Saudi Arabia is expected to continue its dominance as the largest tourism market in terms of revenues, followed by the UAE, Alpen Capital said in its latest GCC Hospitality Industry report.
Upcoming mega events in Qatar and UAE are expected to be the key growth drivers for the hospitality industry in these countries.
The GCC hospitality industry is expected to grow at an annual rate of 9.5 per cent to $35.9 billion by 2018 compared to the $22.8 billion in 2013.
Average occupancy rates are likely to be in the range of 68 per cent and 74 per cent between 2013 and 2018 while ADR is likely to average between $225 and $263 during the same period.
The resource-rich GCC region’s growth prospects remain favorable, supported by stable oil prices and continuous government spending, especially on infrastructure upgrade and economic diversification. GCC countries continue to maintain a pro-business environment with no or low corporate taxes, which has encouraged private sector investments including foreign investments.
GCC is set to host mega events such as 2020 World Expo in Dubai and 2022 FIFA World Cup in Qatar. These coupled with high-profile annual events such as Grand Prix in the UAE and Bahrain are expected to draw a large number of visitors.
With state-of-the-art infrastructure facilities, the MICE (Meeting, Incentives, Conferences and Exhibitions) segment has expanded significantly in the recent past. The number of international association meetings in the Middle East has more than tripled in the last 10 years.
Governments across GCC region are investing billions of dollars to enhance tourism related infrastructure. In addition, for promoting tourism in the region as a whole, GCC countries are planning to introduce a unified visa that would allow tourists to use the visa issued by one GCC nation to visit all the others, just as a Schengen visa works for most of the European countries.
GCC region’s strategic location with respect to global air routes is driving the footfall of short-stay passengers. The region has effectively leveraged this opportunity with increasing investment in airports expansion. GCC airports are expected to handle about 250 million passengers by 2020 - according to a study published for the Airport Show, 2013. Large number of foreign travelers, especially those from Asian region, continues to visit GCC countries. Asia has emerged as one of the biggest and fastest growing international tourist markets for GCC nations. While the Western economies are struggling to recover from global slowdown, emerging Asian economies are witnessing healthy growth. GCC countries’ economic prospects will remain closely linked to growth in Asia as increasing energy demand from this region will help the GCC countries maintain a robust economic growth.
Leisure travel in the region is picking up momentum. UAE with $23 billion market size is the largest market in the region while Qatar has recorded the highest growth in recent past.
Customers are increasingly becoming value conscious: They are also able to compare the offerings of different service providers before choosing the best deal
Accelerated construction pipeline depicts growing industry demand: The GCC construction pipeline looks very robust with the projects due for completion in 2014 valued at $8.6 billion compared to $3.7 billion in 2013.
Spa and wellness themes gaining popularity: UAE is set to become the number one spa destination in the GCC while Qatar is also expected to witness strong growth. The improving healthcare infrastructure along with the region’s reputation as a tourism hub is leading the development of medical tourism within GCC.© Copyright - Saudi Gazette