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Covid-19: UAE records world’s second-highest hotel occupancy rate in 2020

Dubai - The UAE tourism sector was also among the least affected and the fastest to recover from the impact of Covid

The UAE recorded the world’s second-highest hotel occupancy rate last year despite the impact of the Covid pandemic, paving the way to welcome 14.8 million hotel guests spending an average of 3.7 nights per guest, says a report.

The Ministry of Economy has disclosed that the UAE tourism sector was among the least affected and fastest to recover around the world due to early reopening of economy and facilities offered to the businesses.

Referring to official statistics issued by the World Tourism Organisation and the Emirates Tourism Council, the ministry said the UAE ranked second in the world in occupancy rates at hotel establishments with a rate of 54.7 per cent last year, just behind 58 per cent of China who secured first position. The United States ranked third with 37 per cent occupancy rates.

While the global rate dropped to 37 per cent under the weight of the pandemic, and hotels in the Middle East region recorded just 43 per cent occupancy. This is in parallel to the significant decline in tourist activity, which fell by 74 per cent around the world and 76 per cent in the region.

“Despite the tremendous challenges it brought onto the industry, the pandemic also created new opportunities for domestic tourism,” said Dr Ahmad Belhoul Al Falasi, Minister of State for Entrepreneurship and Small and Medium Enterprises.

Domestic tourism

Domestic tourism also contributed Dh41 billion to the national economy last year – a figure that is expected to double in the upcoming few years.

Statistics also revealed that the UAE suffered the least in terms of tourist traffic in 2020, where activity fell by just 45.2 per cent – the lowest drop in the world. The UAE was followed by Mexico, where tourist traffic decreased by 52 per cent and then Italy at 63 per cent.

Hospitality establishments welcomed 14.8 million guests in 2020, who spent 54.2 million nights in 1,089 different establishments that provided approximately 180,000 rooms. This brings the average stay to 3.7 nights per guest, with returns of Dh318.5 per room, according to the Ministry of Economy.

“The UAE can benefit from its advanced infrastructure, modern facilities, and wide range of services and activities to promote itself as a tourist destination with a lot to offer visitors – be they UAE residents or travellers from abroad,” said Al Falasi.

The minister also asserted that the next stage will include further initiatives aiming to maintain the sector’s outstanding performance and boost chances for recovery.

“The tourism sector’s accomplishments over the past year are a result of the notable efforts made by all relevant parties to promote the sector at the federal and local levels. This is in addition to the proactive measures the UAE implemented to deal with the outbreak and minimise its impact on public health,” he said.

Leading from the front

Laurent A. Voivenel, senior vice-president (operations and development) for Europe, Middle East Africa and India at Swiss-Belhotel International, said the emirates has set an example for the entire world with the way it swiftly reopened its borders and economy to welcome international travellers while developing domestic tourism. “We believe 2021 will be a very good year for the UAE. Beach hotels will drive the rate up while the city hotels will still fight for better rate but the occupancy levels will be very good and the best in the region,” Voivenel told Khaleej Times on Saturday.

“We have all been through an unprecedently challenging year. However, travel is everyone’s number one wish as the world waits for the new normal. What is commendable is how the UAE is getting tourism back on track with its pro-active policies, advanced technology, and preventive measures to curb the spread of the coronavirus pandemic,” he added.

Growth drivers

Voivenel gave full credit to the authorities for making the Covid-19 vaccine available so quickly and readily to all of us.

“We are confident, with the vaccine currently being rolled out and Dubai Expo starting on October 1 and the UAE’s 50th year celebrations, a rebound will occur, and hotel performance matrices will begin to return to much healthier levels both in terms of rate and occupancy before the close of 2021. This will drive tourism growth in 2022. Also, Vision 2040 is absolutely remarkable and will open new opportunities for our industry by reinforcing the UAE’s competitiveness as a global destination,” he said.

Lal Bhatia, chairman of the Hilshaw Group, said Dubai’s economy is dependent on business, tourism, finance, and real estate, which means that losing its reputation as an investment destination is not ideal for the country.

“The UAE was committed to bringing positive sentiment back to the economy through merit-worthy decisions and actions and Dubai’s visionary leadership ensured that businesses had the confidence to continue operations without perishing in the crisis tide,” Bhatia told Khaleej Times on Saturday.

Expo 2020 a catalyst

Iftikhar Hamdani, area general manager at Bahi Ajman Palace and Coral Beach Resort Sharjah, said all the indicators show that there will be a rapid increase in travel demand in last quarter of 2021 onwards due to Expo 2020 — the greatest show of the world happening in Dubai from October 2021.

"Hoteliers across the UAE in general and Dubai in particular are preparing themselves for the big inflow of business and leisure guests during the international event. This event will be start of our come back and we foresee a strong occupancies in the hotels during last quarter of 2021," Hamdani told Khaleej Times.

"We are confident that with strict health and safety measures in place, state-of-the-art expo venue, top rated aviation facilities, world best hospitality team will make this event a success. This event is for all of us and it is our responsibility to play a role in the success of Expo 2020. In my opinion each and every industry in the UAE will get benefit of this event so all of us are stakeholder and this is our own event," he said.

— muzaffarrizvi@khaleejtimes.com