x Abu Dhabi, UAESunday 21 January 2018

Gulf needs to co-operate on travel and tourism

Countries in the Gulf region need to co-ordinate their efforts to become travel hubs and tourism destinations, according to study commissioned by the travel technology company Amadeus.

Abu Dhabi International Airport has experienced an increase in traffic with the expansion of routes by Etihad Airways.
Abu Dhabi International Airport has experienced an increase in traffic with the expansion of routes by Etihad Airways.

Gulf airlines could see their growth curtailed if they become complacent and fail to collaborate on shared issues such as air space and airports, according to a report released yesterday.

With the Gulf poised to become the world's dominant global aviation hub, the region may even have to develop a single regulatory system, said the report commissioned by Amadeus, a travel technology company.

"We need to have some collaboration between different countries and need to make sure we are not only serving national interests," said Antoine Medawar, the vice president of Amadeus in the MENA region.

International airports in Dubai, Abu Dhabi and Qatar have enjoyed substantial growth, seemingly against the odds, Mr Medawar said.

"When you look at the rationality of having three important hubs - Dubai, Abu Dhabi and Qatar - within one hour's flight of each other, you can ask yourself if this makes sense. At first, my answer to this question was it doesn't make sense. But the more I see it, the three hubs are growing, and the three hubs are not picking passengers from each other; they are bringing new passengers. Maybe collaboration is important, but it doesn't mean we need to have one hub."

Dubai Airports, the company that operates Dubai International Airport, reported air passenger traffic rose 14.8 per cent to more than 4 million in October compared with the same month last year, helped by the rise of budget carriers such as flydubai.

Abu Dhabi International Airport has also continued growing this year as Etihad Airways expands its network of destinations. The development of the travel sector in the Gulf plays an important role in the region's diversification strategy. Not only does it boost tourism, but it also facilitates growth of other economic sectors, the report from Amadeus highlighted.

"The Middle East already connects more major global destinations via a single flight than any other hub," Mr Medawar said.

Various authorities in the region have earmarked a total of about US$86 billion (Dh315.86bn) for airport development, the Amadeus report said. And the number of tourists travelling to the Middle East is expected to reach 136 million by 2020 compared with 54 million in 2008, according to the UN World Tourism Organisation.

But there is still much to be done.

"We must not be arrogant because we are succeeding," Mr Medawar said.

The region's aviation sector needs, for example, to create better transparency, the report said.

"A number of non-Middle Eastern airlines concerned about the effect of growing UAE carriers on their businesses have accused some of these carriers of receiving hidden state subsidies, including reduced borrowing costs," the Amadeus report said. "The impression is that UAE carriers are maintaining compromised relationships with their national airport and aviation authorities, wholly state-owned entities that share the same government owner as the airline. The accused carriers argue that they are not in a privileged position."

The region has significant advantages in its favour, such as its geographic location and strong economic growth, said the report, which was co-developed by Insights Management Consultancy, based in Abu Dhabi, and h2c, a hospitality consultancy based in Dusseldorf, Germany.