South African Tourism

Transcription

1 South African Tourism 2012/13 Annual Report Presentation Portfolio Committee on Tourism Presentation by: Thulani Nzima CEO: South African Tourism 08 October 2013

2 Objectives of the Presentation

3 Objectives of this presentation At the end of this presentation, you should have: An understanding of the highlights of our 2012/13 Annual Report How SA Tourism has performed against its Pre-determined Objectives How SA Tourism has spent its allocated budget and the return on investment An understanding of the major challenges we are facing at present as well as the big things to do Slide no. 3

4 Global Tourism Trends

5 Background Global tourism arrivals topped a record 1 billion tourists in Increasing demand for shorter trips instead of long haul travel. Average length of stay reduced across the board Spend increased across the board except Africa land markets On-going concerns regarding the future of the Euro-Zone and unstable economies. European countries continually seek austerity measures to boost their economies. Continuing decline in disposable income The US economy is showing recovery signs and travel slowly rebounding Small agility better than big, cumbersome entities Direct tourism contribution to the country s GDP grew by 5% to R84.3 billion in Tourism directly or indirectly sustained 9% of employment Slide no. 5

6 Overall Performance Review

7 GOAL 2 GOAL 1 Overall Business Performance 2012/13 (70% achieved) Measure/ indicator Number of annual arrivals to SA for 2012 calendar year Number of domestic travelers per year Previous year Achievements 2011/12 Annual target 2012/13 Actual Achievements 2012/13 1 2,255,155 11,922,201 13,451,565* Deviation from annual target to Actual Achievement for 2012/2013 1,529, million 14,440, million (1.94 million) Reasons for Deviation Strategic investments done in emerging markets has yilded results. Arrivals from Regional Africa have remained buoyant. Our increased focus on BRICS countries has resulted in phenomenal growth. Reduced trips attributed to affordability and higher fuel costs. Increase in CPIX impacting on disposal income. Average spend per arrival R8,600 (TFDS) R 12,536 (NITS) R12,800* (NITS) R8,200* (TFDS less CAPEX) 264 Spend visitors from Americas, Asias and Australia as well as Europe have all increased and were driven mainly by the increased in arrivals as well as weaker Rand., Asia and Austria, SAs Slide no. 7

8 GOAL 5 GOAL 4 GOAL 3 Overall Business Performance 2012/13 (70% achieved) Measure/ indicator Average brand awareness percentage Previous year Achievements 2011/12 Annual target 2012/13 Actual Achievements 2012/13 Deviation from annual target to Actual Achievement for 2012/ % 79% 81% 2% Reasons for deviation Positive impact of our global media mix has driven awareness in UK (94%), Netherlands (89%), USA (84%), Australia (83%) and Nigeria (81%) Total number of properties graded during the 2012/13 financial year Compliance with policies and procedures 4,886 6,172 6,022 (150) Achieved an unqualified audit report for the year ending March 2011 Unqualified annual external audit report Achieved an unqualified audit report for the year ending March 2012 The Assessors were in the process of persuading the 150 properties to get graded as they were in the records as hot leads during the transition into new membership system Target achieved Slide no. 8 Budget spend Spend no less than 98% or no more than 102% of consolidated annual approved budget for 2012/13 99,95% budget spent Target achieved Target achieved

9 GOAL 6 Overall Business Performance 2012/13 (70% achieved) Measure/ Indicator Previous year Achievements 2011/12 Annual target 2012/13 Actual Achievements 2012/13 Deviation from annual target to Actual Achievement for 2012/2013 Reason for Deviation SAT Annual staff turnover rate Actual average resignation rate of 2,5% No more than 10% Staff turnover 12.5% average 25% Redundancy due to closure of the business tourism business unit staff dismissal staff also seeking other opportunities). SAT average total score in the Small Organisation section of Annual Deloitte Best- Company-to- Work for survey (which measures living SAT s values to some extent) Achieved an average score of 3,55 3,3 Not applicable Board decision not to participation in 2012/13 but focus on implementation of 2011/12 findings. Slide no. 9

