1. Slide no. 1 © South African Tourism 2010 Click to edit Master subtitle style SA Tourism’s 2009/10 Annual Report and Financial & Performance Information for the 6 months that ended on 30 September 2010 Presentation to the Portfolio Committee 10h00 – 13h45 19 October 2010

2. Slide no. 2 © South African Tourism 2010 2 Index 1. SA Tourism Vision, mission, values and structure (slides 2 – 5) 2. Portfolio Review methodology (slides 6 - 9) 3. Outcomes of SA Tourism’s fourth Portfolio Review conducted during July/August 2009 by SA Tourism Strategic Research Unit in consultation with Exco, Manco and TOMSA levy collectors (slide 10) 4. Government’s priorities and SA Tourism high-level mandate, business objectives and strategies 2007-2010 (slides 11 - 15) 5. SA Tourism’s progress against the 4 high-level objectives to date (slides 16 - 40) 6. Grading Council statistics (slides 41 - 43) 7. SA Tourism’s Financial performance during 2009/10 (slides 44 – 49) 8. SA Tourism’s engagement with other stakeholders (slides 50 - 51) 9. SA Tourism’s Business planning process (slide 52) 10. Measuring the 2010 World Cup & way forward (slides 53 – 73) 11. Challenges for SA Tourism going forward ( slides 74 - 76) 12. Extracts from SA Tourism’s 2011/12 Strategic Plan (slides 77 - 87) 13. SA Tourism’s finances as at 31/8/2010 (slide 88) 14. Conclusion (slides 89 – 95)

3. Slide no. 3 © South African Tourism 2010 Slide no. 3 © South African Tourism 2010 OUR MANDATE

4. Slide no. 4 © South African Tourism 2010 Slide no. 4 © South African Tourism 2010 A quick recap of SA Tourism’s vision, mission and values For South Africa to be the preferred tourist destination in the world, in order to maximise the economic potential of tourism for our country and its people Mission of SA Tourism To develop and implement a world-class international tourism marketing strategy for SA. In pursuance of this SAT will: Facilitate the strategic alignment of the provinces and industry in support of the global marketing of tourism to SA Remove all obstacles to tourism growth Build a tourist-friendly nation Ensure that tourism benefits all South Africans

5. Slide no. 5 © South African Tourism 2010 Slide no. 5 © South African Tourism 2010 Values of SA Tourism Pushing the boundaries of excellence in all we do Teamwork Feel responsible and be accountable Care for South Africa and each other Integrity Respect for the purpose, people and assets of the organisatio n We unconditionally respect our organisation’s people, its purpose and its assets. Living this respect with integrity translates into an authentic caring for South Africa and each other, a feeling of responsibility, and the acceptance of accountability for the outcomes of our actions. Our team pushes the boundaries of excellence in everything we do.

6. Slide no. 6 © South African Tourism 2010 Slide no. 6 © South African Tourism 2010 South African Tourism has 10 overseas offices in 4 regions Africa This regional office operates from SA Tourism’s Sandton Head Office and coordinates all marketing activities in East Africa, West Africa, SADC countries and domestic marketing inside South Africa. SA Tourism plans to open an office in Angola following the completion of detailed research (approximately April 2011) Asia and Australasia Australia, Japan, India and China UK and Americas United States of America and the United Kingdom Europe Germany, France, Netherlands and Italy

7. Slide no. 7 © South African Tourism 2010 7 South African Tourism has 15 business units Office of the CEO/COO (including Legal, Internal Audit & Admin) Human Resources Africa Portfolio (including Domestic Marketing) Americas Asia & Australasia Portfolio Europe & UK Portfolio Events Business Tourism Central Marketing (including Global Brand, Channel & Agency Management) E-Business Research PR & Communications Product & Itinerary Finance TGCSA Business Systems (previously known as IT)

8. Slide no. 8 © South African Tourism 2010 SA Tourism’s Portfolio review methodology (done every 3 years) In essence, it adopts a “fresh eyes” approach by considering all the countries in the world, and filtering them based on a set of objective attractiveness criteria Consideration Set Attractive Markets COST-BENEFIT EVALUATION & UNDERSTANDING OF MARKETING ISSUES CORE, TACTICAL, INVESTMENT & WATCHLIST MARKETS Salient Set 1stFilter1stFilter A tt r a c ti v e n e s s C ri t e ri a Qualitative process involving a panel discussion 2nd Filter2nd Filter 4th Filter4th Filter Approach to Portfolio Review

9. Slide no. 9 © South African Tourism 2010 How attractive are these markets in the short term and the long term? Core, tactical, investment and watch-list markets 2nd filter Key steps of the Portfolio Review Process Application of cost- benefit evaluation 1st filter 4th filter Exclude markets with less than 20,000 arrivals p.a. or no airlift 3rd filter Markets with less than 20,000 arrivals p.a. in 2008 but with airlift (strategic hubs) Final portfolio Top sub-Saharan Africa markets PLUS Africa land markets Exclude sub-Saharan Africa Exclude markets with less than 4 million people living in urban areas and less than 20,000 arrivals p.a. or no airlift Include all Africa land markets* Exclude markets of less than 3 million people or GDP per capita is less than US$2,000 Top 50 markets in terms of outbound volume and value Salient set *Africa land markets are markets where more than 60% of arrivals to SA arrive by land.

10. Slide no. 10 © South African Tourism 2010 The results of the evaluation will illustrate the suggested core, tactical, investment and watch-list markets within each region Results of Portfolio Review Less Attractive But Easier Tactical Markets Markets where there are particular opportunities, i.e. “low hanging fruit” 15% of organisation’s effort deployed against these markets Attractive And Easier Core Markets Markets that deliver the “bread & butter” 60% of organisation’s effort deployed against these markets Best capabilities allocated to these markets Less Attractive And Difficult Watch-list Markets Markets that are on the radar Activity in these markets will only occur if there is spare capacity in the organisation 5% of organisation’s effort deployed against these markets Attractive But Difficult Investment Markets Invest in these markets ahead of return, i.e. invest for the future 20% of organisation’s effort deployed against these markets Core markets are those which present the greatest opportunity Tactical markets are those which should be considered for specific, tactical opportunities Watch-list markets need to be watched for value segments Attractiveness of Market Easier to Target Investment markets are those where some investment is made for returns in future

11. Slide no. 11 © South African Tourism 2010 The 4th Portfolio Review process that took place during July/ August 2009 and the outcomes will be implemented in full effective 1 April 2011 Africa & Middle East UK & AmericasAsia & AustralasiaEurope Core Markets Angola Botswana Kenya Nigeria South Africa* USA* Australia* India France* Germany Netherlands UK* Investment Markets DRC Mozambique Brazil Canada China (incl. Hong Kong) Japan Belgium Italy Sweden Tactical Markets Lesotho Swaziland New ZealandIreland Watch-list Markets Malawi Namibia Zambia Zimbabwe ArgentinaRepublic of Korea Austria Denmark Portugal Spain Switzerland Strategic Importance Bahrain, Oman, Qatar, Saudi Arabia Strategic Air Links/Hubs Egypt, Ethiopia, Ghana, Mauritius, Tanzania, Senegal, UAE Malaysia Singapore 4th Portfolio 2011-2014 2008 – 2010 2005 – 20072002 – 2004 RegionalDirectorRegionalDirector Sta keh old er Ma nag er Globa l Chann el Manag er Responsibility Country ManagerCountry Manager *Indicates Business Tourism Hubs

12. Slide no. 12 © South African Tourism 2010 Slide no. 12 © South African Tourism 2010 Linking Government priorities to SA Tourism priorities: STRATEGIC PLAN 1. Government has set five key priorities for the next five years including the creation of decent work and sustainable livelihoods, education, health, rural development including food security and land reform and the fight against crime and corruption. 2. These five priorities has been converted into Government’s Medium-Term Strategic Framework which highlights 10 priorities and 12 outcomes over the MTEF period. Tourism falls under the Economic Sectors and Employment Cluster, one of the 5 Government clusters and its actions appear under Outcome 4: “Decent employment through inclusive economic growth”.

