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Gulf states’ economic diversification beyond oil industry will significantly impact travel

Ernesto Sanchez Beaumont

Head of Commercial Strategy and Business Management, MENA, Amadeus IT Group

Previously, we discussed one of five big travel effects looming for Gulf Cooperation Council (GCC) countries, which we call the ‘population effect’. Another significant effect identified in our report, Shaping the Future of Travel in the Gulf Cooperation Council, is the ‘beyond oil effect’.

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Rising socio-economic aspirations, vastly increased populations, and the national imperative to ensure a sustainable long-term growth trajectory will continue to drive the GCC countries to venture into a wider gamut of economic activities and undergo structural shifts at multiple levels.

Future Predictions

By 2030, all the GCC economies will have a broader and deeper base of non-oil sectors, ranging from the manufacturing of petrochemicals, fertilisers, plastics, pharmaceuticals, aluminium, power, water, automobiles, and steel to the provision of services in education, healthcare, financial services, and tourism.

At the same time, the region’s trade and investment will be characterised by a conspicuous ‘Look East’ theme tilted in favour of emerging economies such as India and China. Lastly, the GCC will continue to develop the region as a base for businesses looking to expand their footprint to Africa and South Asia.

The overall impact of these shifts will be a massive growth in the two-way flow of people for business, leisure, and transit purposes.

The effect will be magnified by the greater-than-global spending power of a larger number of people as well as an increase in the average purchasing power, facilitated by the redistribution of income to non-oil sectors.

Trendsetters

The trendsetters of the region, the United Arab Emirates (UAE) and Qatar, will continue to distinguish themselves with unique destination offerings and will be joined by other GCC countries as they develop their own combinations of culture, nature, sports, themes, and of course, sun and sand.

The sunrise sub-sectors of tourism such as cruise tourism, healthcare tourism, and MICE (Meeting, Incentives, Conferencing, and Exhibitions / Events) tourism will emerge as established world-class industries and add to the inflow of tourists.

Have a look at this infographic for more about the ‘beyond oil effect’ and be sure to download our landmark study Shaping the Future of Travel in the Gulf Cooperation Council for more about this effect and the others that will reshape the region’s travel landscape in the coming decades.

 


Tags

Middle East, Research