10 GOAL 6 Overall Business Performance 2012/13 (70% achieved) Measure/ indicator Previous year Achievemen ts 2011/12 Annual target 2012/13 Actual Achievements 2012/13 Deviation from annual target to Actual Achievement for 2012/2013 Reasons for Deviation Activate all Convention Bureau Business Unit services including bid support, siteinspections, delegate boosting activities and onsite event support Not applicable because National Convention Bureau was not in existence Activate all Convention Bureau Business Unit services including bid support, siteinspections, delegate boosting activities and on-site event support so that the following can be achieved during the 2012/13 financial year: (ii) (a) Source and submit 30 bids with total number of delegates and a total financial (value) impact R 162 million (in conjunction with other Convention Bureaus in South Africa) by 31 March 2013; (ii) (b) Complete the development of a database of leads within the CRM system by 31 March 2013 a) 52,587 delegates b) 46 bids submitted c) Financial impact of bids submitted - R a) Simple view appointed as CRM service provider a) 34,587delegate s b) 16 bids c) R881,193,200 Success achieved due to: Increase in association meetings. Increase number of bids and leads. Slide no. 10

11 Tourism Arrivals Performance

12 % Change Tourist arrivals to South Africa grew by 10.2% in 2012 compared to the global growth of 3.8% for the same period Year-on-Year Change in Tourist Arrivals to each region 15% 10% 5% 10.2% 3.8% 6.0% 6.8% 3.3% 3.8% 0% -5% -10% South Africa World Africa Asia and the Pacific -5.4% Europe Middle East Americas 2010 Tourist arrivals (Millions) 2011 Tourist arrivals (Millions) 2012 Tourist arrivals (Millions) Note: UNWTO estimates incorporate provisional data for some regions Source: StatsSA Tourism & Migration December 2012, SAT analysis; UNWTO World Tourism Barometer Volume 11 Jan 2013, International Tourism results and Prospects for 2012 Slide no ,

13 Foreign Tourist Arrivals to South Africa for Jan to Dec 2012 grew by 10.2% over 2011 to reach 9,188,368 North America 393,446 arrivals # % up from 2011 Americas Europe 1,396,978 arrivals 9.5% up from 2011 # 3 Africa: Air # 4 Europe Middle East 54,172 arrivals 14.1% up from 2011 Asia Central & South America 119,913 arrivals 37.0% up from 2011 GRAND TOTAL 9,188,368 arrivals 10.2% up from 2011 # 5 Africa Land AFRICA 6,634,933 arrivals 8.5% up from ,304 arrivals 33.7% up from 2011 Australasia 142,949 arrivals 16.4% up from 2011 Indian Ocean Islands 21,525 arrivals 9.1% up from 2011 # 1 Asia & Australia Note : Tourist Arrivals figures shown above for Jan - Dec 2012 Source: Table A Tourist Arrivals Jan - Dec 2012 Slide no. 13

14 Slide no. 14

15 Tourism Arrivals Europe remains the main source of tourist arrivals to South Africa, with 1,396,978 tourist arrivals - a 9.5% growth from the 1,275,679 tourist arrivals in This growth has come despite Europe s overall outbound tourism having somewhat slowed down on the back of poor economic performance, austerity measures and a negative economic growth rate of -0.1 % in the 3rd quarter of North America posted a 13.9% growth to 393,446 tourist arrivals in 2012, from 345,384 recorded in 2011 on the back of a fragile economic recovery of 2%. The Asian Tourism Market to South Africa continued on a solid growth path. Tourist arrivals from the Asian countries have grown by 33.7% to reach a total of 398,304 tourist arrivals by year end This growth is led by China, including Hong-Kong which grew by 55.9 %, reaching a total of 132, 334 tourists in o Slide no. 15 In 2012, Chinese tourists have been travelling to South Africa in record numbers and by July 2012 China had become South Africa s fourth largest source market for tourist arrivals. Reasons for the growth, among others; The Chinese market will continue to grow especially after the launch of the non-stop flights between Johannesburg and Beijing by South African Airways in code share with China Air in January 2012 The two new visa application centres which opened in Beijing and Shanghai in 2011 making travelling to South Africa more appealing for Chinese tourists.

16 Tourism Arrivals Central and South America had the highest growth by 37%, attracting 119,913 tourists to South Africa, versus the 87,506 recorded in Brazil had the highest growth in the Central and South American region with a growth of 44.7%, reaching 78,376 compared to 54,183 in Tourist arrival figures in Brazil are expected to grow given the increased marketing efforts driven by an appointed agent initially while we are navigating the application process for a fully-fledged office. The Middle East Markets brought in 54,172 tourists in 2012, up by 14.1 % from Australasia which consists of Australia, New Zealand, and some of the Indian Ocean Islands in total attracted tourists to South Africa, with the highest number of tourists coming from Australia and New Zealand This was a 16.2% increase from Australia in 2011, when tourists travelled to South Africa. Regional Africa reports the highest number of foreign tourist arrivals for South Africa with a 8.5% increase from a total of tourists to South Africa in 2011 to in Slide no. 16 This market is driven mainly by tourists arrivals from Zimbabwe at 1,847974, Mozambique at 1,104,404, Lesotho and Swaziland at 1,618,22. Of the African markets, Tanzania and Ghana are reporting the highest growth at 25.4% and 23% respectively even though from a lower base when compared with the SADC countries listed above.

