MR.HASAN ARAT MR.HASAN ARAT Vice Chairman

Tourism Sector Assembly of Turkey

Istanbul, 10 May 2011 Istanbul, 10 May 2011

4th United Nations Conference 4th United Nations Conference on the Least Developed Countrieson the Least Developed Countries

WEDF 2011WEDF 2011

The Union of Chambers and Commodity Exchanges of Turkey (TOBB) is the highest legal entity in Turkey representing the private sector. Today, TOBB has 365 members in the form of local chambers of commerce, industry, commerce and industry, maritime commerce and commodity exchanges.

TOBBTOBB

TOURISM SECTOR ASSEMBLY OF TURKEYTOURISM SECTOR ASSEMBLY OF TURKEY Tourism Sector Assembly of Turkey has been formed as an advisory body. Members of the Assembly consist of representatives of associations and organisations of businessmen active in the sector and principal manager or equivalent status civil servants of related public sector institutions and establishments.

Determine problem issues related to the sector and suggest solutions, Prepare sectorial reports and projections for the future and create sectorial strategies, Organize activities such as symposiums, panels, conferences and forums to encourage sectorial developments, Make suggestions for the sector to measure its current competitiveness and how to increase its future market share, Set up meetings with government officials and related public sector authorities when necessary, with the approval of the Chairman.

TOP DUTIES & OBJECTIVES TOP DUTIES & OBJECTIVES

FACTS ABOUT TURKEYFACTS ABOUT TURKEYPopulation Population : : 7722 million million

Total Area : 814.578 sq kmTotal Area : 814.578 sq km  

GDP : 620 billion $ GDP : 620 billion $ ((World’s 15th largest economyWorld’s 15th largest economy))

Internet users : 35 million (49%)Internet users : 35 million (49%)

Cell phone users : 62 million (86%)Cell phone users : 62 million (86%)

Universities : 156 Universities : 156

20 million students (primary-secondary-tertiary) United Nations & UNESCO Member since 1945United Nations & UNESCO Member since 1945European Council Member since 1949European Council Member since 1949NATO Member since 1952NATO Member since 1952

TURKEY IS AN OPEN AIR MUSEUM

Archeological SitesArcheological Sites : : 7.272 7.272Natural SitesNatural Sites : : 1.163 1.163 LandmarksLandmarks :: 81.887 81.887Antique CitiesAntique Cities : : 237237Historical Museums Historical Museums :: 95 95

Some of Major Civilizations

HittitesPersiansMacedon

iansRomansHattisPhrygian

sUrartians

Helens

Lycians

Ionians

Lydrians

SeljuksByzantinesOttomans

Throughout 10.000 years of history,

Anatolia hosted 23 civilizations and 3 major religions.

Goreme National Park and Rock Sites of Cappadocia

Mount Nemrut/Adıyaman

Hattusha, Ancient Hitite Capital

Historic Areas of Istanbul

Great Mosque and Hospital of Divriği

Hierapolis-Pamukkale

Xanthos-Letoon, Ancient Lycian cities

City of Safranbolu

Archaeological Site of Troy/Çanakkale

TURKEY HAS 9 OF THEUNESCO’S WORLD HERITAGE

Archaeological Site of Göbeklitepe /Şanlıurfa

10th to be announced in World Heritage Committee Meeting in 19-29 June 2011

162 Airplanes162 Airplanes Flying to 163 Destinations Flying to 163 Destinations (38 domestic + 125 international) (38 domestic + 125 international)

29 million Passengers (2010)29 million Passengers (2010)

More than More than 10100 0 million air passengers in Turkey million air passengers in Turkey

11 Airplanes11 Airplanes Flying to 13 Destinations Flying to 13 Destinations (dom. + int.)(dom. + int.)

36 Airplanes36 Airplanes Flying to more than Flying to more than 100 Destinations 100 Destinations (dom. + int.)(dom. + int.)

16 Airplanes16 Airplanes Flying to 11 Dest.Flying to 11 Dest.(dom. + int.)(dom. + int.)

30 Airplanes30 Airplanes Flying to Flying to 83 Destinations 83 Destinations (dom. + int.)(dom. + int.)

25 Airplanes25 Airplanes Flying to Flying to 55 Destinations 55 Destinations (dom. + int.)(dom. + int.)

TURKEY’S PROMOTION ACTIVITIES

Syria

Lebanon

Jordan

Countries

recen

tly lif

ted off v

isa to

Turkey

Countries

recen

tly lif

ted off v

isa to

Turkey

Albania

Russia

n Fed

erat

ion

Tunusia

Paki

stan

Libya

AndorraArgentineAntigua-BarbudaBahamasBarbados BelizeBrasilBoliviaBosnia-Herz.ChileColombiaCosta Rica CroatiaEl SalvadorFijiGrenadaGuatemalaGeorgiaHaitiHonduras Hong Kong IranJamaica JapanKazakhistanKosovaKyrgyzstan

