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'UAE tourism to post good Q4 results, no reason for panic' |
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12/4/2008 10:56:41 AM |
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The UAE hospitality sector is set to report good final-quarter results – but the global financial turmoil will begin to affect the industry next year, said an expert.
However, the country should continue to pursue its long-term development goals and the current conditions should not cause panic, Alex Kyriakidis, Global Managing Partner of Tourism, Hospitality and Leisure at Deloitte, told Emirates Business.
"Bookings are down for 2009 and the UAE faces a challenging time as it seeks to maintain the growth achieved over the past three years," he said.
"Europeans make up a large share of tourists coming to the UAE but now there could be a drop in the numbers. Europeans have seen a decline in the value of their investments and real estate.
"And the unfavourable exchange rates between European currencies and the dirham have increased the cost of visiting the emirates by at least 25 per cent," he added.
The GCC countries targeted tourism growth of 40 per cent between 2007 and 2010 according to figures quoted by Deloitte – but now the projected growth for the period is 16 per cent.
"However, there is no need for panic," added Kyriakidis. "Investment is pouring into the industry. As far as aircraft investment is concerned, Emirates is spending $35 billion (Dh129bn), Qatar Airways is investing $30bn and Etihad comes on top with $40bn. Besides, there is a lot of money being spent on airport infrastructure."
He said mega projects such as Dubailand estimated at $64bn, Red Sea projects in Saudi Arabia worth $40bn and Oman's $15bn to $20bn tourism city will push up demand and appeal to families.
"The key is broadening the UAE's tourism offering to meet the needs of today's tourists. There will be an increased emphasis on value for money as the UAE competes for European visitors with Egypt, Turkey and the Far East. The mid and limited service hotel market is currently underdeveloped in the UAE and this should be addressed promptly. Hoteliers should also look to different sales channels such as tour operators to broaden the distribution base."
Rob O'Hanlon, Tourism, Hotel and Leisure partner at Deloitte Middle East, said, hotel performance remained very strong in Abu Dhabi with revenue per available room (revPAR) up 45 per cent in the year to October 2008. Dubai's revPAR grew 6.7 per cent in the same period, according to industry data company STR Global.
"To ensure that hotel performance remains solid, an increased marketing effort for the UAE as a whole is important," said O'Hanlon |
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Source: Business24-7.ae |
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