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Abu Dhabi 2017 | TOURISM & LIFESTYLE | REVIEW

Abu Dhabi's tourism sector remained strong in an uncertain economic environment, and the TCA's many partnerships in promising markets have the sector well positioned for future growth.

Abu Dhabi's tourism and lifestyle options continued to expand in 2016 thanks to partnerships in new markets and the introduction of new low-cost options for middle-class markets. Even in the face of an economic slowdown, the sector continued to perform well, drawing a record-breaking number of visitors. Abu Dhabi continues to be a destination for luxury goods and services and is expanding to offer new cultural activities with new festivals for Indian tourists, the opening of a branch of the world-famous Louvre, and Warner Bros and Sea World parks opening soon. Looking to the future, the continued expansion of the retail sector and the introduction of new markets promises to further strengthen this economically vital sector.

2016 STATISTICS

That the Abu Dhabi tourism sector remained stable despite a tumultuous global market speaks to the strength of the industry. The Emirate saw visitors increase by 8%. 4.4 million visitors arrived in 2016, up from 4.1 million in 2015, with India the largest source of foreign visitors at 323,000 guests, a 15% rise. The strength of the growth in the Indian market was especially noteworthy considering the demonetization policies enacted in late 2016 that roiled the Indian economy; Abu Dhabi Tourism and Culture Authority (TCA) officials attribute the sector's performance in this regard to targeted marketing in the Indian market, and expect similar growth in the market this year. The UAE represented the single-largest share of hotel guests, with its arrivals of 1,462,015 representing a 6% increase over 2015. The UK, China, and the Philippines rounded out the rest of the top five most frequent hotel guests. The rise in Chinese visitors was a particularly significant one for the Abu Dhabi tourism sector; the 231,916 guests who arrived in 2016 represent a remarkable 313% increase on 2015. China's population and growing economic significance means that cultivating this relationship will lead to only good things for the sector in the near future.

More detailed trends showed some of the effects the larger economic uncertainty had on the market. The number of hotel guest nights decreased by 2% from 2015, and the average length of stay fell by 9% over the same time period. New construction meant that the hotel occupancy rate fell by 3%, and the shorter stays led to total revenue falling by 9% YoY. Despite these trends of shorter stays and less revenue as a result, the rise in the most important metric—the number of visitors—has industry participants optimistic about the state of the sector.

NEW MARKETS

Sector participants expect further growth in 2017 thanks to the TCA's strategy of targeting top markets: India, China, Saudi Arabia, the US, and the UK. China in particular has been a source of emphasis for the TCA, which has begun new marketing campaigns on Chinese social media networks and initiated a new visa-on-arrival program to ease the paperwork needed to enter the Emirate. The TCA has publicly stated its goal to draw 600,000 Chinese tourists a year by 2021, almost a threefold increase over its 2016 numbers. While ambitious, that would be only a fraction of the rapidly growing Chinese tourism market; the country produced more than 120 million outbound tourists in 2015 and the market is projected to grow to over 175 million by 2020. Market analysts believe that the limited supply of midrange accommodations in Dubai are limiting the growth of this market, but the TCA is working to increase options and ease the effort of traveling to Abu Dhabi. Aside from the aforementioned visa streamlining process, the number of hotels and retailers who have attained the China Tourism Academy's Welcome Chinese Certification has risen due to new efforts in hiring Mandarin-speaking staff members. TCA Abu Dhabi maintains an office in China and will launch a multi-city promotional tour in May 2017 that will bring a delegation of Abu Dhabi tourism sector leaders to four major cities. In addition, the number of flights is expected to increase as national carrier Etihad Airways plans to introduce new flights to China and East Asia.

Other efforts are underway to increase the volume of flights to Russia and India, two of Abu Dhabi's main tourism sources. Currently, the lack of direct flights to the region is a barrier to continued growth in Russian tourism; more than 32,000 seats a week arrive from Russia to Dubai, but less than 2,000 arrive in Abu Dhabi. As such, tourists coming to Abu Dhabi frequently have to stop through Dubai, limiting the Emirate's ability to serve as one-stop spot. While the volume of flights is not expected to increase in 2017, long-term plans for the expansion of Abu Dhabi International Airport have created the possibility for new growth. As with China, Abu Dhabi now lets Russian citizens obtain visas on arrival, a move that should help increase demand. Abu Dhabi TCA officials are also working on hosting new Indian-focused events such as Bollywood-related activities and festivals for Diwali to draw additional Indian tourists. Etihad airlines also signed a USD1 million deal with Thailand's tourism agency to promote its daily flights to Bangkok and Phuket, the better to increase flows in both directions between the two countries.

