1. TOURISM OPPORTUNITIES IN THE PHILIPPINES: THE NATIONAL TOURISM DEVELOPMENT PLAN Pre-Plenary Budget Hearings Congress of the Philippines September 20, 2013

2. International Visitor Arrivals Visitor arrivals In thousands Growth Rate 11.5% 4.5% 9.9% 3.1% 19.1% 12.0% 7.6% 5.3% 5.9% 23.8% 8.4% 9.5% 3.5 M 3.9 M 4.3 M KEY PERFORMANCE INDICATORS INTERNATIONAL VISITOR ARRIVALS 2012 5.6 M

3. INTERNATIONAL VISITOR ARRIVALS 2013 INTERNATIONAL TOURIST ARRIVALS JANUARY - JULY RANKCOUNTRYJAN - JULY 2013GROWTH RATE 1 KOREA 706,99822.30% 2USA417,9042.72% 3CHINA246,96748.58% 4JAPAN245,8176.21% 5AUSTRALIA118,18611.42% 6SINGAPORE100,33418.10% 7TAIWAN95,545-30.09% 8CANADA77,6563.78% 9HONGKONG76,55512.84% 10UNITED KINGDOM71,0886.75% 11MALAYSIA62,8934.84% 12GERMANY41,9905.14% 13OTHERS536,9487.17% GRAND TOTAL INCLUDING OTHERS 2,798,88111.05% Source: A/D Cards and Shipping Manifests

4. INTERNATIONAL VISITOR ARRIVALS AVERAGE LENGTH OF STAY (IN NIGHTS)

5. INTERNATIONAL VISITOR ARRIVALS VISITOR EXPENDITURE (IN US$)

6. INTERNATIONAL VISITOR ARRIVALS VISITOR RECEIPTS (IN US$ MILLION) CAGR = 29.6% CAGR = 5.2%

7. INTERNATIONAL VISITOR ARRIVALS DOMESTIC TRAVELLERS, 2012 TOTAL 974,39719.6% 702,79814.1% 613,27912.3% 396,2898.0% 359,3207.2% 338,9926.8% 290,8455.9% 281,2435.7% 200,2954.0% 184,3623.7% 171,8233.5% 152,3773.1% 151,4543.0% 150,0673.0% CAGR = 6.1% CAGR = 10.6% 40.7 M* 44.1 M * Estimate

8. 2. Improve market access, connectivity and destination infrastructure 3. Improve institutional governance and human resources NTDP 2011 – 2016 STRATEGIC DIRECTIONS 1.Develop and market competitive tourist products and destinations

9. Nature Tourism Cultural Tourism Sun and Beach Tourism Cruise and Nautical Tourism Leisure and Entertainment Tourism MICE & Events Tourism Health,Wellness, and Retirement Tourism Diving & Marine Sports Tourism Portfolio Education Tourism PRODUCT - MARKET DEVELOPMENT

10. PRODUCT – MARKET STRATEGIES PRESENTNEW Market Penetration Aggressive promotion strategies targeted to Japan, South Korea, USA, China to increase the number of overnight visitors. Product Development Quality improvement strategies that seek to increase daily tourist expenditure through higher quality tourist products and services. Market Development Aggressive promotion strategies targeted to Australia, Singapore, Malaysia, Canada market to increase the number of overnight visitors. Diversification Product development and diversification strategies to increase the average tourist length of stay. Main Strategy Niche StrategySecondary Strategy MARKETS PRESENT NEW

11. 1. Develop and market competitive tourist products and destinations 2. Improve market access, connectivity and destination infrastructure 3. Improve institutional governance and human resources NTDP 2011- 2016 STRATEGIC DIRECTIONS

12. INTERNATIONAL VISITOR ARRIVALS TOURISM ROAD INFRASTRUCTURE PROGRAM (DOT - DPWH CONVERGENCE PROGRAM) In Billion Pesos Developed the Tourism Road Infrastructure Project (TRIP) Prioritization Criteria Endorsed for approval by the Tourism Coordinating Council 167 road projects with total of 598 kms worth P 12 Bil for FY 2013 Budget Organized capacity building for CTWG and RTWGs

13. Projected Arrivals in International Gateways - 2016 AirportsInbound Foreign Passengers Manila3,631,695 Mactan – Cebu2,483,991 Clark1,723,222 Kalibo – Iloilo821,806 Davao401,381 Laguindingan364,873 Puerto Princesa198,327 Laoag134,739 Others239,966 Total10,000,000  Airport Development and Promotion  Immigration Officers/ Equipment Total Foreign Passengers Movement Percent Share 7,263,39036.3% 4,967,98224.8% 3,466,44417.2% 1,643,6128.2% 802,7624.0% 729,7463.7% 396,6542.0% 269,4781.4% 479,9322.4% 20,000,000100% CHALLENGES: AIRPORT AND SERVICES

14. INTERNATIONAL VISITOR ARRIVALS PASSENGER TRAFFIC IN MANILA AND SECONDARY GATEWAYS (2008 – 2012) Passenger traffic in secondary gateways experienced a growth of 8.18%, 26.15%, 26.67% and 53.89% respectively during the past 5 years Passenger traffic in Manila grew only by 1.37%, 9.97%, 6.28% and 6.56% respectively during the past 5 years Source: Civil Aeronautics Board CAAP

