South Africa Hotels Investigated for World Cup Price Fixing

Pete Andarton

The tourism ministry in South Africa has launched an investigation into allegations that hotels are pricing rooms unreasonably high for the World Cup. This comes only a month after a similar probe was launched by the government to find out if airlines have been price fixing fares.

South Africans have been urged by business leaders not to take advantage of visitors arriving for the World Cup, because this would only keep them from coming back. Jabu Mabuza, chief executive of a national hotel and casino chain, says that the country has sophisticated attractions, hotels and restaurants that rival others worldwide. The strategy hasn’t been to market the country as cheap, he continued, but as somewhere travelers will get value for their money. He added that it’s disturbing to hear people reporting tripled prices.

The price fixing allegations are worrying hotel operators, as well as South Africa’s tourism business, who denied the claims on Tuesday during a news conference. Tourism Business Council of South Africa members welcome the investigation, which was announced by Tourism Minister Marthinus Van Schalkwyk. The industry group said that they are sure an inquiry will prove that most hotels aren’t price fixing.

Nobody disputes the fact that prices will increase during the World Cup, but what’s considered reasonable? In a statement, Schalkwyk said that they have noted allegations that hotel establishments in the industry aren’t responsible and are excessively inflating prices. Their impression until now, he continued, has been that this isn’t the case, but they think there should be an investigation with the results made public.

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