UAE hotel occupancy jumps to 62% in H1 as tourism sector continues to recover

Originally published on Aug 22, 2021 | The National

Hotels in the UAE recorded a surge in occupancy as hospitality sector revenue jumped more than 31 per cent during the first half of the year, boosted by the country's rapid Covid-19 vaccination campaign.

The tourism sector is poised for further growth during the six-month Expo 2020 Dubai world fair starting in October that will bring visitors from more than 191 countries to the Emirates, government data showed.

The UAE's hotel occupancy rate rose to 62 per cent in the first six months of 2021, up from 53.6 per cent reported during the same period in 2020. Hotels earned revenue of Dh11.3 billion ($3.08bn) in the six-month period from Dh8.6bn recorded a year earlier, the Emirates Tourism Council said in a statement on Saturday.

“The tourism sector was able to achieve outstanding performance rates and enhanced the level of recovery from the impact of the Covid-19 crisis to stand today and move towards a new stage of growth and development to further increase its contribution to supporting the national economy,” Ahmad Al Falasi, Minister of State for Entrepreneurship and SMEs and chairman of the council, said.

The UAE has inoculated more than 80 per cent of the eligible population, healthcare authorities said in June. The country is running one of the fastest inoculation campaigns in the world that has boosted economic recovery, amid rising numbers of tourists flocking to the Emirates.

The economy of Dubai, a major tourism and business hub in the Middle East, has also rebounded from the impact of the Covid-19 pandemic-driven slowdown. Improvement in travel and retail sectors boosted the emirate's non-oil private sector economy in July, according to the IHS Markit Purchasing Managers' Index.

Some 8.3 million guests flocked to hotels in the UAE during the first half of 2021, a 15 per cent year-on-year increase, according to the Tourism Council data.

Domestic tourism continued to contribute to hotels' growth as UAE residents opted for staycations. The number of hotel guests from within the country jumped 77 per cent to 2.3 million during the first half of this year, up from 1.3 million hotel guests during the corresponding period in 2020.

The global travel and tourism sector has been one of the hardest hit by the Covid-19 pandemic, rattled by border closures to stem the spread of the virus.

More than $4.5 trillion in revenue was lost by the industry last year, as its contribution to global gross domestic product slipped to 5.5 per cent, from 10.4 per cent in 2019, according to a World Travel and Tourism Council report published in May.

The number of people working in the industry globally fell by 18.5 per cent, leading to 62 million job losses, the report said. In the Middle East, travel and tourism's contribution to GDP fell 51.1 per cent last year.

In Dubai, the recovery of the tourism sector is “gathering pace”, despite the challenges currently faced by international markets, Crown Prince Sheikh Hamdan bin Mohammed said in July, when the emirate marked a year since reopening its borders.

The Emirates Tourism Council on Saturday also said it approved a joint action plan of the Ministry of Economy and local tourism departments that aims to increase the inflow of international tourists to the UAE as well as target new source markets to attract visitors.

Large-scale campaigns promoting several “promising destinations”, introducing long-term and multiple-entry tourist visas – recently announced by the government – and marketing the country's major tourism spots are part of the plan.

The UAE tourism sector performance during the past 12 months provides a “strong foundation” to increase the number of tourists entering the country during Expo 2020 Dubai, Mr Al Falasi said.

The council also discussed plans for issuing a five-year multi-entry tourist visa, which allows the holder to come to the country for tourism throughout the year and stay in the UAE for a period of up to 180 days.

Details of the virtual work residence permit and the process for applying and benefiting from them, which were launched in March, were also discussed, the council said, without providing details.

The council also adopted a co-ordination system at the federal and local levels to develop new and integrated initiatives where all emirates’ tourism sectors can benefit from the hosting of the Expo, it said.

The Emirates Tourism Council also approved steps for joint planning of an upcoming domestic tourism campaign during the winter season in the UAE. It also agreed on the process to support gathering tourism data in the country.

Following the success of the World’s Coolest Winter campaign, the council suggested focusing on including new activities and initiatives that contribute to increasing domestic tourism to grow the segment's share of total tourism revenue at the national level.