Today's Edition
KHALED AL KHAWALDEH (ABU DHABI)
The UAE leads the GCC in tourism investment as a percentage of GDP, according to a new report from global rating agency Fitch Ratings.
The report highlights significant investments in airports as part of efforts to boost tourism numbers.
The UAE invested approximately 9 percent of its GDP into the tourism sector, a figure expected to rise to 12 percent by 2030, compared to 4.5 percent rising to 10 percent in Saudi Arabia and 7 percent rising to 12 percent in Qatar.
Fitch predicted that this investment would see the GDP contribution from the tourism sector increase from around $130 billion in 2023 to above $340 billion by 2030.
The report emphasised the focus on airport infrastructure, which it stated had helped passenger numbers recover to 97 percent of 2019 pre-pandemic levels, with a likely doubling by 2030.
Both Abu Dhabi and Dubai airports have experienced gradual growth in traffic since March 2021, with the capital growing at a faster rate than its busier Dubai neighbour since November last year.
Nevertheless, DXB remained the region's busiest airport by some margin, welcoming 87 million passengers in 2023, approximately double that of the closest competitors in Saudi Arabia.
"The UAE and Qatar have invested in their airports in recent decades, along with the development of their respective flagship airlines, making them among the world's biggest international passenger hubs," the Fitch report stated.
"This year, Dubai announced a $35 billion plan to transform Al Maktoum International Airport to accommodate 260 million passengers a year."
The report also highlighted the increasing utilisation of public-private partnerships and bond-sukuk markets for financing aviation projects.
It indicated that these investment vehicles would increase the deployment of new projects and give governments further fiscal flexibility.
"GCC countries are increasingly adopting public-private partnerships (PPPs) for a wide range of infrastructure projects. Dubai authorities have already announced a pipeline of social and transport PPPs ($10 billion and about $1 billion, respectively)," the report noted.
"By tapping into bond and sukuk markets, GCC countries would have access to a wider pool of investors and longer-term financing options, which could help finance large projects."
