Category: economic issues

Sponsoring Spurs

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Your questions answered? I doubt it.

Much wailing and gnashing of teeth on social media this week, as it was revealed that SA Tourism – the body charged with promoting and marketing South Africa to the rest of the world as a tourist destination – is/was/are/might be planning to spend close to R1 billion on sponsoring Tottenham Hotspur FC.

“How can you be spending this money when our country is in such a state?”
“Why not spend this money on fixing Eskom?”
“Why must it be a foreign football team? We have plenty of our own who need that money!”

Now, I’m not an expert on marketing – unlike all of the experts on Twitter – but I do understand the basics: namely that you spend some money on telling people about a product or service that you offer, with the intent that enough of those people then buy that product or service to make more money than you spent on telling them about the product or service.

So in this case, a billion Rands outlay with the intention that sponsoring Spurs will bring in more than a billion Rands in tourist revenue.

And I think that rough outline kind of answers the first question above. The plan is to spend some money in order to make more money, and that more money will benefit the country more.

And as the second question points out, the country needs to be fixed. Ignoring the point above, in which we would get more money back (and more), how much would that R1 billion help to fix Eskom and get rid of our loadshedding once and for all? Figures as to how much Eskom needs to work properly again do vary, but this number came up more than once:

This R1 billion amounts to less than 0.1% of that. I’m not saying it’s not a lot of money – it is – but I am saying that giving it to Eskom won’t make any difference whatsoever to loadshedding.
Nothing. Nada. Zippo. Dololo.
You will be urinating it away into the strong southeaster, which is turning our inefficient wind turbines

It wouldn’t even pay off 2% of the R52 billion that Eskom is owed just by South African municipalities.

Oh, and why not sponsor a local football team? Because close to no-one watches South Africa football. Not at the stadiums, not on the TV. You need people to see your marketing message, or it won’t work. And then those people who do watch South African football are South Africans, so they know all about South Africa, but they have no money to spend on coming to South Africa.

I guess my problem with the way this story was broken was twofold.

Firstly, that tourism is South Africa is one of our very few recent success stories. And whatever SA Tourism has been doing to get things going again after the disastrous pandemic seems to have been working, e.g.:

or:

And, before any of this Spurs stuff emerged, we were already being told that we needed to do something more to get people to come here rather than other African destinations:

So it does rather seem that people are having a go at SA Tourism, for… well… just doing their job.

And that seems unfair. What did these same people think of the way that SA Tourism spent their marketing budget last year? Or the year before? Or didn’t they even know that SA Tourism was a thing? Did they really imagine that people found their way on board flights to Cape Town and Joburg thanks to a lucky throw at a map on a dartboard?
This seems a naïve idea for everyone who clearly knows everything about tourism marketing.

A lot of people on Twitter said that the Arsenal “VISIT RWANDA” campaign didn’t work, but Rwanda is making more from tourism than ever before, and the fact that so many commentators were able to go straight to that campaign and draw parallels does suggest that (whether or not they had visited Rwanda), some sort of message had clearly got through.

But there is always a deep distrust of any agency spending public money in South Africa. Which brings me to the second problem: that the Daily Maverick immediately framed this deal as being secretive and dodgy. And yes, that taps nicely into the narrative and it’s certainly got tongues wagging, but again: how did the DM feel about previous expenditure from this department? Why single this out as being an issue? Is it because of the size of the deal? Because football is big business. And Premier League football is the biggest of the lot:

The 20 Premier League clubs collectively spent €830 million ($900 million) in the winter transfer window, which is more than triple the combined spending of the Italian Serie A, Spain’s La Liga, the German Bundesliga and French Ligue 1. That brings the Premier League’s total spending this season to almost €3.1 billion ($3.4 billion), shattering the previous spending record of €2.2 billion ($2.4 billion) set in the 2017/18 season.

And:

The Premier League is the most-watched sports league in the world, broadcast in 212 territories to 643 million homes and a potential TV audience of 4.7 billion.

More than 40% of the UK population watch Premier League football. That’s a lot of prospective tourists seeing the “Come to South Africa” message. And while I don’t expect them all to turn up, it wouldn’t take many for SA Tourism to break even.

And yet, the Daily Maverick could only interview one unnamed tourism expert who said:

And were apparently unable to find anyone who thought it was a good idea.

But then again, perhaps the Daily Maverick’s concerns were valid, given that they now seem to have found a (somewhat tenuous) link between the interim CFO of SA Tourism and an agency that was mentioned in the presentation about the potential deal.

The wording seems deliberately terrible. The language used is carefully crafted to make a story. And yet, the timeline doesn’t really fit, even reading the Daily Maverick’s version of events, and there seems to be quite a degree of overreach – the main link appears to be that the interim CFO did some tax work for the agency in question in the past – he had nothing to do with the Spurs deal except (bizarrely) apparently their using his laptop to present the Powerpoint which was “obtained” by the Daily Maverick earlier in the week, but then people only read the headline, not the story, and so now the whole deal is clearly corrupt.

And maybe it is. After all, everything else here seems to be. And all the social media experts say it must be and that it’s money wasted and, and, and…

Eish.

Living in SA is tiring.

Tourist season down south

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I’m sure I’ve mentioned before (although I can’t easily find out where, as you’ll read below) about the difficulties faced by many small businesses in Cape Agulhas during holiday season. Put simply, because of the region being just too far out of Cape Town to easily attract day or weekend visitors, there are about 50 weeks of relative calm and quiet (which is why I love it down here), followed by 2 weeks of annual chaos.

