A flurry of panic was caused by news in April that Qatar was planning to amend its visa laws, and that from the 1 May 2010 arrivals from 33 countries would no longer be granted a visa on arrival in Doha. Airlines, hoteliers and businesses reacted strongly against the change. But within a matter of days the local media reported that the new visa policy had been scrapped as swiftly as it had been introduced.
The authorities have remained tight-lipped, declining to comment on the affair, but, what is certain, any such change would have damaged the country’s fledgling tourism industry, in addition posing a huge obstruction to business.
About 7,500 hotel rooms will come on stream in Qatar in 2010, raising the country’s total to more than 15,000 rooms
Source: Qatar Tourism Authority
The government has set developing the country’s tourism sector as a key priority. In 2003, Qatar attracted little more than 400,000 visitors. In 2009, the figure reached nearly 1 million, and is expected to grow by a further 10 per cent in 2010.
According to the UK-based World Travel and Tourism Council, Qatar earned $8.2bn from travel and tourism in 2009, contributing 8.4 per cent of Qatar’s gross domestic product.
But even though visitor numbers are up, earnings within the hotel industry are down.
Average revenue per available room (revpar) fell nearly 23 per cent to $148 in 2009, from $206 in 2008, according to figures from hospitality industry tracker STR Global. Occupancy rates were also lower, averaging 57 per cent in 2009, compared with 71 per cent the previous year – the second-highest drop in the region after Dubai.
Rather than attempt to compete with its neighbours, Qatar is carving out its own distinct tourism niche
The main reason for the decreases has been the glut of new room supply entering the market during the past 12 months. This is set to continue in the near term, increasing competition and pushing down occupancy levels even further.
“Approximately half a dozen hotels opened in Qatar in 2009, offering 1,800 new rooms,” Ahmad al-Nuaimi, chairman of Qatar Tourism Authority (QTA) tells MEED. “About 40 hotels will open in 2010, bringing about 7,500 rooms to the market. This will raise [Qatar’s] total to more than 15,000 rooms in the next 12 months. Some projects were postponed from 2009 to 2010 as the result of renegotiating contracts to take advantage of more favourable pricing. But everything is moving ahead.”
|Hotel occupancy (percentage)|
|Source: STR Global|
Most of these new hotels will be concentrated in the already well supplied four- and five-star market segment. Qatar’s stock of luxury hotel and apartment rooms is expected to rise to more than 29,000 units by 2013.
The wave of hotel construction forms part of the response to QTA’s tourism development strategy launched in late 2008, which aims to increase tourism’s contribution to the economy by 20 per cent over five years. By 2020, it is expected the sector could contribute $29bn to the economy. At present, the tourism industry supports 67,000 jobs, and it is predicted this could rise to 105,000 jobs over the next 10 years.
|Revenue per available room 2009 ($)|
|Source: STR Global|
QTA is working with the Ministry of Municipal Affairs and Urban Planning, and the Supreme Council for Development Planning to create a tourism development framework. Qatar Development Bank has pledged to offer support and finance to local entrepreneurs’ start-up tourism ventures. Foreign investors will benefit from new investment promotion laws that allow 100 per cent ownership for ventures in tourism and the entertainment sector.
To complement the drive to attract more visitors, the state is also investing in improving infrastructure. Next year will see the launch of the first phase of the $11bn New Doha International airport, which will be able to handle an initial 24 million passengers a year, rising to more than 50 million on completion in 2015. The new airport will support the expansion of national carrier Qatar Airways, which has 220 new aircraft, including new-generation A380s, on order, worth more than $40bn. The airline is due to take delivery of a new aircraft each month this year.
|Doha major hotel openings|
|Name of hotel||Number of rooms||Launch date|
|Rotana City Centre||300||2010|
|Renaissance City Centre||257||2010|
|Courtyard City Centre||204||2010|
|Four Points City Centre||200||2010|
|St Regis Doha||340||2011|
|Intercontinental West Bay||540||2011|
|Crowne Plaza Business Park||448||2012|
|Four Seasons The Pearl||250||2012|
With the new airport boosting Qatar’s role as a transit hub, QTA is trying to encourage long-haul travellers to break their journeys and stay in Doha for a night or two. If just 5 per cent of transit passengers were to stop over, it would attract 2.5 million visitors in 2015. But it is an ambitious goal, compared with its neighbours, Qatar offers little in the way of amusement parks, beach resorts or nightlife.
