Expo 2020 Dubai is encouraging significant growth in the tourism sector in the Middle East. How can your company benefit from the many opportunities that this will provide?
As a result of Expo 2020 Dubai, the tourism and hospitality sectors in the region are set to receive a major boost.
If you’re thinking of expanding your business into the UAE, now is the perfect time to do it as your business can benefit from the many opportunities Expo 2020 Dubai will bring.
This article discusses the expanding tourism industry in the UAE and explores how Expo 2020 Dubai may have a positive impact on the UAE tourism sector. It also outlines how smart businesses should be poised to make the most of the opportunities this will provide for growth.
UAE economy provides a platform for tourism sector growth
As Expo 2020 Dubai approaches, the macroeconomic indicators show steady, healthy growth of the UAE economy. The current forecasted GDP growth rate for 2018 is 2%, which is lower than the long-term growth rate for developing economies. In terms of foreign direct investment, the UAE currently ranks 13th globally and this is expected to improve as we approach 2020.
With only 30% of the GDP comprised of oil revenue, it is the most diversified of the oil-based economies within the GCC region. Due to a continued drive towards diversification, this number is expected to decrease to 20% by 2021.
The UAE’s economy is the 10th freest economy in the world, Ranked 1st within the GCC region. It has a well-functioning legal system and strong property ownership rights, making it an ideal place to expand your business.
In a bid to attract and retain a highly-skilled workforce, there has also been a focus on changing employment regulations. Coupled with new visa regulations, the UAE is well-positioned to attract and retain talented workers.
When combined together, the right economic conditions create an ideal platform for tourism sector growth.
“25 million visitors are expected to attend Expo 2020 Dubai, and 70% of them will be from outside the Middle East.”
The UAE’s expanding tourism sector
With the UAE’s tourism sector expanding by more than 6% a year, it is likely that the hospitality sector will grow accordingly.
An overall growth of 1% has been experienced by the hospitality business categories, while the supply of available rooms has grown by 4%.
India, KSA, UK, Russia and China figure as the main source markets for the tourism industry. The number of Russian tourists has grown by over 100% in a year-long timeframe (2017 to 2018).
Oxford Economics predicts an overall 59% growth rate of all overnight hotel stays by 2026.
However, due to the impact of growing investment and tourism generated by Expo 2020 Dubai, overall growth is expected to increase to 3% in the next 4 years. It is anticipated that tourism and leisure businesses will grow consistently in line with the UAE’s objectives of economic diversification.
According to the 2017 annual macroeconomic report by the UAE Ministry of Economy, entertainment, accommodation and real estate activities grew by around 7%.
This year’s Arabian Travel Market focused on the benefits Expo 2020 Dubai would bring to travel, tourism and MICE companies looking to attract tourists to the region.
25 million visitors are due to attend Expo 2020 Dubai, of which 70% will be from outside the Middle East. This provides amazing opportunities to build revenue streams by offering value-added packages. Expo 2020 Dubai is anticipated to deliver an exceptional visitor experience with world-class architecture, immersive storytelling, live shows and performances and next-generation innovation.
World’s fastest-growing hub for medical tourism
The expansion of the tourism industry also delivers benefits to the healthcare industry. As the healthcare industry grows to accommodate an aging population, the UAE is the world’s fastest growing medical tourism hub, attracting over $23 billion in expenditure, which is expected to grow by 12.7% every year starting from 2015, increasing by up to $5 billion of expenditure per annum by 2021.
As highlighted in this article, the UAE’s expanding tourism and hospitality industry presents opportunities for expanding your business. The growth of the tourism and hospitality industry will be further boosted by Expo 2020 Dubai and its legacy, meaning that the UAE is a great place for your business to invest not just now, but for the future.
Need support in growing your business in the UAE?
Our free downloadable White Paper provides a detailed analysis on the similarities between the UAE and Australian economies. For more information on how to successfully expand your business into the UAE visit our website.