www.southafrica.net

Notes: 2002* represents projected arrivals for the yearSource: WTO, Stats SA, SATourism Analysis

Presentation to the Portfolio Committee

February 2003

www.southafrica.net

Tourism in South Africa boomed in 2002…

Source: WTO, Stats SA, SATourism Analysis

•Foreign tourist arrivals to South Africa increased by 11.1% (642,215) in 2002

•North America up 9.2% (18,263)

•Australasia up 14.5% (10,833)

•Asia up 20.7% (30,390)

•Europe up 24.2% (244,411)

•Africa up 7.8% (321,830)

•Overseas arrivals up 20.1% (301,797)

www.southafrica.net

Growth in tourist arrivals (1998 - 2002*)

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

1999 2000 2001 2002

% g

row

th

World

South Africa

South Africa has outperformed the global industry by 7 % in 2002.

Source: WTO, Stats SA, SATourism Analysis

www.southafrica.net

Foreign tourist arrivals from Germany (1998 - 2002*)

0

50,000

100,000

150,000

200,000

250,000

300,000

1998 1999 2000 2001 2002

Num

ber

of t

ouris

ts

Foreign tourist arrivals from the UK (1998 - 2002*)

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

1998 1999 2000 2001 2002*

Num

ber

of t

ouris

ts

Arrivals from South Africa’s two primary overseas markets enjoyed growth of 24.1% (UK) and 22.1% (Germany) in 2002

Source:Stats SA, SATourism Analysis

www.southafrica.net

Foreign tourist arrivals from Africa (1998 - 2002*)

3,900,000

4,000,000

4,100,000

4,200,000

4,300,000

4,400,000

4,500,000

1998 1999 2000 2001 2002

Num

ber

of t

ouris

ts

Foreign tourist arrivals from the USA(1998 - 2002*)

155,000

160,000

165,000

170,000

175,000

180,000

185,000

1998 1999 2000 2001 2002

Num

ber

of t

ouris

ts

Tourist arrivals from Africa increased by 7.8% and tourist arrivals from the USA increased by 7.0%

Source:Stats SA, SATourism Analysis

www.southafrica.net

US outbound growth compared to SA arrivals growth

-35%-30%

-25%-20%-15%-10%

-5%0%5%

10%

15%20%

Jan-

01

Feb-0

1

Mar

-01

Apr-0

1

May

-01

Jun-

01

Jul-0

1

Aug-0

1

Sep-0

1

Oct-01

Nov-01

Dec-01

Jan-

02

Feb-0

2

Mar

-02

Apr-0

2

May

-02

Jun-

02

Jul-0

2

% g

row

th

% GROWTH OF US OUTBOUND MARKET % GROWTH OF US ARRIVALS TO SA

With the exception of January 2002, arrivals to SA have outperformed the US outbound market trend.

www.southafrica.net

Foreign tourist arrivals from Argentina (1998 - 2001)

0

500

1,000

1,500

2,000

2,500

3,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Num

ber o

f tou

rists

2001

2002

Markets in decline over 2002 were…

•UAE, down 14.7% (248 tourists)

•Lesotho, down 9.7%(124,855 tourists)

•Reunion, down 6.7% (61 tourists)

•Argentina, down 63.9%(9,081)

www.southafrica.net

Forecasts and targets – discussion table

GROWTH OVER 2002 – BASE YEAR

2002 Base year

2% 5% 7% 7.5% 10%

Arrivals6,373,166 6,500,629 6,691,824 6,819,288 6,851,153 7,010,483

Jobs492,654 502,507 517,287 527,140 529,603 541,919

GDP

(R’000 000)72.5 74.0 76.1 77.6 77.9 79.8

Total foreign direct spend in SA

(R’000 000)*

50.8 51.8 53.3 54.4 54.6 55.9

Notes: *This has been modelled by the SRU. See Appendix 1.

•This is a multiplication table only and not a scientific projection•2002 indicators are multiplied by a range of possible growth percentages to illustrate growth potential•Structural barriers are ignored

www.southafrica.net

Relationship between arrivals, jobs and GDP

Relationship between arrivals, jobs and GDP

-5%

0%

5%

10%

15%

20%

1998 1999 2000 2001 2002

% c

han

ge

% Change in arrivals % change in jobs % change in GDP

•No direct relationship between jobs and arrivals

•1998 and 1999, both jobs and arrivals were in decline

•2000, jobs improved and arrivals declined

•2001, jobs and arrivals decreased

www.southafrica.net

So what does all this mean ?•Uncertain relationship between GDP, jobs and arrivals•Possible reasons for counter-intuitive observations:

• Possible time lags where an increase in arrivals precedes GDP growth which precedes job creation

• Structural inefficiencies in the tourism industry resulting in a non-translation of increased tourist volume to increased GDP to increased job creation

•Areas of intervention• Policy intervention• Industry structure intervention

•Need to develop a thorough understanding of industry dynamics,

flow of funds and industry measures•Possible tools are TSA’s and in-depth cluster analysis

www.southafrica.net

Indaba 2003

•Indaba remains South African Tourism’s premier trade show and marketing event.

•The 2003 Indaba will be held in Durban from 3-6 May 2003.

•The Tourism indaba in the world’s 6th largest travel and tourism trade show

IndabaATE

POW WOW

WTM

CIS

TOP RESA

PATA0

5000

10000

15000

20000

25000

30000

0 1000 2000 3000 4000 5000 6000

Number of exhibitors

Nu

mb

er

of

vis

ito

rs

BIT 400 Exhibitors54,000 Visitors

ITB10,135 exhibitors123,400 visitors

www.southafrica.net

Indaba 2003

•In 2002 there were 212 smmes represented

•This was a 51% increase from 2001

•SATourism aims to improve on this for 2003.

•Numbers will be available after indaba audited results are released

36.25% of the expenses for the show were spent with PDI companies bearing in mind that a large majority of the budget goes to International Marketing, Venue Hire etc – items which are not South African PDI Companies

Of the PDI Spend 31% was spent on KZN based PDI’s

www.southafrica.net

Indaba 2003

•Online registration up 40% this year…

•More focus on key markets

•Over 2000 sqm more space made availavle by the ICC

•South African Tourism aims to make the 2003 indaba the 5th largest Travel and tourism show in the world…

www.southafrica.net

Thank you

www.southafrica.net

appendix

www.southafrica.net

Change in volume of arrivals from Lesotho (Jan 1999- Oct 2002)

-40,000

-30,000

-20,000

-10,000

0

10,000

20,000

30,000

40,000

50,000Ja

n-9

9

Apr-

99

Jul-99

Oct

-99

Jan-0

0

Apr-

00

Jul-00

Oct

-00

Jan-0

1

Apr-

01

Jul-01

Oct

-01

Jan-0

2

Apr-

02

Jul-02

Oct

-02

Num

ber

of to

urists

Tourist arrivals from Lesotho, SA’s largest source market, have been in decline since 1999, due to structural issues. The decline slowed in 2002 and showed signs of levelling off by September 2002 and recovery followed…