Tourism has been one of the key growth sectors in the UAE economy, but this week has seen mixed news from the country's two biggest destinations. The Abu Dhabi Tourism and Culture Authority announced that the emirate had 3.49 million visitors in 2014, a 25 per cent increase on the previous year, and that total hotel revenues had risen 14 per cent to Dh6.28 billion. In Dubai, the addition of new hotel rooms drove average rates down 3.6 per cent in January from a month earlier, and average occupancy dropped by 2.9 per cent to 85.6 per cent.
Taken together, the figures demonstrate the volatility of the market and point to the challenges ahead for tourism and hospitality operators across the UAE. The good news is that the UAE is very much on the international tourist map – thanks to its central location and its two world-class airlines – and it is well served in terms of existing infrastructure and new developments for the surge expected to occur for Dubai’s Expo 2020.
However, the strength of the US dollar, to which the dirham is pegged, against the euro and the rouble, is affecting tourism numbers from across Europe. Hotels in the northern emirates have been especially hit by having fewer Russian tourists. Consequently, the outlook for the coming year is not as bright.
Strategies to deal with this could include broadening the offering with the aim of attracting a range of tourists, from backpackers to billionaires, from different points of origin. This includes continuing to seek out potential visitors from China and South Asia and looking towards Sub-Saharan Africa, where economic improvements have provided more people with disposable incomes. Lower airfares – which should eventually flow on from the recent drop in global oil prices – should also help.
In the meantime, tourism authorities and operators simply need to work harder in marketing the UAE’s undoubted attractions – from its beaches, oases and other natural wonders to its heritage sites, cultural festivals, shopping centres and family-friendly attractions.
