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Middle East Tourism

Are Arab nations snubbing the West by pushing for integration with investment money?

Hazel Heyer l Special to eTN  Jul 02, 2008

When it comes to tourism investment money, the message that is reverberating across Arab nations is clear: Focus on the region and forget the rest.

United Arab Emirates' Foreign Trade Minister Sheikha Lubna Bint Khalid Al Qasimi maintains a prosperous tourism outlook for the Gulf region. She said: “Looking at the growth rate in development in the Gulf Cooperating Council (GCC), we’d rather push for more integration and for lowering trade barriers in the Gulf. More investments among the GCC countries and towards the Middle East itself are currently witnessed here. In our view, development rates are still not good enough. But with pan-Arab growth, the sum of the contribution to the growth is much better than individual parts /or single country contributions.”

The Arab region’s hotel sector will grow by 7.1 percent per annum. Projects are worth over $3.63 trillion earmarked for 2020, covering 80,000 rooms and 100,000 more employees in Dubai alone by 2010.

The trend in the GCC right now is geared towards property investments and tourism investments. The United Arab Emirates ranks first in tourism investments. The current fashion sees more money coming into the region rather than going out. There’s also more money coming from the Gulf towards Egypt, Jordan, the rest of North Africa, said the sheikha. “We are facing closer partnership outlook for the Middle East, generating more employment for the young Arabs. The UAE has been bench-marked number one in the tourism investment competitiveness platform --which ranked us 20th in 124 countries. Our goal is to create more tourism opportunities in the current situation that we have. Tourism and development give so many options for people, in that when we have neighboring countries developing, anyone who comes to the Middle East tends to stay longer around here. UAE has set the lead because of infrastructure development since we’ve kick-started fast-track projects two years ago. We’ve also exported expertise in the tourism industry, from airlines to hotels; they begin their projects in the region. Others who come to us from abroad can contribute to human resources, quality standard and knowledge transfer.” Sheikha Lubna became the first woman in the country's history to assume a cabinet position in 2004, while appointed to manage the UAE's newly-merged economy and planning portfolio.

Dubai’s hospitality sector, driven by growth in tourism arrivals, had another remarkable year in 2007. The first half reported 97 percent occupancy in five-star hotels and guest room nights rising by more than 6 percent over 2006, said Marc Dardenne, CEO of Emaar Hospitality. He added, “This trend will be sustained in the coming years as the Dubai Strategy Plan still sees tourism as one of the major growth sectors and an ongoing contributor to the emirates’ GDP.”

Development in tourism grows phenomenally in the UAE – a country so small but big in wealth. The focus of this country is to follow the mandate for tourism and environment laid down by the government, said Sheikha Lubna. “It’s not only for the UAE but also for the region. Talented individuals from other Arab countries are coming here, contributing quality to the human capital of the industry. Young nationals and others are welcome to work in the Emirates, further diversifying our GDP and economy,” Sheikha Lubna said.

Sheikha Lubna added: “The UAE remains to be very competitive. We will raise the bar and beat our present standing among 124 countries in the point system for competitiveness. In 2006, over $18 billion worth of inflow of investments topping the 2005 numbers. UAE received 1 million UK and .5 million German tourists. We need to maintain our place in the ranks of destinations featured in exhibitions and business conferences as we have over 100 airlines flying into the UAE. Our cruise line terminal in Port Rashid will increase tourism numbers to our country. When you put all the numbers together, the sum of all parts matter most in terms of their contribution to regional tourism.”

Recent reports suggest more than $3.63 trillion is being invested in hotels, leisure projects, aviation developments, cruise lines, tourism promotion and support infrastructure all across the Middle East.

“A wide regional footprint or spread, plus service differentiation is what will lead to top-of-mind brand recognition and uptake particularly as the regional markets feed of each other,” said Christophe Landais, Managing Director of Accor Middle East. He said further, “We must take heed and establish a real product differentiation not just adding new brands but more essentially, by offering new concepts in new segments. Thus providing, a real pull to grab international exposure and demand.”

“Although the Middle East is pegged to be the fastest growing region by 2020, with estimated growth of 7.1 percent per annum, 69 million tourist arrivals and almost $4 trillion in tourism investments, there is more to come,” said Arabian Hotel Investment Conference head Jonathan Worsley.

Sarmad Zok, CEO of Kingdom Hotel Investments (Saudi Arabia), said, “The last few years have seen the Middle East emerging as a major player in the hospitality sector both in investment and development terms. This is set to continue.”

Are Arab nations snubbing the West by pushing for integration with investment money?
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