13. Slide no. 13 © South African Tourism 2010 13  Increase the direct contribution to GDP from R52,38 billion in 2009 (estimate) to R65,72 billion in 2015 calendar year  Increase the indirect contribution to GDP from R210 billion* in 2009 (estimate) to R258 billion in 2015 calendar year  Increase in the number of jobs supported directly by the sector from 527 630 in 2005** to 640 000 in 2015 calendar year  Increase the number of indirect jobs from 557 134 * in 2009 (estimate) 746 000 in 2015 calendar year  Increase number of international arrivals from 9 591 828 in 2008 to 12 068 030 by 2015 calendar year  Increase domestic tourists from 13 483 000 in 2008 to 16 000 000 by 2015 calendar year Empl oy- ment Inco me Level Econo mic Grow th Equal ity  The tourism sector is essential contributor to the creation of decent work and job opportunities Sample Activities  Domestic and international tourism Marketing  Tourism investment promotion  Tourism product diversification  Tourism enterprise development Actio n Activit y Indica tors Decent Employment 1 Incl. & Diversified Econ. Growth 2 * Based on the tourism satellite account for 2008of the World Tourism & Travel Council for SA ** based on the first Tourism Satellite Account by StatsSA SAT’s alignment with NDT’s targets for Tourism development/1

14. Slide no. 14 © South African Tourism 2010 14 SAT’s alignment with NDT’s targets for Tourism development/2  Assisting GDP growth by increasing total tourism direct spend from R100,1 billion in 2008* calendar year to R169 billion in 2015 calendar year (assuming 6% CPIX to reflect a real growth of 1,5% pa)  Increase per tourist spend from R8, 100 in 2008 to R11,600 in 2015 Empl oy- ment Inco me Level Econo mic Grow th Equal ity  The tourism sector is essential contributor to the creation of decent work and job opportunities Sample Activities  Domestic and international tourism Marketing  Tourism investment promotion  Tourism product diversification  Tourism enterprise development Actio n Activit y Indica tors Decent Employment 1 Incl. & Diversified Econ. Growth 2 * last available statistics are for 2008, ** based on the first Tourism Satellite Account by StatsSA

15. Slide no. 15 © South African Tourism 2010 Share our vision with stakeholders Use the trade to grow our business Grow & nurture our staff Improve brand traction in markets Increase value- extraction in SA from all tourists Fine-tune internal systems and communication SA Tourism mandate, key business objectives and strategies at present (until 31/3/2010) Sustainable GDP Growth Sustainable job creation Redistribution and transformation The mandate to SA Tourism is...... through four key targets/objectives...... by focusing on doing only the following “Big 6 things” very well! Achieve targeted total arrivals to SA in 2007 - 2010 Achieve total average tourist spend inside SA in 2007 - 2010 SA to be the most preferred tourist brand by 2014 SA Tourism to be the Best Tourism Organization by 2010

16. Slide no. 16 © South African Tourism 2010 Convince consumers that SA can be trusted to deliver memorable experiences Engage Stakeholders to deliver quality visitor experience that re-affirm the brand promise Work the distribution channel to promote SA Energise and empower the organisation to innovate and achieve excellence Invest only in selected markets to deliver volume and value SA Tourism mandate, key business objectives and strategies at present (effective 1/4/2010) Create a thriving tourism sector by making South Africa a destination of choice Possible Tourism sector outcome which SAT will need to deliver against SAT outcome Strategies to deliver outcome Make the SA brand a Global Player in portfolio markets which will grow tourism’s trended revenue to the economy by 1.5% p.a

17. Slide no. 17 © South African Tourism 2010 Slide no. 17 © South African Tourism 2010 The organization’s financial and marketing performance during the 2009/10 financial year

18. Slide no. 18 © South African Tourism 2010 Slide no. 18 © South African Tourism 2010 Key Messages  Global arrivals declined by 4% in 2009 whilst South Africa’s arrivals grew by 3.6%. South Africa’s growth has outstripped global growth ever year since 2004. India grew by 17.5%, China grew by 12.4% & Africa grew by 5.7%  The domestic market was affected by the financial crisis as domestic tourism decreased by 8% in 2009 with 30 million trips being undertaken compared to the 33 million in 2008. Domestic tourists also tightened their spending in 2009 as total revenue declined by 14% to R22 billion, from R26 billion in 2008. But the domestic market does provide real potential for growth especially in the younger, upcoming segments.  The 2010/11 fiscal is strategically focused at protecting our leadership in wildlife and adventure and build welcoming people. A key asset we leverage off of is the diversity and vibrancy of South Africa’s people.  While our core markets still deliver our bread and butter, we will focus on expanding in China, India, Brazil and African air markets where there is better potential for growth.  The success of the World Cup has created immense goodwill and positive brand reputation for SA, leading to a more receptive world.  The big job after the World Cup is to convert WC awareness into arrivals to continue to upward trend in overall arrivals to South Africa. Message content will be built on rich experiences for travellers that are a combination of people, place and culture. ‘Welcome!’ will continue to be a chief component of the message content to entrench South Africa’s reputation as a friendly, welcoming destination.  Visitor arrivals for the first 7 months of 2010 grew by 13.3% over the same period in 2009 to reach 6,329,643. This was driven by a growth in all markets.

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23. Slide no. 23 © South African Tourism 2010 Slide no. 23 © South African Tourism 2010 What were SAT’s 4 high-level objectives? Objective 1 Achieve total arrivals to SA 2008 calendar year target: 9 699 365 (6.2% increase over 2007) 2008 actual close:9 591 828(5.5% increase over 2007) 2009 calendar year target: 9 824 858 (3.6% increase over 2008) 2009 actual close: 9 933 966 (3,6% increase over 2008 actual) 2010 calendar year target: 10 193 585 (2,6% increase over 2009 actual) 2011 calendar year target: 10 295 520 (4,2% increase over 2010) 2012 calendar year target: 10 398 475 (1% increase over 2011) 2013 calendar year projection: 11 234 911 (8% increase over 2012)

24. Slide no. 24 © South African Tourism 2010 Domestic Tourism Indicators: there has been a decline in both volume and value of domestic tourism in 2009 as the market responded to the financial crisis Note: 1Varies greatly due to seasonality Source: SAT Domestic Tourism Surveys for 2007 – 2009

25. Slide no. 25 © South African Tourism 2010 Slide no. 25 © South African Tourism 2010 What were SAT’s 4 high-level objectives? (figures below per person includes domestic tourist spend figures; total figure agrees to Annexure F) Objective 2 Achieve average spend per tourist inside SA 2008 calendar year target: R 7 300 per person (Total R 70,8 billion) 2008 actual:R 8 100 per person (Total R 83,4 billion) 2009 calendar year target: R 8 300 per person (Total R109,2 billion) 2009 actual:R 8 400 per person (Total R 79,4 billion) 2010 calendar year target: R8 700 per person (Total R117,2 billion) 2011 calendar year target: R9 222 per person (Total R126,1 billion) 2012 calendar year target: R9 775 per person (Total R 135,7 billion) 2013 calendar year target: R10,360 per person(Total R 146 billion)

26. Slide no. 26 © South African Tourism 2010 Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level Fourth level Fifth level Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level Fourth level Fifth level Foreign arrivals increased by 3.6% in the 2009 compared to 2008 Arrivals Arrivals to South Africa by Region, January to October Source: Table A October 2009 2009 Growth target (revised) 3.6%5.8%4.3%0.3%1.2%1.0%2.0%

27. Slide no. 27 © South African Tourism 2010 Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level Fourth level Fifth level Average spend increased by 3.7% driven by increased spend by land tourists but behind our growth targets for 2009 Average spend per tourist per trip TFDS (excluding capital expenditure) by region, Jan to Dec 2009 Growth target (revised) R9,900R6,900R14,600

28. Slide no. 28 © South African Tourism 2010 Average for Welcoming People Maintain Lead on Adventurous and Nature and Wildlife 77% aware of SA 40% positive about SA 26% sought info on SA 14% plan to visit in short- term Closure ratio of at least 1 in 2.9 in all markets What were SAT’s 4 high-level objectives? Objective 3: South Africa to be a most preferred Tourism Brand by 2014: Global Performance Globally, each market should aim to achieve a minimum level of performance along 1. Brand Knowledge, 2. Brand Journey and 3. Conversion. Markets that exceed this level must try to maintain their higher performance Brand KnowledgeBrand JourneyConversion

