UNWTO Cmmissin fr the Middle East Frtieth meeting Dubai, United Arab Emirates, 5 May 2015 Prvisinal agenda item 4 CME/40/4 Crr. Madrid, April 2015 Original: English 4. Snapsht reprt n turism trends in the regin Table f Cntents A. Overall Assessment... 2 A.1. Full year results - 2014... 2 A.2. Key Indicatrs fr the first mnths f 2015... 2 B. Aviatin sectr... 3 B.1. Full year results - 2014... 3 B.2. Key Indicatrs fr the first mnths f 2015... 3 C. Accmmdatin sectr... 4 C.1. Full year results - 2014... 4 C.2. Key Indicatrs fr the first mnths f 2015... 4 D. Travel distributin... 5 D.1. Full year results - 2014... 5 D.2. Key Indicatrs fr the first mnths f 2015... 5 E. Turism segments and prducts... 6 E.1. Full year results 2014... 6 E.2. Key Indicatrs in the first mnths f 2015... 7 F. Surce markets... 7 F.1. Full year results - 2014... 7 F.2. Key Indicatrs in the first mnths f 2015... 8 F.3. Intrareginal (Arab) market trends, challenges and pprtunities... 9 F.3.1. Majr trends... 9 F.3.2. General market characteristics... 9 F.3.3. Key issues and cnstraints... 10 F.3.4. Key pprtunities... 12 F.3.5. Recmmendatins... 13 G. Planned investments... 13 H. Demand recvery/stimulatin measures... 14 I. Outlk fr MENA turism... 16 I.1. Outlk fr 2015... 16 I.2. Lng term prspects (hrizn 2030)... 16 J. Majr challenges t be addressed... 16 Wrld Turism Organizatin (UNWTO) - A Specialized Agency f the United Natins Capitán Haya 42, 28020 Madrid, Spain. Tel: (34) 91 567 81 00 / Fax: (34) 91 571 37 33 mt@unwt.rg / unwt.rg
A. Overall Assessment Internatinal turist arrivals in the Middle East ttalled 50 millin in 2014, grwing at 4% after three years f negative perfrmance. Nrth Africa psted weak grwth, with internatinal turist arrivals grwing just 1% in 2014 ver 2013. First mnths f 2015 shw decline in internatinal turist arrivals t Nrth Africa. As fr the Middle East, data fr majr destinatins is still pending. 1. The Middle East and Nrth Africa (MENA) regin welcmed 70 millin internatinal turist arrivals in 2014, up frm 68 millin t 2013. Internatinal turism in the Middle East (+4%) shwed signs f rebund with gd results in mst destinatins. Arrivals t Nrth Africa were weak (+1%) cmpared t the 6% grwth achieved in 2013 ver 2012. 2. Key indicatrs during the first tw mnths f 2015 shw decline in turism in Nrth Africa, with internatinal turist arrivals dwn in Mrcc and Tunisia. In the Middle East, data is still pending fr majr destinatins, thugh early results shw that the rebund in Egypt and Lebann turism in late 2014 cntinued thrugh January 2015. 3. Based n current trends and the UNWTO Cnfidence Index, UNWTO frecasts mdest grwth fr MENA, due t a large degree f uncertainty ver the geplitical envirnment in the regin. A.1. Full year results - 2014 4. Internatinal turist arrivals in the Middle East (+4%) shwed signs f rebund, after three years f negative perfrmance. The regin attracted an additinal 2 millin arrivals bringing the ttal t 50 millin, with mst destinatins psting psitive results. 1 5. The regin s tp destinatins psting duble-digit grwth were Saudi Arabia (+13%) and Oman (+29%). Qatar psted a slid 8% increase in arrivals in 2014, with figures almst dubling in the past five years (frm 1.5 millin in 2009 t 2.8 millin in 2014). In cntrast, Jrdan (+3%), Palestine and United Arab Emirates (bth +2%) saw mre mderate grwth, the latter after fur years f strng results. Egypt (+4%) saw a rebund in the secnd half f the year, after a drp in arrivals in the first half. Grwth in Lebann (+6%) als picked up frm the third quarter f the year, albeit n drastically reduced numbers in 2013 (1.3 millin internatinal turist arrivals) cmpared t the 2.2 millin internatinal turist arrivals recrded in 2010. 6. In cntrast, Nrth Africa (+1%) psted weak grwth, with internatinal turist arrivals in Mrcc up by a mdest 2% while arrivals in Tunisia decreased by 3%. 7. Data n receipts fr 2014 is still pending fr many MENA destinatins. Hwever, the cuntries that have reprted data already recrded psitive grwth in receipts. Egypt reprted a 24% rise in internatinal turism receipts in 2014, a welcme result after negative perfrmance in 2013 (-39%) while Qatar (+33%), Tunisia (+12%) and Jrdan (+6%) als recrded psitive results that utperfrmed grwth in arrivals t thse cuntries. A.2. Key Indicatrs fr the first mnths f 2015 8. The number f turist arrivals in Tunisia cntinued t decline (-14%) until March 2015 cmpared t the same perid last year. The terrrist attack at the Bard museum in Tunis in March was a further 1 January 2015 editin f the UNWTO Wrld Turism Barmeter 2
blw t the turism industry; at least tw majr cruise lines have cancelled trips t the natin fr the rest f the year. 9. In cntrast, Egypt saw an increase by 6% in the number f internatinal turist arrivals in January 2015 cmpared t the crrespnding mnth in 2014. 2 Turism numbers in Lebann increased by 21% in the first three mnths cmpared t the same perid in 2014 3, while in Dubai, the annual Dubai Shpping Festival attracted 12% mre visitrs in the first mnth f the year. 10. Main highlights f trends in perfrmance f the different sectrs in the travel and turism business in the MENA regin in 2014 and the first mnths f 2015 are presented belw: B. Aviatin sectr Middle East airlines recrded the strngest increase in passenger traffic (+13%) in 2014 ver 2013. Demand further sared 9% in the first tw mnths f 2015. African airlines demand was weakest amng all regins, with vlumes expanding nly 1% in 2014 cmpared t 2013. Vlumes were dwn 1% in February 2015 year-n-year. B.1. Full year results - 2014 11. Air transprt data frm Internatinal Air Transprt Assciatin (IATA) shws that Middle East airlines recrded the strngest increase in passenger traffic in 2014, a rise f 13% cmpared t 2013. 