Jean-Claude Baumgarten President World Travel & Tourism Council

2. Jean-Claude Baumgarten President World Travel & Tourism Council

3. FOUNDING MEMBERS Abercrombie & Kent Accor Hotels American Airlines American Express Avis British Airways Canadian Pacific Hotels Delta Air Lines East Japan Railways Hertz Iberia Airlines Regent International Hotels The Promus Companies Thrifty Rent-a-Car United Airlines Westin Hotels & Resorts

4. Consumption = Travel & Tourism Industry Demand = Travel & Tourism Economy

6. What is Driving the Global Economy? • Macro policy still supportive despite rising interest rates • Long-term interest rates very low • China continues to boom • Buoyant company profits • Recovery in confidence and stock markets • High oil prices not proving to be major constraint on growth

7. Risks to the Forecast • Avian flu pandemic major risk for air travel and international trade • US consumers run out of steam • Twin deficits in the US • Chinese hard landing • Tighter policy causes European and Japanese recovery to stall • Terrorism

8. Implications for Travel & Tourism • Travel & Tourism industry benefiting from strength of global economy • Low interest rates supporting strong consumer demand • Improvement in company finances and M&A activity boosting business travel • Energy costs impacting the P&L bottom line • Countries highly dependent on inbound tourism the most exposed to a flu pandemic • Long-term prospects still very positive

10. Richard R. Miller Executive Vice President World Travel & Tourism Council

11. 2001

12. September 11, 2001

13. 2002/2003

14. Spring 2003

15. 2004 Remarkable Robust Recovery

16. December 26, 2004

17. 2005 Sowing the Seeds of Growth

18. July 7, 2005

19. 2006 Climbing to New Heights

20. WTTC’s 2006 Tourism Satellite Accounting Research

21. The World Perspective

22. World 2005 showed robust growth across the board. For 2006 we expect stronger Visitor Exports but other spending slightly off 2005 levels of growth, but still noticeably higher than 10-year annualized forecast.

23. T&T Economy GDP World Average Caribbean Other Western Europe Oceania European Union North Africa Middle East Northeast Asia Sub-Saharan Africa 2006 T&T Economy GDP (Percent of Total) Central and Eastern Europe North America South Asia Latin America Southeast Asia T&T Economy GDP Growth 2007-2016 (Percent Annualized)

24. T&T Economy GDP World Average 2006 T&T Economy GDP (Percent of Total) North America Latin America T&T Economy GDP Growth 2007-2016 (Percent Annualized)

25. T&T Economy GDP Costa Rica Canada Mexico United States 2006 T&T Economy GDP (Percent of Total) Panama Uruguay Too Small: El Salvador, Honduras, Bolivia, Paraguay, Nicaragua, Belize, Suriname, Guyana Ecuador Peru Colombia Guatemala Venezuela Brazil Argentina Chile T&T Economy GDP Growth 2007-2016 (Percent Annualized)

26. T&T Economy GDP World Average Other Western Europe European Union 2006 T&T Economy GDP (Percent of Total) T&T Economy GDP Growth 2007-2016 (Percent Annualized)

27. T&T Economy GDP EU Average Portugal Malta Greece Cyprus Sweden Spain Belgium Slovenia Austria Slovakia Iceland 2006 T&T Economy GDP (Percent of Total) Switzerland Estonia Italy Czech Republic Turkey Lux Lithuania Denmark Hungary Latvia Poland Netherlands France Ireland United Kingdom Germany Norway Finland T&T Economy GDP Growth 2007-2016 (Percent Annualized)

28. T&T Economy GDP World Average Oceania Northeast Asia 2006 T&T Economy GDP (Percent of Total) South Asia Southeast Asia T&T Economy GDP Growth 2007-2016 (Percent Annualized)

29. T&T Economy GDP Maldives (67%) Other Oceania (32%) Cambodia Fiji (33%) Macau (86%) Hong Kong Malaysia New Zealand China Thailand Brunei Australia Sri Lanka 2006 T&T Economy GDP (Percent of Total) Singapore Laos Vietnam Philippines Papua NG Nepal Too Small: Vanuatu, Tonga, Solomon Islands, Kiribati Japan India Indonesia Bangladesh South Korea Burma Pakistan Chinese Taipei T&T Economy GDP Growth 2007-2016 (Percent Annualized)

30. T&T Economy GDP World Average Central and Eastern Europe 2006 T&T Economy GDP (Percent of Total) T&T Economy GDP Growth 2007-2016 (Percent Annualized)

31. T&T Economy GDP Croatia Bulgaria Montenegro Bosnia/Herz 2006 T&T Economy GDP (Percent of Total) Albania Ukraine Russian Federation Macedonia Yugoslavia Romania Belarus T&T Economy GDP Growth 2007-2016 (Percent Annualized)