MAIN ATTRACTIONS

All the outreach in the world will be meaningless if Abu Dhabi doesn't have the world-class cultural attractions that draw visitors. To this end, TCA works to bring the country's cultural and retail sectors together to create unified marketing opportunities. In April 2017, the TCVA formed an Industry Development Committee for Events & Retail, which includes leaders from the two sectors and will work with the TCA to forge new strategies in a challenging environment. The fall in oil revenues created decreased demand among the high-end retail market, with volumes falling and retailers forced to adapt new strategies to increase efficiency and lower costs. Compounding things, the strength of the dollar meant that Abu Dhabi became an increasingly expensive option for several key markets at a moment when the retail sector was counting on international visitors. The mission of the Events & Retail Committee is to leverage Abu Dhabi's strong tourism market and links to international markets to increase retail success through targeted campaigns. In the long term, the construction of the USD1 billion Al Maryah Central Shopping mall and the USD1 billion Reem Mall will provide greater retail options. Scheduled to open in 2018, the Al Maryah mall will be 2.8 million sqft; the project's developers expect to have more than 75% of available space leased by the end of summer 2017. Though originally planned to open in 2018 as well, the opening of Reem Mall has been pushed back to 2020 due to construction delays and issues with the project's design. Once complete, Reem Mall is expected to have 2.8 million sqft of leasable place and be home to the world's largest indoor snow play park.

FOR THE CULTURE

Of course, Abu Dhabi has more to offer than just high-end shopping. HH Sheikh Nahyan bin Mubarak Al Nahyan, Minister of Culture & Knowledge Development, explained that Abu Dhabi is a global city molded by the dozens of cultures that have been present over the centuries. “Our culture has been strengthened by exposure to cultures from around the world," Nahyan told TBY, “making us global citizens without losing sight of who we are." While home to millions of expats, the Abu Dhabi government has turned the Emirate into a global center for Arabic culture and heritage through investment in the documentation and study of the region's history. Cross-disciplinary projects have used the Emirate's numerous global connections to generate new creative outputs, forming a new body of work unique to Abu Dhabi.

In addition, the Ministry of Culture and Knowledge Development has formed international partnerships to create cultural exchanges and develop events that benefit both countries. “Each year we work closely with two countries in an attempt to build greater cultural collaboration," Nahyan told TBY. “During 2017 we will nurture major international cultural partnerships with the UK and the Republic of India." The British partnership, called “The Year of Creative Collaboration," will focus on the longstanding relationship between the two nations as manifested in the arts, literature, sports, and science. For India, the ministry is curating an exhibition of historic photographs and documents depicting the ties between the two closely linked countries in the hopes of forming a strong and durable bond for future collaboration. Far from being frivolous, projects such as these are central to the future of Abu Dhabi. Nahyan gets to the core of the issue when he states that “we need to know ourselves, we need to know other people and other cultures, and they need to know us."

SPORTING LIFE

Abu Dhabi has also been making a name for its growing sport offerings. The recently launched “Sport in Abu Dhabi" campaign has worked to promote the Emirate's role in the global sports landscape, and a number of major events will be held in the city in the coming years thanks to infrastructure improvements and upgraded facilities. Abu Dhabi will host the quadrennial Asian Cup in 2019 and the Abu Dhabi Tour in 2017. The latter is noteworthy for being elevated to the Union Cycliste Internationale's highest certification only two years after its inception. The Abu Dhabi Golf Club has become the host of the HSCB Open and has achieved recognition as one of the best courses in the Middle East. Ed Edwards, Group General Manager of the Abu Dhabi Golf Group that the course has worked hard to provide quality experiences for locals and international travelers, and are now looking expand the game's profile in the region: “We want to be energizing and engaging to make golf interesting for a new generation that might not have played," Edwards told TBY. “We want to attract new people to visit that have not been to the club before… We want to strengthen our appeal to tourists both from the other Emirates, from the Gulf region and from the rest of the world."