From the 1980s onwards, the UAE and Bahrain sought to attract transit passengers with duty-free shopping. Then, when real estate developers poured money into upmarket malls, Manama and Dubai positioned themselves as destinations, where designer brands could be purchased more cheaply.
But Doha cannot compete as a shopping destination. Historically, Qatar has been an expensive place to visit. Inflation hit 15 per cent in 2008 and is expected to hover between 2-5 per cent this year. Hotels dominate the local food and beverage market, with profitability levels of 40 per cent – among the highest in the industry, according to US hotel consultancy firm HVS.
Focus on culture
Qatar has a long way to go to rival the mix of business and leisure travellers of neighbouring Dubai and Bahrain. QTA’s own figures reveal that business travellers account for more than 90 per cent of all visitors.
Qatar is investing to shore up this existing tourism base, building new venues to support future growth in the meetings, incentives, conferences and exhibitions sector. Doha Convention Centre opens in 2011, bringing 95,000 square metres of additional exhibition space to supplement Doha Exhibition Centre, which has 15,000 sq m. Various government-related entities themselves stage regular conferences to ensure the space is well used and to generate business for hotels.
Rather than attempt to compete with its neighbours, Qatar is carving out its own distinct tourism niche, by focusing on culture, education, healthcare and sport.
In November 2008, Doha opened its new waterfront landmark, the $3bn Museum of Islamic Arts, designed by Chinese-born American architect Ieoh Ming Pei, who also designed the Louvre Pyramid in Paris. In 2009, almost 250,000 people visited the museum, which along with the recently renovated Souk Waqif, now forms the centrepiece of Doha’s tourist attractions.
Another new venue, the Doha Cultural Village, will open later in 2010, comprising a Roman-style amphitheatre, an opera house, art galleries, restaurants and museums.
Existing buildings within the city are being regenerated too. The Qatar Foundation for Education, Science & Community Development is spending $5.5bn on heritage projects covering 35 hectares of Old Doha’s Musheireb neighbourhood. Its subsidiary Dohaland will restore key historic buildings to improve the area’s appeal to tourists.
Phase one comprises a new Emiri Diwan and heritage quarter, restoring four traditional houses. Subsequent phases will add new hotels, malls, a theatre, and a shopping street. The project is due for completion in 2016.
Having spent $2.8bn on new stadiums and sports centres to host the Asian Games four years ago, Qatar is positioning itself as a hub for international sports – everything from dune-bashing to the Qatar Masters golf tournament and from camel racing to international athletics events. In 2011, it hosts the Asian Games again.
In 2009, Doha lost out to Rio de Janeiro in its bid to host the 2016 Olympic Games, but is pulling out all the stops to try to host the World Cup, international football’s biggest event, in 2022. Unveiled earlier in 2010, the Qatar 2022 Fifa World Cup bid includes plans for three air-conditioned outdoor football stadiums.
About 400,000 visitors are expected to descend on South Africa for this summer’s World Cup and sceptics question whether Qatar, a country with a population of less than 2 million, has the infrastructure to cope with a sporting event on such a scale. Doha has limited public transport and business visitors struggle to book a taxi at short notice.
But Doha is prepared to put money behind its bid. If Qatar 2022 succeeds, the government has pledged to bring forward completion of its integrated transport network, a $25bn project comprising inner- and inter-city rail networks, as well as cross-border passenger and freight links to Bahrain and Saudi Arabia.
Altogether, the government has pledged to spend $43bn preparing for the event, to upgrade transport infrastructure and to build 70,000 hotel rooms and 12 new sporting venues.
But all of these efforts to boost tourist arrivals would have been stymied by the change in visa policy. For countries with few attractions of natural beauty, every incentive possible has to be given to draw in visitors, and keeping bureaucracy to a minimum is essential.