1. OVERVIEW OF THE PHILIPPINE TOURISM INDUSTRY

2. Market Prioritization Framework
High
Core Markets
Markets that deliver the “bread & butter”
Bulk of new investment
Best capabilities allocated
Investment / Turnaround Markets
Invest in these markets ahead of return i.e. invest for the future
Tactical / Momentum Markets
With focused spend can relatively quickly generate increased arrivals
Maintenance Markets
Markets that are on the radar
Activity only to occur if there is spare capacity
Ensure mix of countries creates balance across:
Growth cycles
Market development
Short haul vs. long-haul
Seasonality
Investment required
Ability to Win
Competitive Position: How competitive is the Philippines vs. key competitors (SE Asia) ?
Ability to Deliver: How adapted is the Philippines offer to consumer needs?
Low
High
Size of Opportunity
Current size and growth
Potential size and growth
Note: Competitive Position (market share, awareness (unaided, aided), positivity towards RP, consideration of RP, information seeking about RP, likelihood of visiting), Ability to Deliver (Ease of access, trade interest, product availability, importance of safety, Fit of assets vs. consumer preferences, seasonality of arrivals, presence of English speaking population), 2 2

3. Market Portfolio Implications High
Continue to focus bulk of resources and best people on existing core markets (China, Japan, Korea, US Balikbayan)
Increase investment and focus on Tactical/momentum markets (Australia, Russia, Germany, US/Canada)
Maintain investment in turnaround markets (Hong Kong, Taiwan, Singapore) focusing efforts on addressing key barriers to growth
Monitor maintenance markets (UK, Netherlands, Switzerland, and Denmark) on an annual basis to test for low-hanging fruit
Cut focus on Italy, Spain, and India
Ability to Win
Competitive Position
Ability to Deliver
Low
Low
High
Size of Opportunity
Current Attractiveness
Future Attractiveness
Note: **US campaigns and activities can be extended to Canada; *Given limited resources and inherent barriers to activation, UK market has been de-prioritized. However, UK remains a good investment market in Europe
Source: Monitor Analysis 3 3

4. Visitor Arrivals to the Philippines, 2000- 2007
The 2007 has been a breakthrough for Philippine tourism as healthy growth in visitor arrivals was recorded.
Visitor Arrivals to the Philippines,
(In Millions)
Trend Line
YoY Growth Rate (%)
-8.2%
-9.8%
7.6%
-1.3%
20.1%
14.5%
8.4%
8.7%
Source of Data: Arrival/Departure Cards and Sea Manifests Visitor Sample Survey at International gateways 4

5. Top Markets of the Philippines, 2007
One of the main achievements of the DOT is the consolidation of global market portfolio to sustain growth in core markets.
Top Markets of the Philippines, 2007
YoY Growth Rate (%)
14.2
2.0
-6.4
18.0
11.0
-2.4
16.3
15.9
13.4
23.3
8.7
Source of Data: Arrival/Departure Cards and Sea Manifests in major international gateways and sea ports. 5

6. Percent Increase in Strategic Markets, 2007
The Philippines continued to shine in the highly competitive scuba diving arena in Europe and India strengthening its position as one of the best water sports destinations.
Percent Increase in Strategic Markets, 2007
2007/2006
Growth Rate
20.4%
24.4%
8.7%
23.6%
18.7%
21.2%
16.3%
24.0%
28.8%
128.9% 6

7. Visitor Arrivals to the Philippines, January-June 2008
First semester tourist arrivals for 2008 posted 7.4 growth fueled by strong increases in North East Asian and European Markets
Visitor Arrivals to the Philippines, January-June 2008

8. Top 10 Tourist Markets, January-June 2008
Korea continued to lead as key source market. However, China, Taiwan, Australia, Canada and United Kingdom showed strong double digit growth.
Top 10 Tourist Markets, January-June 2008

9. Arrivals from European Markrts, January-June 2008
European Market lead by United Kingdom and Germany demonstrated robust growth. Scandinavian countries continued to increase as even faster rate.
Arrivals from European Markrts, January-June 2008

10. Arrivals from Muslin Generating Markets, January-June 2008
Potential markets for halal services coming from Muslim dominated markets showed double digit growth in the last seven (7) years. Malaysia topped the list followed by Indonesia and Saudi Arabia.
Arrivals from Muslin Generating Markets, January-June 2008
2000
2001
2002
2003
2004
2005
2006
2007
Brunei
1,827
1,786
2,136
2,070
2,151
2,579
2,947
3,040
Indonesia
16,272
16,307
15,352
17,051
19,801
20,055
22,646
25,535
Malaysia
42,067
30,498
31,735
31,161
34,170
43,059
53,279
65,695
Bahrain
911
1,068
1,358
1,379
1,774
2,067
2,246
2,699
Egypt
482
888
580
576
690
564
804
715
Israel
2,808
2,470
2,062
1,720
2,090
2,521
3,959
3,929
Jordan
299
404
292
185
310
351
431
5,052
Kuwait
1,007
1,164
1,469
1,449
2,084
2,339
2,632
2,995
Saudi Arabia
10,444
10,409
11,341
9,842
11,627
14,141
15,017
16,358
UAE
1,568
2,160
3,460
3,305
4,198
5,070
6,414
8,490
Total
77,685
67,154
69,785
68,738
78,895
92,746
110,375
134,508
Growth Rate
-13.6%
3.9%
-1.5%
14.8%
17.6%
19.0%
21.9%

11. Visitor Expenditure in the Philippines, 2000- 2007
For the first time ever, foreign expenditure posted a hefty growth of 40.99% to reach US$4.885 Billion.
Visitor Expenditure in the Philippines,
(In US$ Billion)
Trend
Line
YoY Growth Rate
-16.40%
-19.27%
1.01%
-12.49%
30.74%
12.32%
54.96%
40.99%
Source of Data: Arrival/Departure Cards and Sea Manifests Visitor Sample Survey at International gateways 11

12. Selected Tourist Receipts from European Markets, January – June 2008
Expenditure of European markets went up by insurmountable levels. Russians spent surpassed other key markets.
Selected Tourist Receipts from European Markets, January – June 2008
(In US$ Thousand)

13. The Department of Tourism’s ultimate goal is to attract not only more tourists, but also higher value visitors that stay longer and spend more generating more opportunities for the country. 13

14. The DOT will continue to lead, coordinate and nurture initiatives from the private and public sectors. 14

15. Tourism Sector Level Value Chain
Awareness
and Perception
of the
Philippines
Tour
Package
Acquisition
Transpor-
tation/
Air Flight
Accom-
modation
Delivery and
Tourist
Satisfaction
Awareness and perception of the Philippines
Sales channels
Travel agents
Air accessibility and airports
Hotel capacity and utilization
Tourist satisfaction levels
Quality and value of tourist products and services
All elements to be tracked and measured by the DOT 15

16. THANK YOU!