Most markets expected to improve on 2021’s performance despite geopolitical tension
The new MENA Hotel Forecast study by Colliers International held no surprises.
The report states that the outlook for hotels in the Middle East and North Africa region remains positive in 2022 despite increased geopolitical tension and the rising oil prices.
The study found that the priority for most markets this year is to implement measures to minimise a resurgence of Covid-19 and build consumer confidence. The principal challenge will be in managing demand interruptions from key markets in the Commonwealth of Independent States (CIS), specifically Russia, which is a leading source market for many destinations in the MENA region.
While rising instability in key CIS source markets is expected to suppress demand in the UAE, the diversity of its source markets is likely to mitigate the impact
Qatar capital Doha maintained a high level of demand across 2021, exceeding 2019 levels, and further improvement is expected in 2022 with the FIFA World Cup Qatar a key driver of tourist numbers in the final quarter of the year.
In Saudi Arabia, Riyadh Season and growing consumer confidence helped to boost bookings in both Riyadh and Jeddah, and the return of foreign pilgrimage has improved the outlook for Makkah and Madinah. The rising price of oil has historically led to increased corporate demand in Al Khobar/Dammam and will be monitored as the year progresses.
New tourist attractions in Cairo will help attract visitors, however, increased uncertainty from key CIS markets is expected to have the largest impact on the Red Sea markets of Sharm El Sheikh and Hurghada.
The final months of Expo 2020 Dubai and the FIFA World Cup Qatar 2022 are expected to result in a halo effect for surrounding markets, with travel agents offering two-centre stays, particularly with overspill demand from Qatar visitors to the key transit hubs of Dubai and Abu Dhabi.
In addition, the region’s consistent government support for the tourist and travel industries throughout the pandemic is a key factor in the ongoing recovery.
Across the region, Q1 2022 has seen further easing of Covid-19 restrictions across the region, including the lifting of PCR testing requirements on arrival at many destinations, which is expected to further boost tourism in 2022.
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