July 13, 2024

“Rising Above: Dubai’s Dynamic Economy & Tourism Triumphs”

“Discover Dubai’s resilient economy & booming tourism. From record-breaking airport traffic to hospitality growth, Dubai is a global destination on the rise.”

Dubai’s economy has shown remarkable resilience amidst global conflicts and recent regional unrest, with key sectors driving its steadfast recovery, as revealed in a new report released on Thursday.

The report, titled “Dubai’s Hospitality Sector Market Performance” by Cavendish Maxwell, highlights significant growth in the tourism sector. In 2023, the city welcomed 17.15 million overnight visitors, surpassing the previous high of 16.73 million in 2019 and the 14.36 million recorded in 2022. Furthermore, the tourism sector’s GDP contribution is expected to nearly double this year from 2021, reaching 36.1 percent, and is projected to return to 2019 levels by 2024.

To sustain this upward trajectory, the UAE has set ambitious targets in its National Tourism Strategy 2031, aiming to position itself as a leading global destination by that year. The strategy seeks to increase the tourism sector’s GDP contribution by Dh450 billion, attract investments worth Dh100 billion, and host 40 million hotel guests annually by 2031. This strategy aligns with the Dubai Economic Agenda – D33, unveiled by the Dubai government in early 2023. The D33 Economic Agenda aims to double the city’s economy within the next decade and solidify its position among the top three global cities for travel and business, primarily by boosting foreign trade and foreign direct investment.

Dubai’s Tourism achievements have received global recognition, with the city securing the top spot in the TripAdvisor Travelers’ Choice Awards 2024 for the third consecutive year. Additionally, Dubai has been ranked first regionally and sixth globally as the best city in the world in the World’s Best Cities Report 2024. These accolades underscore Dubai’s commitment to tourism excellence and its status as a premier global destination. The growth recorded by Dubai Tourism in 2023 has undoubtedly provided a significant boost to the city’s hospitality and real estate sectors, as noted in the report.

Dubai Airport

Dubai’s airports maintain their dominant position in managing all air traffic in and out of the city, with Dubai International Airport (DXB) and Al Maktoum International Airport (DWC) being the key hubs. In 2023, DXB exceeded pre-pandemic levels of passenger traffic, handling 86.9 million passengers. Projections indicate that by the end of 2024, this figure could rise to approximately 88.8 million, nearing the record high of 89.1 million recorded in 2018.

The allure of Dubai as a tourist hotspot has been steadily growing. In 2022, the city welcomed 14.36 million international overnight visitors, marking a substantial 97 percent increase from 2021 and reaching 86 percent of pre-pandemic levels. This upward trajectory persisted into 2023, with 17.15 million visitors, representing a 19.4 percent year-on-year increase, according to data.

During Q3 2023, India retained its position as the largest source market for overnight visitors to Dubai, constituting 14 percent of the total, followed by Saudi Arabia, the UK, and Russia, each at 7 percent.

Among the top ten source markets, China witnessed a remarkable 304.4 percent year-on-year increase, followed by Russia at 77.5 percent and Germany at 49.6 percent. Notably, Saudi Arabia and Oman experienced declines in visitor numbers by 5.6 percent and 24.9 percent, respectively.

To accommodate the rising tourism levels in Dubai, the hospitality industry has adeptly adjusted its supply to meet the increased demand.

By the first half of 2023, the total number of hospitality establishments in Dubai had increased to 813, offering 148,711 keys. Towards the end of the year, the total number of establishments rose to 820, with 149,685 keys available for guests.

According to analysts at Cavendish Maxwell, it is estimated that 2024 will witness the opening of 31 new hotels in Dubai, while 2025 is expected to add 16 new hotels to the market. This translates to a cumulative total of 851 by the end of 2024 and 867 by the end of 2025.

Overall, the Dubai market demonstrated a clear recovery in terms of top-line performance, with an average growth of 6.6 percent in Revenue Per Available Room (RevPAR) compared to 2022 figures. All segments experienced year-on-year increases, with the Upscale sector leading with an average growth of around 13 percent in RevPAR.

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