Introduction
The United Arab Emirates is comprised of seven individual emirates each with its unique features and contributions to the overall national tourism sector. Dubai for instance, with its sunny and sandy beaches attracts holidaymakers who throng its world-class resorts. Ras Al Khaimah and Sharjah serve as cultural and religious tourist destinations. Abu Dhabi is also a world-famous resort and real estate destination that is famous for its towering skylines and exquisite hotels and resorts.
The United Arab Emirates is among the world’s fastest-growing business and leisure destinations today. This is largely in part to its strategic location in the middle of the earth between the East and the West and also in part due to the geopolitical importance of the Middle East nation because of its massive oil reserves (GulfNews.Com, 2013).
Factors that contribute to the United Arab Emirates’ Booming Tourism Industry.
The United Arab Emirates is a major travel hub today because of the stellar reputation enjoyed by two of its national carriers, Etihad Airways and Emirates Airlines. The fact that two of the world’s largest and most successful airlines, by IATA standards, are hosted in the Middle Eastern nation makes the United Arab Emirates, and its major cities of Abu Dhabi and Dubai, a hub for international travel (Sharpley, 2002). The tiny Middle East nation is a connecting stopover for many long-haul flights.
This makes it perfect for international business meetings on the go. Almost half of all world airlines pass through the United Arab Emirates en route to other destinations; making it a strategic location for the aviation industry, which is the main driver of the tourism sector. As a stopover choice for many long-haul flights, tourism headed for other destinations may get to sample what the United Arab Emirates has to offer during their transit.
The oil revenues realized by the United Arab Emirates have been put to good use in the Middle East nation. In Dubai, under the leadership of Sheikh Mohammed Al Maktoum, the oil revenues have been put into massive real estate and hospitality industry projects undertaken by the government.
The government of Dubai has built one of the world’s most luxurious hotels; a testament to the vital stature of tourism in the tiny emirate. The revenues recognized from the sale of the massive petroleum deposits in the United Arab Emirates have been put to use through major investments in tourism infrastructure. In Dubai, for instance, the building of the Palm Islands; a series of many artificial islands in the shape of the globe, has been an effort to improve and shore up real estate fortunes in the emirate. This further helps to boost tourism in the United Arab Emirates.
Upon realizing the fact that the oil revenues would not always be there, the United Arab Emirates government embarked on a major economic realignment program to develop the tourism sector to become the next Gross Domestic Product driver. Through major investments in strategic hospitality and tourism sector infrastructure, the United Arab Emirates government aimed to build up this sector of the economy. Today, the United Arab Emirates spends massive amounts of money on the sector through direct investments and other indirect methods.
In almost all major television networks in the world, The United Arab Emirates government has placed advertisements to entice nationalities all over the world to visit, work, and live in any one of the seven emirates. This marketing strategy seems to be working; in the emirate of Dubai, for example, more than 35% of the population is composed of non-Emiratis. These marketing efforts have also improved tourism in the Middle East nation; tourist arrivals stood at 16.5 million people in 2012 and are projected by reliable sources to hit 20 million by 2020 (WTTC, 2014).
The emirates of Dubai and Abu Dhabi have also been building extensive infrastructure in their cities to promote and support tourism. Dubai, for example, is the world’s fastest-growing city in terms of infrastructure development. Several key projects have been built in these two emirates to spur the growth of tourism. Monstrous shopping malls, several theme parks and amusement parks, ultramodern housing complexes, and world-class hotels and resorts have all contributed to the increasing numbers of visitors going to the United Arab Emirates for leisure, stay, and business purposes.
The governments of the seven emirates have constantly been on a mission to improve the marketability of the United Arab Emirates as a premium global tourist destination. In Sharjah, Ras Al Khaimah and Fujairah have been building museums and cultural centers to further support tourism. The new ultra-modern Sheikh Zayed Mosque is also a big tourist attraction in the United Arab Emirates.
Impacts of Tourism on the Economy of the United Arab Emirates
As with all other economic activities, tourism in the United Arab Emirates has an impact on the economy, both positive and negative. These range from the most helpful to the worst and most detrimental to both human and other life forms.
Positive Impacts of Tourism
The development of the United Arab Emirates into a world-class tourism destination has had a myriad of positive influences on the nation. For one, the growth and development of tourism has led to the development and improvement of public infrastructure such as the new metro and tram lines in Dubai, the brand new dual carriageways of Abu Dhabi, and the new museums in Sharjah and Ras Al Khaima. The development and creation of carriageways in the United Arab Emirates have had more than a positive effect on just the tourism sector alone.
Local Emiratis also get to benefit from the infrastructural development spurred by the tourism sector’s growth. Access is eased through the cities due to the rail and roadways that have been created to improve infrastructure and make the United Arab Emirates a friendly tourist destination. The spillover effects of such infrastructure development go beyond the tourism sector. For example, roads improve accessibility of the city, street lights improve overall levels of security and improved security enhances the quality of life for the local Emirati.
