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Could the UAE’s tourism growth be the key to expanding your business?

• The UAE has built a luxurious and family-friendly environment that attracts global visitors, thereby boosting the tourism and hospitality sector.
• The country hosts global giants in the industry and proudly houses homegrown brands that have influenced its economic development.
• The vibrant ecosystem has appealed to global firms looking to maximise the lucrative business field.

The UAE has long been investing in its tourism and hospitality sectors to establish itself as a premier location for leisure and luxury experiences. This strategic decision has successfully drawn in the presence of globally recognised entities in hospitality as well as culture and entertainment. The launch of Emirates in 1985 has also enhanced the UAE’s global connectivity. Indeed, the industry is pivotal in helping boost the nation’s reputation, thereby massively contributing to the GDP.

This article is the first in a series covering the UAE’s vibrant tourism and hospitality sectors.  It looks at the industry’s structure, key players, and the unique market opportunities attracting foreign businesses and investments. This particular series will highlight the nation’s prosperous field — which has made it an excellent hub for entities focused on doing business in the UAE.

Influential reputation boosters in tourism and hospitality sectors

In the first half of 2024, the UAE has seen an increase in passenger arrivals in UAE airports by 14.2% YoY. Dubai International Airport, in particular, saw a record-breaking 23 million passengers in Q1 2024 alone. The rise in visitors is a result of the country’s top-tier attractions and world-class infrastructure.

Major cities like Dubai and Abu Dhabi host internationally renowned luxury hotels, such as Marriott International Inc., Hilton Worldwide Holdings Inc., and InterContinental Hotels Group. Complementarily, the leisure and entertainment industry includes multinational giants like Warner Bros. and Louvre. The upsurge of internationally recognised enterprises has inevitably attracted the presence of HNWIs in the country. As a result, this has paved the way for the development of new partnerships and investments for local and global firms seeking to tap into the abundant business opportunities in the UAE.

Homegrown conglomerates and national airlines

While global brands are making significant strides in the UAE’s hospitality and entertainment sector, homegrown giants such as Emaar and DAMAC have equally impacted the industry. Emaar’s role as the master developer of Burj Khalifa and DAMAC’s luxury developments are examples of the UAE’s innovative approach to establishing itself as a creative leader in the field.

Similarly, the UAE’s airline industry strengthens its tourism appeal by providing convenient travel options for millions of international visitors annually. Emirates and Etihad Airways, the country’s flagship carriers, are renowned worldwide for their luxury services and extensive flight networks. Remarkably, the newly rebranded Zayed International Airport in Abu Dhabi welcomed more than 6.8 million passengers in the first quarter of 2024. Several other construction projects in other emirates are also underway, like Ras Al Khaimah’s RAK Central, and are expected to draw in tourists, residents, and investors alike.

The economic impact of the industry

The UAE’s tourism industry, which includes the hospitality sector, has contributed AED220 billion to the GDP last year. This value reportedly equates to 11.7% of the overall economy. Last year, hotel occupancy rates increased to 75%, with the total number of guests across the seven emirates reaching 28 million. This figure is among the highest achieved by leading global tourism destinations. Consequently, hotel revenues amounted to AED 43.5 billion last year.

It’s also remarkable to note that Dubai was named the world’s No. 1 destination in TripAdvisor’s 2023 Travellers’ Choice Awards. These significant developments clearly put the UAE’s leadership in the industry on huge display. Besides ensuring top-tier travel and stay experiences for tourists, these achievements inevitably appeal to entities looking to conduct business in the UAE.

As the UAE continues to attract travellers and investment opportunities due to its vibrant and profitable tourism and hospitality sector, national forecasts indicate significant growth in GDP. Specifically, the country projects that this industry will grow by 12% by 2031, ultimately accounting for 16% of the overall economy.