GULF: Despite Bad Press, Tourism Growing in Region

By IPS Correspondents Reprint | | Print |

Peyman Pejman

DUBAI, May 18 2004 (IPS) - Standing at her hotel’s exhibition booth at the Arabian Travel Market earlier this month, Anne Bleeker was all smiles. She thinks business is brisk and can only get better.

“Demand in Dubai is very high. The market is booming and there is a lot of growth,” says the Dutch public relations manager of the Jumeira International LLC, a chain of nine five-star hotels in Dubai and two in London.

The chain includes Burj al-Arab (Arab Tower), a trendy fit-for-royalty hotel whose 202 all-duplex suites rent for a minimum of about one thousand U.S. dollars a night. The hotel is known as one of the most luxurious hotels in the world, equipped with a helicopter pad to facilitate the arrival of high-class guests and chauffeured Rolls Royce cars to accommodate tenants’ movements.

With a total of about 25,000 hotel rooms in Dubai, Bleeker’s chain counts for about 10 percent of the city’s available rooms, and the company has further expansion plans in the future.

According to Dubai Tourism Development Co, 8,500 of the total rooms are in five-star hotels and the overall occupancy rate in Dubai last year was an unprecedented 72.5 percent.

But Bleeker is not the only one who is beaming. Hotel and tourism executives in the United Arab Emirates say Dubai is basking in unrivaled success, but add that the tourism outlook is equally bright for many other destinations in the Middle East.

Qatar has announced it will spend 20 billion dollars in the next six to 10 years on the tourism industry, hoping to attract an additional 600,000 tourists annually for a total of one million visitors.

Saudi Arabia, which receives millions of religious tourists, plans to ease visa restrictions to accommodate more pilgrims.

According to statistics published by the World Tourism Organisation, while worldwide tourism declined 1.2 percent in 2003, the Middle East showed a 9.5 percent increase, on top of 10.5 percent growth the previous year.

The organisation said tourism in the region showed a 27 percent aggregate growth between 2000 and 2003, despite the Iraq war, the backlash of the Sep. 11, 2001, terrorist attacks in the United States, and negative effect of diseases such as SARS.

At the same time, experts caution that growth in one part of the world would not necessarily have a negative impact on tourism industries in other parts of the globe.

“If you are talking about leisure tourism, people who want to go to Asia, will continue to go to Asia, and people who want to visit the Middle East or the Mediterranean, will continue to go to those places,” says Denis Johnson, InterContinental Hotel’s Middle East and Africa vice president for sales and marketing.

Out of the 5.5 trillion dollar worldwide hotel and tourism industry, South-east Asia counts for 145 billion dollars in revenue, while the Middle East lags behind with 108 billion dollars in revenue, according to World Tourism Organisation figures.

Experts and officials also say there are several reasons why the Middle East tourism and hotel industries are growing with the current intensity.

“There are two different types of ‘tourists’ that we are talking about, and it just so happens that Dubai has worked hard to show growth in both,” says InterContinental’s Johnson.

Of the total 4.9 million tourists who visited Dubai last year, the UAE government and hotels officials say about 50 percent were business men and women and the rest were leisure tourists. That is a more balanced ratio than seen by many other popular Asian and Middle Eastern tourist destinations, they say.

Much of the “business tourism” can be attributed to the economic growth and increased business activities in the Middle East, especially in the six-nation Gulf Cooperation Council nations of United Arab Emirates, Kuwait, Qatar, Saudi Arabia, Bahrain, and Oman.

Whereas the average economic growth rate for Europe and the United States was 2.8 percent in 2003, the GCC countries recorded an average of 4.5 percent.

“Much of what we call ‘corporate business’ hotel occupancy in Dubai is caused by intra-regional travels. It has become much more common to hold region-wide business meetings in Dubai, as opposed to elsewhere,” says Jirayr Kececian, Middle East and Africa director of sales and marketing for Starwood hotels and resorts which includes the Sheraton chain.

Another reason is political.

“It used to be that many international corporations that are based in the United States used to hold their annual meetings or conferences there. Now either many Arab businessmen don’t feel welcome in the United States anymore, or simply have problems getting quick visas, or visas at all,” says one U.S. businessman in Dubai who is the Middle East and North Africa chairman of his U.S.-based company.

“So now, instead of everyone going to the States, everyone is coming here,” he adds.

Dubai officials, with help from the UAE’s national flagship, Emirates Airline, are also targeting more leisure tourists, and hoteliers say there is close coordination between officials of various sectors of the tourism industry to make sure there are direct flights to Dubai from the cities targeted. They say favourite target countries are European – France, Switzerland, Germany, and Britain. Eastern countries such as former Soviet republics are also in demand.

UAE officials and hoteliers acknowledge that two problems have hampered Dubai’s faster progress.

One, they say, is that in the past Dubai has put much emphasis on marketing itself as a “luxury destination” and in the process missed out on attracting lower-budget visitors.

That is about to change, says InterContinental’s Johnson. The chain plans to spend 100 million dollars in the coming years to open a number of Express by Holiday Inn hotels in Dubai and other countries to attract budget-conscious travelers. Other hotel chain and management companies have similar plans.

Another issue hampering further growth has been the association by many of the Middle East as a region seething with terrorism and religious fundamentalism.

“I was on the phone the other day with some Korean and Japanese companies trying to convince them to come to Dubai for their conferences. They said it is too risky. As far as some people are concerned, the whole Middle East is dangerous,” says an official with a company that organises international conferences.