1. Africa The effect of the economic crisis

2. Economic Crisis hits Africa Private capital flow is down by 40% in second half 2008 Private capital flow is down by 40% in second half 2008 Remittances are declining (contribute appr. $ 40 bn to African economies) Remittances are declining (contribute appr. $ 40 bn to African economies) Reduction of Official Development Assistance (development aid) – already $ 20 bn short of Gleneagles 2005 (Life threatening: HIV/AIDS) Reduction of Official Development Assistance (development aid) – already $ 20 bn short of Gleneagles 2005 (Life threatening: HIV/AIDS) Export revenues down e.g. oil and tourism Export revenues down e.g. oil and tourism

3. Economic Crisis hits Developing Countries - World bank statistics GDP growth of developing countries will further slow down GDP growth of developing countries will further slow down 2007: 8.1%; 2008: 5.9% 2007: 8.1%; 2008: 5.9% 2009 growth prediction in March still 2%; April: 1.2% 2009 growth prediction in March still 2%; April: 1.2% When China and India are excluded effectively a negative growth of 1.6% When China and India are excluded effectively a negative growth of 1.6%

4. Economic Crisis hits Developing Countries - World bank statistics Good news for coming years! Good news for coming years! 2% expected global GDP growth in 2010 2% expected global GDP growth in 2010 3.7% expected GDP growth in Africa in 2010 3.7% expected GDP growth in Africa in 2010 4.4% expected GDP growth in all developing countries 4.4% expected GDP growth in all developing countries And…now already, innovation all over! And…now already, innovation all over!

5. Africa and South Africa ICCA statistics 2008: 189 events in Africa (Market share of 3% only!) ICCA statistics 2008: 189 events in Africa (Market share of 3% only!) UIA statistics 2008: 536 events in Africa (Market share of 4.7%) UIA statistics 2008: 536 events in Africa (Market share of 4.7%) 40% of all international meetings in Africa take place in South Africa (ICCA) 40% of all international meetings in Africa take place in South Africa (ICCA) 60% of all international meetings in South Africa take place in Cape Town (ICCA) 60% of all international meetings in South Africa take place in Cape Town (ICCA) Only 58 international organisations based in Africa (ICCA) Only 58 international organisations based in Africa (ICCA)

6. Recession affects meeting industry in Africa (South) Africa has been relatively protected; effect of recession only noticeable from 2 nd part 2008 (South) Africa has been relatively protected; effect of recession only noticeable from 2 nd part 2008 Most Convention Centres will still make their 08/09 budgets. Others experience revenue drops of up to 50% Most Convention Centres will still make their 08/09 budgets. Others experience revenue drops of up to 50% Cancellations and postponements of corporate meetings and incentives Cancellations and postponements of corporate meetings and incentives Association meetings attract up to 20% lower delegate numbers than expected, but no cancellations Association meetings attract up to 20% lower delegate numbers than expected, but no cancellations

7. Recession affects meeting industry in Africa Exhibitions and trade fairs 10-30% down in visitors, 10-12% down in space Exhibitions and trade fairs 10-30% down in visitors, 10-12% down in space Organizers are aiming for quality Organizers are aiming for quality Venues are expected to become creative and come to the party Venues are expected to become creative and come to the party

8. Side effects Strong reduction of sponsor budgets -> (medical) congresses under pressure and less cultural and sport events Strong reduction of sponsor budgets -> (medical) congresses under pressure and less cultural and sport events (PCO) clients become more cost focussed (PCO) clients become more cost focussed Less delegates -> substantial reduction in F&B income Less delegates -> substantial reduction in F&B income Less independently organised banquets Less independently organised banquets Swine flu related travel warning did not really help Swine flu related travel warning did not really help

9. Immediate relief Review of expense budgets Review of expense budgets Cost reductions of up to 10% Cost reductions of up to 10% Freezing of personnel cost Freezing of personnel cost In sourcing services and temp. staff In sourcing services and temp. staff Increasing marketing budgets Increasing marketing budgets

10. How to counter the trend? Nurturing increased interest in trade fairs Nurturing increased interest in trade fairs Partnerships with event organizers Partnerships with event organizers Organizing own events Organizing own events More flexibility in pricing More flexibility in pricing Packages in stead of discounts Packages in stead of discounts Invest in quality Invest in quality Create new business (e.g. religious meetings) Create new business (e.g. religious meetings) Concentrate more on government business Concentrate more on government business

11. Wake up call for hotels Occupancy levels and revenues 10-20% down Occupancy levels and revenues 10-20% down Less than 10% retrenches staff Less than 10% retrenches staff 100% prepared to ‘fight’ for the business (in all categories) 100% prepared to ‘fight’ for the business (in all categories) More interest in packages and partnerships sacrificing rates More interest in packages and partnerships sacrificing rates High expectations of 2010 High expectations of 2010

12. In the interim: make a plan! In the interim: make a plan! If the wheels come off, …… If the wheels come off, ……