Qatari hotels report positive rise in occupancy rates and revenues.
In a comparison of the first half of year 2010 with the first half of year 2009, Qatar Tourism Authority reports that the hotel sector in the State of Qatar shows a rise of two points in the occupancy rate. In addition to positive results for occupancy rates, revenues for four-star and five-star hotels in the first half of 2010 exceeded those revenues for the same period in years 2008 and 2009.
The improvement in hotel performance can be attributed to the effort the State has put in motion to increase tourism activities, and in hosting sporting and cultural events. It is also due to the continuous expansion of Qatar Airways into new routes in spite of the global economic crisis.
While there is recovery of the tourism industry at the global level from the effects of the global economic crisis of 2009, this recovery is still a slow and cautious one.
Qatar Tourism Authority has in place promotional plans which meet the changes that the tourism industry will face for the coming period. Likewise, investment in the hotel facilities sector continues.
In this first half report, Mr. Ahmed Al Nuaimi, Chairman of Qatar Tourism Authority, states that statistics on occupancy rates for all hotels in Qatar in the first half of 2010 recorded an increase of two (2) points versus the same period in 2009. These statistics show that the occupancy rate for the first half 2009 was 59% compared to the first half 2010 of 61%.
As to the improvement witnessed in 2010 as compared with 2009, Mr. Al Nuaimi stated that “this increase is a sign of recovery of the hotel sector in the State from the world economic crisis of 2009. And in spite of the decline in indicators of the global tourism industry to its lowest status in 2009, Qatar’s interest in increasing tourism activities in the country by promoting various unique attractions regionally and abroad, and the interest in sports and cultural tourism, led to the positive results. This recovery in the hotel sector can also be attributed to the continuous expansion in Qatar Airways routes around the world, and raising the size of the fleet (number of airplanes).” It is worth noting that in the year 2010, several new hotels opened resulting in an expansion of hotel capacity since 2009. However, this has not adversely affected the occupancy rate; on the contrary, as this recent report indicates, the occupancy rate rose from the year 2009 to date. It is expected that the occupancy rate in the next six months will show an even better improvement as Qatar is hosting several events that would support tourism of exhibitions and conferences, cultural tourism, as well as sports tourism. This is in addition to QTA’s efforts in attracting tourists who come on a business, encouraging them to prolong their stay as part of the touristic promotional agenda set by QTA.
When asked about his forecast for the coming period on the world tourism industry, its impact on the tourism market in Qatar and what plans are established by QTA in response, Mr. Al Nuaimi stated that “the year 2009 was the most difficult year on the world tourism industry due to the effects of the global economic crisis on the tourism industry and the subsequent travel restrictions because of the spread of H1N1. In that year, global rates of visits declined to less than 4%, which is considered the worst rate in 60 years. And the number of passengers across nations fell from 950 million to 880 million. In addition to the drop in tourism revenues globally by 6%, even though this decline is considered the smallest compared with revenues of other sector, where the commercial sectors witnessed a decrease of 12%.”
As for the impact of the economic crisis on the tourism industry in the Arab region, it can be seen through the reports by the World Economic Forum and UNWTO that the rates of visits to the Arab region are slightly lower than the global decline which reached 5%. However, the decline of Arab tourist revenue was lower by half the proportion of the global decline, reaching 3%. Mr. Al Nuaimi refers this to the role that domestic tourism plays in bridging the shortfall faced by the tourism industry of tourists coming from abroad. In this regard, Mr. Al Nuaimi said that “this highlights the magnitude and importance of revitalizing domestic tourism as an alternative to deal with crises in the tourism sector.” Although, he states, it is well known that domestic tourism does not fall within the sub-account of the state’s revenue where it does not bring cash from overseas. It does, however, reduce the currency exchange abroad, affecting operating income of the national institutions rather than foreign exchange.
As for the changes carried by the year 2010 in the tourism sector, and also forecasted by the World Bank and International Monetary Fund, there is an expectation of economic growth worldwide which could exceed 4%. And the World Tourism Organization predicts that the growth in tourist traffic will range between 3% and 4%. However, the recovery from the effects of the global economic crisis that hit the world in 2009, which affected various sectors and industries including economic and tourism industry is still a cautious and slow recovery, and is not commensurate with the stronger global recovery. For example, as soon as travel and tourism flourished in the first quarter on 2010, the industry hit a crisis caused by natural disasters including the impact of the volcano of Iceland on air traffic which passed the continent of Europe to other continents such as Asia, Africa, North and South America. And following that, was the crisis of high indebtedness of some European countries, giving rise to financial and economic crises experienced in some countries where the support of governments of various countries and various public sectors strive to stimulate these economies by pumping money into them, leading to increased debt. In response to this, many countries have had to impose a set of fiscal policies, the most influential ones on the tourism and travel sectors such as the enforcement of a series of taxes in Europe including imposing a departure tax, which is likely to affect the tourist influx for these countries and limit outward travel. Among the countries which imposed the tax are the United Kingdom, Germany and Spain, where this tax could cost, for example, any three people travelling abroad the equivalent of 150 to 200 pounds.
Mr. Al Nuaimi has said to address these situations, “QTA has developed short-term promotional plans to attract tourists targeted in the current circumstances as well as to address changes at the global tourism level. We are focusing on the type of tourist to target for the future, not only by number but also including the length of stay and amount of money they spend.” QTA plans also include identifying the largest tourist exporting markets and focusing on them for marketing and promotions to attract the type of tourists convenient for tourist attractions visitors can find in Qatar.
It is worth mentioning that the World Tourism Organization, had originally expected that the percentage of tourists exported from the European market next year is 4.2%. However, after the changes in economic policies in the European market, the expectations have dropped to a rate of 1% to 1.5% only, while expectations of exported tourists from other markets such as the Asian market were less affected than 3 to 4%.
In that regard, Qatar Tourism Authority has laid marketing plans for expansion in the Asian market among the countries targeted for the Qatari tourism sector. As such, QTA prepared a plan to promote tourism which will be implemented in the Asian countries including Malaysia, Singapore, Hong Kong, and South Korea. A delegation representing the tourism sector in Qatar has been compiled including representatives from business tourism, the conferences and exhibition industry, sports tourism, cultural tourism, entertainment tourism and Qatar Airways. This campaign will promote the State of Qatar to MICE (meetings, incentive, convention and exhibition) specialists in these countries.
This is in addition to the continuous promotion of the State of Qatar as a premier tourism destination, showcasing the different events organized by the State of Qatar, especially the Asian Cup 2011. QTA will also cover the Australian market over the next year, which will be the first time for a specific promotional campaign to the country by QTA.
As reported by Mr. Al Nuaimi, the expansion of investments planned in the field of hotel facilities continues, as it seems certain to open 42 hotel facilities by the end of 2010, ranging from hotels and hotel apartments classified with a rough capacity of up to 6731 rooms and 1573 hotel units.
With regard to the income of hotels (four- and five-star) for 2010, Mr. Al Nuaimi said that revenues of hotel facilities for four and five star hotels operating in the country has seen remarkable growth exceeding the years 2009 and 2008, where revenues of rooms and revenue of drinks and foods department make the bulk of these revenues. And due to the increasing number of four- and five-star hotels with high levels of quality and service, statistics show rising revenues of four-star hotels in the first half of 2010 at the rate of QR 11 Mn as compared to 2009. As for five-star hotels, they recorded the greater increase of QR 100 Mn in the first half of 2010, as compared to 2009. Al Nuaimi referred the increases to the high operating ratios in the first half in 2010, and to the increase in operating the food and beverages section, which includes the increase in bookings for rooms and restaurants.