Tourist numbers down 83% but confidence slowly rising

With Saudi Arabia’s flagship Red Sea tourism project securing $ 3.8 billion in green funding, various governments in the Gulf region are looking to new alternative tourism models to boost coronavirus recovery in this important sector, with an emphasis on eco-friendly options and stays.

Both to revive its tourism industry and as part of its desire to diversify its economy away from hydrocarbons, Saudi Arabia is developing several major ecological tourism projects.

In April, the Red Sea Development Company – which is owned by the Kingdom’s Public Investment Fund – announced that it had raised $ 3.8 billion for the Red Sea project through the world’s first ever financing credit facility. green denominated in riyals.

The project is built on a 28,000 km² site which contains 90 islands. It is expected to welcome its first visitors in 2022 and, when fully operational in 2030, will include 50 hotels, a luxury marina and a range of entertainment and leisure facilities.

The entire site transport network, including a new airport, will be powered by renewable energies.

Four banks in Saudi Arabia – Banque Saudi Fransi, Riyad Bank, Saudi British Bank and Saudi National Bank – helped finance the construction of the project, while HSBC acted as the green lending coordinator.

Alternative tourism on the rise

The Gulf region as a whole is increasingly adopting innovative and sustainable approaches to tourism.

“The demand for local, greener and more environmentally friendly tourism has grown exponentially, both in Europe and in the GCC,” Chirag Kanabar, managing director of Pine Wood Building Materials Trading, a company told OBG. focused on ecological and sustainable modular construction. . “This is in line with pandemic preferences for increased social distancing and privacy. “

The United Arab Emirates, for example, has seen a significant increase in ‘glamping’, a phenomenon whereby tourists can enjoy the camping experience while having access to more luxurious facilities than those available at traditional campsites.

Glamping is part of a larger change to the so-called staycation model. With flights stranded and borders closed due to Covid-19, last year many people around the world took their vacations in their home countries. This year, even though vaccination programs are being rolled out and borders are gradually being reopened around the world, international tourism is expected to slowly recover and “staycationing” is leading the way.

In 2018, market research firm Aritzon predicted that the global glamping industry would reach revenues of around $ 1 billion by 2023, growing at a compound annual growth rate (CAGR) of 6. % throughout the period.

However, it would appear that the coronavirus pandemic has served to accelerate the growth of the sector. According to a report released in March this year by Grand View Research, global glamping will be worth $ 5.4 billion by 2028, thanks to a CAGR of 14.1% between 2021 and 2028.

The UAE is uniquely positioned to take advantage of this trend, with its range of natural landscapes close to urban centers offering diverse cultural attractions.

A flagship project is the Kingfisher Retreat in Sharjah, a tented hotel in the Middle East, which won the 2020 Luxury Beach Retreat in the Middle East award at the World Luxury Hotel Awards.

“This is tangible proof that the emirate’s ecotourism model, based on environmentally friendly structures, is working, so the government is looking to extend it to other places on its territory”, David Patrick Court, consultant at Bushtec Creations, a manufacturer of luxury tents. for resorts and glamping providers, OBG said.

Meanwhile, the recently announced Dubai 2040 Urban Master Plan places a strong emphasis on sustainability.

In a significant gesture, Glampitect – a UK leader in eco-resort design consultancy – announced in March the opening of a site in Dubai.

Elsewhere, during the Arabian Travel Market 2021 – held at the Dubai World Trade Center from May 16 to 19 – the Ras Al Khaimah Tourism Development Authority (RAKTDA) announced more than 20 sustainable tourism development initiatives across the emirate.

In addition to glamping sites, these will include eco-hotels and experiential offers.

“The GCC region excels at providing experiential travel opportunities, given its rich history and culture. One possible way for the region to take full advantage of this could be for countries and emirates to coordinate with each other in an approach similar to that adopted by countries in Southeast Asia, where each can specialize in their proposal for distinctive value, ”Tommy Lai, CEO of Gulf-based GHM Hotels, told OBG.

“For the region, it is important to promote the idea that ecotourism is multifaceted, and not just associated with tropical forests and tropical environments. The multi-faceted potential of ecotourism can be developed based on the unique habitats of the GCC, including its deserts, ”added Lai.

Echoing these sentiments, Sanjiv Malhotra, executive vice president of Shaza Hotels, told OBG that “in the UAE, each emirate offers a distinct experience. Sharjah is firmly committed to positioning itself as a capital of heritage and culture, relying on an identity linked to education. It also relies on its natural assets, from its Gulf coast to Khorfakkan.

New industry trends

RAKTDA said its plan reflects Ras Al Khaimah’s new destination strategy, which focuses on nature, recreation, adventure, accessibility and authenticity.

These axes correspond globally to six key trends identified by Euronews Travel in a recent report on the future of post-2020 tourism, namely: open-air tourism, ecotourism, nomadic tourism, wellness tourism, authentic tourism and conscious tourism.

Nomadic tourism, or “long-stay travel”, corresponds to the significant growth of digital nomads. These travelers move for longer periods of time, and if they spend less on a daily basis, it is possible to derive substantial value from their presence.

As many emerging economies scramble to position themselves as digital nomadic hubs, Dubai is already an established leader in the field.

As OBG detailed, the government of Dubai has launched a virtual work program designed to attract professionals, entrepreneurs and people working in start-ups.

Given its strong ICT infrastructure and healthy start-up scene, Dubai is an attractive option for digital nomads, with officials presenting the emirate as a place for people to live and work by the beach.

In short, from ecotourism to glamping, via staycations and digital nomads, the Gulf region is at the forefront of the latest tourism developments, offering a revival model on which other regions should be able to rely on. ‘to come up.

About Andrew Miller

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