1. Cruise Tourism A Regional Perspective ~ Observations from the 2013 ACA White Paper Boon or Bane of the Tourism Sector

2. Cruise Line Deployment in Asia 2013 -21 Cruise lines deploying 56 ships in Asian waters -Most are there except in (northern) summer months -Only the Top Three (Star, Royal Caribbean, Costa) cruise Asia year-round -In 2013 there are 762 cruises plus 58 voyages -Creating capacity for : -1.47 million passengers -6.77 million cruise days -Passage revenue of about USD2 billion

3. Cruise Lines In Asia MarketCruise LineShips in Asia Segment 2013 / 14 Large ShipAIDA2 Costa4 Fred Olsen2 Holland America3 P&O3 Princess6 Royal Caribbean4 Star5 Voyages to Antiquity1 930 UpscaleAzamara2 Celebrity2 Cunard3 Hapag Lloyd3 Oceania1 511 LuxuryCrystal2 Regent 7-Seas1 Seabourn5 Sea Dream Yacht Club1 Silversea3 5 12 ExpeditionCie du Ponant1 Orion Expedition1 Silversea (Silver Explorer)1 33

4. Deployment by cruise length Short cruises dominate -Cruises of less than 7 nights -629 in all -77% of the number of cruises -49% of total cruise nights. -Cruises between 1 and 2 weeks -15% of the number offered -32% of cruise nights. -Longer cruises, over 15 nights -only 2% of the total -7% of cruise nights.

5. Deployment by cruise length Cruise length (nights) Number of cruises offered% of total Total Cruise nights% of total 2-336845% 82920% 4-626132% 120328% 7132% 912% 8-10314% 2797% 11-13263% 3127% 14486% 67216% 15-19142% 2325% 20+10% 251% Voyages587% 60814% TOTAL820100% 4251100%

6. Capacity in Asian destinations 2013 -Many countries have significant numbers of cruise calls -China ports and Singapores 2 terminals dominate as turnaround hubs

8. Source Markets in Asia

10. Outlook for 2014 -Only first quarter fully published -Capacity shifts can occur through many initiatives -Larger ship -Longer season -Additional ship -More short cruises -Significant increase in number of Q1 cruises and voyages: -14% more total passenger days in Asia (20% on cruises) -average cruise length remains at 6.6 nights -deployment dominated by South East Asian cruises (67% of total, vs. 63% in 2013)

11. 1.Cruise Geography Issues 2.Attitudinal issues 3.Infrastructure Challenges 4.Other Operating Challenges Operating Conditions

12. 1. Cruise geography Issues a)The main ports in Asia are too far apart for short cruises b)SE Asia in a better position c)There are too few transit ports-of-call

13. 2. Attitudinal Issues Authorities around Asia have become enthusiastic a.But economic benefits of cruising yet to be appreciated b.Cruise ships not given appropriate priority c.Lack of clear berthing policies d.Immigration and customs procedures unnecessarily onerous e.Immigration authorities inflexible in hours of duty f.Travel distributors not setting client expectations g.Must work together for mutual benefit

14. 3. Infrastructure Challenges Winter months unattractive north of Shanghai -> redeployment to SE Asia from North Asia a)Much to be done to create new ports of call in Southeast Asia b)Emphasis should be on needs rather than architecture c)Berth capacity may soon become constrained d)Infrastructure not likely to keep pace with industry needs e)Airlift capacity f)Shortage of tour guides and buses in ports of call

15. 4. Other Operating Challenges Fees and charges in port operations are high by world Standards: a)Visa and immigration requirements are particularly challenging b)Without support of authorities, regulations and procedures likely to remain unsympathetic and lack relevance c)Political unrest disrupts cruise operations

16. Thank You Kevin Leong General Manager Asia Cruise Association