Hotels, holidays and hope as tourism closes 2025 on a high
One of Cape Town's drawcard beaches.
Image: Unsplash
South Africa’s tourism sector closed 2025 on a strong footing, with rising accommodation income, improving profitability and a surge in overseas arrivals reinforcing confidence across the hospitality industry.
Two sets of data releases out today showed that almost four million people travelled in and around South Africa over December, with by far the majority of these tourists in South Africa on holiday.
Year-on-year, that’s an increase of 15.3%, which follows a neat increase in spending on accommodation the prior month.
Tourism remains a critical economic driver, with the sector’s total contribution to gross domestic product projected to have reached 8.9% in 2025.
Employment has climbed above 1.68 million jobs as the industry continues its recovery following the COVID-19 pandemic.
Statistics South Africa said income from accommodation increased by 13.6% year-on-year in November 2025. This followed a 15.3% increase in October and pointed to sustained momentum as the peak travel season approached.
Measured in nominal terms – which strips out fluctuating prices – total income for the tourist accommodation industry rose by 11.9% compared with November 2024.
Statistics South Africa said this was driven by both higher occupancy and stronger pricing.
Investec economist Lara Hodes said hotels remained the backbone of the recovery, growing by 15.1% year-on-year and contributing 8.9 percentage points to overall accommodation income in November.
Hodes pointed out that the ‘other’ accommodation category, including lodges, bed-and-breakfast establishments and self-catering accommodation also gained.
Statistics South Africa said the increase reflected an 8.1% rise in the number of stay unit nights sold, alongside a 5.1% increase in the average income per stay unit night sold, suggesting demand was translating into improved margins.
That improvement was reflected in industry sentiment. The Bureau for Economic Research (BER) said confidence in the hospitality sector climbed by 23 points in the fourth quarter to 79, the highest level in nearly twenty years.
Specifically, “higher business volumes were driven by improved demand, which in turn led to a significant improvement in profitability,” the Hodes quoted BER as having said.
The G20 summit played a role in lifting tourism flows and sentiment during the period, with the BER noting it “reinforced positive sentiment towards South Africa”.
International travel trends continued to support the domestic recovery. Hodes pointed out that overseas traveller numbers increased 14.4% year-on-year in November, with arrivals from Europe rising by 17.9%.
Traveller numbers from Central and South America increased by 27.6%, while arrivals from the Middle East climbed by 38.9%, Hodes noted.
The momentum carried into December. Stats SA said almost four million travellers passed through South Africa’s ports of entry and exit during the month, including almost a million overnight visitors.
At a broader level, Hodes noted that UN Tourism said Africa recorded an 8.0% year-on-year increase in tourist arrivals to 81 million during 2025, reflecting strong global travel demand.
UN Tourism anticipates “continued growth” in 2026 but warned that “uncertainty derived from geopolitical risks and ongoing conflicts, trade tensions and extreme weather events could weigh on traveller confidence”.
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