,” Asharami says.

“Asharami Synergy affirms that the product was sourced from the Saudi Arabian Oil Company (Aramco), one of the world’s foremost trading firms with an acclaimed reputation for quality and global standards, thus lending credence to Asharami’s unwavering commitment to impeccable standards in all aspects of its operations. We note that the product is on-specification for all parameters, right from the loading port where the test by Bureau Veritas recorded a final boiling point of 199 degrees Celsius.”

The tests upon which the decision on the specification of the cargo were made, Asharami said, were carried out by agencies “without any certificate of international calibration”.

“In addition, the facilities did not have the required certification to perform the stated test for gasoline, requiring calibration deductions to be applied to the final result,” it says.

“As a result, a correlation was made between automotive gas oil and mogas, which does not meet global standards as every product exhibits different properties.”

 

Credit: Daily Nation

Published in Business
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