TOURISM OPPORTUNITIES IN THE PHILIPPINES:

THE NATIONAL TOURISM DEVELOPMENT PLAN

Pre-Plenary Budget Hearings Congress of the Philippines September 20, 2013

INTERNATIONAL VISITOR ARRIVALS 2012

Arrivals by Markets
Korea USA Japan China
Taiwan
Growth Rate 11.5% 4.5% 9.9% 3.1% 19.1% 12.0% 7.6% 5.3% 5.9% 23.8% 8.4%

KEY PERFORMANCE INDICATORS International Visitor Arrivals

Arrivals by Year
4,600,000
4.3 M 3.9 M 3.5 M

4,200,000
3,800,000 3,400,000

3,000,000
2010 2011 2012

Australia Singapore Canada Hong Kong Malaysia UK Germany

Projected Arrivals
10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 0
2011 2012 2013 2014 2015 2016

5.6 M

2012 0 500

2011 1,000

9.5%

1,500

Visitor arrivals In thousands

2013 INTERNATIONAL TOURISTARRIVALS ARRIVALS INTERNATIONAL VISITOR

JANUARY - JULY

RANK

COUNTRY

JAN - JULY 2013

GROWTH RATE

1 2 3 4 5 6 7 8 9 10 11 12 13

KOREA USA CHINA JAPAN AUSTRALIA SINGAPORE TAIWAN CANADA HONGKONG UNITED KINGDOM MALAYSIA GERMANY OTHERS

GRAND TOTAL INCLUDING OTHERS

706,998 417,904 246,967 245,817 118,186 100,334 95,545 77,656 76,555 71,088 62,893 41,990 536,948 2,798,881

22.30% 2.72% 48.58% 6.21% 11.42% 18.10% -30.09% 3.78% 12.84% 6.75% 4.84% 5.14% 7.17% 11.05%

Source: A/D Cards and Shipping Manifests

INTERNATIONAL VISITOR ARRIVALS AVERAGE LENGTH OF STAY (IN NIGHTS)

INTERNATIONAL VISITOR(IN ARRIVALS VISITOR EXPENDITURE US$)

INTERNATIONAL VISITOR VISITOR RECEIPTS (IN US$ ARRIVALS MILLION)

CAGR = 29.6%

CAGR = 5.2%

INTERNATIONAL VISITOR ARRIVALS DOMESTIC TRAVELLERS, 2012

Top Overnight Destinations
(Partial as of June 2012)

TOTAL 974,397 702,798 613,279 396,289 359,320 338,992 290,845 281,243 200,295 184,362 171,823 152,377 19.6% 14.1% 12.3% 8.0% 7.2% 6.8% 5.9% 5.7% 4.0% 3.7% 3.5% 3.1%

Domestic Travellers by Year

45,000,000
40,000,000

Metro Manila

40.7 M* CAGR = 6.1%

Boracay Island
Cebu City

35,000,000 30,000,000 25,000,000 20,000,000 2008 2009 2010 2011 2012

Lapu Lapu City

Puerto Princesa City

Baguio City Albay Batangas Cagayan de Oro City

Davao City

* Estimate

Projected Domestic Travellers

60,000,000 55,000,000 50,000,000 45,000,000 40,000,000 35,000,000 30,000,000
2011 2012 2013 2014 2015 2016

Bohol
Iloilo City

CAGR = 10.6% 44.1 M

Clark
Negros Oriental
Domestic Foreign

151,454
150,067

3.0%
3.0%

0.0

175.0

350.0

525.0

700.0

NTDP 2011 2016 STRATEGIC DIRECTIONS

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

PRODUCT - MARKET DEVELOPMENT

Portfolio
Nature Tourism Cultural Tourism Sun and Beach Tourism Leisure and Entertainment Tourism MICE & Events Tourism

Health,Wellness, and Retirement Tourism

Cruise and Nautical Tourism Diving & Marine Sports Tourism

Education Tourism

PRODUCT MARKET STRATEGIES PRESENT

Market Penetration PRESENT Aggressive promotion strategies targeted to Japan, South Korea, USA, China to increase the number of overnight visitors.

NEW
Product Development Quality improvement strategies that seek to increase daily tourist expenditure through higher quality tourist products and services.

MARKETS

Main Strategy Market Development Aggressive promotion strategies targeted to Australia, Singapore, Malaysia, Canada market to increase the number of overnight visitors. Niche Strategy NEW Diversification Product development and diversification strategies to increase the average tourist length of stay. Secondary Strategy

NTDP 2011- 2016 STRATEGIC DIRECTIONS

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

TOURISM ROAD INFRASTRUCTURE PROGRAM INTERNATIONAL VISITOR ARRIVALS

(DOT - DPWH CONVERGENCE PROGRAM)

In Billion Pesos

Developed the Tourism

12,000 7,920
Road Infrastructure Project (TRIP) Prioritization Criteria

14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

Endorsed for approval

by the Tourism Coordinating Council 167 road projects with total of 598 kms worth P 12 Bil for FY 2013 Budget

1,390

2011

2012

2013

Organized capacity
building for CTWG and RTWGs

CHALLENGES: AIRPORT AND SERVICES

Projected Arrivals in International Gateways - 2016
Airports Inbound Foreign Passengers 3,631,695 2,483,991 1,723,222 Total Foreign Passengers Movement 7,263,390 4,967,982 3,466,444 Percent Share 36.3% 24.8% 17.2%
Airport Development and Promotion Immigration Officers/ Equipment

