Tourism Industry Thriving in the UAE, to rise 67% by 2016

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Vistors during Arabian Travel Market 2012
Vistors during Arabian Travel Market 2012. Photo courtesy-ATM

The Middle East region, especially the UAE is now entering a new era of stability and increased connectivity and expansion of existing infrastructure. UAE tourism receipts are forecast to rise by 67% over the next few years. This was higlighted during the Arabian Travel Market (ATM) 2013 road show series which concluded in Dubai today.

According to Alpen Capital’s October 2012 GCC Hospitality Industry Report, the UAE’s hospitality market is likely to reach $7.5bn by 2016, up from $4.5bn (67% increase) in 2011 as visitor demand gains traction and new hotel supply enhances the existing tourism product.

“The UAE’s tourism map is now incredibly diverse. The Northern Emirates of Sharjah and Ras Al Khaimah are building on their own cultural foundations to present a series of unique individual products that, together with Dubai and Abu Dhabi, position the country as a cohesive hospitality hub, with varied appeal,” said Mark Walsh, Portfolio Director, Reed Travel Exhibitions.

Looking longer term, a recent Dubai Chamber study, supported by statistics published by Business Monitor International, puts UAE tourism sector growth at 6.5% per annum between 2011-2021, with visitors from the Middle East, Europe and Asia Pacific the key source markets. Employment growth prospects for the sector are also buoyant, with a forecast annual real growth rate of around 4.1%.

Tourist arrivals in the UAE are forecast to grow at a CAGR of 5.3% between 2012 and 2022, with hotel supply also expected to increase from the current 96,992 hotel rooms in Dubai and Abu Dhabi, to a total of 125,383 hotel rooms in 2016.

Dubai and Abu Dhabi continues their impressive performance

The emirate of Dubai continues to build on impressive performance levels. In November 2012, year-to-date occupancy of 80% was up 2% on 2011 according to Ernst & Young’s 2012 Middle East Hotel Benchmark Survey.

Dubai International Airport, which is currently ranked the fourth busiest airport in the world in terms of international passengers, recorded total passenger traffic in the first 11 months of 2012 at 52.3 million travellers, up 13.1% against 2011, with passenger numbers forecast to reach 56.5 million in 2012, and 98 million by 2020.

Abu Dhabi has recorded similarly buoyant figures with 2012 another record year according to the Abu Dhabi Tourism & Culture Authority (TCA Abu Dhabi), which revealed that in 2012 it welcomed 2.3 million hotel guests to the emirate’s hotels and hotel apartments, representing a 13% rise on 2011 figures. Hotel revenues for the same period also increased by 6% to $1.261bn.

Other Emirates gaining momentum

Ras Al Khaimah’s plans to position itself as a nature-focused tourism destination are gaining momentum. By 2021, the emirate expects around 20% of its GDP to be generated by tourism-related activities. According to Oxford Business Group, the northern emirate is aiming to 10,000 rooms by 2016 with a $218m commitment to tourism development from the government.

“Local government investment into infrastructure, private sector investment into creating world-class attractions, and major route expansion by the two national carriers is a three-way strategy that is paying dividends for the UAE tourism industry,” said Walsh.

Held under the patronage of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, Ruler of Dubai and set to celebrate its 20th anniversary, the show has grown to become the largest showcase of its kind in the region and one of the biggest in the world.

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