17 Tourism Spend

18 Tourism Spend International tourist spend generated from tourist arrivals increased between 2011 and 2012 from R 71 bn to R76.4 bn (up 7.4%) Average spend per tourist decreased from R8 900 in 2011 to R8 700 in 2012 (down 2.3%). Africa Land was the only region that posted a decrease in revenue in Looking at the factors that caused the increase in total spend as opposed to a decrease in average spend; this can be attributed to larger volumes mainly driven by the Africa land tourist segment. The decrease in spend per tourist is attributed to current economic conditions, with consumers being less generous with their expenditure. Slide no. 18

19 Total foreign direct spend generated from tourist arrivals increased by 7.6% between 2011 and 2012 Revenue (R - Billion) Africa - land and Africa - air were the only regions that posted a decrease in revenue from 2011 to 2012 Total Foreign Direct Spend (excluding capital expenditure), 2010 to 2012E E Total Africa - land Africa - air Americas Asia & Australasia Europe Average spend per tourist in SA 2010 R9,300 R8,300 R12,600 R12,800 R13,400 R10, R8,900 R8,100 R13,300 R11,000 R12,000 R10, E R8,700 R6,900 R11,700 R13,800 R14,300 R13,000 Note: In 2009, Statistics SA for the first time was able to make the distinction between tourists and day visitors and this started a new data series. As a result of this change, the results in this report are now not comparable to previous reports. Source: SAT Departure Surveys Slide no. 19

20 Length of Stay

21 Length of Stay The average length of stay decreased from 8.5 nights per tourist in 2010 to 7.6 nights in 2012 This decline was driven off shorter stays by tourists from most of our markets. This global trend affects all our competitors due to the economic downturn around the world. Slide no. 21

22 Average number of Nights The average length of stay decreased between 2011 and 2012 Average Length of Stay in SA for Total Tourist Arrivals, Total Africa - land Africa - air Americas Asia & Australasia Europe CAGR % 1.1% -13.3% -8.9% -13.8% -9.8% Source: SAT Departure Surveys Slide no. 22

23 Most common number of Nights The most common length of stay of tourists from both air and land markets declined to five nights and one night respectively Most common number of nights in South Africa, Air Land Source: SAT Departure Surveys Slide no. 23

24 Free State, Mpumalanga and North West were the only Provinces in which foreign tourists stayed, on average, longer in 2012 Average Nights Spent Average Length of Stay by Province ( ) Eastern Cape Free State Gauteng KwaZulu Natal Limpopo Mpumalanga North West Northern Cape Western Cape CAGR % 1.2% 12.1% 3.8% -3.2% 1.0% 6.2% 0.1% 4.3% Source: SAT Departure Surveys Slide no. 24

25 Trends in Arrivals per Region

26 Number of Provinces Visited Tourists from both air and land markets visited one Province in South Africa in 2012 Average Number of Provinces Visited by All Tourists ( ) 2.4 Air Land Source: SAT Departure Surveys Slide no. 26

27 Number of Provinces Visited There has been a decrease in the number of Provinces visited by all tourists Average Number of Provinces Visited by All Tourists ( ) Total Africa - land Africa - air Americas Asia & Australasia Europe CAGR % -2.0% 4.4% -12.1% -7.3% -9.6% Source: SAT Departure Surveys Slide no. 27

28 Provinces Visited Although first-time visitors tend to visit more Provinces than repeat visitors, there is a trend towards fewer Provinces being visited on a trip. Average Number of Provinces Visited by Frequency of Visits to SA ( ) First Time 2-3 Times 4-5 Times 6-9 Times 10+ Times CAGR % -5.5% -2.7% -3.6% -2.0% Source: SAT Departure Surveys Slide no. 28