29. Slide no. 29 © South African Tourism 2010 Note: Core Markets weighted according to relative investment spend – Australia = 6%, France = 17%, Germany = 18%, India = 6%, Netherlands = 18%, UK = 18% & USA = 17%; Investment Markets weighted according to – China = 32%, Italy = 43% and Japan = 25%; Global Average, weighted according to investment spend – Core = 91%, Investment = 9%; All rating questions have been analyzed using top 2 box approach Source: SAT BrandTracker Feb-07 through Nov-09 (merged for each year) AwarenessPositivity Sought Info in the Past Likely to Visit in Next 18 Months 2007 Baseline75%38%23%12% 2008 Actual76%37%22%11% 2009 Actual79%38%21%11% Global Target 201077%40%26%14% Global Target 201379%42%28%16% Global Targets Objective 3: South Africa to be a most preferred Tourism Brand by 2014: 2. The Brand Journey – Global Target We have improved in both awareness and positivity but declines on sought info and likely to visit on the next 18 months due to the slowdown in global travel

30. Slide no. 30 © South African Tourism 2010 Progress on our 2007-2010 4 high-level objectives? Objective 3: South Africa to be a most preferred Tourism Brand by 2014: South Africa to be a most preferred Tourism Brand by 2014 Improve Global awareness Achieve 77% global awareness by Dec. 2010 Brand awareness at 79% (2009 Actual, Source: SRU) Improve Global positivity scores Achieve 40% global positivity by Dec 2010 Global positivity at 38% (2009 Actual, Source: SRU) Improve global reach on TV, cinema and online global marketing 1 Billion consumers to be reached on TV, online, cinema and global platforms. We reached 1,208 Billion consumers with 3,381 brand spots,753 billboards, 285 vignettes/programmes and 36.8 Million online impressions.

31. Slide no. 31 © South African Tourism 2010 1. Knowledge of the Brand – Global Target  Memorable  (Average)  Nature & Wildlife  (Leadership)  Welcoming People  (Average )  Adventurous  (Leadership)  Value for Money Table Stakes (Require Improvement)  Variety  Breathtaking  Enriching  Safety & Security Immediate Focus 2008 to 2010 Long Term Build Reinforces Memorable In 2009, the global average for most of the Brand Knowledge metrics improved, however, it continued to drop for Welcoming People and Safety and Security 5.69 (2009) 5.65 (2008) 5.68 (2007) 6.12 (2009) 6.07 (2008) 6.10 (2007) Note: Core Markets weighted according to relative investment spend – Australia = 6%, France = 17%, Germany = 18%, India = 6%, Netherlands = 18%, UK = 18% & USA = 17%; Investment Markets weighted according to – China = 32%, Italy = 43% and Japan = 25%; Global Average, weighted according to investment spend – Core = 91%, Investment = 9% Source: SAT BrandTracker Feb-07 through Nov-09(merged for each year) 4.70 (2009) 4.73 (2008) 4.75 (2007) 5.74 (2009) 5.69 (2008) 5.70 (2007) 5.66 (2009) 5.62 (2008) 5.67 (2007) 5.55 (2009) 5.51 (2008) 5.51 (2007) 5.51 (2009) 5.49 (2008) 5.51 (2007) 4.52 (2009) 4.56 (2008) 4.58 (2007) 3.41 (2009) 3.54 (2008) 3.53 (2007)

32. Slide no. 32 © South African Tourism 2010 MetricNetherlandsGermanyUKFranceUSAIndiaAustraliaItalyChinaJapan Memorable1243442222 Adventurous2233322322 Natural Wildlife Experience1322222333 Welcoming People You Can Interact With 4555435345 A Wide Variety of Experiences 1222221234 Breathtaking1243332322 Enriching1244444242 Unique1253243222 An Authentic Travel Experience 2343245232 Value for Money3444444445 Safety & Security5554345255 Ranking (out of 5) of The SA Brand Relative to Direct Competitors Along Key Brand Attributes – 2009 Note: Competitor set includes Australia, Thailand, Kenya, Brazil to produce ranking out of 5. If any of the above are not included in survey, India or China is used as destinations. For India market, Egypt is used as an additional destination for ranking purposes Source: SAT BrandTracker Feb-09 and Nov-09 Knowledge of the Brand – SA Rank Versus Direct Competitors (2009) In 2009, South Africa’s perception improved on key Personality Attributes in the Netherlands and Germany, compared to its direct competitors, however, it declined substantially in Italy When SA is ranked highest amongst competitors When SA is ranked lowest amongst competitors Significantly Above Average for 10 destinations (at 95% confidence level) Significantly Below Average for 10 destinations (at 95% confidence level)

33. Slide no. 33 © South African Tourism 2010 Brand Journey Metrics – SA Rank Versus All Destinations (2009) Ranking (out of 10) of The SA Brand Relative to Competitors Brand Journey Attributes – 2009 South Africa’s rating on Stature has improved marginally in 2009; the ratings on other metrics continue to be below average in most of the markets, except for the Netherlands and Germany Note: For ranking purposes, if there are more than 10 destinations in survey, the following destinations are removed from rankings: USA followed by Italy and France Source: SAT BrandTracker Feb-09 and Nov-09 MetricNetherlandsGermanyUKFranceUSAIndiaAustraliaItalyChinaJapan Total Awareness 5567778889 Unaided Awareness 3548776579 Positivity 3567768679 Likely to Visit in Future 2456778679 Likely to Seek Info 1457768679 Uniqueness 1244362358 Stature 4455566579 Sought Info 2456767679 Familiarity 45510877889 Suitability 4255566569 Likely to Visit in Next 18 Months 2459776779 Closure Ratio67781086869 Blue-Sky Considerers Information Seekers When SA is ranked highest amongst competitors When SA is ranked lowest amongst competitors Significantly Above Average for 10 destinations (at 95% confidence level) Significantly Below Average for 10 destinations (at 95% confidence level)

34. Slide no. 34 © South African Tourism 2010 South Africa has seen a positive CAGR for most of the Brand Journey metrics between 2006-2009; however, Visitation and Closure Ratio have declined slightly in 2009, compared to 2008 Brand Journey Trends – Core Markets Note: Core Markets weighted according to relative investment spend – Australia = 6%, France = 17%, Germany = 18%, India = 6%, Netherlands = 18%, UK = 18% & USA = 17%; Closure Ratio = Visited in Past 18 Months / Sought Info in the Past; All rating questions have been analyzed using top 2 box approach Source: SAT BrandTracker Nov-06 through Nov-09 (merged for each year) 2006200720082009CAGR (2006-09) Total Awareness74%77%78%81%3% Unaided Awareness18%19%20%19%2% Positivity37%39%38%39%2% Likely to Visit in Future31%35%32%33%2% Likely to Seek Info17%19%18% 1% Uniqueness28% 27%28%0% Stature19%20%18% -1% Sought Info21%23%22%21%0% Familiarity20%22% 3% Suitability19% 18%0% Likely to Visit in Next 18 Months10%12%11% 2% Visited in Past 18 Months6%8% 7%6% Closure Ratio1 in 3.351 in 2.901 in 2.751 in 2.856%

35. Slide no. 35 © South African Tourism 2010 2006200720082009CAGR (2006-09) Total Awareness54%57%55%58%3% Unaided Awareness11%13%11%14%7% Positivity27%29% 32%5% Likely to Visit in Future27% 28%2% Likely to Seek Info18%20% 21%5% Uniqueness24%26% 3% Stature17%18% 19%3% Sought Info22%23%22%23%1% Familiarity7%8%9% 13% Suitability17%19%18%20%5% Likely to Visit in Next 18 Months10% 11% 3% Visited in Past 18 Months7%8% 7%-1% Closure Ratio1 in 2.981 in 2.961 in 2.781 in 3.12-2% Brand Journey Trends – Investment Markets Note: Investment Markets weighted according to relative arrivals – China = 32%, Italy = 43% and Japan = 25%; Closure Ratio = Visited in Past 18 Months / Sought Info in the Past; All rating questions have been analyzed using top 2 box approach Source: SAT BrandTracker Nov-06 through Nov-09 (merged for each year) In Investment Markets, South Africa’s performance has improved on most of the Brand Journey metrics in 2009, compared to 2008; however, a slight drop in Visitation has led to a drop in Closure Ratio

36. Slide no. 36 © South African Tourism 2010 Slide no. 36 © South African Tourism 2010 Objective 4 : SA Tourism to be the Best Tourism Organization by 2010 (will be replaced, effective 1/4/2011, by SA Tourism to be a Top 20 Best-Company-to-Work- for by 2012*) As decided by the Annual Tourism Awards Committee of the World Tourism Organization, and as attested to by the most credible award committees in our chosen core markets *As measured in the annual Deloitte Best-Company-to-Work-for survey that will take place during June/July 2012

