NEW Western Cape Finance, Economic Development and Tourism MEC, Alan Winde, has promised the region’s hospitality industry that he will personally speak to the banks to help find a relief for the current credit crunch.
 
The economic slowdown, exacerbated by the traditional slow winter season in the Cape, has seen a string of restaurant closures in Cape Town, while hoteliers – particularly five-star establishments – have reported difficult trading conditions over the past six months as consumers downgrade or stop travelling.
 
Philip Couvaras, Fedhasa Cape chairman and gm of the five-star Table Bay Hotel, told a recent Fedhasa Cape AGM: “It’s been an incredibly difficult and challenging year. We’ve had a terrible past six months.” However, he added, the situation was also breeding success in that five-star hotels in the Cape were now working together to attract visitors, whereas in good times the competition was fierce.
 
Winde said banks were turning down 70% of all credit applications, which was strangling SMMEs. “We need a relief, especially when the upturn is on the way and we are seeing that it is on the horizon.” He said the Cape could not afford to lose businesses with the 2010 World Cup around the corner.
 
However, he said, the provincial government was not able to pump huge sums of money into the industry because it too was receiving less funding from national government because of the recession.
 
He appealed to businesses to communicate with their staff and suppliers when in trouble. “If people know and understand that you are in financial difficulty but have responsible plans for the future, they will do their utmost to accommodate you.”  
 
Winde said he remained optimistic despite the economic crisis, because of the expected tourism boost linked to 2010.