15. MARKETSSEAT ENTITLEMENTS PHFOREIGN Korea1,482,000 Japan1,856,400 China702,000 Taiwan522,600 Australia312,000208,000 Singapore2,280,044 Hong Kong1,367,600 Canada109,200 Malaysia354,640 United Kingdom218,400 Germany109,200 India109,200 Indonesia156,000 Thailand355,680 Vietnam312,000 TOTAL10,246,96410,042,964 ENTITLEMENT UTILIZATION PH%FOREIGN% 1,177,80079.47%1,339,62490.39% 533,62428.75%247,52013.33% 617,76088.00%182,93626.06% 239,35845.80%178,20434.10% 250,06880.15%95,36845.85% 882,54438.71%721,13631.63% 958,88070.11%897,46865.62% 109,200100.00%00.00% 355,680100.29%346,84097.80% 00.00%0 0 0 99,11290.76%00.00% 147,36894.47%00.00% 313,97688.27%158,60044.59% 122,30439.20%00.00% 5,807,67456.68%4,167,69641.50% AIR SEAT ENTITLEMENTS AND UTILIZATION 2012

16. ESTIMATED AIRCRAFT DELIVERY OF PHILIPPINE AIR CARRIERS January 2013 – March 2014 AIRCRAFT DELIVERIES AIRBUS 32014 AIRBUS 3217 AIRBUS 33010 BOEING 7772

17. Luzon 1.South Harbor, Manila 2.Poro Point, San Fernando City 3. Batangas Port, Batangas City 4. Subic Bay Freeport, Zambales Visayas 5.Cagban Jetty Port, Boracay 6.Cebu Port, Cebu City 7.Iloilo Port, Iloilo City 8.Catagbacan Port, Bohol Palawan 9.Coron Port 10.El Nido Port 11.Puerto Princesa Port PPA Recommended Ports of Call Mindanao 12. Davao Port 13.Cagayan de Oro Port 14.Siargao Port, Surigao del Norte Cagban Jetty Port

18. INTERNATIONAL VISITOR ARRIVALS ROOM PROJECTION IN 2016 Destination Clusters Island Grouping Northern PH Central PH Southern PH Total PH Critical Cluster Destinations Room Demand Available Room In the Pipeline Room Gap Metro Manila & CALABARZON 54,81837,3117,33010,177 Central Visayas41,40227,4472,12411,831 Bicol15,8048,5491307,125 Cordillera9,8516,8551062,890 Manila will still need the most rooms between now and 2016 Key demand cities outside of Manila are: Cebu, Panglao, Bicol, Cordillera Current accommodation development in the pipeline covers only 40% of room requirement Room Supply (Available + Pipeline) Available in 2012 In the Pipeline 71,8048,206 61,9785,129 28,9221,686 162,70415,021 Room Gap In Critical Destination Clusters 16,025 20,757 570 37,352

19. 1. Develop and market competitive tourist products and destinations 2. Improve market access, connectivity and destination infrastructure 3. Improve institutional governance and human resources STRATEGIC DIRECTIONS

20. PROGRAMS PROGRAMS Improve the Philippines ranking in the WEF Travel and Tourism Competitive Index Reduce business cost and improve compliance Implement Hotel and Resort Quality Assurance and Accreditation System (HRQAAS) Train 5,000 tourism workers Certify 500 tourism professionals under the ASEAN MRA

21. TRAVEL AND TOURISM COMPETITIVENESS Source: World Economic Forum 1. Switzerland 2. Germany 3. Austria 138. Burundi 139. Chad 140. Haiti 1. Singapore 2. Australia 24. Pakistan 25. Bangladesh PHILIPPINES StrengthsWeaknesses Natural Resources Protection of Foreign Investments Price Competitiveness Starting Up a Business Visa Regulation Safety and Security Air Services Agreement Health and Hygiene Transport and ICT Infrastructure 2013 Headline PH as most improved country in Asia and the Pacific

22. INTERNATIONAL VISITOR ARRIVALS TARGETS, 2012 - 2014 INDICATORS201220132014 International Tourism Visitor Arrivals (mil)4.35.56.8 Length of Stay (nights)8.09.0 Average Daily Expenditure (Pesos)4,431.04,914.05,431.0 Visitor Receipts (Pesos bil)156.0205.4269.9 Domestic Tourism Domestic Travellers (mil)40.744.147.7 Domestic Trips (mil)162.7176.2191.0 Length of Stay (nights)4.7 Average Daily Expenditure (Pesos)2,469.02,580.02,593.0 Domestic Receipts (Pesos bil)1,152.01,298.61,409.2

23. INTERNATIONAL VISITOR ARRIVALS ECONOMIC IMPACT PROJECTION 2012 - 2016 INDICATORS20122013201420152016 Gross Domestic Product Total Visitor Receipts (Pesos bil) 1,308.01,504.01,679.11,957.52,307.1 Tourism GVA (Pesos bil)650.8748.3835.4974.01,147.9 Share to GDP (%)6.26.77.07.88.7 Employment Tourism employment (mil)4.24.95.46.37.4 Share to National Employment (%) 11.613.014.216.218.8

24. Thank You!