37. Slide no. 37 © South African Tourism 2010 37 International Olympic Committeewill host the International Olympic Committee’s 123rd Congress in in 2011 Society of Incentive & Travel Executives (SITE) The Society of Incentive Travel Executives (SITE) has selected to host its International Conference in December 2010. The event will bring the leaders of the design and delivery of motivational experiences and travel rewards, a multi-billion dollar global industry, to the City Two South African companies also walked away with a SITE Crystal award in 2009: - Terra Nova won a SITE Crystal Award for “Most Outstanding Motivational programme 2009” - Dragonfly Africa won a SITE Crystal Award for the “Most Outstanding Sustainable Motivational Experience 2009” Great Wine Capitals Global Network Rust en Vrede Restaurant in Stellenbosch was announced Global Winner in the 2010 Best of Wine Tourism award in the Wine Tourism Restaurants category. S. Pellegrino 100 World’s Best Restaurant Awards S. Pellegrino 100 World’s Best Restaurant put two South African restaurants in the 2010 top 50 world’s best restaurants  La Colombe in Constantia (12th place up from 38 last year);  Le Quartier Francais in Franschoek (31st place, up from 37th place in 2009) South African restaurants in the top 100 in 2009:  Le Quartier Francais in Franschoek  La Colombe in Constantia  Jardine’s  Aubergine Rust en Vrede in Stellenbosch Chinese Tourists Welcoming Award 2009 The won the bronze award in the internet/new media category of the 2009 Chinese Tourists Welcoming Award which were announced in April during China Outbound Tourist and Trade Market in. Luxury Tourism Awards 2009 has been awarded in the Best Entertainment Category of the Luxury Tourism Awards 2009 held at the International Luxury Travel Exhibition held in Travel & Leisure World’s Best Awards readers’ survey Cape Town has been voted second in the world’s top City in the 2009 Travel and Leisure online poll The following SA hotels have been voted the world's top 100 hotels for 2009 in an online poll by Travel & Leisure magazine:  Bushmans Kloof, Western Cape, Cedarberg Mountains (1st place)  Sabi Sabi Private Game Reserve (Earth Lodge), Sabi Sand Wildtuin, Kruger National Park (3rd place)  Singita Sabi Sand, Sabi Sand Wildtuin, Kruger National Park (6th place)  Twelve Apostles Hotel & Spa in Western Cape, Cape Town (15th place) , Sabi Sand Wildtuin, Kruger National Park (24th place) , Kruger National Park (25th place) , Eastern Cape (27th place)  Hotel, Gauteng, Johannesburg (29th place)  (29th place) , Sabi Sand Wildtuin, Kruger National Park (34th place) , Western Cape, Franschhoek Valley (60th place) , Sabi Sand Wildtuin, Kruger National Park (77th place) 16th World Travel Awards.  Saxon Boutique Hotel & Spa – World’s Leading Boutique Hotel  Thanda Private Game Reserve - World's Leading Luxury Lodge  The Blue Train - World's Leading Luxury Train  Shamwari Game Reserve – World’s Leading Conservation Company Accolades for 2009/10

38. Slide no. 38 © South African Tourism 2010 38 2009 TripAdvisor Travellers’ Choice awards  (5th place)– Top World 100 Best bargains  An African Villa,,, (24th place)– Top World 100 Best bargains  54,, (54th place)– Top World 100 Best bargains  (4th place)– Top World 10 Hidden Gems  (2nd place)– Best World Service  (8th place)– Top 100 Best Luxury  Shamwari Game Reserve, (82nd place)– Top 100 Best Luxury Condé Nast Traveler World Savers Awards has been named Global Winner of Wildlife Conservations Programs (2009) in the third annual Condé Nast Traveler World Savers Awards International Wine and Spirits Competition South African brandy, KWV Founders Reserve Brandy, won gold at the International Wine and Spirits Competition hosted July 2009 in US Incentive Industry Award South African Tourism’s operation has been named a 2009 winner of Incentive magazine’s prestigious Platinum Partner Award. More than 65,000 of ’s most qualified travel industry decision-makers selected the people, products and services that helped them most in motivating their employees and customers over the past year. Sustainability is named as one of the 2020 Global Sustainability Centers by The New York Ethisphere Institute Conference and Incentive Travel Magazine’s Hot List 2009 was voted Best Incentive Destination in the inaugural Conference and Incentive Travel magazine’s 2009 Hot List. 2009 Condé Nast Readers’ Travel Awards  is voted eighth (8) in the top 20 overseas cities category.  ranked eight (8) has reader’s favourite country as a result of it diverse range of attractions and activities.  Pride of Africa, Rovos Rail was voted third (3) as the reader’s favourite train experience due to its child friendly facilities.  Blue Train ranked tenth (10) in the favourite train experience (10). ABTA Travel Trends Report ABTA has named South Africa as a top destination for 2010. The annual report cites ‘x-factor destinations’ - those with something new and unique to offer. Accolades for 2009/2010 (Continuation)

39. Slide no. 39 © South African Tourism 2010 Slide no. 39 © South African Tourism 2010 The organization’s financial and marketing performance during the 2009/10 financial year

40. Slide no. 40 © South African Tourism 2010 Slide no. 40 © South African Tourism 2010 On the financial side… South African Tourism achieved its 9th consecutive unqualified (no emphasis of matter) audit report from the Auditor General and holds the record in Government (including all Departments, Public entities and Local Authorities) with the most consecutive unqualified no- -emphasis audit reports! But we realize it’s even tougher to stay Nr. 1!

41. Slide no. 41 © South African Tourism 2010 Slide no. 41 © South African Tourism 2010 Overview of SAT’s financial position and financial performance for the 2009/10 financial year SA Tourism’s total expenditure increased by 17% from R 724,27 million in 2008/9 to R 849,15 in 2009/10, leaving a net surplus of R 13,35 million (2008/9: R 6.94 million). The surplus related entirely to the acquisition of capital items as well as the capatilisation of intangible assets (including ongoing website improvement). A total increase of 19% over the previous year of SA Tourism’s funding, representing 80.7% (2008/9: 79%) of R 699.49 million (2008/9: R 586.09 million) of total revenue, came from Government. Other revenue of R 167.26 million (2008/9: R 154.86 million), an increase of 8% over 2008/9, was earned from voluntary Tourism levies, interest received, exhibitions, grading activities, sale of marketing items, sale of advertisement space in publications and raising sponsorships.

42. Slide no. 42 © South African Tourism 2010 Slide no. 42 © South African Tourism 2010 Total non current assets comprising of PPE, staff loans and intangible assets decreased by 14% (2009/10 R 74.31 million, 2008/9: R 86.9 million). Approximately 40% (R 3.71 million ) of total costs on PPE for the year (R9.20) was spent on acquisition of furniture and fittings. Approximately 99% (R 1.73 million ) of total costs on intangible assets for the year (R 1.74 million) was spent on website costs. Cash and cash equivalents increased by 38% (2009/10 R 224.66 million, 2008/9: R 162.61 million). Total current assets increased by 151% (2009/10 R 300.39 million, 2008/9: R 199.41 million) largely due to prepayments classified under trade and other receivables while overall total assets increased by 31% (2009/10 R 374.69 million,2008/9: R 286.32 million) Overview of SAT’s financial position and financial performance for the 2009/10 financial year (cont.)

43. Slide no. 43 © South African Tourism 2010 Slide no. 43 © South African Tourism 2010 Trade and other payables (2009/10 R 209.77 million, 2008/9: R 180.55 million) representing approximately 76% (2008/9: 89%) of total current liabilities (2008/09 R 275.92 million, 2008/9: R 203.09 million) increased by 16% over the previous financial year. Total non current liabilities comprising of provisions and finance lease liabilities decreased by 8% (2009/10 R 13.09 million, 2008/9: R 14.19 million) whilst total liabilities increased by 33% (2009/10 R 289.02 million, 2008/9: 217.28 million) over 2008/9 financial year. Accumulated surplus increased by 25% (2009/10 R 68.17 million, 2008/9: R 54.57 million) over the previous year. It largely represents tangible and non-tangible assets on SA Tourism’s Statement of Financial position. Overview of SAT’s financial position and financial performance for the 2009/10 financial year (cont.)