Maccedonia MaldivesMalaysiaMarocMauritiusMontenegroNicaraguaRep. of PalauPhilippines ParaguayRep.of South AfricaSanta Lucia St.Vincent-GrenadinesSeychellesSerbia Singapore Solomon Islands South KoreaSri Lanka Swaziland ThailandTrinidad-TobagoT.R.N.C TuvaluUruguay VaticanVenezuelaWest Samoa

Countries who does notCountries who does notcurrently apply Visa to Turkeycurrently apply Visa to Turkey

ARRIVALS TO TURKEY FROM SOME DESTINATIONS (2010)

COUNTRY THOUSAND

GERMANY 4.385

RUSSIAN FEDERATION 3.107

UNITED KINGDOM 2.673

IRAN 1.885

BULGARIA 1.434

GEORGIA 1.112

HOLLAND 1.073

FRANCE 928

SYRIA 899

FACTS AND ECONOMIC ASPECTS OF TURKISH TOURISM

UNWTO 2009 Report - Turkey is 9th in tourism revenue and 7th in tourist arrivals in the world.

One quarter of the world’s population can be reached within three hours flight time.

Good balance between price and quality

High performance of Turkish tour operators abroad

Charter flights of Turkish air carriers

All inclusive system

Number of employment in the tourism sector is 1,5 million which corresponds to 6,5 % of overall employment in the Turkish economy.

The size of domestic tourism revenue is around 1/4 of the international tourism revenue. So in 2010, Turkey earned 5 billion US$ from domestic tourism.

In 2010 the service sector constitutes 73 % of GDP.

54 % of the total labour force in the country is employed by the service sector.

Tourism is among the first three sectors that attract highest level of investments.

Tourism sector stimulates overall production in the economy by creating demand for over 50 other sectors.

Tourism is the biggest net foreign currency generating sector in the economy. In 2010, Turkish tourism revenue was 20,8 billion US$.

SOME OF SOME OF LEADING TURKISHLEADING TURKISH HOTEL GROUPS / CHAINSHOTEL GROUPS / CHAINSOPERATOPERATING ING IN TURKEY AND ABROADIN TURKEY AND ABROAD

ESTABLISHMENTS BED CAPACITY

DEDEMAN HOTELS 25 10.471AKFEN / ACCOR 16 5.220ANEMON HOTELS 16 3.629

RIXOS HOTELS 13 10.581DIVAN HOTELS 10 2.624KAYA HOTELS 9 7.516LIMAK HOTELS 9 6.490

THE MARMARA HOTELS 9 2.790WORLD OF WONDERS 8 6.401

MERIT HOTELS 7 3.370PEGASOS HOTELS 7 9.123

BARUT HOTELS 7 3.970TITANIC HOTELS 7 3.090MARTI HOTELS 6 2.886

CLUB VOYAGE HOTELS 6 6.737

*

**

*

*

*

*

*(*) Operating both in Turkey and abroad

e.g. New York, Berlin, Northern Cyprus, Erbil, Moscow, Almaty, Astana, Sofia, Damascus, Aleppo, Bucarest, Tripoli, Kiev, Palmyra, Plovdiv, Tashkent, Batumi, Samara, Yaroslavi

Out of world’s top 100 best hotels 20 are from TurkeyOut of world’s top 100 best hotels 20 are from Turkey (TUI Holly, 2009 (TUI Holly, 2009))

*

*

TOURIST ARRIVALS TOURIST ARRIVALS & & TOURISM REVENUES TOURISM REVENUES IN TURKISH TOURISM (1980-2010)IN TURKISH TOURISM (1980-2010)

Tourist Arrivals (million)

Tourism Revenues (billion $)

1980 1.3 0.3 1985 2.6 1.5 1990 5.4 3.2 1995 7.7 5.0 2000 10.4 7.6 2005 21.1 18.2 2010 28.6 20.8

Tourism Encouragement Framework Decree published in 1980.

Tourism Encouragement Law No.2634 published in 1982.

The tourism investment move started by the late prime minister Mr.Turgut Özal at the end of 1983, (Land allocations, investment allowance, VAT Exemption)

Tourism was declared as “Special Important Sector in Development” in 1985.

