Representatives of the region's travel industry descended on Dubai yesterday professing a renewed sense of optimism. Their upbeat outlook at the Arabian Travel Market and the prospect of 75 million arrivals this year banished the blues of the global downturn last year. Although major announcements about industry deals were scarce, the opening day of the three-day event attracted 2,100 exhibitors from 72 countries and an expected 15,000 visitors. Industry officials said business conditions had improved dramatically in the past few months.
"We are certainly seeing recovery, there is no question about it," said Nigel Page, the senior vice president of commercial operations for the Americas and Africa at Emirates Airline. Emirates operates the largest Arab airline in addition to owning hotels, tour operators and travel agencies in locations including Kabul, Dubai, and New South Wales in Australia. "I think people were very worried about various economies last year. This year, I detect a lot of very upbeat people - they believe it is going to get better and better."
The driving factor in the industry - tourism arrivals - is expected to grow significantly in the region over the next five years, according to Euromonitor International, the UK-based research company. It said regional tourism arrivals would grow by 6 per cent this year to 75 million, and pass the 100 million mark by 2014. By contrast, it described "an unprecedented decline in global arrivals" last year - a fall of 5 per cent.
Major hotel groups are also dusting off expansion plans and pushing ahead with new projects. "The economy as a whole is starting to show strength in certain markets," said Ed Fuller, the president and managing director of international lodging at Marriott International. "We're very encouraged right now. I think the Middle East is mixed. We definitely see good occupancy growth in leisure markets like Egypt and Dubai."
Marriott has about 40 hotel projects planned for the Middle East and Africa that have already been announced, including in Saudi Arabia and the UAE. It is upgrading a project in Abu Dhabi, the Grand Canal Hotel, to its Ritz-Carlton brand, its most luxurious offering. "We have a number of projects that haven't been announced [yet]," Mr Fuller said. "We will start seeing some more projects as we put more effort into this market."
Other hotel management companies said that while some projects had slowed, there were signs that activity was picking up again. "In a lot of cases, those [slowed] projects are being re-energised," said David Roberts, the executive vice president of operations for Asia-Pacific at Fairmont Raffles Hotels International. In Abu Dhabi, the Fairmont group is restarting its project in the Abu Dhabi marina, which he said had lain "dormant" because of the financial crisis.
"Now, we're back talking with the project manager." The group was also engaging other potential partners in the region. "The environment today is such that we are having those discussions," Mr Roberts said. "It looks very rosy." The growing confidence is also being felt among the region's airlines. Last year was painful for carriers, which were estimated to have lost billions of dollars worldwide. But Middle East airlines continued to see demand rise over the year, although the growth in passenger numbers often fell short of the capacity added with aircraft deliveries, hurting profitability.
In August, the region's airlines carried 4.3 per cent more passengers, well short of the double-digit gains recorded during the boom years, according to the International Air Transport Association (IATA). Conditions have since recovered strongly, and in March, Middle East Airlines carried 25.9 per cent more passengers - in large part because of a growing number of tourist destinations in the region, IATA said.