Hospitality News Middle East’s editorial team forecasts a bright future for the hospitality industry, which is gathering pace post-pandemic.
Despite geopolitical tensions, the rising price of oil and widespread inflation, the Middle East hotel market is faring, well thanks to the easing of Covid-19 restrictions, which has boosted consumer confidence.
According to the 2022 Colliers’ hotel forecast report for key MENA hospitality markets, the UAE market has been positively impacted by Expo 2020, while the FIFA World Cup Qatar 2022 is expected to produce overspill demand in the key transit hubs of Dubai and Abu Dhabi. However, the rising instability in major CIS source markets is expected to suppress demand, with Dubai and Ras al Khaimah likely to be most significantly affected. Given the diversity of source markets for the UAE, additional hotel demand may be induced from alternative markets at a lower price positioning.
In KSA, the Riyadh Season, coupled with growing consumer confidence, has benefitted both the markets of Riyadh and Jeddah. In addition, there are positive signs regarding the return of pilgrims to Saudi Arabia’s renowned pilgrimage sites, notably Makkah and Madinah. Rising oil prices have historically led to increased corporate demand in Al Khobar/Dammam. However, an increase in outbound travel may reduce this impact.
Turning to Egypt, data shows that Cairo has maintained its rate of growth, although leisure-oriented markets have experienced a marked fall in tourist numbers due to increased competition in the region, as well as travel uncertainty from the key CIS markets. The exception here is the Hurghada market, which has maintained levels of demand. Furthermore, Sahel is proving to be an exciting growth market.
When it comes to Qatar, Doha has experienced a slight decrease in occupancy over H1 2022 compared to the previous year. Nevertheless, the FIFA World Cup Qatar 2022 is expected to result in an unprecedented number of arrivals. According to World Bank data published in March 2022, the Kuwaiti economy is expected to increase by 5.3 percent this year and 3 percent next year, which would put the country on track to achieve its pre-covid growth by 2023, provided that current global inflation does not get in the way.
Furthermore, the Central Bank of Jordan reported that tourist arrivals increased to 716,000 in June, up from 650,000 in May 2022.