44. Slide no. 44 © South African Tourism 2010 Slide no. 44 © South African Tourism 2010 Executive Summary – 2009/10 scorecard 20082009Growth Arrivals9,591,8289,933,966+3.6% Awareness76%79%3 pp Positivity37%38%1 pp  Overall, we reached 1,262 Billion consumers with 5900 brand spots, 3800 vignettes, 2992 billboards and 84 Million online impressions in the 2009/10 fiscal.  Tourist arrivals for the first 4 months of 2010 grew by 16.3% over the same period in 2009 to reach 1,886,523. This was driven by a growth in all markets

45. Slide no. 45 © South African Tourism 2010 45 Areas of co-operation with stakeholders StakeholderDetails of co-operation TBCSA & TOMSA 1.1 SAT is co-funded from voluntary tourism levies collected and SAT therefore offers some specific benefits for establishments that collects TOMSA levies 1.2 SAT and TBCSA, which represents all tourism business associations, jointly addresses the industry once a year in all provinces and have bilateral meeting quarterly 2. Provincial Tourism Authorities CEO’s Forum (now called the Marketing Working Group) meeting quarterly where SAT CEO meets Provincial CEO’s to share Business Plans & Budgets and discuss specific marketing issues including joint marketing projects. SANParks, SANBI and TEP also attend. The CMO convenes the quarterly marketing forum with provincial marketing managers. 3. Fedhasa, ASATA and SATSASharing of information 4. DEAT public entities & programmes: 4.1 SANPARKS 4.2 SA Weather service 4.3 SANBI 4.4 TEP Lobby SANPARKS to also start collecting TOMSA levies. Provide exhibition space at exhibitions at beneficial rates Share information Joint funding of ETEYA project 5. IMC, GCIS and the Department of Trade & Investment Sharing of information and joint marketing activities 6. SAPSQuarterly meetings with Provincial SAPS leadership 7. Match & LOCOngoing liaison on Confederations Cup and 2010 Soccer World Cup 8. Miptech and Minmec Sharing of information on obtaining inputs on high-level marketing issues. SAT’s CEO attends both meetings. 9. Departments of International Relations & Cooperation and South African embassies overseas Provide marketing collateral

46. Slide no. 46 © South African Tourism 2010 Slide no. 46 © South African Tourism 2010 The Grading Council Performance 2009/10 financial year

47. Slide no. 47 © South African Tourism 2010 Slide no. 47 © South African Tourism 2010 TGCSA (historical performance of the TGCSA until 31/3/2010

48. Slide no. 48 © South African Tourism 2010 Slide no. 48 © South African Tourism 2010 Establishments Summary As at end July 2010 Non-Hotel AccommodationECFSGPKZNLPMPNWNCWCGrand Total Backpacker & Hostelling13112 34422879 Bed & Breakfast32276328325204436523771580 Caravan & Camping10372316267179118 Country House15819327213075180 Guest House314141643212861691381278552685 Lodge722667828476531940519 Self Catering19653225379120135504711032308 Non-Hotel Accommodation Total9423081301106533647529126424877469 Hotel Total70271657333321623191630 Accommodation Grand Total10123351466113836950730728726788099 MESE Total (Business Tourism)5311217182128218224 Grand Total Graded Properties10173381578115538752833528926968323

49. Slide no. 49 © South African Tourism 2010 Slide no. 49 © South African Tourism 2010 Rooms Summary As at end July 2010 Non-Hotel AccommodationECFSGPKZNLPMPNWNCWCGrand Total Backpacker & Hostelling4861915309817319815448311365060 Bed & Breakfast18183741662184214328623632916518341 Caravan & Camping4131543831731112515038247865617480 Country House107792713811082733707712027 Guest House2637111152901787962160914991108579621799 Lodge66847413691156107914438382174247668 Self Catering13773561427218421302001998430442015323 Non-Hotel Accommodation Total75062567119321006256207313458633531475967698 Hotel Total365415181533747101787168317449441214143518 Accommodation Grand Total1116040852726914772740789966330429726900111216 MESE Total (Business Tourism)206625587271764721004 Grand Total Graded Properties1118040912789414830747990676406430126972112220

50. Slide no. 50 © South African Tourism 2010 Introduce Grading Criteria which are globally recognised and credible to visitors & stakeholders Simplify Billing process and implement a more equitable fee structure Improve the integrity of the grading process using IT Infrastructure Improve the competence and integrity of Assessors Stop illegal use of stars and protect the TGCSA brand The road ahead for TGCSA from 2011 - 2014 TGCSA Outcome/Vision Strategies to deliver outcome Establish a recognisable and credible, globally bench-marked system of quality assurance for accommodation and MESE experiences which can be relied upon by visitors when making their choice of establishment Get industry to see value in participating in the grading system -

51. Slide no. 51 © South African Tourism 2010 The road ahead for TGCSA from 2011 - 2014 TGCSA Outcome/Vision Strategies to deliver outcome Establish a recognisable and credible, globally bench-marked system of quality assurance for accommodation and MESE experiences which can be relied upon by visitors when making their choice of establishment All progressing well, system going live on 14 October 2010 and commencement date. Update: Improve the integrity of the grading process using IT Infrastructure

52. Slide no. 52 © South African Tourism 2010 Slide no. 52 © South African Tourism 2010 DELL – Tablets – New QiT System

53. Slide no. 53 © South African Tourism 2010 Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level Fourth level Fifth level New Grading Fee Structure 6 room Guesthouse 5-Star Franschhoek R3 000.00 pp-pn Last year = R2 082.00 New Fee = R 3 030.00 Grading Plaque 6-room Guesthouse 2-Star Soweto R500.00 pp-pn Last year = R 2 082.00 New Fee = R 2 350.00 Grading Plaque

54. Slide no. 54 © South African Tourism 2010 Slide no. 54 © South African Tourism 2010 Performance in April to September 2010

55. Slide no. 55 © South African Tourism 2010 Slide no. 55 © South African Tourism 2010

56. Slide no. 56 © South African Tourism 2010 Slide no. 56 © South African Tourism 2010

57. Slide no. 57 © South African Tourism 2010 Visitor arrivals for the first 7 months of 2010 grew by 13.3% over the same period in 2009 to reach 6,329,643 AFRICA 4,808,453 arrivals 9.7% up from 2009 Central & South America 91,447 arrivals 152.8% up from 2009 North America 216,069 arrivals 19.0% up from 2009 Europe 790,202 arrivals 8.9% up from 2009 Asia 156,274 arrivals 33.9% up from 2009 Australasia 75,139 arrivals 19.8% up from 2009 Middle East 31,444 arrivals 24.0% up from 2009 Indian Ocean Islands 13,059 arrivals 22.4% up from 2009 Source: Table A Visitors Arrivals July 2010

58. Slide no. 58 © South African Tourism 2010 SA continues to outperform global growth, which grew by 6.9% in the first 6 months of 2010 Note: UNWTO estimates incorporate provisional data for some regions Source: Statssa Tourism & Migration release June 2010, SAT analysis; UNWTO World Tourism Barometer, September 2010 Growth in visitor arrivals for Jan to Jun: 2009 vs 2010 % Change

59. Slide no. 59 © South African Tourism 2010 % TFDS (excl. Capex) by Region, 2009 and 2010 Source: SAT Departure Survey 2009 - 2010 Total revenue generated by tourism increased by 15% driven off a 28% increase from the Africa land markets

60. Slide no. 60 © South African Tourism 2010 % Average TFDS (excl. Capex) by Region, 2009 and 2010 Source: SAT Departure Survey 2009 - 2010 The increases in revenue are due to increases in average spend per trip of tourists from the Africa land markets

61. Slide no. 61 © South African Tourism 2010 Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level Fourth level Fifth level Click to edit the outline text format Second Outline Level  Third Outline Level Fourth Outline Level  Fifth Outline Level  Sixth Outline Level  Seventh Outline Level  Eighth Outline Level Ninth Outline LevelClick to edit Master text styles Second level Third level Fourth level Fifth level There was growth in all regions as a result of the 2010 FIFA World Cup that was hosted in June and July Arrivals Visitor arrivals to South Africa by Region, January to July Source: Table A Visitor Arrivals July 2010

62. Slide no. 62 © South African Tourism 2010 % Most Common Length of Stay by Region, 2009 and 2010 Source: SAT Departure Survey 2009 - 2010 Length of stay increased by 1 night in the period compared to 2009

63. Slide no. 63 © South African Tourism 2010 % Most Common Length of Stay by Region, 2009 and 2010 Source: SAT Departure Survey 2009 - 2010 Length of stay remained flat in the period compared to 2009 ( till April 2010)