29 Nights Gauteng and Western Cape are by far the most visited Provinces and account for the bulk of the bednights spent in SA Total Nights Spent in SA by Province and by Type of Accommodation, ,000,000 25,000,000 Other 20,000,000 Unpaid (Friends / Family) 15,000,000 10,000,000 Paid (Hotel, Game Lodge, Guest House, Train/Ship, B & B, Backpackers, Self-catering, Camping) 5,000,000 0 Gauteng Western Cape Mpumalanga KwaZulu Natal Free State Limpopo Eastern Cape North West Northern Cape Total Nights ( 000s) %of Total Nights (2011) 26,514 16,322 5,928 5,921 4,154 3,355 2,669 2, % 24.4% 8.8% 8.8% 6.2% 5.0% 4.0% 3.1% 0.7% Source: SAT Departure Surveys Slide no. 29

30 Nights Millions The total number of bednights spent in SA by foreign tourists increased in 2012 by 1.5% however there is a new trend to use non-hotel accommodation facilities Total Nights Spent in SA by Type of Accommodation 36,9m m 66.2m 67.2m Other Unpaid Paid Note: Unpaid accommodation refers to staying with friends or family. Source: SAT Departure Surveys Slide no. 30

31 Domestic Tourism

32 Executive Summary Domestic Tourism Performance Report Jan-Dec 2012 Domestic trips dropped 26.4m to 25.4m in 2012 While domestic travellers are taking less trips, they stay longer up from 4.4 to 4.8 in 2012 Domestic tourist spend has increased by 1.5 % from R 20.3bn in 2011 to R21.8bn in Average expenditure on domestic travel per trip per day increased from R 780/day spent to R850/day spent SA Tourism currently finalising a revamped Domestic Tourism Campaign Source: Stats SA Tourism Satellite account WTTC-Org Slide no. 32

33 Brand Performance

34 SA Brand Journey Global Performance (2011 Feb 2013) Global Targets Awareness Positivity Sought Info in the Past Likely to Visit in Next 18 Months 2011 Actual 79% 37% 22% 12% Feb 2012 Actual 81% 41% 24% 13% Nov 2012 Actual 80% 38% 21% 13% Feb 2013 Actual 79% 37% 21% 13% Note: In Feb-12, Nov-12 and Feb-13, Core Markets weighted according to relative investment spend Australia = 7.4%, France = 13%, Germany = 15.2%, India = 7.8%, Netherlands = 9.5%, UK = 20.2%, USA = 21.4%, Kenya = 2.7%, Nigeria = 2.7%; Investment Markets weighted according to China = 38.9%, Italy = 25.8%, Japan = 11.6% and Brazil = 23.7%; Global Average, weighted according to investment spend Core = 90%, Investment = 10%; All rating questions have been analyzed using top 2 box approach Source: SAT BrandTracker Feb-11 through Nov-11 (merged for 2011), SAT Brand Tracker Feb-12 through Feb-13 SAT - Feb13 - Global Report 30 April Copyright 2013 Grail Research, a division of Integreon Confidential

35 Closure Ratio Global Performance (2011 Feb 2013) 2011 Feb-12 Nov-12 Feb-13 Market Closure Ratio Rank Closure Ratio Rank Closure Ratio Significantly above Average for 10 destinations (at 95% confidence level) Significantly below Average for 10 destinations (at 95% confidence level) Significantly above Average for 10 destinations (at 95% confidence level) Significantly below Average for 10 destinations (at 95% confidence level) Rank Closure Ratio Netherlands 1 in in in in Germany 1 in in in in UK 1 in in in in France 1 in in in in USA 1 in in in in India 1 in in in in Australia 1 in in in in Kenya 1 in in in in Nigeria 1 in in in in Market Closure Ratio 2011 Feb-12 Nov-12 Feb-13 Rank Closure Ratio Rank Closure Ratio Rank Closure Ratio Italy 1 in in in in China 1 in in in in Japan 1 in in in in Brazil 1 in in in in Rank Rank Core Markets 1 in 2.10 (2011) 1 in 2.19 (Feb-2012) 1 in 2.21 (Nov-2012) 1 in 2.14 (Feb-2013) Investment Markets 1 in 3.26 (2011) 1 in 2.75 (Feb-2012) 1 in 3.25 (Nov-2012) 1 in 3.08 (Feb-2013) Global Closure Ratio 1 in 2.19 (2011) 1 in 2.24 (Feb-2012) 1 in 2.31 (Nov-2012) 1 in 2.23 (Feb-2013) Note: Global closure ratios weighted according to marketing spend in market; Closure Ratio = Visited in Past 18 Months / Sought Info in the Past Source: SAT BrandTracker Feb-11 through Nov-11 (merged for 2011), SAT Brand Tracker Feb-12 through Feb-13 SAT - Feb13 - Global Report 30 April Copyright 2013 Grail Research, a division of Integreon Confidential