12. Middle Eastern carriers benefitted frm slid trade grwth which supprted expansin in business related internatinal air travel. The regin s ecnmies are cmparatively well-placed t withstand the plunge in il revenues and its airlines cntinued t gain market share. Capacity expansin was kept t 11% in 2014, tw percentage pints belw grwth in demand, pushing lad factrs t 78% in 2014 cmpared t 77% in the previus year. 13. Internatinal demand fr African carriers was weakest amng all regins, with vlumes expanding nly 1% in 2014 cmpared t 2013. The direct effects f the Ebla utbreak are judged t be small; instead ecnmic activity and demand fr air travel was hampered by weakness in Africa s largest ecnmies, including Nigeria, which relies heavily n il revenues. Capacity expansin f 3% was abve traffic grwth, resulting in reduced lad factr f 68% cmpared t 69% in 2013. B.2. Key Indicatrs fr the first mnths f 2015 14. Middle East carriers demand rse 9% in the first tw mnths f 2015, strngest amngst all regins. Capacity climbed 11% leading t lad factr f 78%, marginally abve the glbal average. 4 15. African airlines passenger demand cntinued t be weak, with vlumes dwn 1% in February yearn-year, the nly regin t reprt negative grwth. Capacity was reduced t match lwer demand, resulting in unchanged lad factr f 66%, the lwest fr any regin. 16. IATA frecasts pst-tax net prfits fr Middle Eastern airlines t grw t US$1.6 billin in 2015 (up frm US$1.1 billin in 2014). African airlines are expected t pst barely psitive prfits (US$200 millin in 2015 which is an imprvement n the break-even perfrmance in 2014). 5 2 Central Agency fr Public Mbilizatin and Statistics (CAPMAS) 3 http://www.lebaneseexaminer.cm/2015/02/21/winter-lebann-attracting-turists-year/ 4 http://www.iata.rg/whatwed/dcuments/ecnmics/passenger-analysis-feb-2015.pdf 3
C. Accmmdatin sectr Middle East htels psted psitive results in ccupancy (+3%), Average Daily Rate (ADR) (+1%) and Revenue per Available rm (RevPAR) (+4%) in 2014. The first tw mnths f 2015 saw decreases in all three metrics. Nrthern Africa htels psted grwth in all three perfrmance measures: ccupancy (+12%), RevPAR (+15%) and ADR (+3%) in 2014; hwever, ccupancy levels were just 52%. The first tw mnths f 2015 als saw psitive perfrmance results n all three metrics. C.1. Full year results - 2014 17. Middle East htels psted psitive results n all three perfrmance measures: ccupancy (+3%), ADR (+1%) and RevPAR (+4%). The RevPAR f US$140.52 was the highest in the wrld. 6 The Middle East has had ne f the lwest supply grwths in the last six years. Lwer supply, cupled with a 9% increase in demand, led t a psitive impact n ccupancy which drve RevPAR grwth. 18. Dubai htels clsed 2014 with strng ccupancy and average rm rates in December which saw verall perfrmance levels exceed thse achieved in 2013. This increase was driven by a 2% increase in ADR, hwever the market witnessed a marginal decline in ccupancy by 0.2 percentage pints t clse the year at 80%. 7 19. Significantly, Dubai s htels welcmed 11.6 millin guests in 2014, up 6% n the previus year, despite the decrease in the number f Russian visitrs - a result f the current geplitical situatin and the decrease in the value f the Ruble. Steady grwth frm traditinal surce markets such as Saudi Arabia, India and United Kingdm, and significant grwth in htel guests frm China cntributed t the verall psitive results fr the year. 8 20. Three markets that reprted duble-digit grwth in all three perfrmance measures were Abu Dhabi, Dha and Beirut. Htels in Beirut psted a strng recvery in perfrmance levels during the latter part f 2014, ending the year with 5% grwth in prfit margins. Manama htels were buyed by higher leisure demand frm Saudi Arabia due t greater plitical stability. RevPAR grew 5% n the back f ccupancy rising by 6%, while ARR was dwn by 1% frm 2013. 9 21. With plitical tensin easing, and turists returning t the cuntry, htels in Egypt recrded a significantly better perfrmance. 22. Nrthern Africa htels experienced grwth in all three perfrmance measures: ccupancy (+12%), RevPAR (+15%) and ADR (+3%) in 2014; hwever, ccupancy levels were just 52%. C.2. Key Indicatrs fr the first mnths f 2015 23. Middle East htels reprted year-t-date decreases in all three perfrmance metrics in February 2015. Occupancy was dwn 1%, RevPAR dwn 2% and ADR dwn -0.2%. On the ther hand, ccupancy in Nrth Africa htels was up 9%, and RevPAR and ADR increased by 19% and 9% respectively. Hwever, even thugh Nrth Africa is psting strng imprvement, ccupancy was belw 50% in the sub-regin. 10 5 http://www.iata.rg/pressrm/pr/pages/2014-12-10-01.aspx 6 http://www.htelnewsnw.cm/media/file/pdfs/mnthly_charts/glbalhtelreview_media_december_2014.pdf 7 http://www.hteliermiddleeast.cm/19357-dubai-htels-reprt-tp-prfits-fr-furth-year/#.u0qx5maxiu 8 http://www.arabianbusiness.cm/dubai-htels-welcme-11-millin-guests-in-2013-541345.html 9 http://www.trimideast.cm/uplad/dcuments/htstats_mena_chain_december_2014.pdf 10 http://www.htelnewsnw.cm/media/file/pdfs/mnthly_charts/glbalhtelreview_media_february_2015.pdf 4
24. Amngst the key cuntries in the regin, Egypt experienced significant increases in RevPAR (+33% t US$36.75) and ADR (+29% t US$78.00). Cair reprted the highest increases in bth ccupancy (+40% t 51%) and RevPAR (+44% t US$52.88). 25. In additin t Cair, tw ther key markets reprted increase f mre than 20% in tw majr metrics: Beirut reprted uplift in ccupancy (+24.7% t 49%) and RevPAR (+30% t US$73.28), and Abu Dhabi reprted duble-digit increase in ADR ((+27% t US$187.63) and RevPAR (+29% t US$151.15). Amman (-19%) and Muscat (-10%) experienced duble digit declines in RevPAR. D. Travel distributin The GCC travel trade cntinued t benefit frm the verall increase in turism demand in 2014. Turism businesses in Egypt and Lebann benefited frm the rebund in turism, while Jrdan travel businesses cntinued t face difficulties. A similar trend cntinued in the first mnths f 2015, even as Dubai shwed signs f slwdwn. D.1. Full year results - 2014 26. The GCC travel trade cntinued t benefit frm the verall increase in turism demand, thugh incmes f the trade that depended n the Russian market were severely tested, especially in Dubai. Cmpanies wrking with charter flights and with large tur peratrs had declines f 30% r mre, with margins als cming under pressure due t increased cmpetitin. 