32. T&T Economy GDP World Average North Africa Middle East 2006 T&T Economy GDP (Percent of Total) T&T Economy GDP Growth 2007-2016 (Percent Annualized)

33. T&T Economy GDP Bahrain Jordan Morocco Tunisia Egypt Syria 2006 T&T Economy GDP (Percent of Total) Libya Qatar Lebanon Iran UAE Yemen Algeria Kuwait Saudi Arabia Israel Oman T&T Economy GDP Growth 2006-2015 (Percent Annualized)

34. T&T Economy GDP World Average Caribbean 2006 T&T Economy GDP (Percent of Total) T&T Economy GDP Growth 2007-2016 (Percent Annualized)

35. T&T Economy GDP Caribbean Avg US Passport Impact Begins 2007 Potential to Benefit Antigua Barbuda Aruba Anguilla Barbados Bahamas 2006 T&T Economy GDP (Percent of Total) St Lucia BVI’s Guadeloupe US Virgin Islands Jamaica Cayman Islands Grenada Dominica Dominican Republic St Kitts/Nevis St Vin/Gren Cuba Trinidad Tobago Puerto Rico Bermuda Curaçao Martinique Haiti T&T Economy GDP Growth 2007-2016 (Percent Annualized)

36. In Jeopardy - Visitor Exports *Potential to Benefit Percent of Total Visitor Exports

37. T&T Economy GDP World Average 2006 T&T Economy GDP (Percent of Total) Sub-Saharan Africa T&T Economy GDP Growth 2007-2016 (Percent Annualized)

38. T&T Economy GDP Angola (41%) Seychelles (54%) Mauritius Cape Verde 2006 T&T Economy GDP (Percent of Total) Nigeria South Africa Kenya Namibia Sudan Gabon Chad Reunion T&T Economy GDP Growth 2007-2016 (Percent Annualized)

39. The Top Ten Lists

40. 2006 - 2016

41. T&T Demand WTTC’s Top Ten Industry Growers (2007-2016 Annualized Real Growth, Percent) 1 Montenegro 10.2 2 China 8.7 3 India 8.0 4 Romania 7.9 5 Croatia 7.6 6 Vietnam 7.5 7 Latvia 7.3 8 Maldives 7.2 9 Albania 7.0 10 Cambodia 7.0

42. T&T Economy Employment WTTC’s Top Ten Job Creators (2007-2016 Employment Growth, Jobs) 1 China 12,389,790 2 Mexico 2,858,515 3 India 2,666,670 4 Indonesia 2,539,180 5 Spain 1,364,452 6 Brazil 1,359,725 7 Japan 1,136,158 8 Vietnam 924,618 9 France 909,185 10 Philippines 873,971

43. T&T Capital Investment WTTC’s Top Ten Investors (2005-2014 Annualized Real Growth, Percent) 1 Spain 9.4 2 Russian Federation 9.3 3 Mexico 8.8 4 China 8.3 5 Hong Kong 8.2 6 India 7.8 7 Libya 7.8 8 Montenegro 7.5 9 Norway 7.4 10 Bahrain 6.9

44. EU25, G8 Plus 5

45. European Union Strength of most TSA elements propelled the EU25 to excellent results in 2005. In 2006, surging Visitor Exports are expected to propel EU25 results above last year’s GDP and Employment levels. Only weaknesses showing in 2006 are Govt Expenditures and Capital Investment.

46. Canada In 2005, Visitor Exports was weak link with real loss of 2.4%, while GDP still met 10 year avg from strength of Personal, Biz Travel and Capital Investment. This year, Visitor Exports rebound (+5.3%) is expected to return industry to healthy GDP and Employment position.

47. China Continuation of extraordinary growth, double digit in all categories except Govt Spending, but strong too. In 2006, Personal and Biz Travel are pushing real Industry GDP growth up 12.7% while Capital Investment is keeping Economy GDP high.

48. France 2005 was a strong year for Travel & Tourism in France with the exception of Visitor Exports. 2006 should follow suit except Capital Invest is expected to weaken and Visitor Exports strengthen with the latter pushing GDP and Employment to higher levels.

49. Germany Personal and Biz T&T are doing well in Germany, and Visitor Exports is exceeding 10-year forecast putting GDP and Jobs in favorable position. Govt Expend and Capital Investment were down in 2005, but expected to recover and boost T&T Econ. GDP and Jobs in 2006.

50. India 2006 appears to be a near repeat of a very strong 2005 in all categories of Travel & Tourism economics with the exception of a stronger outlook for Biz Travel.