Regional violence hurts Lebanese and Egyptian tourism

Beirut and Sharm El Sheikh hotels suffer dips in occupancy levels as violence in neighbouring countries keep away tourists from the destinations.

Unrest in Egypt continued to affect hotels in the Red Sea resort of Sharm El Sheikh, as occupancies fell five percentage points to 56 per cent. Marco Longari / AFP
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Hotel occupancy in Beirut and the Egyptian resort of Sharm El Sheikh nosedived in the first four months of the year as violence in neighbouring countries scared away tourists.

In the Lebanese capital, occupancy dipped by 16 percentage points from January through April to 42 per cent. A slide in room rates by 7 per cent, touching US$156, did not help, according to the EY Middle East Hotel Benchmark Survey for the year’s first four months, released yesterday.

In April alone, occupancy rates in Beirut touched 52 per cent, dropping 12 percentage points.

The UAE issued a fresh travel warning yesterday to its citizens, asking them to leave Lebanon immediately, and the hotel sector there is expected to experience tough times.

Over the weekend, security forces in Beirut remained on alert after threats of terror attacks on state buildings and a suicide bombing on Friday.

According to a travel agent at Al Rais Travels in Dubai, the agency’s airline bookings to Beirut have been well below normal, at three to five a week for the past month.

The violence in Syria and Iraq has slowed the flow of tourists from the Arabian Gulf to Lebanon and that is hitting the economy hard, said Nada Sardouk, the director general at Lebanon’s tourism ministry, on the sidelines of the Arabian Travel Market in May.

The latest figures show that the number of Arab visitors to the country declined by 12.22 per cent to 402,080 last year.

In Egypt, unrest elsewhere in the country continued to affect hotels in the Red Sea resort of Sharm El Sheikh. Occupancies fell five percentage points to 56 per cent, while average room rates were $47, a drop of 7.6 per cent between January and April. In April alone, room rates fell 4.5 per cent to $42, while occupancy rates dropped 15 percentage points to 61 per cent.

In the capital city, hotels fared worse. Occupancy rates were down to 27 per cent from 28 per cent last year, even though room rates were lowered to $80 from $84 during the first four months of the year.

Meanwhile, as tourists flocked to Dubai, the city led a strong hospitality market in the Gulf despite a slowdown in the summer months.

During the cooler first four months of the year, beach hotels in Dubai had rooms going at an average price of $473, up 4.8 per cent from a year earlier. The city hotels on average went for $241, up 6.7 per cent. Occupancy rates dipped by 1 percentage point to 87 per cent during the period.

“The slight month-on-month decrease in occupancy from March to April is in line with the market’s typical seasonality, as tourism inflows begin to slow towards the hot summer months,” said Yousef Wahbah, EY’s head of transaction real estate for Middle East and North Africa regions.

April is one of the busiest months in the city as it hosts a number of events ahead of the summer heat. This year, Indian Premier League matches were played in Abu Dhabi, Dubai and Sharjah.

Dubai’s overall average occupancy stayed at 85 per cent in April, despite the increase in rooms over last year.

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