11 27. In the Levant regin, the Lebanese travel trade had an verall better 2014 as turism rebunded in the latter half f the year. In Petra, Jrdan, the travel trade cntinued t suffer frm the decline in the number f annual visitrs that has drpped by 50% since 2010. Hteliers have had t clse drs r scale back staff as vernight stays have reduced; 1,500 turism jbs have been lst. 28. In Egypt, fr thusands f Egyptians whse incmes rely n turism, there was renewed hpe as turist numbers surged in the secnd half f the year with signs f plitical stability. D.2. Key Indicatrs fr the first mnths f 2015 29. The travel trade in Oman is benefiting frm a psitive start t 2015 and expects a gd year; Oman turism is frecast t see ne f the biggest imprvements in the wrld this year. Bahrain and Qatar t have started the year well, with Bahrain s Spring f Culture Festival in March drawing praise. All f this has bsted the travel trade in these destinatins. 30. Lebann had a successful skiing seasn this winter, with increased visits frm its traditinal markets. On the ther hand, Jrdan suffered a setback in the first mnths f 2015, with Petra htels being clsed dwn due t dismal ccupancy levels. Mrcc and Tunisia have seen similar setbacks. This is impacting travel businesses negatively, after sme signs f hpe n turism renewal in 2014. 31. Egypt has started the year well, cntinuing frm the imprvement seen in the secnd half f 2014, with increased number f turists frm its traditinal markets. 2014 numbers are seen t be by far the best since 2011, and the trade feels that 2015 shuld be even better if plitical stability cntinues. Cair htels benefited strngly in Q4-2014, and the expectatin is that this will cntinue thrugh 2015. This is gd news fr the travel trade, which had been crushed under the effects f the Arab Spring fr the past several years. 11 http://www.hteliermiddleeast.cm/22555-uae-hteliers-feel-the-brunt-f-russian-turmil/ 5
E. Turism segments and prducts Leisure turism grew in MENA acrss mst destinatins, while business turism in key destinatins Qatar, Saudi Arabia and the UAE als saw sustained grwth. Religius turism in Saudi Arabia was affected by capacity cnstraints related t the expansin f the Grand Msque in Mecca and ther crucial Hajj-related infrastructure, but is expected t rise steadily ver the cming years. 12 Cruise turism in Egypt cntinued t suffer. It achieved slid grwth in the GCC cuntries. Medical turism was impacted in Lebann, was mre resilient in Jrdan, and is nw a fcus area in the UAE. Perfrmance in the first mnths f 2015 was cnsistent in the GCC destinatins, acrss turism segments and prducts. Tunisia, Mrcc and Jrdan saw sliding turist numbers acrss segments, while leisure demand fr Egypt seems t be n the rise. E.1. Full year results 2014 32. Leisure turism is the mainstay f mst destinatins in MENA. In Nrth Africa, Mrcc psted a mdest 2% grwth in internatinal turist arrivals in 2014, majrity being leisure turists, while Tunisia suffered a decline (-3%) in 2014. Bth destinatins witnessed a majr dwnward trend in French turist arrivals twards the end f the year. Leisure turism t Egypt imprved significantly in the secnd half f the year, as plitical stability ensued and travel warnings were lifted by majr turism-generating cuntries. 33. In Lebann, relative stability fllwing the frmatin f the Gvernment in February 2015, and the subsequent launch f prmtinal campaigns and lifting f the travel ban by GCC cuntries prir t the peak summer seasn, helped revive leisure turism. In Jrdan, leisure turism cntinued t suffer frm reduced turist inflws due t reginal turmil, the decline further exacerbated by dubling f turist visa fees in March 2014. 13 34. GCC cuntries cntinued t benefit frm increased inflw f reginal and internatinal leisure visitrs. In Saudi Arabia. Hajj numbers peaked at clse t fur millin in 2013, but because f the Mecca renvatin prject, 2014 numbers did nt reach tw millin. 14 35. The business turism sectr saw sustained grwth in key GCC cuntries namely Qatar, Saudi Arabia and UAE, registering year-n-year psitive grwth in business travel and MICE turism. Infrastructure develpment wrk cntinues t grw especially in Dubai where increased cnstructin activity cntinues t attract investrs and suppliers t its trade fairs and prject launches. 36. Qatar and the UAE, key sprts turism destinatins, hsted several sprting events as scheduled. In Bahrain, the three-day Frmula 1 Grand Prix bsted the turism industry with ccupancies in fur star and five star htels rising abve 85%, an increase f 15% year-n-year. 15 In the UAE, the Abu Dhabi Grand Prix als hsted mre internatinal visitrs as the rganizers bsted capacity t meet rising demand. 12 http://www.xfrdbusinessgrup.cm/verview/sustaining-grwth-innvative-strategies-are-being-emplyed-imprvefferings 13 http://www.telegraph.c.uk/travel/destinatins/middleeast/jrdan/10739113/jrdans-visa-fee-dubled-despite-drp-inturist-numbers.html 14 http://www.htelnewsnw.cm/article/14960/saudi-religius-turism-changes-spark-grwth 15 http://www.mc.gv.bh/en/mediacenter/news/2014/april2014/name,11259,en.html 6
37. Cruise turism cntinued t suffer in Egypt in 2014, and Tunisia als saw reduced numbers. In the UAE, Dubai received 358,000 passengers frm 94 cruise ship calls in 2014, while Abu Dhabi received nearly 25% mre cruise ships and 16% additinal passengers in the year. In Oman which has psitined itself as a chice destinatin fr cruises, arund 300,000 cruise passengers were recrded in 2014. Cruise turism is set t receive a further bst frm the new multiple-entry visa intrduced by the UAE which is expected t make travel between the UAE and neighburing cuntries easier fr cruise passengers. 16 38. Medical turism generated mre than US$1 billin in 2014, with a ttal f 250,000 patients frm abrad cming t Jrdan fr treatment, a number that is almst similar t the year befre, accrding t the Jrdan Private Hspitals Assciatin. Each patient was escrted by tw peple, with the ttal number f escrts standing at arund half-a-millin. 17 In Dubai, which aims t be a medical turism hub in the Gulf regin, the number f turists fr medical prcedures hit 135,000 in 2014, up frm 120,000 in 2013. Dubai is targeting 500,000 medical turists by 2020. 