MILESTONES IN TURKISH TOURISMMILESTONES IN TURKISH TOURISM

PUBLIC PRIVATE PARTNERSHIP EXAMPLES

Belek Tourism Center and Belek Tourism Investors Union (BETUYAB) 2 billion US$ of Superstructure Investments by Private Sector. Total Infrastructure Expenditures (350-400 million US$ ) equally shared by Tourism Investors, Ministry of Culture & Tourism, Other Public Institutions. Completed infrastructure investments : Drinking water / Waste water treatment plants / Road / Electrification / Telecommunication

Istanbul Shopping Festival (40 days) 26 million US$ for Promotional Expenditure, resulting 900.000 arrivals – 500 million US$ revenues – 100 % hotel occupancy rate.

Universiade 2011 (10 days) 308 million US$ Public Sector Investment , 3.6 million US$ for Promotional Expenditure , 2.500 participants from 52 countries

PUBLIC PRIVATE PARTNERSHIP EXAMPLES

Turkey’s 2011 Promotion Company Selection Committee Formed by NGOs and also by Ministry of Culture & Tourism authorities to supervise more than 50 million US$ budget. Total Gov. Marketing / Promotion Budget is aprx. 120 million US$

Trabzon 2011 European Youth Olympic Festival 300 million US$ Public Sector Investment including Promotional Expenditure, 4.000 athletes from 49 countries

Mersin 2013 Mediterranean Games 300 million US$ Public Sector Investment – 100 milyon US$ for Promotional Expenditure, 4.000 athletes from 24 countries.

Turkey clearly integrated the Principles of Sustainable Developmentinto Country Policies and Programmes safeguarding its environmentwell into the future.

The Environment Impact Assesment (EIA) process in Turkey is very crucial for Sustainable Development and the process starts with applying to the Ministry of Environment and Forestry.

Turkey will continue to educate the public with EIA which will also lead to long-term positive effects for Turkey's economy as well as maintaining sustainable tourism while also protecting and preservingnatural and cultural assets.

ENVIRONMENTAL EDUCATION / ISSUE ENVIRONMENTAL EDUCATION / ISSUE FOR SUSTAINABLE DEVELOPMENTFOR SUSTAINABLE DEVELOPMENT

NEW INVESTMENT MOVE IN TOURISM SECTOR (2010-2023)

LICENCED BY MINISTRY

LICENCED BY MUNICIPALITY

TOTAL PRESENTCAPACITY

NEW INVESTMENT

TOTAL CAPACITY

NEW INVESTMENT

TOTAL (MILLION $)

ACCOMMODATION

(*) 609.000 391.000 1.000.000 500.000 1.500.000 13.000

MARINAS 25 - 25 40 65 2.000

YACHT MOORING CAPACITY 10.000 - 10.000 20.000 30.000

GOLF COURSES15 - 15 35 50 525

NUMBER OF AIRPLANES 250 - 250 250 500

6.000

AIRPLANE SEATS 45.000 - 45.000 55.000 100.000

CONGRESS/FAIR SHOPPING MALL /ENTERTAINMENT SPORT FACILITIES CROISIER PORT

2.500

PRESENT INVESTMENT STATUS (2009)

FORESEEN INVESTMENT(2010-2023)

INVESTMENT TOTAL 24.025

BED OR SEAT CAPACITY

(*)includes Thermal / Spa

YEARSTOURIST

ARRIVALS

CHANGE %

TOURISM REVENUES

CHANGE%

(MILLION) (BILLION $)2010 29 8 21 02011 31 7 23 72012 33 6 24 72013 35 6 26 72014 37 6 28 72015 39 6 30 82016 42 6 32 82017 44 6 35 92018 47 6 38 92019 50 6 42 92020 52 5 45 92021 55 5 50 102022 57 5 55 10

2023 6060 55 6060 1010TOTAL 611611 66 509509 88

TOBB 2023 PROJECTION

WHAT INVESTORS ARE LOOKING FOR ?

Management opportunities

Shorter payback period on investments

Attractive long term bank loans / lendings

Long term land allocationland allocation

All kinds of tax exemptions for long periodtax exemptions for long period

Special support for SMEs in the sector

Electricity and water rate subsidies

Easily given employment permits

Guarantees against confiscation, immunity from administrative sequestration

THANK YOU

SOURCESREPUBLIC OF TURKEY MINISTRY OF CULTURE & TOURISM

REPUBLIC OF TURKEY PRIME MINISTRY INVESTMENT SUPPORT & PROMOTION AGENCY

TURKISH TOURISM INVESTORS ASSOCIATION

ASSOCIATION OF TURKISH TRAVEL AGENCIES