64. Slide no. 64 © South African Tourism 2010 Slide no. 64 © South African Tourism 2010 We are still in process of studying the impact of the 2010 FIFA World cup Impact of 2010 FIFATM World Cup on ‘Brand South Africa’ - analyze Brand Tracker (Regular + Lite) survey data to track the changes in perception about South Africa as a leisure destination across the globe. SAT commissioned a shorter version of the existing Brand Tracker study to understand the movement in key brand indicators post the World Cup Impact of 2010 FIFATM World Cup on International Tourism –analyse Departure survey data to evaluate in detail the impact of World Cup on International tourism. SAT extended the scope of the Departure Survey in the months of June and July to ensure that a larger sample of “World Cup” respondents are sampled Impact of 2010 FIFATM World Cup on Domestic Tourism – evaluate the impact of World Cup on South Africa’s Domestic tourism, by analysing data from Domestic survey

65. Slide no. 65 © South African Tourism 2010 Slide no. 65 © South African Tourism 2010 Positive global reputation – our people did it

66. Slide no. 66 © South African Tourism 2010 Slide no. 66 © South African Tourism 2010 World Cup Legacy - What's in Store for Country? by JP van der Merwe All Africa Aug 31, 2010 (Trade Invest Africa/All Africa Global Media viaCOMTEX) -- With the end of the FIFA 2010 World Cup just over a month ago, South Africa can be proud of pulling off an amazing event, which in many ways showed off the best that the country has to offer. The question, which everyone is now concerned about is what happens now? Will the South African economy be able to capitalise on the momentum or will we be stuck with a World Cup hangover that never seems to go away? We know the question is: “What now?”

67. Slide no. 67 © South African Tourism 2010 Slide no. 67 © South African Tourism 2010 But it won’t last forever Britons priced out of South Africa Visitor numbers have slumped in South Africa since the World Cup, says Oliver Smith. By Oliver Smith Published: 8:00AM BST 04 Sep 2010 http://www.telegraph.co.uk/travel/travelnews/7979689/Brito ns-priced-out-of-South-Africa.html Sounds of labour strife replace vuvuzela in South Africa The Economist 31 August 2010 THE warm, fuzzy feeling of national pride and unity engendered by South Africa's hosting of the football (or soccer) World Cup did not last long.

68. Slide no. 68 © South African Tourism 2010 Slide no. 68 © South African Tourism 2010 Challenges No doubt impact of world cup on global perceptions has resulted in a more receptive world Back home national pride We are feeling pressure to sustain momentum Global recession still affecting global travel but UNWTO has indicated upward trend of +7% in global travel though based on decline last year. Our mission is to meet arrival and revenue targets at a time when our key markets are in decline Choices have to be made on how to manage the falloff Next few slides show the extent of the problem that we face if we continue to lose revenue out of the UK and Europe

69. Slide no. 69 © South African Tourism 2010 Slide no. 69 © South African Tourism 2010 Post 2010 WC Campaign - 20 Experiences,10 days To inspire people to visit South Africa & get a glimpse of what we have to offer, we have developed this campaign. This campaign allows us to showcase South Africa as a breakthrough destination & reinforces reasons to believe in a real & authentic way. In May/June 2010 4 couples from the UK, USA, India & Nigeria got to experience an incredible adventure in South Africa. Filmed in South Africa – the group started together but went on four different journeys around the country, enjoying 20 amazing experiences in 10 days. While they were here, their experiences, adventures, responses & emotions were all captured on camera. They journeys were developed into 4 brand TVC’s that will flight on global platforms (CNN EMEA, CNN USA, BBC, Fox & cinema). The campaign will also be driven online through various social media with 360 integrated portal on the SAT’s homepage.

70. Slide no. 70 © South African Tourism 2010 Egyptian Tourist Authority spent 64% of total adspend on TV. SA Tourism spent 38% of total adspend on the Internet. 64% TV 41% Mag 39% TV 39% TV 38% Int 82% TV 51% OOH 36% Mag 66% Nws 52% Nws 52% Int Source: Nielsen adex Jan-June 2010 SA Tourism & its Key Competitors / Adspend Split by Medium

71. Slide no. 71 © South African Tourism 2010 Slide no. 71 © South African Tourism 2010 Global Ad spend Summary  Tourism Boards had a higher SOV than Airlines by 18%.  SA Tourism ranked 22nd in the overall category set of Tourism Boards.  India, Morocco & Egypt Tourist boards are amongst the top 10 advertisers.  Television is the key medium used by Tourism boards, whereas, Newspapers are the key medium used by Airlines. SAT & ITS KEY COMPETITORS  SA Tourism ranked 5th amongst its key competitors with Egyptian Tourist Authority ranking 1st.  Television was key medium used followed by magazines. Egyptian Tourism Authority had the 46% SOV on Television and highest SOV in Outdoor by 47%.  SA Tourism had the highest SOV on the Internet by 44%, Radio by 46% and Cinema by 41%.  India Tourist Board had the highest SOV in Magazines by 34% & Newspapers by 29%.

72. Slide no. 72 © South African Tourism 2010 April 2010 to September 2010 TimingEstimated Admissions Target MarketFormat Canada ( Toronto) Estimated no of screens 2 x 60 vign 3rd Sept to 30th Sept 2 x 60 vign13th Sept to 30th Sept Netherlands ( National) France (Paris) 2 x 60 vign1 Sept – 30th Sept Germany (Hamburg, Munich, Dusseldorf, Cologne, Frankfurt, Berlin & Stuttgart) 2 x 60 vignW/c 30 Sept 144 303 768 353 1,000,000 569,000 2,626,400 265,600 Total reach: 7,431,386 Global Cinema / Activity Overview Netherlands, France & Germany to continue running into the 3rd quarter. UK, USA, Australia and India to commence in 3rd & 4th quarters. Final Total Reach: 22,899,852 USA (NY, Boston, LA, San Francisco & Chicago) 2 x 60 vign1 Sept – 30th Sept4061,391,361 UK (National) 2 x 60 vign1 Sept – 30th Sept5851,579,025

73. Slide no. 73 © South African Tourism 2010 Global Brand / southafrica.net southafrica.net EngagementTotal Numbers Visits1,134,875 Page views4,342,372 Pages/visits3.83 Average time spent on site149.57 % New visits83.81% % Bounce rate17.44%

74. Slide no. 74 © South African Tourism 2010 Global Brand / southafrica.net AprilMayJuneJulyAugustTotal/Average Visits177,246230,871307,383234,048185,3271,134,875 Pageviews751,406990,4181,188,896777,964633,6884,342,372 Pages/Visit4.244.293.873.323.423.83 Bounce Rate16.67%17.34%17.18%17.88%18.12%17.44% Avg. Time on Site 191.43179.42150.03112.85114.13149.57 % New Visits79.79%81.78%85.73%85.97%85.78%83.81%

75. Slide no. 75 © South African Tourism 2010 Agency Generated / All April May June July August Septembe r Totals 40 260 2,490,932 36,890,283 3,028,062.60 6,497,862.71 9,084,187.79 19,493,588.13 75 46 285 10,337,67 6 2,675,355 39,554,907 1,063,842.44 3,031,774.22 6,782,826.78 3,191,527.30 9,095,322.65 20,348,480.34 Mont h Total articles Circulatio n Ad Value in ZAR PR Value in ZAR 14736,88792,770.09278,310.27 686,196,592 424,715.86 1,274,147.58 6718,050,20 8 1,949,980.925,849,942.77 71 9,415,664 1,002,333.243,006,999.70 171,127,088119,650.09 358,950.27 706,196,592467,198.861,401,596.58 77 19,218,19 6 2,100,361.176,301,083.52 N/A Total Value of Editorial Coverage Over the Period Global & Corporate

76. Slide no. 76 © South African Tourism 2010 655219,471,423 15,084,510.57 815234,845,51117,247,342.7 6 45,244,530.7 0 51,733,027.27 Perio d Total articles Circulatio n Ad Value in ZAR PR Value in ZAR Apr 09 – Sep 09 Apr 10 – Sep 10 33454,490,968 7,848,774.38 35358,273,231 8,261,505.53 23,546,323.14 24,784,516.5 9 Agency Generated / All ROI The PR Value is calculated by multiplying the Ad Value by a factor of 3 – this is because editorial is universally regarded as more credible, and therefore more valuable, than advertising. ROI is calculated by dividing the total PR Value for the period by the total retainer for the period ROI = 1 : 9 Includes EVERYTHING done by FD– Global, Corporate, Business Tourism, Product & Itinerary, Domestic, SADC etc. Please note that 2010 coverage is only for 5 months as the September figures were not available at the time of the report S.A. / Comparison of Editorial Coverage and ROI

