The UAE remains at the peak of West Asia tourism

The UAE in the World Economic Forum's Travel and Tourism Development Index of 2024 placed first in the region and eighteenth in the world. The UAE in 2019 had obtained rank 25. Economic and political stability and an inclusive society have been among the reasons for this country's rank improvement, which has turned it into an ideal business and tourism destination. Traditional Arab hospitality and this country's pleasant temperature in winter together with advanced infrastructure and welfare facilities have been among the other influential components.

In addition to these, the small but oil-driven Persian Gulf country of the UAE has been a desirable place for holding conferences, regional and international exhibitions, large cultural events such as Expo 2020 Dubai and hosting important sports competitions and events such as the Dubai World Cup horse race, the Abu Dhabi Formula One race, the Dubai Desert Classic golf tournament, the Club World Cup and Special Olympics sports competitions. In this report we look at the trend of development of the tourism industry in the UAE, the reasons for its superiority in the region and its outlook in the future.

Overall outlook of the tourism industry in the UAE

According to statistics, respectively 36/18 and 07/24 million foreign tourists in 2014 and 2023 traveled to the UAE. As the chart below shows, from 2023 onward the rate of tourists has been increasing and it is forecast that in 2029 this figure will reach 66/44 million people.

The UAE's favorable status on travel and tourism indicators has been one of the reasons for foreign tourists' reception of travel to this country. According to the World Economic Forum's Travel and Tourism Development Index, the UAE among 119 countries of the world obtained first rank on the indicator of providing travel and tourism data and air-transport infrastructure, second rank in infrastructure and services, and third rank in the comprehensiveness of travel and tourism data, the efficiency of air-transport services and travel and tourism policymaking. It is forecast that the share of UAE tourism in this country's economy by the end of 2024 will reach 236 billion dirhams (64 billion dollars); equivalent to 12 percent of the country's total GDP.

Leisure tourism income; leading in the UAE

Among types of tourism, leisure tourism income in the UAE has been leading. This country, possessing more than 46 percent of the luxury hotels of the Persian Gulf Cooperation Council region, had 5/43 billion dirhams (84/11 billion dollars) of income from this sector in 2023. According to statistics of the Ministry of Economy of the United Arab Emirates, in this year 4/75 percent of tourists occupied hotels, which shows 6 percent growth relative to the previous year. Duration of stay at the hotel too was 5/3 days, which made the average price of each room 508 dirhams (31/138 dollars). Also it is necessary to know that hotels in the UAE have provided more than 210 thousand rooms for tourists, of which 150 thousand are located in Dubai alone.

The 10 countries that between January and December 2023 had the most travel to Dubai, one of the most populous cities of the UAE, were respectively India, Oman, Saudi Arabia, England, Russia, the United States of America, Germany, France, Pakistan and Iran. The rate of foreign tourists' travel to this city in this year was 15/17 million people; 43/19 percent more than 2022. The eight main destinations of these tourists, as suggested by the two travel-guide companies Tripadvisor and Lonely Planet, can be listed according to Table 1:

Outlook of the tourism industry in the UAE

As the evidence showed, with the exception of the COVID-19 pandemic period which placed all countries under many crises, the tourism industry in the UAE has been accompanied by continuous and ongoing growth. This country has planned a documented strategy to attract 3/39 million tourists by 2031 (7 percent annual growth) which will be accompanied by a value of 90 billion dirham-dollars (5/24 billion dollars) of the tourism sector in the country's GDP and the creation of more than 178 thousand new jobs. According to this strategy, compared with 2019 through 2031, hotel guests will become 5/1 times (from 27 million to 40 million); this means 5/2 times more value for the country's GDP (from 01/49 billion dollars in 2019 to 52/122 billion dollars in 2031).

In addition, hotels will increase from 126 thousand rooms to 251 thousand and holiday homes, in order to diversify tourists' options, will also be added to the facilities. According to Statista's estimate, by 2028 travel with travel agencies as the largest sector of the tourism industry in the UAE with 99/2 percent annual growth will reach 1,628 million dollars. Applicants of these agencies will increase to 2,235 thousand people, whose average revenue per user (ARPU) will be 30/457 dollars. Knight Frank —a real-estate, residential and commercial property consultancy agency— has also forecast that by 2027 of 7/163 thousand hotel rooms in the city of Dubai, 3/34 thousand will be luxury five-star, 5/33 thousand hotel apartments, 9/29 thousand four-star Upscale, 2/27 thousand five-star Upper Upscale, 4/20 thousand three-star Midscale and 5/18 thousand four-star Upper Midscale.

Why the UAE tourism industry is superior in the region

What factors have caused the small country of the UAE, despite rich oil resources, to be the leader of the countries of North Africa and West Asia in the tourism industry and among the countries of the world to obtain rank 18? This is while our own country in the world has had rank 73 and in the region too, despite rich resources and extensive natural and historical landscapes, has rank 9.

One of the reasons that thinkers have pointed to has been the UAE's reliance on diverse models of tourism to attract different groups. Business tourism, medical tourism, agricultural tourism, MICE tourism namely gatherings and meetings, desert tourism, adventure tourism such as physical activities, cultural exchanges and activity in nature, sustainable tourism which includes four types of green tourism, soft tourism, community tourism and ecotourism, and so on are among the various models of the tourism industry in this country. For example in 2023, about 787 thousand foreign patients referred to the equipped Cleveland Clinic Abu Dhabi; 12 percent growth relative to the previous year, which is expected by 2028 this figure will become 25 percent more. This tourism in 2023 brought a value equivalent to 91/31 billion dollars for the UAE economy.

In another example, the UAE as a strategic region between Asia, Europe and Africa has led it to be called a "global trade hub." Abdullah bin Touq Al Marri, the UAE Minister of Economy, says: "The development of startups plays an important role in strengthening this country's economy and will double GDP by 2031." At present nearly 40 free zones for commercial affairs are in place in this country; including the Ajman Free Zone, Dubai Media City, the Jebel Ali Free Zone, the Dubai Knowledge Park Free Zone, and others. These are separate from two main and maritime zones for registering and conducting commercial affairs.

A strong cultural heritage, modern superstructure, diverse urban and natural landscapes, shopping centers, a safe environment, a mild climate and a multicultural society are among the other reasons for the attractiveness of the UAE for foreign tourists. Providing modern technology and artificial intelligence facilities for planning and better assisting tourists is another effective component. Booking.com has reported that 60 percent of travelers to the UAE have trusted an artificial intelligence recommendation for their trip. Even so, this country intends in the next three years to provide more ground for "slow travel," that is, away from any kind of technology; the complete immersion of every tourist in nature and local culture.

Final word

The tourism industry is one of the sources of economic growth of the UAE, which expands every year with continuous and sustained growth. It is forecast that by 2031 this investment will reach 90 billion dirham-dollars. This means a small country's reliance on diverse resources for its sustainable growth and development at the regional and global level. The growth of the tourism industry in this country has not only had a sustainable profit in the economy; it has also made the world familiar with the country's local culture and strengthened communication and exchange networks with the world. In just one example, patients who travel to this country for treatment, aside from receiving quality medical services, can also visit the city's natural and historical areas and attractions.

Modern superstructure, a safe environment, diverse historical and natural landscapes, a rich cultural heritage, a pleasant climate especially in the winter season, access to advanced technology and high-speed internet, are among the reasons that have attracted tourists to this country. This country's precise planning and foresight for the next several years, including creating a unified national tourism identity across all cities, diversifying cultural goods and products and involving more local people, make us see the outlook of the tourism industry in this country as growing and flourishing.

Author: Niloufar Saghabashi

 

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