MAYS IBRAHIM (ABU DHABI)

The UAE’s tourism sector is experiencing an exceptional boom, driven by visionary leadership and strategic investments that are drawing millions of visitors, solidifying the country’s position as a top global destination with world-class infrastructure.

The World Economic Forum’s Travel & Tourism Development Index (TTDI) 2024 showed that the UAE has surged to first place in the Middle East and North Africa (MENA) region, climbing to 18th globally - a remarkable leap from its previous ranking of 25th in 2021.

The TTDI evaluates 119 economies based on a variety of factors including the enabling environment, travel and tourism policy and infrastructure, infrastructure and services, travel and tourism resources such as nature and culture, and the sustainability of the travel and tourism sector.

Job Creation

Speaking at the end of the UN Tourism 50th Regional Commission Meeting for the Middle East in Oman capital, Muscat, in May 2024, Khaled Al Midfa, Chairman of Sharjah Commerce and Tourism Development Authority (SCTDA), highlighted the significant role of tourism in the UAE’s economy.

The sector generated 809,000 job opportunities across various activities and fields in the UAE in 2023. Projections indicate that the number of job opportunities will increase to 833,000 in 2024, according to Al Midfa.

GDP Contribution

The UAE’s Tourism Strategy aims to increase the sector’s contribution to the national GDP to Dh450 billion by 2031. To achieve this ambitious goal, the country is looking to attract Dh100 billion in tourism investments and welcome 40 million visitors to its hotels over the next decade.

This vision aligns with a broader trend. According to a report from Fitch Ratings released in July 2024, the UAE leads the Gulf Cooperation Council (GCC) in tourism investment as a percentage of GDP. Currently, the country invests around 9% of its GDP in the tourism sector, with expectations that this will rise to 12% by 2030.

Fitch predicts that this significant investment will propel the GDP contribution from tourism from approximately $130 billion in 2023 to over $340 billion by 2030.

The World Travel and Tourism Council (WTTC) forecasts that the travel and tourism contribution to the UAE GDP will reach around Dh236 billion in 2024, with a projected increase to approximately Dh275.2 by 2034, supported by the world-class infrastructure in the country, which includes airports and accommodations, but also thrilling tourist attractions.

Dubai welcomed 10.62 million tourists in the first seven months of 2024, an 8% increase year-on-year (YoY), data showed. Meanwhile, Abu Dhabi’s hotels saw over 2.87 million guests during the first half of 2024, generating Dh3.6 billion, a 19.5% growth YoY.

The report by Fitch Ratings pointed out that the focus on enhancing airport infrastructure has been instrumental in boosting passenger numbers in the UAE.

Airport Traffic

In the first half of 2024 alone, UAE airports experienced a 14.2% increase in passenger traffic, accommodating over 71.7 million travellers compared to 62.8 million in the same period last year, according to the latest data issued by the Central Bank of the UAE (CBUAE).

The Quarterly Economic Review showed that passenger traffic at the Abu Dhabi and Dubai International Airports increased by 33.8% and 8% Y-o-Y, respectively. It also noted that Zayed International Airport, which boasts top-tier facilities and services, welcomed over 13.7 million passengers in the first half of 2024.

Data published by the Dubai Department of Economy and Tourism (DET) in July showed that Dubai welcomed 9.31 million international overnight visitors in the first six months of 2024, marking a 9% increase compared to the same period in 2023. This follows a landmark year in 2023 when Dubai recorded 17.15 million international visitors.

Hotel Sector

The hotel sector in the UAE is also experiencing robust growth. As of mid-2024, the country boasts the largest hospitality market in the GCC, with an impressive inventory of 212,000 quality hotel rooms, according to the GCC Hospitality Market Review – 2024 by Knight Frank.

Dubai accounts for a significant portion of this inventory, with projections indicating a 10% increase in hotel room supply by 2026 as ongoing construction projects reach completion.

Knight Frank’s report also revealed that the GCC’s hospitality landscape has rebounded strongly, with the UAE leading the region with an average hotel occupancy rate of 80% in early 2024. Revenue per Available Room (RevPAR) levels in the UAE reached $155, reflecting the nation’s attractiveness as a premier destination for both leisure and business travelers.

Tourist spending in the UAE also surged by nearly 40% in 2023, exceeding Dh175 billion. Knight Frank attributed this growth to strategic government initiatives, including long-term residency visas for investors and skilled professionals, expanded tourism infrastructure, and a strategic promotion of the UAE as a world-class destination.