18 E.2. Key Indicatrs in the first mnths f 2015 39. Leisure and cruise turism have suffered in Mrcc and Tunisia, bth f which are highly reliant n cruise turism. Hwever, cruising n the Nile has picked up, and there is a general perceptin that if plitical stability remains, mst f the 350 ships sailing n the Nile befre the revlutin will be back in business. 40. In Dubai, a landmark achievement was cmpleted with the pening f the new Hamdan bin Mhammed Cruise Terminal, where 5 ships were dcked simultaneusly in January 2015 with 25,000 passengers. 41. Dubai is seeing a rise in demand in its medical turism segment, particularly frm within the Arab market. 42. Relative stability in Bahrain has seen cntinued gd perfrmance in its leisure, sprts and business turism segments. Its Spring f Culture festival in March was well received, and the Bahrain Grand Prix in April is expected t bst htel ccupancies. Perfrmance in ther GCC markets remains cnsistent, acrss turism segments and prducts. F. Surce markets Internatinal visitrs cntinued t travel t MENA in 2014, thugh numbers varied by destinatin. Intra-reginal turism demand t GCC cntinued t build n the psitive perfrmance in the previus year. There was a lift in Arab visitrs t Egypt and Lebann as well. In the first mnths f 2015, Eurpean turism t Tunisia and Mrcc declined. In the GCC, turist traffic frm Asia and the Middle East maintained the grwth mmentum f the previus year. F.1. Full year results - 2014 43. Air travel demand frm Asia & the Pacific t Africa and the Middle East grew by 17% in 2014, despite a slwdwn twards the end f the year. Air travel frm the Americas and Eurpe increased 16 http://www.thenatinal.ae/business/travel-turism/recrd-mnth-fr-new-cruise-terminal-in-dubais-mina-rashid 17 http://www.phajrdan.rg/en/news/newsdetails/tabid/71/articleid/139/medical-turism-generates-ver-jd1-billin-in- 2014-PHA.aspx 18 http://www.thefirstgrup.cm/en/news/2015/1/dubai-hspitals-g-high-tech-t-attract-medical-turists.aspx 7
6% and 1% respectively, thugh the last fur mnths saw demand drp, due t reginal cnflict and extremism. 19 Intra-reginal turism demand saw weaker increase (1%). 44. While Mrcc saw verall grwth in 2014 versus 2013, a dark prtent was apparent when its mst imprtant surce market, France, registered 46% reductin in bkings in December 2014 against bkings in December 2013. The decline is attributed t terrrist activity directed at French citizens in neighburing cuntries. 20 Tunisia als received reduced number f French natinals (-6%). 45. Till September, Jrdan witnessed a 13% drp in day visitrs frm the regin, and 3% grwth in vernight visitrs led by Eurpe, cmpared t 2013. In Lebann, there was a lift f 15% in Arab visitrs led by Iraqis. The decline seen in Q1 was mre than cmpensated in the later mnths, particularly after the travel ban was lifted by the GCC gvernments. 46. In Egypt, arrivals frm traditinal surce markets in Western Eurpe, Eastern Eurpe and the Middle East grew by 70% in Q3-2014 cmpared with the crrespnding perid in 2013. In ttal, sme 1.6 millin Arab turists visited Egypt in 2014, increasing by 16% cmpared t the preceding year. Despite its gegraphical clseness t Egypt, the percentage f GCC turists visiting Egypt cmpared t the ttal number f turists did nt exceed 20% in any given mnth in 2014. 21 47. In the GCC, grwth in internatinal turist arrivals frm all wrld regins reflects the results f slid perfrmance, with intrareginal turism demand maintaining steady grwth. Dubai s tp surce markets fr turists in 2014 largely remained unchanged frm 2013, with Saudi Arabia tpping the list. India, UK, USA, Iran, Oman, China, Kuwait, Russia and Germany were the ther tp surce markets fr turists cming t Dubai. The number f Chinese turists t Dubai als saw a steep grwth f 25% in 2014 cmpared t the previus year. The ttal number f htel guests increased by 6% despite the decrease in the number f Russian visitrs a result f the current geplitical situatin and the decrease in the value f the ruble. 22 48. In Qatar, visitrs frm GCC, the largest surce market, increased 3% t 1.2 millin arrivals. There was a surge in the number f arrivals frm Asia (+20%) ttalling 782,904 visitrs. Overall visitrs were up 8% t 2.83 millin. 23 49. Oman, ne f the tp destinatins fr shrt breaks amng GCC turists, registered a 17% grwth in GCC visitr numbers at the end f Q3, 2014. The tp three Eurpean surce markets were UK (+4%), France and Germany. Italy (+22%), which std furth, emerged as the best-perfrming surce market amng all freign markets that cntribute t turism in the cuntry. 24 F.2. Key Indicatrs in the first mnths f 2015 50. The mst imprtant factrs impacting travel t the MENA regin in the first mnths f 2015 have been the fears arund ISIS and ther terrr activity, and drp in value f the Eur and Ruble making travel significantly mre expensive fr travellers frm these surce markets. 51. The impact is evident frm the fact that French bkings fr vacatins in Mrcc decreased in January by 60%; French bkings t all destinatins registered a 14% decrease. Mrcc is the 19 FrwardKeys fr UNWTO 20 http://www.htelnewsnw.cm/article/15381/htel-cmpanies-tipte-back-t-nrth-africa 21 http://www.albawaba.cm/business/checking-r-ut-egypt-and-arab-turism-thrugh-2014-675956 22 http://gulfbusiness.cm/2015/03/dubai-htel-guests-crss-11-6m-5-6-2014/#.vstkdfmues 23 http://dhanews.c/qatar-htel-ptins-multiply-2015-amid-rising-visitr-numbers/ 24 http://www.muscatdaily.cm/archive/oman/oman-received-1.47mn-turists-in-2014-3ww1 8
