Hotelier explains: Maputo benefits from Durban’s loss

According to Southern Sun, Durban’s setbacks are proving advantageous for Maputo. BusinessLive reports that Durban’s ongoing tourist and port challenges are opening new opportunities in Maputo, Mozambique.

This came to light in the hotel operator’s latest annual report, published last week (31 August 2024).

In it, Southern Sun clarified how its Durban locations were suffering from low occupancy and having difficulty trading. And how the city’s worsening reputation and on-going port delays were causing a diversion of business to Maputo, Mozambique.

MAPUTO IS ON THE UP

Over the last year, Southern Sun and StayEasy Maputo achieved a remarkable 37% growth. The report says this is the result of shipping business being redirected from Durban’s port, according to CEO Marcel von Aulock. Meanwhile, over the same period, KwaZulu-Natal’s contribution to the business had reduced to just 16% for the group. “Durban struggled to attract tourism because of negative PR around polluted sea waters and the after-effect of the 2021 riots and floods on public perception of the city,” explained the group.

Durban Container Terminal Pier 2 used to handle 72% of Durban port traffic and 46% of South Africa’s total import and export traffic. However, Transnet’s poor performance of late has led to massive backlogs at SA’s largest port. As a result, Maputo has been able to expand quickly to meet demands.

DURBAN DECAY AND DYSFUNCTION

Southern Sun Chair, John Copelyn, was scathing about Durban’s dysfunction in the group’s annual report. “The Durban municipality recently put out tenders for two of the most iconic hotels on the Durban beachfront, the Maharani and the Elangeni. However, the fact that not a single hotel group saw fit to consider putting in a bid has forced us to recognise that we are largely alone in our efforts to retain the area as a vibrant holiday destination.”

Moreover, large mining and logistics companies are increasingly turning to Maputo, rather than face costly delays at Durban. Earlier in the year, the Mozambican government extended concession with Grindrod, DP World and other operators to help run the port. These will last until 2058 and include a $2-billion expansion.

LOW OCCUPANCY

Nevertheless, despite the challenges, Southern Sun maintains its optimism that new provincial government will help rebuild Durban. The group’s occupancy in the city currently sits at 58.6%, which it says reflects the low economic growth in South Africa. The hotelier hopes for additional activation of incoming flights into KwaZulu-Natal. And streamlining of the visa application procedure for certain growing areas such as China and India.