The manager of Cape Town Tourism, Cheryl Ozinsky, told the BBC that her office was drawing up guidelines which properly-run sex tourism outlets would have to abide by.

"We need to formalise the sex industry like any other service that visitors are offered when they come to a city," she said.

She said the guidelines would focus on fair conditions for employees, hygiene, access to sex education, and regular medical tests.

The fight against Aids was one reason why it was important to regulate the industry, Ms Ozinsky said.

'Not a sex destination'

The news has caused a stir in a country where prostitution is widespread but remains stigmatised.

Sunday World newspaper heralded the news with the headline "City to sell sex tourism".

But Ms Ozinsky insisted that her office was not trying to promote Cape Town as a sex destination.

"All we are doing is trying to manage an existing service," she told the BBC.

"The sex industry is quite alive here in Cape Town as it probably is in every other city in the world.

"Either one sweeps this under the carpet and prefers to ignore it, or we look at fair business practices."

Amsterdam in the Netherlands pioneered the regulation of the sex industry. Prostitutes there are licensed to conduct their trade, subject to regular medical checks.

Legal doubts

Ms Ozinsky admitted she was "not absolutely clear" on the current legal position surrounding prostitution in South Africa, where much of the old body of legislation has been overtaken by a new human rights oriented constitution.

Nevertheless, the decision by Cape Town's tourism chiefs shows that South Africa has come a long way from the days when Calvinist morality governed the thinking of the apartheid government.