Tourism in Mauritius Prospects & Challenges A Presentation to the Monetary Policy Committee Bank of Mauritius Sen Ramsamy Managing Director Tourism Business Intelligence 14 July 2014

“The positive results in world tourism show “The positive results in world tourism show that it is time to position the sector higher up the world trade agenda so as to maximize its capacity to promote trade and regional integration” Taleb Rifai Secretary General United Nations World Tourism Organization April 2014

World Tourism International Tourism 29% of world export services 6% of overall exports of goods and services Rank 5th after fuel, chemicals, food and automobile industry 2013 Tourist Arrivals worldwide - 1,087 bn (5%) Tourism Receipts worldwide - US$ 1,159 bn (5%) Growth in arrivals match growth in earnings

World Tourism by Region 2013 Arrivals Receipts (‘000) (US$ million) Worldwide 1,087 (5.0%) 1,159 (5.3%) Europe 563 (5.4%) 489 (3.8%) Asia & Pacific 248 (6.2%) 359 (8.2%) Americas 168 (3.2%) 229 (6.4%) Africa 56 (5.4%) 34 (0.0%) Middle East 52 (-0.2%) 47 (-1.9%)

World Top Ten Tourist Spenders 2013 Country US$ (billion) China 129 USA 87 Germany 85 Russia 54 United Kingdom 53 France 42 Canada 35 Australia 28 Italy 27 Brazil 25

Tourism in Africa (million) (US$ billion) 2013 Arrivals Receipts North Africa 20.0 10.24 Southern Africa 36.0 23.98 South Africa 9.5 9.24 Botswana 2.3 Mozambique 2.0 Zimbabwe 1.8 0.85 Kenya 1.6 Uganda 1.2 1.18 Swaziland 1.1 Namibia 1.0 Senegal 1.0 Tanzania 1.0 1.88 Mauritius 1.0 (993,106) 1.32

Tourism in the Indian Ocean Region Average Expenditure/Tourist 2013 Destinations Number of Hotels Room Capacity Tourist Arrivals 2008 Tourist Arrivals 2013 % 2013/12 Receipts 2013 US$ (millions) Average Expenditure/Tourist 2013 US$ Comoros N/A 350 (18,000) (25,000) (13.6) Madagascar (2,159) (21,525) 375,010 196,375 -22.0 105 534 Maldives 265 13,050 683,012 1,125,202 17.4 2,200 1,955 Mauritius 114 13,200 930,456 993,106 2.9 1,321 1,330 Reunion  N/A 416,000 -6.8 404 971 Seychelles 247 3,500 158,952 230 000 5.7 430 1,870 Sri Lanka 620 16,223 438,475 1,275,000 26.7 1,715 1,345 Tourist Arrivals January- June 2014 Destination No. of Visitors % Change Maldives 600,000+ 12.0 Mauritius 490,697 4.0 Seychelles 110,870 -0.02 Sri Lanka 727,353 24.6

Comparative Analysis Growth Rate in Tourist Arrivals – Jan to June 2014 Mauritius Sri Lanka Europe 0.8 17.0 France -4.3 30.9 Italy -6.5 25.5 UK 10.5 7.7 Germany 2.9 23.0 Spain -0.3 55.4 Russia -14.7 74.8 India 4.2 23.6 China 86.9 137.0 South Africa -2.3 30.7 United Arab Emirates -4.0 22.3

Tourist Arrivals in Mauritius Sea Air Total 1952 1,550 1965 746 9,312 10,058 1968 647 14,906 15,553 1970 365 27,285 27,650 1975 554 74,043 74,597 1980 470 114,610 115,080 1985 920 147,940 148,860 1990 1,200 290,350 291,550 1995 6,105 416,358 422,463 2000 10,677 645,776 656,453 2005 13,321 747,742 761,063 2010 23,648 911,179 934,827 2013 23,165 969,941 993,106

Hotels & Room Capacity Building Year Hotels Rooms 1971 22 811 1975 34 1,499 1980 43 2,201 1985 55 2,630 1990 75 4,603 1995 95 5,977 2000 95 8,657 2005 99 10,497 2010 112 12,075 2011 109 11,925 2012 117 12,527 2013 107 12,376 2014 114 12,653

Tourism For Wealth & Job Creations Year Employment Earnings Average Spend (Rs mn) (Rs) 1980 - 360 3,128 1985 4,650 845 5,676 1990 9,670 3,630 12,005 1995 13,855 7,472 17,687 2000 17,433 14,234 21,683 2005 25,377 25,704 33,774 2010 27,161 39,457 42,208 2011 28,181 42,717 44,283 28,433 44,378 45,967 28,356 40,557 40,839 N/A 44,500 43,204

Brand Positioning 80s-90s - Mauritius, The Most Cosmopolitan Island in the Sun 2009 - Mauritius, C’est un plaisir - Mauritius, Simply Divine - Mauritius, C’est un plaisir 2014 - ???

Tourism Development in Mauritius Institutional Level Plus Points Market Diversification - China Direct Air Links from China Modern Airport Terminal New (and scenic) Road Infrastructure Negative Points No restructure of the MTPA No professional body for air access policy/planning/management No professional hotel classification system No synergy (public and private) to shape a better future for tourism No clear vision

Factors constraining Growth & Profitability Constant room capacity expansion Poor market visibility Poor destination planning (mushrooming of eyesores in tourist zones) Lack of air seats A primarily euro-centric and ageing tourism product - 3 S’s Mismatch between product offering and new customer expectations Declining service standards Change in visitor profile, behavior and spending pattern Increased competition and price war Stifling all-inclusive packages in hotels Product Mix - more of the same (hotels, entertainment, shopping etc) Lack of tourist safety & security (a culture of greed and easy money) Low room occupancy rates and low revenue Decline in tourism receipts and average tourist spending Low business profitability Unprecedented level of hotel indebtedness

Tourism Development in Mauritius A 60-year old Business Model

Shaping a New Vision for Tourism Mauritius Tourism – at a cross-road …for too long From Hotel Industry to Tourism Sector Tourism Business Transformation Plan Tourism Market Consolidation and Diversification Adding Value to the Blue Economy A New Business Model for Mauritius Tourism Tourism Vision 2030

Future Tourism Development Potentials Mauritius/Rodrigues/Outer Islands

Reconnecting with Growth & Profitability Steering with a sense of direction Professionalization of tourism institutions Synergy – Public/Private Sectors Local Authorities - Tourism Development Agenda More creative and diversified product mix Innovative actions in destination marketing Use of local talents and expertise Putting the right people in the right place

Investing in the Future Mauritius Geo-Strategic Position in the Indian Ocean basin Gateway to Vanilla Islands Bridging the New Africa & the Emerging Economies

Mauritius – In a Geo-Strategic Position between the Emerging Economies and the Rising Africa

Mauritius Tourism - Tomorrow Beyond Sun, Sand & Sea Stimulating a new tourism business vitality in the region Air access Regional Trade Centre Maritime City Aviation Hub Summits & MICE Lifestyle & Fashion Wellness & Sports Medical Tourism Culture & Heritage Events & Concerts

Mauritius Tourism … Cordially Yours !!! Towards a New Vision …a New Image Leadership Role in the Vanilla Islands concept Ile Maurice - Destination Bien Etre Mauritius, The Art of Island Living Mauritius – Lifestyle Destination Mauritius … Cordially Yours !!!

Synergy – Public & Private Sectors Clear & Long Term Vision Strong Leadership ‘Audacity of Dreams’ ‘Audacity of Actions’

Thank You