77. Slide no. 77 © South African Tourism 2010 Slide no. 77 © South African Tourism 2010 Total value of Editorial Coverage in Rands over the Period Worldwide Agency Generated Australia France India Japan Netherlands South Africa * USA 69,193,397.82 44,104,331.81 1 : 195 1 : 58 98,889,731.61 93,889,965.00 1 : 389 1 : 153 6,102,742.43 9,051,754.02 1,459,061,115.4 4 1 : 30 1 : 39 1 : 213 6,044,847.05 10,988,375.5 5 10,148,416,107.92 1 : 38 1 : 434 1 : 1,621 Countr y 200 9 R OI 201 0 R OI 44,213,631.24 1 : 10761,042,597.6 6 1 : 171 291,304,084.7 4 1 : 629 184,719,571.88 1 : 554 77,840,818.7 6 1 : 238 22,533,790.38 1 : 83 270,162,202.5 0 1 : 371 481,692,281.40 1 : 782 150,853,457.1 9 1 : 450 521,414,587.52 1 : 2,059 226,311,779.4 3 1 : 345 8,036,782,616.5 5 1 : 14,412 52,048,565.07 1 : 147 474,187,460.5 5 1 : 1,838 45,244,530.70 1 : 13 25,512,737.00 1 : 9 (approx) 172,629,819.7 3 1 : 148 132,683,959.631 : 146 South Africa includes 2010 tactical, Fly the Flag, Sho’t Left Global, Corporate, Business Tourism, Product & Itinerary, Domestic and SADC China Germany Italy Kenya Nigeria UK Total Please note that 2010 coverage is only for 5 months as the September figures were not available at the time of the report

78. Slide no. 78 © South African Tourism 2010 Slide no. 78 © South African Tourism 2010  South African Tourism spent R 315,8 million or 81% of its budget of R 389,9 million budget during the first 5 months of the 2010/11 financial year.  The reasons for this underspent situation are:  some projects have been slightly delayed for a number of reasons;  the continued strength of the Rand has resulted in forex profits of which some has been reallocated to new and existing marketing projects; however, some profits have not been reallocated yet South African Tourism’s finances as at 31 August 2010

79. Slide no. 79 © South African Tourism 2010 Slide no. 79 © South African Tourism 2010 Winning in 2011/12

80. Slide no. 80 © South African Tourism 2010 Slide no. 80 © South African Tourism 2010 Marketing Focus - 2011/12 1.Winning in 2011/12 is about pushing harder and leveraging our phenomenal Brand awareness/positivity from the 2010 World Cup. It took the UK 25 years to host the Cricket, Rugby and Football World Cups. South Africa achieved this in 15 years. 1.Our key marketing strategy will continue to focus on protecting our leadership in wildlife and adventure which will be supported by our hospitality and welcoming people. The critical factor is to develop a stronger ‘emotional connection’ with our people/destination and our consumer heartland. Building our emotional positioning will assist us in our strategy to engage and convert more visitors as opposed to just building awareness in the Global space.

81. Slide no. 81 © South African Tourism 2010 Slide no. 81 © South African Tourism 2010 Marketing Focus - 2011/12 3.The advertising medium will move more towards personalised customised communication mainly through online media/campaigns for conversion. However, we are still building Global awareness but traditional advertising will be used strategically to complement our 360 brand communication strategy.

82. Slide no. 82 © South African Tourism 2010 Slide no. 82 © South African Tourism 2010 How to Win in 2011/12 1.Launch new Global BIG Idea with new images to support 2011/12 campaign that improves conversion and relevancy. a. Build positive awareness by developing fewer and bigger executions that can be leveraged online and on global platforms. (Discover why South Africa hosted the most experiential and adventurous World Cup) b. Develop stronger emotional connections with SA people/key experiences – Key is to focus on experiences that are highly memorable. 1.Global Media a.Assess media landscape and develop Global media strategy that talks to the hearts and minds of our core target audience b.Global media buy to cover massive opportunities in Africa, Asia + South America 3. eMarketing to form even bigger part of marketing activity leveraging social media platforms and key travel sites. 4. National convention and events bureau to be set up to enhance national bidding capacity and delegate boosting. (examples: Climate change, Airport games, Architects congress, Cardiology, Olympics, etc.)

83. Slide no. 83 © South African Tourism 2010 83 REVENUE TARGETS 2008 Actual 2009 Baseline2010T2011T2012T2013T2014T2015T Total foreign direct spend (R-bn)100.1109.2117.2126.1135.7146.0157.0169.0 Assumptions: 1. 2009 was used as the baseline for setting the targets 2. 2009 estimates was calculated based on the available data for the year collected through the departure and domestic surveys 3. 2009 estimates were then corrected to real values using CPI of 6.2% as published by StatsSA 4. A forecast CPIX of between 5 to 7% was assumed 5. For these targets, the middle of the range CPIX value of 6% was assumed 6. The targets are represented in real terms as adjusted for assumed CPI of 6% The outcome we are working towards will result in an additional R69 billion revenue by 2015

84. Slide no. 84 © South African Tourism 2010 Slide no. 84 © South African Tourism 2010 KEY CHALLENGES FOR TOURISM Our competitiveness – 16.1 arrivals per job; revenue low Barriers to travel – Value; safety remain Risks – natural disasters; economic recession Transformation is slow Positioning – our culture is undersold and under packaged Oversupply in the industry driven by world cup

85. Slide no. 85 © South African Tourism 2010 85 1. Safety & security of tourists Research confirms that this represents the biggest deterrent to aggressively growing tourist arrivals to South Africa over the next 5 years. SA Tourism will continue to work with its stakeholders in Government and the private sector to address this. Following the recent completion of the Safety and Security study, we will now draft a letter from our Board to the Minister of Tourism and the Office of the President given the earlier Board decision in this regard (see the separate slide on this topic from our recent research on this matter, we now know that crime is costing South Africa R 32,22 billion per annum in lost foreign direct spend from tourists and 183 000 direct jobs lost per annum). 2. Provincial- and Local Authority Tourism Authorities Like in most other countries, South Africa needs to create a culture of more domestic travel as that is the biggest contributor to sustainable businesses and jobs in tourism industry. Realizing that the bulk of domestic tourism growth should come from the metropolitan areas, Provincial Tourism Authorities should be encouraged to spend the bulk of their budgets on: 2.1 the aggressive promotion of travel to their provinces within the metropolitan areas (e.g. through billboards and radio advertising) and not on overseas marketing and travelling (which is SA Tourism’s primary responsibility); 2.2 creating a culture of a “welcoming-towards international- and-domestic-tourists” public in their provinces that will also be the eyes and ears of Government (to deter/report crime). SA Tourism’s medium to longer-term challenges

86. Slide no. 86 © South African Tourism 2010 86 Extract from SA Tourism’s latest Strategic Plan (until 2015/16) (R’mil) Detail/Financial yearAudited 2008/9Audited 2009/10Approved budget 2010/11budget 2011/12budget 2012/13budget 2013/14budget 2014/15budget 2015/16 Total revenue budget 740 945 454 866 743 518 823 180 293 828 319 148 865 538 067 902 005 698 942 228 662 944 280 546 Less: Overheads & CAPEX 227 611 967 206 481 360 217 102 177 223 377 489 230 910 020 236 536 278 242 594 771 248 469 347 Total HR mainline expense items 110 911 933 111 459 183 118 341 747 127 309 611 131 128 900 135 062 767 139 114 650 143 288 089 Total Net premises mainline expense items 16 867 439 17 397 452 25 445 252 23 395 901 29 611 230 31 064 523 30 301 372 30 966 549 Total Other operating expenses mainline expense items 68 548 759 72 296 489 58 135 178 56 611 537 53 290 368 52 753 007 54 710 594 55 377 190 CAPEX 31 283 836 5 328 236 15 180 000 16 060 440 16 879 522 17 655 980 18 468 156 18 837 519 Total amount available for marketing and research 513 333 487 660 262 158 606 078 116 604 941 658 634 628 047 665 469 420 699 633 891 695 811 199 Total marketing expenses 537 669 992 652 238 113 606 078 116 604 941 658 634 628 047 665 469 420 699 633 891 695 811 199 Net surplus/deficit for the year -24 336 505 8 024 044 - - - - - - Total non-marketing overheads 83 496 136 74 997 889 76 038 627 80 200 955 82 937 242 85 617 189 86 123 210 87 880 575 Non-marketing overheads as a % of total marketing revenue11.8%9.0%9.7%10.2%10.1%10.0%9.6%9.8%