wrst hit amng all destinatins wrldwide. 25 If this trend cntinues, turism t Mrcc will be hugely affected as French turists are the largest freign grup visiting Mrcc. 52. The terrrist attack at the Bard Museum in the heart f Tunis n 18th March has put a majr brake n Tunisian turism. Italian cruise peratr Csta Crciere suspended peratins t Tunisia. Other cruise cmpanies were expected t fllw suit. Several cuntries have instituted travel advisries against their natinals travel t certain destinatins, r specific parts f thse destinatins, fllwing terrrist threats. 53. Travel by Russians has been impacted by the drp in value f the Ruble. Russian visitr numbers t Dubai fell by 36% in February 2015 cmpared t a year ag, and drpped further in March. This has caused a drp in htel ccupancies, acutely felt in a city that had grwn accustmed t high ccupancy levels, and equally imprtant, drp in retail sales f high-end gds. In cntrast, Russian turism t Egypt has risen by 15% in the first mnths f 2015, which is due t a clse partnership between Egypt and Russian tur peratrs, ensuring that a cnstant stream f turists are entering the cuntry, and because Russians are leaning mre tward all-inclusive package trips, an area in which Egypt specializes. 26 54. Turist traffic frm Asia and the Middle East t GCC has maintained the grwth mmentum f 2013, thugh India has lst its secnd psitin t the UK in 2014 in terms f traveller natinalities visiting Dubai. With this supprt, and the cntinuing rle f Dubai increasingly being a hub fr travel acrss the wrld, Dubai Internatinal Airprt tppled Lndn Heathrw as the wrld s busiest airprt fr internatinal travellers in 2014, with passenger numbers recrded at 70.47 millin. 55. Outbund travel frm the U.S. t the Middle East recrded an increase f 16% in January 2015, ver the same mnth in 2014. 27 F.3. Intrareginal (Arab) market trends, challenges and pprtunities F.3.1. Majr trends 56. Intrareginal turism in the Middle East rse steady frm 66% in 1995 t 75% in 2010. Hwever, since the Arab Spring, the cntinuing geplitical envirnment has resulted in a massive decline in turism within the regin. Intrareginal turism has a lw share (42% f ttal internatinal arrivals) in cmparisn t that experienced in ther regins such as Eurpe, Asia and the Americas (which accunts fr ver 70% f ttal arrivals). 57. Turism t traditinal leisure destinatins such as Syria, Lebann, Egypt and Jrdan has suffered hugely. Grwth tday is mainly cncentrated in the GCC destinatins, led by leisure and business travel t the United Arab Emirates and religius travel t Saudi Arabia. F.3.2. General market characteristics 58. Irrespective f the many links and cmmn features that tie Arab cuntries tgether, the Arab market segments, whether ecnmic, scial, cultural r gegraphic, dictate variatins in attitudes and travel patterns. The cmbinatin f business and leisure is perhaps the mst cmmn purpse f travel besides visiting relatives and friends. 25 http://www.mrccwrldnews.cm/2015/02/152660/number-french-turists-mrcc-decreases-60-january/ 26 http://www.tdayszaman.cm/business_reprt-number-f-russian-turists-t-turkey-t-increase-in-2015_376156.html 27 http://travel.trade.gv/tinews/archive/tinews2015/20150324.html 9
59. The main Middle East travel surce markets are the six GCC cuntries that cnstitute ver 60% f travel vlume and 75% f travel spend frm the regin. Over tw-thirds f travel is fr leisure and VFR purpses, ne-furth fr business and 7% fr religius, health and ther purpses. 60. 60% f utbund travellers are Arab natinals while 40% are resident expatriates. They are mre males than females; ne-half are yung (18-34 years) and well-educated, and ver ne-half are married, with children in the husehld. They have high dispsable incme. They travel as families, in large travel grups, g n lng hlidays (20+ nights) and are high spenders. 61. This lucrative travel market is increasingly heading t Asia and the Pacific and Eurpe, nt nly due t the existing sci-plitical situatin within the regin but als due t certain cnstraints that inhibit intrareginal travel. F.3.3. Key issues and cnstraints 62. The main factrs generally cnstraining the develpment f intrareginal turism in the Arab wrld are identified as fllws: Pr crss brder access and transprtatin cnnectivity Narrw and prly adapted turism prduct base designed t meet the needs f the intrareginal market Inadequate marketing and prmtins at the cuntry and reginal level Pr quality f turism facilities and services, cmpared t that ffered by cmpeting destinatins in ther regins Lack f cmprehensive, reliable, cmparable and timely turism statistics and ecnmic impact data Limited turism investment prmtin Weak educatin and training institutinal plicies and prgrammes that d nt meet the turism labur market s needs. F.3.3.1 Crss brder access 63. The difficulty f btaining visas due t cumbersme prcessing requirements and in sme cases high visa fees that discurage intra-arab travel is a majr impediment t intra-reginal Arab travel. UNWTO research n visa facilitatin fund that the mst cmmn visa facilitatin techniques applied by natinal authrities fell int the fllwing 5 areas: imprving delivery f infrmatin; facilitating current prcesses t btain visas; differentiating treatment t facilitate turist travel; instituting e-visa prgrammes; and establishing reginal agreements 64. Other initiatives t facilitate crss brder mvements fr Arab turists that culd be cnsidered include reducing the cst f visas, extending visas n arrival and pre-departure clearance. F.3.3.2 Transprt cnnectivity 65. Insufficient transprtatin services especially air services between generating markets and destinatins, exacerbated by passenger prcessing arrangements at airprts and resistance t entry f reginal lw cst carriers and charter peratins are main impediments t the grwth f intra-reginal Arab turism. 10
66. Fur key issues need t be addressed in rder t facilitate expanded intra-reginal air cnnectivity: Adpting a mre liberal apprach t cnnectivity and ecnmic regulatin; Ensuring that taxes and ther levies are balanced and nt distrted against the airline industry; Adpting binding rules gverning the rights and bligatins f turist cnsumers and travel rganizers; Develping an integrated strategic framewrk fr the facilitatin f air transprtatin cnnectivity within the regin. F.3.3.3 Prduct develpment 67. There are limited and relatively narrw turism prducts that are neither inclusive nr designed fr intra-arab reginal markets. Fr example, main leisure turism prducts in the regin (which cmprise the resrts f the Nrth African cast, the Red Sea and the Arabian Gulf; the urban resrt areas f the UAE, Bahrain, Egypt, Lebann, Mrcc and Tunisia; as well as a limited number f sprts, adventure, ecturism and cmmunity-based turism prducts), have been tailred t the needs f the Western and Asian markets rather than t the specific needs f the intra-reginal Arab market. 