Jordan's tourism: less is more
It has been an uneven year for Jordan’s tourism industry, with rising earnings yet declining visitor numbers.
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Tourism is one of the most important sectors in the economy, The World Travel & Tourism Council (WTTC) puts the industry’s direct contribution to GDP at 7.7%. This figure rises to 18.9% when indirect factors are taken into account. Tourism is also one of the kingdom’s leading employers, providing jobs for almost 17% of the national workforce.
On November 12, the Central Bank of Jordan (CBJ) released its latest data on tourism revenue, which showed receipts totalled $3bn in the first 10 months of 2012, an 18% increase in earnings compared to the same period in 2011.
The strong improvement, however, came off a low baseline, as 2011 was a poor year for tourism. Estimates issued by the Ministry of Tourism and Antiquities (MoTA) earlier this year put the cost of the sector’s downturn in 2011 at $1bn, with total direct earnings at $2.8bn, a 16.5% drop on performance in 2010, Global Arab Network reports according to OBG.
Visitor numbers were also down: 6.6m tourists went through passport control in 2011, a 19.5% decline on the 8.2m arrivals in 2010. This reduction is widely being attributed to the effects of the Arab Spring, which the MoTA said had substantially impacted arrivals from Arab countries, which account for 48% of Jordan’s tourism market.
Though revenue may be up, there has been a further fall this year in visitor numbers: arrivals were down 6% over the first seven months of 2012, dipping from just over 4m in the first six months of 2011 to 3.7m for the same period in 2012, according to official data.
The fall in visitors is not just a Jordanian phenomenon, however. A report by the UN World Tourism Organisation (WTO) showed that the decline was common across the Middle East. According to the report, issued in mid-November, inbound tourist numbers eased 1% in the first seven months of the year across the region – the only part of the globe that did not post growth. But the WTO did note that the 1% reduction in arrivals was a far cry from the 7% decline in 2011 and suggested a turnaround for the industry in 2013.
Some of the blame for the continued decline in visitor numbers has been laid at the door of Syria and other areas of instability in the region. However, there are also concerns that local issues have played a role. According to recent media reports, protests over rising fuel prices and the scaling back of subsidies have prompted some cancellations at hotels and resulted in blocked roads causing delays in transferring tourists. In the wake of the protests, Nayef Al Fayez, the minister of tourism and antiquities, warned there was not only the risk of tourists cancelling planned trips, but also of those visitors currently in the country possibly leaving.
While Jordan is keen to maximise both visitor numbers and revenue, it has been tightening the focus of its tourism industry, aiming to attract visitors from higher-income brackets who are likely to stay longer and spend more.
According to Sean Cullen, the director of sales and marketing at Mövenpick Resort Petra, Jordan is positioning itself at the upper end of the tourism market. “Jordan does not wish to be a volume-driven attraction like Egypt,” Cullen said in an interview with Forbes Magazine in early November. “It is an exclusive destination. The current visitor profile is over 40, financially sound, widely travelled, interested in history and culture, and seeking a once-in-a-lifetime experience.”
This less-is-more approach has seen a flurry of new top-end hotels coming onto the market, with the five-star Millennium Hotel Amman opening its doors on November 1. At least another four luxury hotels are due to launch in the next three years, adding 1000 new rooms to existing stocks, according to the Jordan Tourism Board.
Though visitor numbers are unlikely to surge in the last month of the year, Jordan’s tourism sector looks set to post solid revenue and should be able to look ahead to better things to come. However, such a turnaround may largely depend on a cooling of regional tensions, a factor beyond the kingdom’s control.
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