36 Key Brand Journey Metrics (Feb 2013) Total Awareness Positivity Likely to Visit in Future Likely to Seek Info Sought Info Plan to Visit in Next 18 Months Visited Recently Australia 80% 27% 22% 8% 11% 5% 3% France 77% 35% 27% 19% 17% 9% 4% Germany 68% 37% 29% 15% 15% 9% 6% India 68% 49% 38% 44% 35% 27% 24% Netherlands 86% 43% 34% 19% 30% 11% 10% UK 90% 34% 36% 16% 20% 12% 10% USA 81% 36% 28% 15% 16% 10% 7% Kenya 71% 45% 48% 41% 40% 30% 29% Nigeria 86% 38% 56% 37% 31% 31% 21% China 77% 37% 39% 35% 35% 23% 10% Japan 28% 14% 17% 6% 9% 2% 2% Italy 78% 46% 32% 27% 30% 13% 10% Brazil 62% 34% 24% 25% 21% 12% 9% Core Markets 1 80% 37% 32% 19% 20% 12% 9% Investment Markets 2 68% 36% 31% 27% 27% 15% 9% Note: 1 Core Markets weighted according to relative investment spend Australia = 7.4%, France = 13%, Germany = 15.2%, India = 7.8%, Netherlands = 9.5%, UK = 20.2%, USA = 21.4%, Kenya = 2.7%, Nigeria = 2.7%; 2 Investment Markets weighted according to China = 38.9%, Italy = 25.8%, Japan = 11.6% and Brazil = 23.7%; All rating questions have been analyzed using top 2 box approach Source: SAT BrandTracker Feb-13 SAT - Feb13 - Global Report 30 April Copyright 2013 Grail Research, a division of Integreon Confidential

37 Portfolio

38 Global Channel Manager Stakeholder Manager Regional Director Country Manager 4 th Portfolio Review Outcome Implemented effective 01/04/2011 to 30/03/2014 AFRICA AMERICAS & the UK ASIA & AUSTRALASIA EUROPE CORE MARKETS Angola Botswana Kenya Nigeria South Africa* USA Australia India France Germany Netherlands UK* INVESTMENT MARKETS DRC Mozambique Brazil Canada China (including Hong Kong) Japan Belgium Italy Sweden TACTICAL MARKETS Lesotho New Zealand Ireland Swaziland WATCH-LIST MARKETS Malawi Namibia Zambia Zimbabwe Argentina Republic of Korea Austria Denmark Portugal Spain Switzerland STRATEGIC IMPORTANCE Bahrain, Oman, Qatar, Saudi Arabia STRATEGIC AIR LINKS/HUBS Egypt, Ethiopia, Ghana, Mauritius, Senegal, Tanzania, UAE Malaysia Singapore Slide no. 38 Strategic Plan & Annual Performance Plan - 23 April 2013

39 Audit Performance

40 Highlights of 2012/13: Audit performance Audit area Overall result in 2012/13 Overall result in 2011/12 Movement in overall result Quality of 2012/13 result Overall financial audit report 12 th consecutive unqualified nomatter of-emphasis 11 th consecutive unqualified nomatter of-emphasis Overall Performance Information (PDO) Audit report 4th consecutive unqualified report 3rd consecutive unqualified report Number of material misstatements identified in Annual Financial Statements 0 1 Number of red faces on Dashboard report Nil Nil Slide no. 40

41 Highlights of 2012/13 financial results 1. NET SURPLUS OR DEFICIT FOR THE FINANCIAL YEAR For 12 consecutive financial years, South African Tourism managed to spend its full annual budget despite the uncertain foreign exchange environment in which it conducts its operations.. South African Tourism recorded a net deficit of R 9,14 million for the financial year 2012/13 compared to a R 34,3 million net deficit in the previous financial year. While we were previously successful in getting our full annual international budget upfront in the financial year, the National Department of Tourism is no longer in a position to do it. We have applied to National Treasury for a special dispensation. This allows us to transfer most of our annual overseas budgets to our offshore bank accounts earlier in order to reduce foreign exchange risk. Slide no. 41

