Health check: Is the Middle East’s tourism sector bouncing back after the pandemic?

Health check: Is the Middle East’s tourism sector bouncing back after the pandemic?

The Middle East and North Africa (MENA) countries are among the most promising travel markets anywhere on the planet.

The region made up approximately 6% of the total worldwide tourist arrivals before the pandemic, according to data from the United Nations World Tourism Organization (UNWTO). However, COVID-19 had a significant impact on the MENA tourism sector – as was the case the world over – with a 74.3% year-on-year fall in visitor growth in 2020.

Encouragingly, we have already witnessed strong signs of recovery across the MENA region – particularly in markets such as Dubai, which welcomed 5.1 million visitors in Q1 2022, representing more-than-threefold year-on-year rise.

But what about tourism’s longer-term prospects in the Gulf? Has our region really bounced back? To find out, we’ll need to examine the latest trends and data.

The UAE is leading the way

One handy industry barometer is the Arabian Travel Market, which saw 23,000 visitors flock to Dubai World Trade Centre in May 2022. Here are some of the main takeaways:

ATM 2022 was 85% larger than last year’s edition, with the focus moving from recovery to future opportunities. During the event, ministers and industry leaders discussed the importance of investing in new ideas and technologies as a way to drive growth and Foreign Direct Investment (FDI) across the sector.

Encouragingly, the total contribution of travel and tourism to the GDP of Middle East countries is expected to more than double by 2028, passing $486 billion. This is really great news when it comes to the sector’s post-pandemic prospects.

Nowhere is this trend more evident than in the UAE. H1 2022 saw around 7.12 million international visitors journey to Dubai for overnight stays, putting the Emirate back on track to achieve its goal of becoming the world’s most visited destination. On a national level, our leaders are also working diligently to ensure this growth is maintained and accelerated.

I believe much of this comes down to mindset. Our willingness to embrace innovation and diversify our thinking represents the foundation upon which our country was built, so it’s no surprise that the multifaceted nature of the UAE’s tourism offering is proving so attractive to the global market. Where else in the world could you take a desert safari, skydive over a man-made palm-shaped archipelago, see the world’s tallest building, experience Bedouin culture, and dine out in Michelin-star dining establishments during a single vacation?

Our nation’s capacity to host large-scale events, both local and international, is also a major advantage. With visa-free entry for visitors from GCC nations and visas on arrival for citizens of 70 global destinations, it’s never been easier for a worldwide audience to come to the UAE. Expo 2020 Dubai has set a tremendous precedent in this respect, attracting more than 24 million visits during its six-month duration. With these fundamentals, the UAE’s tourism sector is only heading in one direction: UP!

Developments in the wider region

Tourism statistics from the UAE’s Gulf neighbours paint a similarly bright picture. Saudi Arabia, for example, aims to attract more than 70 million tourism-related visits this year after registering 62 million in 2021. The Kingdom’s dual-pronged strategy is to continue to build on its religious tourism sector while increasing its focus on leisure tourists. Indeed, visits increased by 130% in the first quarter of 2022 compared with the final quarter of 2019, which – don’t forget – was just before the global pandemic struck. With $1 trillion worth of investment earmarked for travel and tourism from now to 2030 and a raft of megadevelopments underway in line with Vision 2030, these numbers only look set to rise.

Qatar, meanwhile, is embracing the global megaevent as a way to future-proof its travel economy. The country has invested heavily in its infrastructure ahead of the FIFA World Cup 2022, building stadia, hotels and luxurious parks to accommodate guests. Having attracted more than 729,000 visitors in H1 2022 – a rise of 19% on the total number of visitors for the whole of 2021–these efforts already appear to be paying dividends.

Harnessing the latest tech

At the same time, the Middle East’s tourism sector is working hard to further strengthen its position as an international hub for travel and hospitality technology. In my opinion, the effective incorporation of the latest innovations into everyday travel experiences will continue to bolster industry growth and success across our region.

Indeed, there has already been much speculation regarding the metaverse’s place in this sector. Hotel chains, travel agencies, and experiential providers can leverage Web3.0 to showcase their products and services to prospective customers, allowing tourists to ‘try before they buy’ through virtual experiences before they even set foot on a plane.

Recognition technology also boasts the significant potential to simplify elements such as hotel check-in and touch-free airport security. Carbon offsetting technology, meanwhile, also promises to provide solutions for the eco-conscious traveller who wishes to minimise the impact of their business trips and holidays. Given that Millennials and members of Generation Z are the two primary age groups targeted by metaverse developers (43% of Gen Z and 41% of Millennials are significantly influenced by how digitally advanced a product or service is), it seems the future of hospitality is most definitely digital.

Long-term impact

Colliers International predicts that $4.5 billion worth of hotel construction contracts will be awarded in the GCC during 2022, representing a 16% year-on-year rise. The wider MENA region also appears to be in the throes of recovery, achieving a 120.1% year-on-year uptick in 2021 and further growth of 33.4% anticipated this year. All the metrics indicate that market confidence has well and truly returned following the global pandemic.

But how are the region’s current tourism-related efforts likely to play out during the coming years? Well, by leveraging on their already solid fundamentals while investing in cutting-edge innovations that will deliver unique experiences – both physical and virtual – for visitors, Gulf nations are well placed to cement their position as global leaders in the travel, tourism and hospitality space.

Providing we continue to invest and seize opportunities as they arise, it seems inevitable that present and future generations of travellers will continue to flock to the Middle East.

Perhaps the question is not how many visitors will want to come. Instead, we should be focusing on how many we can realistically welcome.

The sky really is the limit for the Gulf’s tourism industry.