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The Middle East and North Africa Tourism - Ultimate Destination

Global Arab Network - Robert Bailey

Tuesday, 27 April 2010 23:58

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The Middle East and North Africa tourism sector continues to develop and expand its horizons, offering resorts to suit every visitor’s needs, from golf to health, and from city to beach. Robert Bailey considers the challenges ahead

Such has been the pace of tourism development in the Middle East and North Africa (MENA) region over the past decade that countries such as Egypt and Turkey are poised to enter the premier league of global destinations. Steadily increasing visitor numbers have also stimulated increasingly bold hotel and resort projects.

However, the last year has been a severe test. Visitor numbers have declined worldwide, leaving many investment projects looking vulnerable, particularly at the top end of the market. The big question now is whether the sector can regain its momentum.

While the environment remains challenging, there is some evidence that business is improving. Arrivals in the Middle East fell sharply in the first half of 2009 but picked up to grow 4.9 per cent in the third quarter. The apparent recovery is good news for Egypt, Morocco, Tunisia and Jordan – countries that are heavily reliant on tourism both for inflows of foreign exchange and for employment generation.

Morocco’s annual tourism receipts over the last few years have averaged $7.5 billion and rank second only in importance to its phosphate exports. In Tunisia toursim accounts for about 7 per cent of GDP and ranks as the country’s largest foreign currency earner. The sector is Jordan’s second largest contributor of foreign exchange after remittances and supports more than 300,000 jobs.

In Egypt, tourism is an economic mainstay accounting for 20 per cent of foreign exchange earnings. Every extra million tourists that visit generate another 200,000 or so jobs, directly and indirectly. New Red Sea resorts have attracted growing numbers of visitors from Western Europe and more recently from Russia and Eastern Europe. Although business has been hit by the global recession, officials are optimistic about recovery, predicting 14 million visitors by 2011 compared with 13 million in 2008, and around 27 million by 2022.

Apart from building on its existing assets in the Red Sea and well-trodden classical sites, Egypt hopes to attract visitors to its northern coast, where some 450km of beaches have much the same tourism potential as the Red Sea. Indeed, the whole North African littoral, located a few hours flight from major European cities, has considerable development potential.

Morocco is one of the few tourist destinations in the region that witnessed an increase in visitors during 2009. This has been stimulated, more than anything else, by the country allowing low-cost airlines to operate through its open skies policy. Tunisia intends to implement a similar policy within the next year.

Tourism minister Khelil Lajimi believes this will result in budget carriers bringing in considerably more visitors for short and long breaks, as well as stimulating a market for second-homeowners. While its beach-destination niche is likely to remain the locomotive of Tunisia’s tourism, efforts are now focusing on desert safaris to create a year-round appeal, as well as golf courses and medical tourism aimed at European visitors. However, to stay competitive with other parts of the MENA region, the hotel industry in Tunisia and Egypt will have to focus on better facilities and staff training.

Turkey, for example, plans to increase visitor numbers by 10 per cent to 33 million, by 2012, by raising its share of the beach holiday market, while developing new areas of interest such as winter sports, golf and health spas. The opening of a five-star, 500-room hotel and resort in Antalya, in 2009, illustrates the country’s ambitions to cater for the top end of the market, as well as package holidays.

The Gulf caters almost exclusively for the business traveller. The formula – involving the provision of meeting, conference and exhibition venues, as well as incentive travel – worked well during the boom. However, the sector’s overheads are considerable and it remains to be seen whether the region can attract a broader clientele to fill its expanding hotel stock. According to a report by travel research company STR Global, the UAE is currently building 57,125 hotel rooms, almost half the entire number being built in the MENA region.

Abu Dhabi’s severe accommodation shortage coupled with its booming economy has enabled it to buck the trend. It has been one of the best-performing five-star market segments worldwide. Other than Beirut, Abu Dhabi was the only MENA market to have experienced positive hotel revenue growth in 2009. Demand continues to outweigh supply, despite 3,000 new rooms being commissioned in the fourth quarter bringing the Emirate’s total room stock up to 17,000 at end 2009. And the trend is set to continue with Abu Dhabi Tourism Authority projecting a further 10 per cent growth in tourists in 2010 and a 15 per cent rise in both 2011 and 2012.

The aim is to lure high-spending leisure visitors to new sports and cultural attractions, such as the Emirates recently acquired slot in the Formula One motor racing calendar. One of the big draws is likely to be the Saadiyat Island project, featuring beachfront luxury resort-style hotels, a championship golf course and major museums containing collections from the Guggenheim and Louvre.

Abu Dhabi is not the only Emirate embarked on breakneck expansion. In January 2010, Dubai commissioned a 3,450 square metre cruise terminal capable of accommodating three to four cruise liners simultaneously and an influx of more than 300,000 visitors a year – in good time, presumably, for the 2020 Olympics that it is bidding to host. Qatar has some $17 billion of tourism infrastructure projects planned over the next five years, which will quadruple hotel capacity to 29,000 rooms by 2012.

Oman is also seeking to enhance its credentials as a top-end destination. The huge expansion of the Sultanate’s national airline, which is designed to open up direct international services to Muscat, is a key part of this strategy. As is the introduction of internal travel services such as the state-of-the-art fast-ferry service linking Muscat with the Musandam Peninsula – a prime tourism development.

For a growing number of countries in the region, these multi-billion dollar projects are expected to unlock the potential of travel and tourism as an engine for economic development.

Global Arab Network

Robert Bailey is Global Arab Network consulting editor and writer specialising in the Middle East. This article is published in partnership with the Middle East Association.

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