42 Highlights of 2012/13 financial results (cont.) 2. REVENUE Revenue increased by 11% from R million in 2011/12 to R million in 2012/13. The net increase in revenue of R 100,1 million was due to an increase in government grants and TOMSA levies received. Government grants received from National Treasury increased by R 86.3 million while TOMSA levies increased by R 13.8 million. 3. OTHER INCOME Other income increased from R million ( net of prior year forex losses) in financial year 2011/12 to R million in 2012/13. This net increase of R million was due to the following: (i) 38% decrease in grading revenue; (ii) 68% increase in sundry income from Indaba and Meetings Africa; (iii) 9% decrease in interest received; (iv) South African Tourism incurred a foreign exchange loss of R million in the financial year ended 2011/12 compared to a foreign exchange gain of R million in the financial year ended 2012/ EXPENSES Total expenses increased by 1% from R million in financial year 2011/12 to R million in 2012/13. Finance cost decreased from R in 2011/12 to R in 2011/12. Slide no. 42

43 Highlights of 2012/13 financial results (cont.) 5. EQUITY The equity balance reduced from R 64 million on 31 March 2013 to R 29.8 million on 31 March The reasons for this decrease can be explained as follows in terms of assets and liabilities: 5.1 ASSETS Current assets increased from R million in 2011/12 to R million in 2012/13, largely as a result of a 20% increase in cash and cash equivalent balances (from R million on 31 March 2012 to R million on 31 March 2013). 5.2 LIABLITIES Current liabilities increased from R million in 2011/12 to R million in 2012/13. Income received in advance declined by 100% from R million to R 0 million in 2012/13. Trade and other payables declined by 51% from R to R million. Non-current liabilities increased from R million in 2011/12 to R 31.2 million in 2012/13. Slide no. 43

44 Grading Statistics

45 Number of Graded Establishments as at end March 2013 Non-Hotel Accommodation EC FS GP KZN LP MP NW NC WC Backpacker & Hostelling Grand Total Bed & Breakfast Caravan & Camping Country House Guest House Lodge Self Catering Non-Hotel Accommodation Total Hotel Total Accommodation Grand Total MESE Total (Business Tourism) Grand Total Graded Properties Slide no. 45

46 National Convention Bureau

47 National Convention Bureau s Performance The National Convention Bureau s (NCB) in conjunction with the City and Provincial Convention Bureaus submitted over 46 international bids, with an estimated economic impact of R and an estimated delegates. South Africa secured 87 international association meetings (to be staged in South Africa from 2013 to 2017) with an estimated economic impact of R2.6billion over 5 years and an estimated delegates. Meetings Africa 2013 that took place from Feb 2013 hosted delegates and 309 qualified hosted buyers attending the trade show. For the first time included in this number are 49 Regional African Association buyers and 65 National Corporate Buyers, delivering on the theme Advancing Africa together. In 2012 SA remained the top ranked Association Congress destination in Africa and the Middle East. The regional spread and footprint of association meetings are improving year on year. SA hosted 106 international association conferences in 2012 with a combined economic value of R662 million, delegates which generated 414 conference days. According to the 2012 ICCA ranking SA still hosted almost a 3rd of all association meetings hosted on the continent. Slide no. 47

48 Key Considerations

49 Strategic Initiatives and Challenges Barriers to Growth Increasing cost of doing business abroad Strategic Initiatives to Unlock Barriers In order to improve return of investment, a Hub Approach will be taken in marketing abroad. The approved Hub Strategy is being operationalised for implementation from 2014/15 and beyond Use of virtual offices is under consideration. Challenges with visa administration Funding constraints due to a R26m currency loss Engagement with the Department of Home affairs to Generally improve efficiencies in visa processing in certain markets - Angola and build capacity to handle increasing demand in some markets like Nigeria, China and India. A draft contingency plan is in place and awaiting proper consultation with the Board for approval. Affordability & perceptions that SA holidays are expensive - Domestic Although consumer spending is increasing, household consumers are still heavily indebted with the average household debt ratio at 76% of income & unemployment at 25.1%. Engagement with media to send positive messages about great value for money. Low Consumer confidence- Domestic Although consumer (retail) spending is on the increase, there is still unwillingness to spend disposable income of travel. The revamped domestic campaign will disrupt this retail spending to travel and create a culture to short trips. Collaboration with trade for deal driven campaigns. Seasonality - Domestic The revamped domestic campaign will promote short trips and will be deal driven. Trade Partners will play an important role. Slide no. 49

50 Slide no. 50 Thank You