Included in this roundup of news from the MEA region; Saudi staycations; oil fluctuations; and more.
Each week, Hotel News Now features a news roundup from a different global region. Today’s compilation focuses on Middle East/Africa.
Staycations highlight Saudi travel shortfalls
With potential travelers from Saudi Arabia unable to go abroad as they normally would, many more are opting for trips within that nation’s borders and finding their options lacking, The Wall Street Journal reports. The newspaper noted the only major tourist destination in the country—Mecca and Medina—are holy sites without the appeal of many international leisure destinations.
Officials within the country are hoping to change that.
“In recent years, however, the government has announced multibillion-dollar development projects as pillars of a nascent leisure travel sector at the heart of Crown Prince Mohammed bin Salman’s ambitious plan to diversify the country’s oil-dependent economy,” The Journal reports. “It aims to triple the sector’s contribution to gross domestic product by 2030, from about 3% last year.”
Hope remains for a rebound in Israel
While Israel is going to fall well short of officials’ original expectations of a record year in 2020, hoteliers and experts in the market believe there are still plenty of reasons to remain optimistic for the long term, HNN contributor Vladislav Vorotnikov writes.
Governmental intervention will be helpful in that regard.
“The bailout package, including the cancellation of city tax, a furlough scheme which runs until June 2021, as well as grants to assist with running costs until next June, (is), as far as I know, more extensive than many other countries in Europe and will without a doubt be a key pillar to frame and assist existing hotels to stay afloat,” Simon Hulten, senior associate at business advisory HVS London, said.
Chinese demand buoys oil demand
Oil prices bounced up and down Tuesday as demand for crude imports in China pushed it up and continued impasses with U.S. stimulus talks pushed it down, Bloomberg reports.
“The market is bouncing back, but the rally is being currently mitigated by dollar strength,” said Harry Tchilinguirian, head of commodities strategy at BNP Paribas. Meanwhile, “fiscal uncertainty in the U.S., with the possibility of a fourth round of stimulus taking place only after election, is a concern for the economic outlook, and thus for oil demand.”
Investment interest remains in Middle East
HNN’s Terence Baker writes from the online Arabian Hotel Investment Conference that investors are maintaining a certain level of long-term confidence, but the pandemic has changed their thought processes.
“Our pattern of investments (has) definitely changed, whether we should be investing in city properties, whether we should be investing in resort properties or what are the new travel segments that are emerging? Also, the décor of the properties we would invest in. We are taking all of this into account before making investment decisions,” Adeeb Ahamed, managing director at Twenty14 Holdings, said.
In related news, deals are still happening in the region.
“Our team is extremely busy, and that is reflection of the sentiment in the market. Investors extremely are optimistic of the future, wanting to get into projects. Overall, we’re pleasantly surprised with the momentum we have at the moment,” said Matthew Tripolone, VP of development at InterContinental Hotels Group.
Compiled by Sean McCracken.