Could local vs. international tourist pricing damage SA tourism?

I recently read, with great interest, an article from Skift, about what is becoming in some cases an enormous disparity between prices charged for locals and international tourists when visiting many countries’ premier tourist attractions. This is nothing new but according to the Skift article, which is mostly about Japan (currently a hot tourist destination) and their struggle to justify this. As the article says, “Japanese businesses are trying to strike a balance between catering to loyal local customers while staying true to ‘omotenashi’ (Japanese hospitality)”. Where do you draw the line and to what extent can this ultimately damage tourism in the area? Interestingly the article goes on to say, “Michelle Lyons, founder of?Point North, a branding and strategy firm specialising in Japan’s tourism industry, noted that while this model may deter price-conscious tourists, it could lose effectiveness over time as people adapt to higher prices, much like inflation”. Well, the jury is still out on that one but what about other destinations – is this a global phenomenon?

The global picture

Yes, it is very much so, and the same article goes on to cite some of the well-known pricing disparities (which I can back up from personal experience) like, “the entry fee in India’s Taj Mahal is INR 50 for domestic tourists and INR 1100 for most other foreign tourists. In Jordan’s Petra, the entry fee for locals is JD 10 while foreigners pay JD70. The Kinabalu Park in Malaysia charges RM 10 from Malaysians while foreigners pay RM 50. Egypt’s Great Pyramids, St. Petersburg in Russia, and Angkor Wat in Cambodia are all places where foreigners pay more than locals”.

Nothing new

The fact is that the large difference between pricing for locals and international tourists in certain destinations has been happening for a long time. Still, the question is all about striking the balance and ensuring that one is still able to make attractive tourist destinations available to local residents at reasonable prices for all to enjoy. Obviously, there is good reasoning for the different pricing as countries try to limit the number of visitors to certain places. This gets into the territory of preventing “over-tourism” though, which is in itself quite a complex subject and one which I will tackle as a sequel to this article. The main reason though is that in most cases, particularly at state-owned tourism hotspots, the tourism industry needs to maximise revenue and still enable the local population to visit what is rightfully theirs. Of course, this can be a very different picture when it comes to tourism that has been generated from private enterprise.

The South African picture

Whereas Japan and a number of these destinations have a substantial variance, I believe that we in South Africa have created a better balance. We have for many years been charging locals quite a lot less to visit at least state-owned attractions and of course our National Parks. I think particularly since COVID-19, when locals were greatly encouraged to see the wonders of their own country, a lot of the local discounts in many establishments have remained. The game lodges especially, some of which are way above the affordability of the average South Africans have made concessions for locals but obviously, this is usually a seasonal concession. We also get special prices for SADAC citizens who book trips to lodges.

Of course, in the case of most private enterprises, where businesses have had to invest a lot of capital to create the hospitality venue or tourist attraction and they have an opportunity to earn more from foreign travellers, they cannot be expected to lose profits from offering local concessions. There are however some areas where we have been accused of pretty unbalanced profiteering in season and these are usually all types of restaurants and hospitality establishments in Cape Town and other coastal areas. Even in these cases, we do need to remember that many owners of coastal properties simply cannot survive through winter seasons without highly profiteering in peak holiday seasons.

All told, I believe that we are certainly no worse off than many other countries and whereas extortion should never be encouraged, and unfair pricing can harm the local tourism industry, we seem to have managed to attain a pretty good balance.