The South African Department of Trade and Industry has identified business tourism as one of three niche tourism segments which have the potential for growth (the others being backpacker tourism and community-based tourism). Business tourism refers to travel for business (rather than leisure) purposes and includes travelling to participate in meetings, incentives, conferences and exhibitions (commonly referred to as MICE tourism), events, and independent business trips.

The MICE industry is one of the fastest growing segments within the global tourism industry. The markets for MICE tourism are extremely competitive both internationally and domestically. In line with international MICE market trends, in sub-Saharan Africa the MICE industry has been a driver of growth in regional tourism markets over the last decade. However, Europe and United States still remain the major markets worldwide in respect of the number of meetings, conferences and exhibitions. South Africa captures an estimated 1.3 per cent market share of the global business tourism industry.

Business travel is a lucrative sector of the tourism industry, with business travelers spending on average three times more than leisure tourists. In addition, up to 40% of business travelers return to a destination within 5 years. It is estimated that 6-7% of all foreign tourists visiting South Africa during 2007 were business tourists, amounting to 550 000 business tourists in 2007 (compared with 470 000 in 2006). The total foreign direct spend of business tourists in South Africa amounted to an estimated R2.4-billion in 2006, up from approximately R2.1-billion in 2005.”

The South African business tourism industry has the potential to contribute sustainably to economic growth. The business tourism industry has significantly expanded in the post-apartheid period, with the establishment of major convention centres of international standards but Black Economic Empowerment (BEE) remains slow in this industry.  The successful hosting of the 2002 World Summit on Sustainable Development (in Johannesburg) was deemed a watershed event in the development of South Africa’s participation in the global MICE market.

As South Africa attracts a relatively low number of international events, the tourism market is largely domestic and corporate, and therefore dependent on the well being of the economy. Furthermore the business tourism industry in South Africa is seasonal and predominantly concentrated in Gauteng, the Western Cape and KwaZulu-Natal. There is an evident geographical divide between the international and domestic market demands with Cape Town the prime contender for international meetings and Johannesburg dominating the domestic MICE market (with an estimated 64% of the market share<

With its range of natural and cultural attractions, Cape Town is central to South Africa’s international MICE industry. In the 2007 M&IT Trends & Spends Survey of readers of the influential Meetings and Incentive Travel (M&IT) magazine – circulated to event organizers throughout the UK - Cape Town topped the list of favourite long-haul destination cities, while South Africa was voted the second favourite long-haul destination country.” 

Cape Town currently holds the 36th position in the international ranking list of congress destinations however, in terms of the ranking for future scheduled international congresses for the next decade, the city holds the 8th position. “South Africa's conference industry moved up to 31st place in the International Congress and Convention Association's latest top-40 list of leading destinations in the world, released in May 2007.”  



In 2006 Grant Thornton conducted an international benchmarking study on the business tourism sector, which was commissioned by the National Economic Development and Labour Council (NEDLAC). The findings illustrated that, in comparison with Australia, Ireland and Singapore there does not seem to be much difference in what South Africa is doing. But the one area in which the other benchmark countries do well, is the co-operation between government, private sector and other key stakeholders to promote the industry.

The expansion of conferences and exhibition tourism has contributed positively to local economic development in the South African urban context but there is room to broaden the economic benefits of the business tourism industry.

In terms of implementing pro-poor strategies to do this, Christian Rogerson, Professor of Geography at the University of Witwatersrand (and an expert on tourism and development) says: “I think there are major opportunities in terms of the corporate gift market especially for good, market-savvy arts and craft enterprises. We need linkages between corporates and potential suppliers. Municipalities can help in terms of building data bases and introducing potential buyers to suppliers.” In commenting on potential investment opportunities, Professor Rogerson contends that, “the opportunities are in supplying into the existing business tourism chains rather than say new conference/convention centres.”

There are obviously a range of factors which influence the performance of the business tourism industry but Grant Thornton’s business tourism sector study specifically highlighted infrastructure constraints as a barrier to a competitive business tourism environment in SA. Minister of Environmental Affairs and Tourism, Marthinus van Schalkwyk, recently stated that public and private sector investments in South Africa's infrastructure would enhance the country's position in the global business tourism industry. Hence the existing investment opportunities in tourism businesses and related infrastructure development projects cater for a variety of budgets from relatively small-scale investments to massive public-private sector projects.

Here is a sample of some current and planned industry-related investment projects:

• The Bloemfontein International Convention Centre opened in the Free State capital in November – capable of accommodating up to 5 000 delegates.
  
• There are plans for an international convention centre in Polokwane (Limpopo Province ). Prospective investors will also have the opportunity to co-develop a 300 bed 3-star hotel with 50 5-star rooms.
  
• Airports Company South Africa has injected R5.2-billion into extensions and refurbishments at South Africa's three main airports: OR Tambo, Cape Town and Durban International.
  
• A new R2-billion airport, King Shaka International, is under construction at La Mercy north of Durban.
  
• Polokwane International Airport in Limpopo province will furnish a new R45-million terminal by the end of February.
  
• A state-of-the art R460-million indoor arena has opened at Durban's Inkosi Albert Luthuli Convention Centre – capable of accommodating 10 000 people.
  
• The Cape Town International Convention Centre plans to double its size by expanding across the adjacent freeway.
  
• Port Elizabeth is to get its own convention centre, the Nelson Mandela Bay International Convention Centre. This will feature a 1 000-seater convention and conference venue with a range of add-on facilities.

Sources:
- Rogerson, C.M. (2005). Conference and Exhibition Tourism in the Developing World: The South African Experience. Urban Forum, Vol. 16, No 2-3. 
- Business Tourism Sector Study: Executive Summary. (2006). Grant Thornton and Prodigy Business Services. Fund for Research into Industrial Development Growth and Equity (FRIDGE)
- Business Tourism Sector Study: International Benchmarking and Secondary Research  (2006). Grant Thornton and Prodigy Business Services. Fund for Research into Industrial Development Growth and Equity (FRIDGE)

Additional Links: 
http://www.southafrica.info/news/conferences/calendar-exhibitions.htm
http://www.sa2010.gov.za/news/080228_tourism.php
http://www.traveldailynews.com/pages/show_page/20500
 

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