The Department of Tourism has made an additional R200 million available to assist SMMEs in the tourism and hospitality sector who are under particular stress due to the new travel restrictions around the COVID-19 cases in South Africa.
This forms part of a raft of financial assistance measures announced earlier tonight by President Cyril Ramaphosa after highlighting that South Africa would be on a 21-day lockdown, starting at midnight on March 26 and ending at the same time on April 16.
He acknowledged the “devastating effect” this would have on business, particularly small, medium and micro businesses, pointing out that government had introduced a set of intervention measures to mitigate the economic impact.
“This is the first phase of the economic response, and further measures are under consideration and will be deployed as needed,” said Ramaphosa.
The President explained that, to get things moving, government would provide seed capital of R150 million to safeguard SMMEs. “The private sector has already pledged to support this fund with financial contributions in the coming period and in this regard, we must applaud the commitment made in this time of crisis by the Rupert and Oppenheimer families of R1 billion each to assist small businesses and their employees affected by the coronavirus pandemic.”
Ramaphosa highlighted that government was in consultation on a proposal for a special dispensation for companies that are in distress because of COVID-19.
“Through this proposal, employees will receive wage payment through the Temporary Employee Relief Scheme, which will enable companies to pay employees directly during this period and avoid retrenchment,” he said.
Furthermore, Ramaphosa highlighted that, in the event that it became necessary, government would utilise the reserves within the UIF system to extend support to those workers in SMMEs and other vulnerable firms that are faced with loss of income and whose companies are unable to provide support.
“Details of these will be made available within the next few days,” he said.
Meanwhile, an industry authority commented off the record that the South African government recently quoted the World Tourism Organization as saying that the value of tourism’s contribution to the SA economy was R145 billion (€7.62bn) in 2018. “So R200m (€10.51bn) is a political gesture of no consequence,” he added.
Tourism Update will attend tomorrow’s inter-ministerial press briefing and we will bring you more updates as details unfold.
Travel restrictions clarified
Ramaphosa also took the opportunity to clarify certain travel restrictions:
- South African citizens and residents arriving from high-risk countries will automatically be placed under quarantine for 14 days.
- Non-South Africans arriving on flights from high-risk countries which was prohibited a week ago, will be turned back.
- International flights to Lanseria Airport will be suspended.
- International travellers who arrived in South Africa after March 9 from high-risk countries will be confined to their hotels until they have completed a 14-day period of quarantine.