68. The develpment and marketing f shrt and lnger stay vacatin prducts tailred t the needs f the Yung-Millennial (Y) and Senir Citizens (X) generatins that accunt fr ver 40% f the Arab regins ppulatin are currently quite limited and lcalized mainly in the GCC Arab states. F.3.3.4 Quality standards 69. There is cnsiderable variatin in quality and incnsistency in standards f the regins accmmdatin, restaurant, attractins, and turist shpping facilities and services. A regin-wide standards benchmarking apprach that takes int accunt the specific needs f Arab markets wuld help t lift the verall attractiveness f the regin as a destinatin nt nly t glbal markets, but especially t the intra-reginal Arab markets. F.3.3.5 Turism Statistics and Ecnmic Impact Measurement 70. With few exceptins, mst data n internatinal and dmestic turism, and their ecnmic impact is insufficient and unreliable fr decisin making. 71. Facilitating the cllectin f sufficient, reliable, and timely turism statistics and assessing the impact f turism n the ecnmies f the cuntries is critical t the effective planning, validating investment in infrastructure and turist facilities and services, and sustaining natinal and reginal cperatin budgets fr marketing and prmtin. F.3.3.6 Turism Investment Prmtin 72. Investment in the turism sectr, althugh significant in a number f cuntries, is generally limited and lcally driven. The lack f a clearly defined directin fr the develpment f the turism sectr, a well-runded regime f fiscal and nn-fiscal incentives, prject investment prtflis, challenging business rules and regulatins, and limited investment prmtin are sme f the main reasns fr the pr level f investment in the sectr. 11
F.3.3.7 Marketing and Prmtin Capabilities 73. The current level f marketing and prmtinal activities directed at intra-reginal Arab markets remains quite limited at the natinal and reginal level. The lack f knwledge, skills and resurces in the public sectr, and insufficient partnering with the private sectr are sme f the main reasns fr this situatin. 74. It is nted that the highly successful reginal trade frums seen in ther regins such as Eurpe and Asia are nt in place whilst trade, media and cnsumer prmtin activities fr the mst part d nt factr in the pwer f scial netwrking and pwerful meta-search engines able t link t nlinetravel-agencies and bking engines such as Agda, Expedia, amng many thers. F.3.3.8 Capacities f Natinal Turism Administratins 75. A majr impediment t the develpment f intra-arab turism is the limited capacities f Natinal Turism Administratins t undertake reginal and sub-reginal cperatin prgrammes in the areas f research and statistics, plicy and planning, prduct develpment and diversificatin, marketing and prmtin, investment prmtin, access and cnnectivity imprvement and quality management. F.3.3.9 Turism Educatin and Training Institutins 76. A key issue fr the private sectr - especially the accmmdatin, fd and beverage, transprtatin, and tur peratrs - in the less develped cuntries f the regin, is that mst f the new entrants prduced by the existing turism educatin and training institutins are nt suited t the ccupatins fr which they apply and require extensive remedial n-the-jb training t becme prductive. 77. At the same time, the lw skill levels f existing supervisry and rank and file ccupatins are ne f the main causes f the pr quality service experienced in many f the regin s turism establishments. 78. The main challenge t raising the quality f the turism educatin and training supply in the regin is the absence f, and in many cases, lack f a cnsistent apprach t ccupatinal cmpetency standards cupled with limited participatin by the private sectr in the frmulatin and delivery f turism educatin and training. This makes it very difficult fr turism educatin and training institutins t mre effectively match the turism labur markets needs. F.3.4. Key pprtunities 79. The Middle East regin is ne f the wrld s smallest, yet fast grwing, turist generating regins in the wrld. Outbund travel frm the regin has mre than quadrupled frm 9 millin in 1995 t ver 40 millin in 2013, and as per UNWTO s lng term frecast Turism Twards 2030, the regin will generate 2 millin additinal turist arrivals annually until 2030. 80. Middle East destinatins have the pprtunity t garner a larger share f this grwth by tapping the hidden ptential f intrareginal turism. Destinatins that align themselves reginally t netwrk and cperate can strengthen their cmpetitiveness n the turism frnt leading t all rund ecnmic and scial develpment in their ecnmies. 81. Sme f the key benefits f cllabratin and cperatin include: leveraging ecnmies f scale and reducing csts by pling resurces, transnatinal prduct develpment, knwledge sharing 12
and human capital develpment, and mre effective utreach. Lesser knwn destinatins can benefit frm the psitive image f better knwn destinatins in the regin. F.3.5. Recmmendatins 82. It is recmmended that the fllwing key issues be addressed and actined ver the shrt-term (i.e. in the next five years) t develp intrareginal turism: facilitating visa arrangements, imprving air cnnectivity between generating and receiving cuntries, and imprving key airprt facilities including quick-build lw-cst airline and charter carrier terminals; diversifying and adapting existing turism prducts in selected destinatins in the regin s receiving cuntries designed t meet intra-reginal Arab travel markets requirements; enhancing marketing and prmtins fcusing n marketing and prmting key destinatins and cmmercial prducts likely t attract increased intra-reginal travel; imprving the quality f turism facilities and services t meet intra-reginal market requirements; enhancing the capacity f turism educatin and training institutins t meet the shrt-term skilled training needs; imprving the scpe and reliability f turism statistics and adptin f the TSA, especially enhancing awareness f the imprtance f gd data and marshalling the supprt and resurces f the related Ministries; increasing the level f turism investment prmtin; and using existing and develping new training prgrammes and prcesses designed t raise the capacity f natinal turism administratin fficials t undertake the abve initiatives in partnership with the private sectr. G. Planned investments 83. The Middle East/Nrth Africa htel develpment pipeline cmprises 640 htels ttalling 149,799 rms, accrding t the February 2015 STR Glbal Cnstructin Pipeline Reprt. The UAE, Saudi Arabia, Qatar and Egypt accunt fr ne-third f the rms in the regin s pipeline. 