High growth vital for Dubai vision

08 May 2014

The UAE emirate will require strong growth to fuel its ambitious plans to attract more than 20 million tourists

Dubai has set ambitious targets for its tourism sector, with plans to attract more than 20 million visitors a year by 2020, the year it will host the World Expo.

To meet these goals, the emirate will need to add more than 60,000 rooms, nearly doubling its current supply. At the moment, hotels in Dubai are enjoying robust business, with occupancy rates soaring to 88 per cent in the first quarter of this year.

But wise planning will be needed to ensure that future hotel supply is in line with market demand. With 10,000 rooms currently in the pipeline and many more to be added soon, hotel operators in the emirate are likely to feel some short-term pain over the next few years as the build-up in supply starts to take shape. The sector is also likely to see a dip once the Expo is over.

However, prudent steps are being taken to help ensure Dubai is able to meet its targets and maintain high demand for the next decade and beyond. Recognising that it needs to attract a wider swathe of tourists, the emirate is planning to build more budget and mid-market hotels to complement its current supply of mostly luxury hotels.

Greater airport capacity is also set to buttress growth, with the new Al-Maktoum International slated to handle up to 160 million passengers a year by the early 2020s.

Looking ahead, continued growth in Dubai’s economy will be vital to ensuring the emirate has the funds to keep building the required infrastructure to attract tourists.

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