Building for the future
Tourism in the Middle East is set to conquer new heights, with targeted investments building new attractions and promoting new destinations, says Jason J. Nash

The Middle East is on the verge of an investment spree in the tourism sector unlike anything the global industry has ever witnessed, with at least US$1 trillion set to be poured into hotels, resorts, attractions and associated infrastructure between now and 2020.

According to an initial report released in early May, the region will see the capacity of its airports increased by an extra 300 million passengers, another 200 hotels built adding 100,000 beds to the existing stocks and the numbers of visitors rising to 150 million. These figures do not take into account developments that have yet to make it to the planning stage, but are based on projects already announced.

The report, prepared by consultancy firm Global Futures and Foresight (GFF) and presented at the Arab Travel Market (ATM), the region’s leading tourism expo, said that the countries of the Middle East have the ambition, resources and commitment to turn this vision into reality.

The results of the GFF study were backed up by another study, conducted by the World Travel and Tourism Council, which predicted that tourism will claim about 10 per cent of all Middle East investment annually through to 2016.

Destination ME
There are a multitude of reasons behind the boom in Middle Eastern tourism investments, including social, financial and political. Perhaps the foremost of these is the concerted drive by most states in the Gulf and beyond to prepare their economies for life after fossil fuels.

Dubai and Abu Dhabi have led the way for economic diversification and liberalisation, with most of the other states in the region catching up fast. Great effort, and an even a greater amount of cash, has been expended to develop industries, foster private sector investment, attract foreign firms and to create an environment for doing business.

However, nowhere is this more apparent than in the tourism sector. If successful, this campaign will pay off handsomely and help sustain the region’s economy in the future. Quite apart from the revenue that tourism will bring in, between now and 2020, some 1.5 million jobs will be created in the hospitality industry in the Middle East. While many will go to expatriate workers, new opportunities will be opened up for locals, one of the underlying motives for the massive shift to tourism.

Another cause for the promotion of a home grown tourism industry is the sense of alienation felt by many in the Middle East in the wake of the terrorist attacks against the US in September 2001. While there was an across-the-board increase in travel security in the West, with visa requirements tightened and processing procedures at ports of entry stepped up, visitors from the Middle East have felt particularly targeted and unwelcome.

A very direct outcome of this was the ramping up of tourism investments in the region, seeking to provide facilities and attractions offered by more distant destinations without the feelings of suspicion and distance. It is perhaps telling that apart from a few firms that operate in the Middle East, about the only US representation at the recently concluded ATM was from the Office of Homeland Security. With major promoters having apparently given up on the Middle Eastern market, explanations of finger printing techniques were hardly likely to woo prospective tourists.

The oversight could be a costly one. According to the World Tourism Organisation, tourists from the Gulf region spent more than US$12 billion on overseas holidays in 2005, the last year for which full figures were available. Much of this was spent in the more friendly and welcoming environment of the Middle East.

However, while many in the Middle East may feel somewhat ostracised by the West, those feelings do not extend their culture. Recently signed deals will see Universal Studios, Marvel Comics and Nickelodeon Recreation build theme parks in Dubailand, the Emirate’s multi-billion dollar recreation and holiday centre. More upmarket are the agreements reached by Abu Dhabi to have two of the world’s premier art galleries, the Louvre and the Guggenheim, to lend their names and their works to new purpose built centres.

Though there has been a rush to sign up some of the leading icons of international popular and high culture, it is the local colour of the region that is to be the main draw card for the Middle East’s tourism industry.

Exciting possibilities
“The challenge now is to drive the next wave of innovation that emphasises, celebrates and promotes Middle Eastern cultures, heritage and tradition,” said David Smith, joint chief executive of GFF.

There is also a shift in emphasis within the trade. Where once it was almost exclusively focused on the top end of the market, with seven star hotels and luxury resorts, there is a growing awareness of the vast and little tapped medium range tourism sector.

This shift has spawned a number of budget airlines, such as Air Arabia and Jazeera Airways, and increased investment in more affordable hotels and accommodation. Where once the Middle East may have been looked upon as a playground for the wealthy, it is now becoming a playground for all.

Though funds have been committed to develop the tourism sector, infrastructure put in place and the full gamut of activities catered to, the industry still has hurdles to overcome. One of these is duplication of efforts: there is active rivalry between some of the states in the region to build the biggest and the best.

In part, at least, this is starting to be addressed, with a number of Gulf states identifying particular niche markets. As an example, Oman is actively promoting itself as an adventure holiday destination, its mountains and rugged terrain ideal for trekking, camping and safari tours. The Sultanate is also pushing its potential for medical tourism, using its hospitals and health facilities to draw in international visitors in need of specialised care.

Other states have given particular attention to niche segments such as sports, with facilities for internationally popular leisure activities, such as golf, cricket, car racing and rallying and aquatic sports.

Need perceptions
The well-developed transport infrastructure in the Gulf region too can play its part, allowing visitors to move between states quickly and easily, sampling the best each has to offer.

Another sub-sector where business is becoming brisk is professional tourism: meetings, incentives, conferences and exhibitions, more popularly known as MICE. While it is again Dubai and Abu Dhabi that lead the way in catering to this increasingly lucrative form of tourism, states such as Bahrain and Kuwait are taking an increasing slice of the market.

Another challenge that the GFF report identified was the “collective identity” that the region suffers from, again in part harking back to the perceptions generated by 9/11, a challenge, it said, that can be met through vigorous security measures.

While money alone cannot guarantee success in any venture, there is a growing understanding that while it is all very well to draw tourists in with the lure of fine hotels, golden beaches and year round sun, which most of the countries in the region have in abundance, discerning visitors want more. This has meant that there is an increasing focus not just on investments but also on targeted investments, allowing the Middle East’s tourism industry to mature and broaden. It is now not so much a case of “if you build it, they will come” as “if you build what they want, they will come”.

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