The Arabian Dream Becomes Reality: As Dubai Gears Up to Welcome Delegates to the 13th Arab Travel Market, One of the Major Events in the Travel and Tourism Industry Calendar, Rhona Wells Looks at Some of the Latest Regional Developments-The Futuristic Projects, the Multibillion Dollar Investments and the Prospects for the Region's Continued Success as an International Tourist Destination

By Wells, Rhona | The Middle East, May 2007 | Go to article overview

The Arabian Dream Becomes Reality: As Dubai Gears Up to Welcome Delegates to the 13th Arab Travel Market, One of the Major Events in the Travel and Tourism Industry Calendar, Rhona Wells Looks at Some of the Latest Regional Developments-The Futuristic Projects, the Multibillion Dollar Investments and the Prospects for the Region's Continued Success as an International Tourist Destination


Wells, Rhona, The Middle East


ARAB COUNTRIES ARE increasingly investing in worldwide tourism and governments in the region are making determined efforts to tap into the potential of attracting foreign visitors. Improved product development, enhanced funding for tourism and an increase in marketing and promotion have all facilitated the task and helped to secure a good return on investment.

The Middle East's positive results (with tourism up an average of 6%) have to be interpreted within the geopolitical context; data available so far shows that the 34-day conflict between Israel and Lebanon last summer had only very limited impact on the growth pace of the region as a whole. However, Israel's once thriving tourist industry has been reduced to a mere trickle of foreign guests because of the ongoing unrest in the country. But although it has taken its toll on tourism demand for some destinations, past experience suggests that consumer confidence recovers quickly.

The United Nations World Tourist Organisation (UNWTO) forecasts that international arrivals to the region may end 2006 up by 7.2%, well above the expected world growth rate of 4.6%. In the first eight months of 2006, international tourist arrivals totalled 578m worldwide (+4.5%), up from 553m in the same period of 2005, a year which saw an all-time record of 806m people travelling internationally. Growth is expected to continue in 2007 at a pace of around 4% worldwide.

Travel and tourism activity in the Middle East region is expected to grow by 4.4% per annum in real terms between 2007 and 2016. The travel and tourism sector in 2006 will generate $148bn in the Middle East, with a target figure of $279.4bn by 2016, according to UNWTO. The industry is expected to contribute 2.6% ($27.3bn) to GDP in 2006, rising in nominal terms to 58.9bn (3.1% of total) by 2016.

Mega projects are already underway in the region or are planned for the near future and focus mainly on developing the infrastructural basis of the tourism industry. Although diversification of Middle East oil-based economies through tourism is a relatively recent phenomenon, governments in the region have gone out to secure a slice of this lucrative market.

According to UNWTO's panel of experts from the region, tourism growth has been stimulated by the public and private sectors increasingly working in partnership.

It is estimated that the Middle East economies benefited from 4.5m tourism-related jobs in 2006, 10.1% of total employment, or one in every 9.9 jobs. By 2016, this should total 6.1m jobs, 10.6% of total employment. The 1.6m jobs that currently exist in the industry accounted for 3.7% of total employment in 2006 and this figure is set to rise to 2.4m jobs or 4.3% of the total by 2016. Capital investment in the region's tourism is estimated at $21.1bn or 9.9% of total investment in the year 2006. By 2016, this should reach $39.4bn or 9.6% of total. Government tourism operating expenditures in 2006 are expected to total $3.8bn or 2.1% of total government spending. In 2016, this spending is forecast to total US$6.5 bn, or 1.8% of total government spending.

Currently there are 2,185 hotels registered in the Gulf region, with 178,662 rooms spanning all categories. Another 128 new hotels are predicted to open their doors in the GCC in the period up till 2009 adding 41,396 rooms. New developments such as the $27bn Bawadi project in Dubailand comprise 31 hotels delivering 29,200 rooms; and the Nakheel Palm development, which is expected to open in 2008, will include about 40 hotels. Overall occupancy levels at 73% are the best in the world and remain high. Rates in Dubai are as high as 85% and in Abu Dhabi reach 78%. While the top-of-the-range hotels such as Four Seasons, Ritz-Carlton, Rosewood and Fairmont are consolidating their regional base, several chains are expanding into the mid-market sectors with brands such as Accor's Ibis, Holiday Inn Express and Rotana's Centro drawing up plans to enter this region.

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The Arabian Dream Becomes Reality: As Dubai Gears Up to Welcome Delegates to the 13th Arab Travel Market, One of the Major Events in the Travel and Tourism Industry Calendar, Rhona Wells Looks at Some of the Latest Regional Developments-The Futuristic Projects, the Multibillion Dollar Investments and the Prospects for the Region's Continued Success as an International Tourist Destination
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