The figures speak for themselves. Madrid-based World Tourism Organisation (WTO) estimates that the Middle East attracted 38.4 million visitors in 2005. North Africa welcomed an additional 13.6 million, almost half the number of tourists heading to the African continent. The combined global market share of tourism in the Arab world now stands at about 5.5 per cent, almost equivalent to the number of visitors to South-East Asia and Northern Europe.
The WTO forecasts 8 per cent growth this year, as a result of increasing intraregional travel and significant government and private sector spending on better infrastructure, marketing and improved tourism legislation.
The investment in the travel industry is unprecedented. In the Gulf alone, MEED Projects is tracking $10,000 million in hotel developments. By 2009, the Arabian Peninsula is set to see 80 new hotels open, according to Deloitte & Touche.
This may well be conservative. In Qatar, one of the smallest regional markets, up to 50 hotels are under construction, in design or at the planning stage. And figures do not incorporate mega projects such as the recently announced Al-Bawadi hotel and tourism development in Dubai, which once completed will see more than $27,000 million invested to improve tourism infrastructure including a 6,500-room property.
Regional hotels continue to outperform some of the world's leading destinations. According to Deloitte's most recent Hotel Benchmark Survey, during the first quarter of the year, the region's hotels saw revenue per available room (revpar) rise by 11 per cent to $96, a drop on 2005, but still among the world's best performers. Average room rates for the Middle East and Levant rose 15 per cent to $142 - $38 more than in the US and $21 more than in Europe. Dubai remains the top performer, with average room rates reaching new highs of $286, an almost 20 per cent increase on the previous year. Occupancy rates in the region are among the best in the world, averaging 70 per cent and in Abu Dhabi, as high as 84 per cent.
Rising visitor numbers have been fuelled by the strong growth in Gulf airlines. Emirates, Etihad Airways and Qatar Airways have ploughed billions of dollars into massive fleet expansions and acquiring the latest aircraft. Combined, the three are now carrying more than 25 million passengers a year. Regional economies are set to reap the benefits. The World Travel & Tourism Council's 2006 report forecasts that economic activity in the hospitality sector across the region will increase by 4.4 per cent a year, generating nearly $300,000 million by 2016 from just under $150,000 million in 2006.
Amid all the positives, the region is also adapting to the changing dynamics of the market. According to hospitality consultant the RSP Group, 45 per cent of regional tourism is likely to come from the mass market. 'You can't have a destination of size without appealing to everybody,' says easyGroup chairman Stelios Haji-Ioannou. 'Not everybody is coming for the safe, clean and luxurious tourism.'
Cheaper alternatives are also being sought. One area that is expected to see strong growth is the nascent timeshare sector. The opportunities remain limited partly due to the lack of legislation, but some form of timeshare already exists in Morocco and Egypt. In Saudi Arabia, the Abraj al-Bayt development in Mecca has adapted the concept for pilgrims. 'In 10 years people will be shocked about the timeshare industry in Dubai,'
says David Clifton, managing director, Europe, Middle East, Africa and Asia, at timeshare exchange company Interval International. 'It's a mainstream hospitality product and natural progression fro