84. Mrcc has begun a 28 millin regeneratin f the histric Old Medina f Casablanca, a vital part f the city s histry and ne f its mst appealing turist attractins. The prject is part f a 530 millin Casa-Prt prject, which will transfrm Casablanca s harbur and prt area and help restre the city nce knwn as the jewel f Mrcc. 85. Saudi Arabia is lking t build n and expand its turism industry, with US$11.6 billin turism develpment prjects underway. The nging prjects significantly increase the ttal value f dmestic and religius turism, amunting t a ttal f US$45.3 billin. The 6.7 billin (US$7.19 billin) Haramain High Speed Rail Prject that will carry up t half a millin Muslim pilgrims each day a distance f 450km between the hly cities f Medina and Mecca, is under develpment and expected t be cmpleted by December 2016. 86. On the back f turism recvery in 2014, several turism prjects wrth US$5.3 billin are under develpment in Egypt. Investment int Egypt s cultural heritage is being spearheaded by the Ministry f Antiquities, which is mving frward with its US $810 millin phase three-develpment plans fr the Grand Egyptian Museum. 87. Qatar Turism Authrity has annunced an allcatin f up t US$45 billin t develp its turism industry by 2030 as part f the Natinal Turism Sectr Strategy 2030. 13
88. In the UAE, the tp ten turism prjects represent a cllective investment f just under US$40 billin. In ttal, the UAE has earmarked 18 museums and cultural initiatives, 88 retail develpments, 24 theme parks, 15 sprting venues, 17 cnventin centres and 7 theatres fr develpment. 28 H. Demand recvery/stimulatin measures 89. The Egyptian gvernment has endeavured t imprve the perfrmance f the turism sectr in general and especially targeting the Arab turist. Thrughut 2014 and during the first few mnths f 2015, several turism marketing campaigns were launched t attract the Arab turist. These campaigns included Wahshtna ( We have missed yu ) campaign, which was launched in April 2014 and targeted turists frm the Kingdm f Saudi Arabia, United Arab Emirates and Kuwait. The campaign resulted in a 150% increase in the number f visiting turists frm these cuntries, between July and December 2014. Anther campaign, Masr Orayeba ( Egypt is clse ), included a five minute sng encuraging Arab turists t visit Egypt, and featured many Egyptian actrs and actresses. The campaign was launched earlier this year. Furthermre, t stimulate turism frm the Russian Federatin, Russian turists were ffered temprary exemptins frm entry visa fees, as f January 2015. 29 90. The Gvernment f Jrdan has als taken a series f measures t stimulate demand: Fees and travel taxes at the airprt in Aqaba have been waived t lure back charter flights and discunt airlines. The natinal carrier, Ryal Jrdanian ffered discunts n sme fares, targeting ptential visitrs frm Eurpe and the Gulf Arab states. The turism bard, meanwhile, hsted dzens f travel writers and blggers, with Jrdan's Queen Rania welcming the grup. In February 2014, the Jrdan Sciety f Turism and Travel Agents brught Meditatin Turism t the shres f the Dead Sea. The Jrdan Turism Authrity signed a Memrandum f Understanding with USAID, t strengthen the prmtin f Jrdan as a turist destinatin in the Eurpean, Nrth American and Mexican markets. 91. As fr the Lebanese Ministry f Turism, key measures taken were as fllws: The launching f the Live, Lve, Lebann campaign, relying n Lebanese citizens t push it and make it g viral n all the scial media and acrss nline platfrms. 30 The launching f the Lebanese diaspra turism prmtin prgramme (Ana) which targets 14 millin Lebanese abrad and encurages them t visit Lebann at least nce in their lifetime. The launching f the Phenicians Rute initiative which aims t develp and prmte cultural turism itineraries alng 18 Mediterranean cuntries and mre than 80 twns f Phenician- Punic rigin and culture. The launching f a 5-year Rural Turism Strategy t enhance ecnmic pprtunities in Lebanese rural areas thrugh imprving the cmpetitiveness f specific value chains, including rural turism and anther set f agriculture sectrs and fd prducts. 28 http://www.leadersme.cm/numbers-stack-up-fr-uae-turism-sectr-as-2020-appraches/ 29 http://www.thecairpst.cm/news/133207/inside_egypt/russian-turists-exempted-frm-egypt-entry-visa-fee 30 http://www.hteliermiddleeast.cm/22874-market-update-lebann/3/ 14
The develpment f the Lebann Muntain Trail prject as the first lng distance hiking trail in Lebann t discver the hidden beauty f Lebann and t prmte a scially respnsible turism that safeguards natural, cultural and histrical heritage n the trailside. The reductin by Middle East Airlines f its frmer fuel surcharge frm 15% t 7.5%, after the drp in il prices. 92. In Tunisia, the Natinal Office f Tunisian Turism (ONTT) initiated and supprted several prmtin campaigns, relying heavily n scial netwrks in its prmtin f the cuntry: Many Facebk pages were started, with pictures psted f the mst beautiful turist areas in Tunisia, such as Je vais en Tunisie ( This summer I'm ging t Tunisia ), an initiative fr the return f French turists in Tunisia. 31 ONTT cllabrated with the cuntry's new Star Wars fan club t stage its first Star Wars encunter, in which fan clubs frm all ver Eurpe tk part, with screenings f the Star Wars films taking place at the desert mvie sets in the cuntry. The campaign began with Tunisia's wn vide f Pharrell Williams' 'Happy' featuring Star Wars characters dancing arund Tunisian turist sites and the mvie sets. The vide has been viewed ver tw millin times since it was first psted in March 2014. 32 In cllabratin with Tunisair Marseille and CTN France, ONTT als hsted an educatinal tur fr the trade and media frm March 27th thrugh 30th in Tunis, Hammamet and Mnastir, which allwed a visual demnstratin f the cuntry s recvery. 