Cape Town's tourism sector recorded a direct spend of R24.5 billion in 2025, with foreign visitors contributing R19 billion of that total. This substantial financial inflow shows the critical role international tourism plays in the city's economic landscape. Despite this significant revenue, the city's tourism Gross Value Add (GVA) experienced an 11% year-on-year decline, settling at R23 billion. These figures indicate a complex financial picture for the region's tourism economy during the period, noting both strong spending from international visitors and underlying challenges affecting the sector's overall economic contribution. The R24.5 billion direct spend represents the total financial injection into the local economy directly attributable to tourist activities, covering everything from accommodation and transport to retail and leisure.
International Spending Drives Growth
Cape Town received 1.44 million international overnight visitors in 2025. These visitors spent an average of 9.5 nights in the city, contributing significantly to the local economy. The extended duration of their stays allowed for deeper engagement with the city's offerings and a more substantial financial contribution per visitor. On a daily basis, international tourists spent approximately R1,390 each, demonstrating a high level of expenditure that helps to support a wide array of local businesses and services. This consistent daily spend from a large number of visitors forms the backbone of the city's tourism revenue.
The primary foreign source markets for Cape Town's tourism included the United Kingdom, the United States, Germany, the Netherlands, France, and Australia. These established markets continued to provide a steady stream of visitors, drawn by Cape Town's diverse attractions. In addition to these overseas markets, the city also saw a substantial increase in visitors from the African continent, with arrivals rising by 17% in 2025. This growth from regional markets signals an expanding diversification of Cape Town's visitor base, potentially offering resilience against fluctuations in traditional long-haul markets. The increase in African arrivals indicates a growing interest in intra-continental travel and strengthens regional economic ties.
The influx of both international and regional visitors contributed to a notable performance in the hospitality sector. Hotel occupancy rates in Cape Town reached an average of 61.7% during the year, reflecting a healthy demand for accommodation across the city. This figure saw a significant peak in February, when occupancy rates surpassed 80%, indicating a particularly strong performance during the peak summer season. The strong hotel occupancy figures are a direct indicator of the volume of visitors and their need for lodging, translating into revenue for hotels and associated services. The consistent demand for accommodation shows Cape Town's appeal as a premier tourist destination for a diverse range of international and regional travelers.
Domestic Travel Faces Economic Headwinds
South Africans undertook 1.42 million overnight trips to Cape Town, contributing to the city's overall visitor numbers. Despite the volume of domestic visits, the total spend from local tourism experienced a notable decline, falling from R8.0 billion to R5.5 billion. This reduction in spending reflects a significant shift in domestic travel patterns and economic conditions impacting local tourists, indicating that while many South Africans still visit Cape Town, their financial contribution has lessened. The decrease in domestic spend by R2.5 billion points to a substantial change in the spending habits of local travelers.
The duration of domestic stays also decreased during the period under review. Average domestic overnight stays dropped from 5.2 nights to 4.4 nights, indicating shorter trips by South African visitors to the city. This reduction in stay duration suggests that domestic travelers might be opting for shorter getaways or are constrained by budget, leading to less time spent and, consequently, less money injected into the local economy per visit. Concurrently, the average daily expenditure by domestic tourists also saw a reduction, settling at R882 per day. This figure is notably lower than the R1,390 spent daily by international visitors, further noting the differing economic impact of the two visitor segments. These figures collectively suggest that while the number of overnight trips by South Africans remained substantial, their economic contribution per visit diminished. The trend points to potential economic pressures influencing how and for how long domestic travelers visit Cape Town, possibly due to broader national economic challenges affecting household disposable income.
Airport Traffic and Sector Impact
The tourism sector in Cape Town supported more than 106,000 jobs in 2025, playing a vital role in employment generation across various industries, including hospitality, transport, retail, and entertainment. This significant number shows tourism's broad economic footprint beyond direct spending. However, despite the job creation, tourism-related employment experienced an 8.5% drop, indicating some contraction in the workforce directly attributable to the sector during the year. This decline in employment, coupled with the GVA reduction, suggests a need for strategic interventions to stabilize and grow the sector's job-generating capacity.
Airports Company South Africa reported 11.1 million two-way passengers passed through Cape Town International Airport, marking a 7% year-on-year increase in overall passenger numbers. This growth in airport traffic is a key indicator of the city's increasing accessibility and popularity as a destination. International passenger numbers through the airport also rose by 7%, mirroring the overall increase and confirming the strong inflow of foreign visitors. The consistent growth in passenger numbers, both overall and international, notes the airport's key role as a gateway for tourism and business travel into the region. Tourism's contribution to Cape Town's Gross Value Add stands at 6.3%, reflecting its significant, though slightly diminished, share of the city's total economic output. The 11% year-on-year decline in tourism GVA to R23 billion, as previously noted, indicates that while visitor numbers and direct spend remain high, the overall efficiency and profitability of the sector faced challenges.
Future Strategies and Outlook
Cape Town Tourism and the City of Cape Town are implementing a three-pronged strategy to address evolving visitor trends and sustain sector growth. These initiatives are designed to bolster the city's tourism economy against fluctuating market conditions and to ensure its long-term viability. The first initiative includes a dedicated domestic campaign aimed at encouraging local travel within South Africa. This campaign seeks to stimulate greater spending from South African visitors, potentially offsetting the recent decline in domestic tourism expenditure and encouraging longer stays. By promoting local attractions and experiences, the campaign aims to rekindle interest and increase the economic contribution of domestic travelers.
Concurrently, a regional partnership is being established with Zimbabwe and Namibia, focusing on attracting visitors from these neighbouring countries. This strategic collaboration aims to tap into the growing African market, building on the 17% increase in African arrivals seen in 2025. By fostering stronger ties and promoting Cape Town as a premier destination within the Southern African region, this partnership seeks to further diversify the city's visitor base and strengthen regional tourism corridors. Internationally, the 'One Small World' campaign is underway, designed to enhance Cape Town's global appeal and draw tourists from further afield. This campaign targets traditional and emerging long-haul markets, aiming to maintain and grow the high-spending international visitor segment that contributes significantly to the city's direct spend.
These strategies collectively seek to diversify Cape Town's tourism base and mitigate the impact of shifting economic conditions affecting different visitor segments. The domestic campaign aims to bolster local tourism spending, while regional and international efforts are designed to maintain and increase the inflow of foreign currency. By focusing on multiple market segments, Cape Town aims to create a more resilient and sustainable tourism sector capable of navigating future economic challenges and continuing its vital contribution to the city's economy and employment landscape. The full nature of these strategies demonstrates a proactive approach to ensuring Cape Town remains a top global destination.