Compare and contrast with Hermanus which is 75 minutes out of Cape Town (if you ignore the nonsense of Somerset West) and is busy most weekends with tourists from the Mother City. They can run businesses with plenty of staff all year round. They’re experienced in dealing with large numbers of people, and even when December is busier, they’re ready to go.

But Hermanus used to be lovely. Now it’s just like another busy city. So actually, vive le difference.

Reasonably though, you can’t set up a small business in Agulhas to effectively deal with that sort of wild seasonal dichotomy.

And so there are issues with too few tables at restaurants, not enough goods in supermarkets, slow service in both, and general frustrations for everyone concerned: the tourists are hungry and could be on the beach, the businesses could be getting more people in and out through their doors and making more money. And that’s so annoying, because this is their one fortnight chance to make proper moolah to last them through the harder times ahead.

There’s no easy answer.

And then there’s the water and the internet. Struisbaai relies on boreholes to get water for its +/- 4,000 residents. There’s no rain here in summer. Boreholes need electricity though, and there isn’t a lot of that about at the moment. There’s quite literally not enough water to go around at the best of times.

But there are over 20,000 tourists visiting throughout Christmas and New Year. They don’t care about the water restrictions, because their GP-registered Chelsea Randburg tractor is near the sea, and will rust overnight if they don’t hose it down each evening. And so we literally run out of water some days.

But remember that if you are a tourist, the place you’re visiting is completely yours for the duration of your stay. Never mind the other people visiting, and certainly don’t worry about the local residents – they’re just there for you to use and abuse as you wish.

But that’s another story.

Anyway, we’re a bit tight on resources, so it’s a good job they’re not planning on building 650 new housing units down here.

Oh. Wait.

And the internet at our cottage in our little village is via one mobile operator. There’s a single small mast here, and it doesn’t like loadshedding. It also doesn’t like it when the village is full of people. It can’t cope. And so this post, while being typed on my laptop, will then have to be transferred to my phone via Whatsapp, formatted on the WordPress app, moved into one of the larger villages nearby and uploaded from there.

Needs must.

I don’t like it when it’s so busy here, but I get it: without these two weeks each year, there wouldn’t be anything here for the other 50.

But I am looking forward to some February sunshine and a beach to myself (and the beagle) again.

El Niño Is Coming – and the World Isn’t Prepared

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That’s the title of this Wired article, and it makes scary reading.

I have no doubt that climate change is a very real thing, but I have often commented that I am regularly unimpressed by the hyperbole and drama with which the news stories around it are presented.

This one seems a little different.

Current forecasts suggest that La Niña will continue into early 2023, making it – fortuitously for us – one of the longest on record (it began in Spring 2020). Then, the equatorial Pacific will begin to warm again. Whether or not it becomes hot enough for a fully fledged El Niño to develop, 2023 has a very good chance – without the cooling influence of La Niña – of being the hottest year on record.

Sure, there are predictions of hurricanes and crop failure, of food shortages and economic impacts, of power outages and ever increasing temperatures, but there’s no embellishment: just facts and indications of what we might expect.

It still doesn’t sound good.

I was less sure about climate change 15 years ago. I was put off by the constantly incorrect predictions and yes, probably swayed by peer pressure when it came to believing (or not believing) what was going on. But if I hadn’t changed my mind about climate change before 2020 (I had, but…) then Covid sealed the deal for me. Not because I believe that the latter was due to the former, but because I watched experts being experts and sharing their expert knowledge, and it being shot down because of poor reporting or just sheer bloody ignorance.

Now I know how those climatologists felt.

The worst bit about knowing that this is happening is not being able to do anything about it. Because it really doesn’t matter how much good stuff like recycling and switching off our geysers that you or I do, when (e.g.) China is building another 15GW-worth of coal-fired power stations in the first six months of 2023 and (e.g.) India is reopening more than 100 coal mines to make more electricity. While collective effort at a local level probably assisted with some degree of relief during our awful drought in Cape Town, it’s absolutely laughable to try to get consumers to behave more responsibly when it comes to climate change when Jinping and Modi are chucking out more CO2 than ever before.

We don’t even have enough electricity to go around, but we’re being told (and paid) by Europe to shut down our 18 coal-fired plants, which at full capacity (ha!) amount to about 45GW of generation capacity. Meanwhile, China is operating over 1,100 coal-fired stations for 1,110GW. And all the emissions that come with them.

Until that sort of dichotomy is rectified, (and I understand how depressing and pessimistic this sounds) it feels utterly pointless to try and “do our bit” on a personal level.

Wet summer ahead

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I mean, it’s not going to rain all the time, but climatologists are predicting that it will be wetter than an average summer. And that’s no bad thing, given that Cape Town generally gets less than 100mm of rain between November 1st and March 31st each year. So a bit wetter than that shouldn’t be too much of a problem.

Wandile Sihlobo, Senior Lecturer Extraordinary at the Department of Agricultural Economics at Stellenbosch University describes the forecast as “comforting”:

And with our local dams also at a “comforting” 85.6% full, it’s all looking rather rosy.

Water-wise, at least.

Also, if the “comforting” rains could just hold off for the next week or so, I’d be really delighted. Please can someone organise that for us?

Thanks in advance.