33 In Octber 2014, a new turist tax f Dinars 30 (abut 13) was annunced, payable by all nnresidents (regardless f natinality, and with exceptin t Tunisians residing abrad) upn departure frm Tunisia. With this tax, the Tunisian Ministry f Finances hpes t generate 40 millin Tunisian dinars (arund 17.5 millin eurs) in revenues in 2014 and 120 millin (clse t 52.5 millin eurs) in 2015, thereby helping the cuntry regain its pre-revlutin turism incme levels. 34 93. As fr Mrcc, the Gvernment has als taken special measures t prmte the cuntry as a turist destinatin. These measures include: Intrducing a new tax f US$12 per ecnmy-class passenger in 2014 t generate funds t step up the prmtin f Mrcc abrad Earmarking 100 millin dirhams ( 9.2 millin) t implement a plan f shrt-term actins t strengthen the prmtin f Mrcc destinatin in its key surce markets and t mitigate the negative impact f the attack against Charlie Hebd in Paris n its turism. 35 Launching the 2014 editin f Meet Mrcc, the new 92-page guide encapsulating Mrcc s unique appeal as a destinatin fr meetings, incentives, cnferences and exhibitins, with features n the kingdm s principal regins, the main visitr activities, new infrastructure develpments, meetings facilities and a cmprehensive list f htels and lcal service prviders. 36 Hlding several events fr tur peratrs and the press in France and in Britain during the Wrld Travel Market t reassure tur peratrs f turist safety in Mrcc. Signing a three-year (2014-2016) deal with the rganizers t hst the next three editins f the Wrld Travel Awards Grand Final in Marrakech, Fez and Casablanca, seeing it as a great 31 http://www.eturbnews.cm/44800/tunisia-prmting-new-image-its-turism 32 http://www.dailymail.c.uk/travel/article-2616758/tunisia-turns-star-wars-bst-turism.html 33 http://www.turmag.cm/tunisia-djerba-and-resrt-clubs-bsters-fr-the-recvery-f-the-french-market_a66454.html 34 http://hspitality-n.cm/en/news/2014/08/28/la-tunisie-taxe-les-turistes-sur-le-retur/ 35 http://www.turism-review.cm/mrcc-eur92-millin-invested-in-prmtin--news4449#jlvmr0lwxibcuz1t.99 36 http://www.visitmrcc.cm/index.php/eng/stries/mrccan-natinal-turist-office-launch-the-third-editin-f-meet- Mrcc-2014 15
pprtunity t prmte these histrical destinatins, and further enhance their visibility n a glbal scale. 37 I. Outlk fr MENA turism I.1. Outlk fr 2015 94. UNWTO frecasts internatinal turist arrivals t increase by 3% t 5% in Africa, and 2% t 5% in the Middle East. The frecast interval is wider in these regins due t higher uncertainty and disruptin risks. I.2. Lng term prspects (hrizn 2030) 95. Lng term prspects fr the MENA regin are strngly psitive, with internatinal turist arrivals prjected t reach 195 millin by 2030. 96. The Middle East is prjected t grw frm 70 millin in 2014 t 149 millin in 2030, with an average annual grwth rate f 4.6%. Nrth Africa is als prjected t grw at a similar annual rate, with internatinal turist arrivals reaching 46 millin in 2030 (frm 20 millin recrded in 2014). J. Majr challenges t be addressed 97. Turism perfrmance in the MENA regin has imprved acrss mst destinatins this past year, yet the situatin is still quite fragile. 98. A disturbed geplitical envirnment, negative perceptins cncerning safety and security and the neighburhd effect that results in events in ne, even distant, part f the Middle East are impacting turism flws acrss a wide, very diverse regin. 99. Visitrs perceptins regarding persnal safety and security cntinue t negatively affect turism demand in sme f the majr turist destinatins. Negative publicity and cautinary gvernment travel advisries als cntinue t deter freign turists frm visiting these destinatins, despite several marketing and prmtinal effrts t restre cnfidence and revive turism demand. 100. In Nrth Africa, the main challenges are t imprve the quality and diversity f turism prducts and bst the image f destinatins, while: Natinal carriers cntinue t struggle t cmpete with much bigger internatinal carriers which carry the bulk f passengers t and frm the cntinent as a whle. Turism prmters largely catering t the market fr mass beach ( sun, sand, and sea ) turism are frced t cmpete with ther similar Mediterranean destinatins driving dwn prices and prfit margins. Over-reliance f majr destinatins n Eurpean surce markets resulted in vulnerability t the impact f ecnmic cnditins in Eurpe which in turn has resulted in drawing pricecnscius turists whse lwer level f spending has led t reduced revenues fr lcal turism suppliers. 101. On the ther hand, in the fast grwing GCC regin, grwth cntinues t be driven by the Gulf Three airlines Emirates, Etihad and Qatar Airways, supprted by huge investments in infrastructure develpment including wrld-class airprts, htels and mega retail, leisure and entertainment prjects. 37 http://www.breakingtravelnews.cm/fcus/article/mrcc-unveils-ambitius-plans-fr-glbal-destinatins/ 16
102. Finally, the GCC s turism industry faces several specific challenges which, in a sense, at least partly, spring frm its rapid and successful develpment: Massive fleet expansin plans f majr GCC-based carriers might lead t vercapacity acrss the sectr, nce new aircrafts are delivered. Air space cngestin is a key issue that may threaten t hld back the frecast grwth f airlines in the regin. Adhering t a myriad f envirnmental nrms and plicies stipulated by aviatin regulatrs, acrss the wrld, may pse a challenge fr airline cmpanies in the future. Prduct develpment deficiencies and limited appeal f turist fferings. The GCC turism industry will require an increased number f skilled persnnel and staff. Labur supply will be a key issue. GCC natins are facing the risk f water shrtages in the near future (while already being ne f the mst water scarce cuntries in the wrld). This will be a key challenge in turism develpment and sustainability. The GCC has s far fcussed n luxury turism and htel develpment. Upscale and luxury segments dminate the future htel cnstructin pipeline, which can restrict demand frm emerging surce markets in Asia and Africa. 17