UAE tourism sector set to double in 14 years

The UAE has pumped nearly Dh47 billion into projects over the past decade to develop its tourism sector within long-term economic diversification plans and further investment will nearly double the sector in the next 14 years.

The projects, covering hotels and other infrastructure ventures, boosted the country’s tourism sector’s contribution to GDP from around 3.2 per cent in 1995 to 6.2 per cent in 2010, the government-controlled Emirates Industrial Bank (EIB) said in its monthly economic bulletin for June.

Further investments planned in Dubai, Abu Dhabi and other emirates are expected to expand that contribution to about 12.5 per cent by 2025, it said.

“The expansion over the past 10 years was a result of massive investments in the tourism sector, totaling around Dh47 billion,” the bulletin said.

It said investments could reach nearly Dh100 billion if funds spent on new airports and expansion of existing airports are included.

The report said expansion projects were prompted by a sharp rise in the number of tourists visiting the UAE, the second largest Arab economy.

“In 2010, the number of visitors to the UAE grew by around 10.5 per cent over the previous year to reach nearly 11.6 million,” it said.

Key projects which were carried out over the past few years to support the growing tourism sector included Sheikh Zayed Mosque in Abu Dhabi, Burj Khalifa in Dubai, the world’s tallest building, and Burjk al Arab hotel in Dubai.

“Besides airports and other projects, the UAE has also allocated large funds for the expansion of its ports to cope with the growing sea traffic in terms of cargo and passengers….in 2010, passengers using UAE ports rose by nine per cent.”

The report said the steady expansion in the UAE’s tourism sector, which was also supported by massive shopping facilities, turned it into one of the most important components of the country’s GDP along with industry, trade and financials services, which are considered the pillars of diversification.

Figures by the National Bureau of Statistics showed economic diversification programmes in the UAE were paying off, with the non-hydrocarbons sectors gaining ground over the past years.

In 2010, the non-oil sector contributed around Dh749.2 billion, nearly 68.5 per cent of the overall GDP of Dh1,093 billion compares with Dh510 billion in 2006, nearly 62.5 per cent of the Dh815 billion GDP.

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