Development of Infrastructure
Airports, shopping malls, railway stations, and railway lines have been developed in the recent past to cater to the needs of visitors entering the Sheikhdoms of the United Arab Emirates. Cultural, religious, and art centers are also currently under construction to cater to the new and existing tourist markets. Such amenities as ski centers and waterparks have been constructed to further lure more visitors into the United Arab Emirates.
Because of these recent developments in the United Arab Emirates, as necessitated by the increasing importance of the tourism sector, the Middle East nation has recorded impressive growth and development in the field of infrastructure. It is an emerging market that rivals the infrastructure of some of the world’s most developed economies and cities. The tourism sector has therefore helped propel the United Arab Emirates from a nation with not much infrastructure to a fast-developing country with rapidly expanding social and economic amenities.
Expansion of the National Airlines
The tourism sector in Dubai coupled with the strategic location of the United Arab Emirates serves to expand the network of the two national carriers, Etihad Airways and Emirates Airlines. The tourism industry in the Emirates has greatly strengthened in Dubai and Abu Dhabi; with improved occupancy.
The two airlines are among a myriad of airline operators that make stopovers in the Emirates and necessitate the need for accommodation. This influx of passengers headed for and through the United Arab Emirates has led to a major increase in the number of hospitality establishments to cater to their needs.
The high and ever-increasing number of tourists headed for the Emirates has created the need for Middle Eastern airlines to expand their network of destination cities all across the globe. The two airlines have been recording impressive growth numbers and great revenue figures due to more and more tourists visiting the United Arab Emirates for leisure, shopping, and business. These numbers are expected to hit 20 million by 2020; with the Emirates Airlines projecting about 78 million passengers for that same year.
Marketability of the Emirates
Dubai, the second of the seven emirates that make up the United Arab Emirates, is today considered and rightly recognized among the top entertainment and hospitality hubs in the world. The first emirate, Abu Dhabi, also enjoys a near similar stature internationally. This is largely attributed to the vibrant tourism sector that has necessitated the growth and development of world-class infrastructure. The new stature of the emirate has helped put Dubai on the international scene.
Numerous exhibitions, expos, and conferences are today held in Dubai and other United Arab Emirates cities because of its growing fortunes as a hospitable home of international visitors. This has helped increase the tourist arrivals in the once-tribal sheikhdoms that constitute the United Arab Emirates. Thanks to the tourism sector, the financial, political, and strategic importance of the United Arab Emirates has been boosted further.
Diversification of the Economy
Oil has been the major driver of Gross Domestic Product in the United Arab Emirates over the last six decades since commercial drilling began. The economy of the Emirates has largely been dependent on the petroleum industry. With the new emergence of the tourism sector as a key player in economic development, the United Arab Emirates has been diversifying its economy. The tourist arrival numbers in the United Arab Emirates stood at 10 million in 2012; the figure is expected to double by the year 2020.
This will more than triple the contribution made by tourism to the national economy of the United Arab Emirates. In 2012, the sector contributed 8.5% of the nation’s Gross Domestic Product (GulfNews.Com, 2014). Tourism therefore has a major economic impact on the future of the emirates. After realizing the oil fortunes may not last much longer, the governments of the emirates decided to diversify into other economic sectors.
This new growth and diversification has been spearheaded, in large part, by the tourism sector. In Ras Al Khaimah and Fujairah, the two emirates considered centers of heritage and culture, hotels have been projecting an increase of between 20 and 25% in revenues over the next two years due to an increase in tourism numbers (Issac, 2013). It is therefore evident that tourism is expected to contribute very greatly to the UAE’s Gross Domestic Product in the coming years.
Growth of Sports and Culture
Due to tourism, the United Arab Emirates has been touted as one of the most important destinations for sport tourism. One of the seven major IRB Rugby tournaments, The Dubai 7s, is held in the United Arab Emirates city-state of Dubai. The Dubai Formula 1 has also served to increase the stature of the city.
Several other major annual sporting events are also held in the Emirates such as the Abu Dhabi dhow racing event, the Dubai Open Golf tournament, several tennis championships, and even the treacherous desert rally racing. The stature of these events has been raised by the huge number of tourists that attend them each year (Henderson, 2006). This creates a vicious effect that ensures more and more visitors visit the United Arab Emirates each successive year. Tourism in the United Arab Emirates, has, therefore been boosted by its efforts and charm.
Development of Family Facilities
Due to the increasing instances of family tourism and vacations to the United Arab Emirates, there have been various developments. Today, the emirate of Dubai is positioning itself as a family-friendly destination. In 2015, the Yas Water World was opened up to attract more family tourists. Theme parks and amusement parks have also been constructed to help attract holidaygoers and merrymakers who prefer to travel with their families. The Sheikh Zayed Museum is also expected to be opened up soon to showcase Emirati culture and in turn increase tourism destinations in the UAE. Tourism has therefore led to greater development of social amenities in the United Arab Emirates.