Manila Mactan Cebu Clark

Kalibo Iloilo
Davao Laguindingan Puerto Princesa Laoag Others

821,806
401,381 364,873 198,327 134,739 239,966

1,643,612
802,762 729,746 396,654 269,478 479,932

8.2%
4.0% 3.7% 2.0% 1.4% 2.4%

Total

10,000,000

20,000,000

100%

PASSENGER TRAFFIC IN MANILA AND INTERNATIONAL VISITOR ARRIVALS

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

AIR SEAT ENTITLEMENTS AND UTILIZATION 2012

MARKETS Korea Japan China Taiwan Australia Singapore Hong Kong Canada Malaysia United Kingdom Germany India Indonesia Thailand Vietnam SEAT ENTITLEMENTS PH FOREIGN 1,482,000 1,482,000 1,856,400 1,856,400 702,000 702,000 522,600 522,600 312,000 208,000 2,280,044 2,280,044 1,367,600 1,367,600 109,200 109,200 354,640 354,640 218,400 218,400 109,200 109,200 109,200 109,200 156,000 156,000 355,680 355,680 312,000 312,000 PH 1,177,800 533,624 617,760 239,358 250,068 882,544 958,880 109,200 355,680 0 0 99,112 147,368 313,976 122,304 ENTITLEMENT UTILIZATION % FOREIGN 79.47% 1,339,624 28.75% 247,520 88.00% 182,936 45.80% 178,204 80.15% 95,368 38.71% 721,136 70.11% 897,468 100.00% 0 100.29% 346,840 0.00% 0 0.00% 0 90.76% 0 94.47% 0 88.27% 158,600 39.20% 0 % 90.39% 13.33% 26.06% 34.10% 45.85% 31.63% 65.62% 0.00% 97.80% 0.00% 0.00% 0.00% 0.00% 44.59% 0.00%

TOTAL

10,246,964

10,042,964

5,807,674

56.68%

4,167,696

41.50%

AIRCRAFT DELIVERIES
ESTIMATED AIRCRAFT DELIVERY OF PHILIPPINE AIR CARRIERS January 2013 March 2014 AIRBUS 320 14

AIRBUS 321 AIRBUS 330 BOEING 777

7 10 2

PPA Recommended Ports of Call

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 Mindanao 12. Davao Port 13. Cagayan de Oro Port 14. Siargao Port, Surigao del Norte

Cagban Jetty Port

INTERNATIONAL VISITOR ROOM PROJECTION INARRIVALS 2016

Destination Clusters Island Grouping Northern PH Central PH Southern PH Room Supply (Available + Pipeline) Available in 2012 71,804 In the Pipeline 8,206 Room Gap In Critical Destination Clusters 16,025 20,757 570 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

61,978
28,922

5,129
1,686

Total PH
Critical Cluster Destinations Metro Manila & CALABARZON Central Visayas Bicol Cordillera

162,704
Room Demand 54,818 41,402 15,804 9,851

15,021
In the Pipeline 7,330 2,124 130 106

37,352
Room Gap 10,177 11,831 7,125 2,890

Available Room 37,311 27,447 8,549 6,855

STRATEGIC DIRECTIONS

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

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

TRAVEL AND TOURISM COMPETITIVENESS

2013 Headline
1. Switzerland 2. Germany 3. Austria
1. Singapore 2. Australia

PHILIPPINES
24. Pakistan 25. Bangladesh

PH as most improved country in Asia and the Pacific

Weaknesses Protection of Foreign Investments Starting Up a Business Safety and Security Health and Hygiene Transport and ICT Infrastructure

PHILIPPINES

Strengths Natural Resources

138. Burundi 139. Chad 140. Haiti
Source: World Economic Forum

Price Competitiveness Visa Regulation Air Services Agreement

INTERNATIONAL ARRIVALS TARGETS,VISITOR 2012 - 2014

INDICATORS
International Tourism Visitor Arrivals (mil) Length of Stay (nights) Average Daily Expenditure (Pesos) Visitor Receipts (Pesos bil) Domestic Tourism Domestic Travellers (mil) 40.7 44.1 47.7 4.3 8.0 4,431.0 156.0 5.5 9.0 4,914.0 205.4 6.8 9.0 5,431.0 269.9

2012

2013

2014

Domestic Trips (mil)

Length of Stay (nights)

162.7
4.7

176.2
4.7

191.0
4.7

Average Daily Expenditure (Pesos)

Domestic Receipts (Pesos bil)

2,469.0
1,152.0

2,580.0
1,298.6

2,593.0
1,409.2

ECONOMIC IMPACT PROJECTION INTERNATIONAL VISITOR ARRIVALS

2012 - 2016
2012 2013

INDICATORS
Gross Domestic Product Total Visitor Receipts (Pesos bil) Tourism GVA (Pesos bil) Share to GDP (%)

2014

2015

2016

1,308.0
650.8 6.2

1,504.0
748.3 6.7

1,679.1
835.4 7.0

1,957.5 2,307.1
974.0 1,147.9 7.8 8.7

Employment
Tourism employment (mil) 4.2 11.6 4.9 13.0 5.4 14.2 6.3 16.2 7.4 18.8

Share to National Employment (%)

Thank You!