The lender warned that building consumer confidence and gradually opening up would be essential to ensure the recovery of the UAE tourism sector.
The outlook for the UAE’s travel and tourism sector improved in the second quarter of 2021 as the positive impact of the country’s strong immunization program began to take effect, Mashreq Bank said in a report.
However, the lender warned that boosting consumer confidence and gradually opening up would be essential to ensure the recovery of the UAE tourism sector.
The bank noted that as challenges persist for some segments of the tourism and hospitality industry, businesses will need to remain nimble and keep their operations as lean as possible.
With the United Arab Emirates remaining at the global forefront of Covid-19 testing and vaccination rates, the recovery of the country’s hospitality and tourism industry is expected to accelerate in 2021, also aided by the easing of travel restrictions in certain markets.
During the first quarter of 2021, the UAE’s tourism sector continued to recover, with the average hotel occupancy rate across the country approaching 63%.
“The UAE continues to strengthen its coveted position in the global tourism scene, with domestic tourism now proving to be an important catalyst for economic growth and a key contributor to GDP in the implementation of directives from the UAE’s wise leadership. Arab Emirates, ”Dr Ahmad Belhoul Al Falasi, Minister of State for Entrepreneurship and SMEs, who is also chairman of the UAE Tourism Council, said.
As Dubai eased Covid-19 restrictions, allowing hotels in the regional tourist hub to operate at full capacity and allowing concerts and sporting events where all attendees and participants have been vaccinated, Abu Dhabi expects its hotel occupancy rates are increasing to at least 80 percent this year, from 70 percent in 2020.
Mashreq Bank’s latest industry briefing highlights how business travel and hospitality companies will face hurdles for the remainder of 2021 due to the Covid-19 pandemic.
“While hotel occupancy rates in the United Arab Emirates will gradually recover thanks to the increase in domestic tourism and the return of international travelers, business travel will not return to pre-pandemic levels in the future. predictable, ”said Zain Qureshi, Managing Director and Global Head of Real Estate Finance & Advisory at Mashreq Bank.
Recent studies have shown that remote working trends triggered by the pandemic are expected to continue, given the security and cost-effectiveness of digital conferencing tools.
“The success of the UAE vaccination campaign as well as the government’s strategic initiatives to support local tourism have significantly contributed to improving the outlook for leisure travel. In order to combat the pandemic, federal and Emirati agencies in the United Arab Emirates have taken a “zero tolerance” approach to failing to adhere to safety protocols. Sanctions have been swift, ranging from warnings to license suspensions, ensuring that the rules are followed, ”the Mashreq report said.
“However, traveler sentiment remains mistrustful and it is essential that the industry takes a phased and coordinated approach to rebuilding traveler confidence. For hospitality and tourism businesses to successfully win back their customers, operational agility will be essential in the ‘developments,’ the report said.
According to Qureshi, the UAE has continued its strategy of becoming a world-class travel hub, despite the challenges of 2020, indicated by the number of new air routes and destinations added in the past six months.
“The introduction of new routes not only makes the UAE more relevant as a tourism hub, but also encourages inbound traffic from visitors who might never have made the trip to the UAE otherwise. Even if it’s just for a layover or a short break, it still adds value to the local aviation industry, ”Qureshi said.
As one of the first mega-events to take place since the start of the pandemic, Expo 2020 could serve as a case study for the way forward, Qureshi said. “Covid-19 and its variants may stick around for the foreseeable future, and the UAE really has a chance to set the benchmark with this global event. “