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usiness characteristics and unrelated reasons for failure), the pre-existing tourist market and
accessibility and the constraints such as sea and launching conditions. We take these factors into
consideration in estimating the potential number of permits required in each area in order to maximise
industry potential.
Boat-based whale watching has grown steadily from 1999 to 2003, with numbers of passengers
remaining stable from 2003 to 2004, possibly due in part to the strengthening of the rand. Based on
possible seagoing days during whale season, it is estimated that the permitted boats are only
operating at about one third of their potential capacity. Some of this is due to certain boats that have
not yet begun operations, and others that are experiencing difficulties. The degree of non-permitted
activity suggests that the demand exists to take advantage of this spare capacity to some extent.
Taking the marketability of the resource base into account (the quality of whale watching), the
limitations imposed by sea conditions, and the existing demand as described by operators and
tourism agents, different parts of the coast were rated from poor to excellent in terms of their whale
watching potential. Based on existing demand, rather than potential demand that could be generated
by additional marketing, it is estimated that the coast could already support at least six additional
permits in some of the better areas. Note that current demand is a function of successful marketing
efforts by existing permit holders as well as regional tourism bodies. Taking untapped existing
markets into account, this could potentially increase to 11 additional permits. Demand could
potentially be increased in a number of other areas by marketing, although permit numbers will
ultimately be restricted by sustainability issues. Indeed, the decision on where to expand boat-based
whale watching activities in future should ultimately be decided on the basis of marketing strategy
(e.g. concentrating activity into high quality whale watching areas) and what the resource can
withstand, rather than where current demand exists. In the poor areas, where few of the possible
permits have been taken up, the activity may not be viable at present.
The increased number of permits should be seen as synonymous with an expansion in the number of
boats (i.e. each permit is for one boat). There is no economic reason for this to mean that the
additional permits should not go to existing permit holders. Indeed, multiple users working in the
same area would be expected to compete, which would create greater pressure on the resource,
whereas a single owner of multiple permits would have more of an incentive to protect the resource.
Moreover, allowing existing permit holders to have additional permitted boats rewards these operators
instead of penalising them by providing new permits to other operators in areas where they have
created demand.
In order to maximise the industry potential and minimise the obstacles to growth, the main
recommendations made with regard to its management by MCM are as follows:
• MCM and SABBWWA should enter into a co-management arrangement whereby SABBWWA
participates in permit allocation, law enforcement and performance assessment of permit holders;
• Communication should be streamlined through a dedicated liaison person from each organisation;
• The number of available permits should be increased in areas with high potential, subject to
environmental impact assessment, and reviewed on a regular basis;
• Allocation of permits should be based on a systematic set of criteria and weightings which include
indications of capability and likely success, black empowerment and quality of service;
• Permits should confer long-term rights, subject to annual payments and performance assessments
which check activity, compliance, monitoring and standards of service; and
• Permit fees should be used towards effective policing, data analysis, communication and research.