87. Slide no. 87 © South African Tourism 2010 87 SAT marketing expenses: 2009/10 – 2011/12 Country office Currency of office Audited 2009/10 Approved (forex)(R’mil) budget 2010/11 (forex) budget 2010/11 budget 2011/12 (forex) budget 2011/12 (R’mil) 1. USAUSD5.666 43.631 5.074 42.406 5.074 42.423 2. UKGBP3.025 37.745 2.740 34.348 2.740 34.335 3. GermanyEUR4.052 43.517 3.371 36.128 3.371 36.133 4. FranceEUR2.840 30.916 2.375 25.461 2.189 23.465 5. NetherlandsEUR2.042 22.409 1.813 19.432 1.720 18.435 6. ItalyEUR1.215 13.165 0.690 7.392 0.690 7.393 7. IndiaINR67.102 13.420 105.882 18.000 88.235 15.000 8. ChinaCNY10.593 12.712 15.250 11.585 14.238 9. JapanJPY79.786 6.736 59.663 8.811 59.663 5.395 10. AustraliaAUD2.347 15.407 2.339 12.400 2.339 15.906 11. DomesticZAR 19.500 - 12. NigeriaUSD 6.813 - 6.991 13. KenyaUSD 5.110 - 3.610 14. SADCUSD 7.133 - 6.633 15. AngolaUSD - - 7.133 - 9.633 16. DRCUSD - - 7.133 - 5.633

88. Slide no. 88 © South African Tourism 2010 88 SAT marketing expenses: 2009/10 – 2011/12 Please note that the 2009/10 Africa figure includes Indaba 2010/11 strategy for Americas & Europe Portfolio’s are to stabilise while we increase funding in Africa and Asia Portfolio’s Finance’s & Office of the CEO’S 2008/9 audited figures were negative due to exchange profits Business UnitAudited 2009/10Approved (R’mil)budget 2010/11budget 2011/12 (R’mil) 1. Americas & UK Portfolio 84.284 79.544 79.709 2. Europe Portfolio 109.838 91.203 87.379 3. Asia Portfolio 48.169 54.562 52.144 4. Africa Portfolio including Domestic* 35.858 55.000 52.000 5. Business Tourism 27.078 10.500 11.109 6. Central Marketing 199.824 183.000 189.635 7. PR & Comms 17.546 12.000 11.000 8. Events 31.394 10.000 8.000 9. TGCSA 4.570 22.936 25.410 10. TECSA 1.061 - - 11. Finance 7.738 5.798 6.134 12. HR 0.185 2.005 2.121 13. e-Marketing 25.219 18.000 14.000 Sub total 592.762 544.547 538.642

89. Slide no. 89 © South African Tourism 2010 89 SAT marketing expenses: 2009/10 – 2011/12 Business UnitAudited 2009/10Approved (R’mil)budget 2010/11budget 2011/12 (R’mil) Sub total from previous page 592.762 544.547 538.642 14. Business Systems (IT) - - - 15. Office of the CEO/COO 1.988 6.500 6.877 16. Research 45.600 46.531 49.230 17. Product 11.889 8.500 10.193 Total Marketing expenses 652.238 606.078 604.942

90. Slide no. 90 © South African Tourism 2010 90 Changes to SAT’s non-financial resources during the 2011/12 financial year 1. People 1.1. Number of employees SA Tourism’s current staff complement of 174 will be increased by 3 staff members to 177 to cater for the Luanda office staff effective 1 April 2011 (Country Manager, Trade Relations/Marketing Communications Manager and Finance & Admin Manager). No other changes will take place in terms of SA Tourism’s staff compliment until 31 March 2012 and sufficient provision has been made in the budget to fund it.

91. Slide no. 91 © South African Tourism 2010 91 Changes to SAT’s non-financial resources during the 2010/11 financial year 1. People (continue) 1.2. Skill set of staff members No changes are foreseen. 1.3. Time allocation/management of marketing staff members 1.3.1 In terms of SA Tourism’s Board-approved market prioritization, marketing staff members will continue to spend the following proportion of total available time on the different types of markets: Core markets: 60%, Investment markets: 20%, Tactical markets: 15% and Watch-list markets: 5%. 1.3.2 In terms of maximizing available time of all SAT managers,: 1.3.2.1 SAT will continue to encourage short to-the-point meetings preferably not exceeding 3 hours; 1.3.2.2 SAT will continue to encourage staff members to rather attend to e-mails after 13h00 every day (and not during the mornings when productivity is at its optimum); 1.3.2.3 SAT will continue to enforce the following management routines (where proper minutes should be kept available for audit-inspection purposes): 1.3.2.3.1 An Exco meeting every Tuesday 1.3.2.3.2 A Manco meeting twice a month (on Wednesday’s) 1.3.2.3.3 A Country Office meeting twice a month 1.3.2.3.4 A Business Unit meeting twice a month

92. Slide no. 92 © South African Tourism 2010 92 Changes to SAT’s non-financial resources 2. Systems No change is foreseen at this stage to SA Tourism’s 3 primary systems (Oracle, EPM Project Management and the QIT Grading Backoffice system) except for the implementation/loading of regular updates/patches.

93. Slide no. 93 © South African Tourism 2010 93 Changes to SAT’s non-financial resources 3. Infrastructure 3.1 Head Office No change 3.2 Country offices SA Tourism’s 11 country offices will be retained and no additional offices are planned due to the budget constraints.

94. Slide no. 94 © South African Tourism 2010 94 Changes to SAT’s non-financial resources 4. Business Units No changes are necessary in SAT’s current 15 business units. Office of the CEO/COO (including Legal, Internal Audit & Admin) Human Resources Africa Portfolio (including Domestic Marketing) Asia, Australasia and Americas Portfolio Europe & UK Portfolio Events Business Tourism Central Marketing (including Global Brand, Channel & Agency Management) E-Business Research PR & Comms Product & Itinerary Finance TGCSA Business Systems (previously known as IT)

95. Slide no. 95 © South African Tourism 2010 95 Changes to SAT’s non-financial resources effective 1 April 2011 The budget cuts of R 50,4 million, R 53,4 million and R 57,0 million over the 2010/11, 2011/12 and 2012/13 financial years have been fully catered for and no staff reduction or office closures are foreseen until 31 March 2012 unless the Rands weakens dramatically against major currencies in which case the situation will be re-assessed.

96. Slide no. 96 © South African Tourism 2010 Slide no. 96 © South African Tourism 2010 SA Tourism’s KPI’s and targets for 2011/2 (get from Gomo) SA Tourism’s KPI’s and targets for 2011/12 (please note that a projection for a financial year, e.g. 2011/12 will lead to the achievement or non-achievement of a projection during the previous calendar year, in this case the 2011 calendar year)

97. Slide no. 97 © South African Tourism 2010 Slide no. 97 © South African Tourism 2010 Moving forward – CEO I will lead the organisation forward on these key areas and give personal attention to some of them: First and Foremost to raise the profile of tourism within government and continue the battle for more funds especially post 2010. Partnerships with industry via TBCSA and others to promote brand competitiveness ito value for money; access and quality experience. Defend core markets – convert awareness to arrivals New growth – Brazil, India, Angola, Nigeria and DRC offer quick wins for growth Watchlist – Spain, Argentina and Portugal – tactical opportunities

98. Slide no. 98 © South African Tourism 2010 Slide no. 98 © South African Tourism 2010 Moving Forward continued Setting up of national conventions and events bureau – critical bidding support, positioning for meetings/events and research. Linked to Sports bidding strategy with SRSA Staff development and internal communication to drive results focussed and people centred organisation. To make SAT a top best company to work for. Also look at succession planning and coaching. Stakeholder management intra-government especially Home Affairs; DIRCO; DOT, Arts and Culture and Safety and Security Quality assurance and visitor experience – new grading critieria to be launched.

99. Slide no. 99 © South African Tourism 2010 Slide no. 99 © South African Tourism 2010 Siyabonga Thank You