Increased Employment Levels
Employment prospects have increased in the United Arab Emirates greatly due to the growth of the tourism industry. The government of the UAE has a forecasted annual employment real growth rate of about 4.1 %. The increased tourism has increased the number of hotels, hospitality establishments, and related industry establishments.
These all require manpower to support the sector. People are employed in the transport and allied hotel and resort, and real estate and construction sectors of the economy. Tourism is one of the largest drivers of employment growth in the economy of the emirates alongside the Petroleum and Financial Services sectors. The increasing growth of the sector holds further promise for the Middle East nation and assures the nation of more and more employment opportunities. The multiplier effects in the economy further create more jobs in the economy.
Negative Impacts of Tourism
Economic Distortion
While tourism has been poised to bring great growth to the UAE economy, it is not without its challenges and shortcomings. First of all, the emergence and growth of tourism as a major economic sector has led to a situation similar to the one witnessed during the early years of oil production. During these years, the economy of the UAE became entirely dependent on the Petroleum Industry. There is a risk of recurrence of such a phenomenon in the tourism sector.
Already much of the employment growth forecasted by the UAE has been pegged on the growth of tourism. The government has already released projected growth in employment opportunities of 4.1% that are largely dependent on the tourism industry. Many more development visions have also been tied to the tourism sector. The newfound reliance of the economy on the sector of tourism may end up distorting the economy by creating an overreliance on one sector at the expense of other sectors. With oil revenues expected to falter going into the new decade, the UAE economy is only poised to become more reliant on the tourism sector.
Increase in General Price Levels
Tourism has often been considered, the world over, as a preserve of individuals with high disposable income. Tourists have huge amounts of money to spend in the course of holidays and merry-making. These heavy spending habits tend to distort the prices of commodities and services in the local economy. Dubai, one of the seven emirates with the highest tourism numbers, has some of the world’s most expensive prices of goods and services. This can be largely attributed to the heavy spending of tourists and expatriates who live in the city-state.
The massive numbers of tourists who flock to the city each year to shop and make merry have helped, in large part, to shore up the prices of even the most basic commodities. The high commodity prices tend to disadvantage local Emirates who live in the city. Housing prices in Dubai are among the highest globally. The city alongside its UAE sister, Abu Dhabi, hosts some of the most expensive and luxurious hotels in the world. The most prestigious hotel brands on earth, which also happen to be the priciest outfits, are housed in the two emirates.
Erosion of Culture
Tourism may lead to the erosion of culture and the spread of negative cultural aspects. The Middle East is a largely conservative Muslim society. This means that they hold several values that are common among Western individuals in low regard. The stature of the UAE as a world-leading tourist destination exposes it to increased cultural permeation from the West. The interaction of the two cultures may lead to the erosion of certain values that the Emirates hold such as the mode of dressing. Recreational use of drugs that are now cropping up in the UAE can be blamed on the Western tourists that flock to the Emirates.
Decadent aspects of the West like prostitution have also been spread into the emirates through tourism and expatriation. Other aspects of culture such as the Western dishes have also found their way into popular Emirati cultures. Other aspects of Western culture such as sports betting and gambling have also permeated into the Emirati lifestyle, thanks to tourism. These elements of Western culture have spread to the very heartland of Islamic culture, finding their way to such conservative nations as Qatar, Kuwait, and Iraq which still do not openly welcome these practices.
Overuse and Over exploitation of Resources
Tourism may also lead to the overuse of resources and the production of other negative externalizes like pollution in the Emirates. The industry players tend to exploit natural resources such as water to very detrimental levels. The hotels and resorts in the UAE tend to use colossal amounts of fresh water for the swimming pools, hotel rooms, water parks, and water fountains hence causing a strain on the precious and scarce resource (Gladstone, Curley, & Shokri, 2013).
This leaves the local Emiratis disadvantage due to reduced quantities of the vital resource. The construction of hotels and resorts tends to excavate sand and rocks. This process usually leads to noise, air, and even water pollution. The pollution of the environment worsens the quality of life for locals who live in the Emirates. The excavation process may also endanger life forms that thrive on the corals and beaches where these resorts are established. This tends to disrupt the ecosystem in the Emirates.
Conclusion
The UAE has been witnessing a major shift in its core economic sectors. The tourism sector has been increasingly touted as the next growth frontier. It is expected to contribute increasingly substantial percentages to the overall Gross Domestic Product figures.
The sector, with all its shortfalls and disadvantages, does more good than harm to the Middle East nation which faces the increasing likelihood of dried-up oil fields. Along with the vibrant and fast-expanding financial services sectors, tourism is expected to be the future of the United Arab Emirates.