Kite surfers in action at the Kite and Surf beach in Dubai. Pawan Singh / The National
Kite surfers in action at the Kite and Surf beach in Dubai. Pawan Singh / The National
Kite surfers in action at the Kite and Surf beach in Dubai. Pawan Singh / The National
Kite surfers in action at the Kite and Surf beach in Dubai. Pawan Singh / The National

Travel and tourism sector to contribute $49bn to UAE’s economy this year, WTTC says


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The travel and tourism sector is projected to contribute Dh180.6 billion ($49.18 billion) to the UAE’s economy this year, representing nearly 10 per cent of the total, says the World Travel and Tourism Council.

The estimate for 2023 is only 1.6 per cent lower than the 2019 high of Dh183.4 billion, the global tourism body said in its latest Economic Impact report on Wednesday.

WTTC expects the sector to cross the pre-pandemic employment levels, reaching more than 758,000 jobs, including nearly 7,000 new positions, this year.

“The sector is recovering at a rapid pace, proving the UAE continues to grow in popularity amongst international travellers,” said Julia Simpson, WTTC president and chief executive.

“The UAE is home to one of the world’s busiest and most successful airports, Dubai International, which acts as a gateway to the Middle East.”

Last year, the travel and tourism sector’s contribution to the UAE’s gross domestic product grew by more than 60 per cent to reach nearly Dh167 billion, representing 9 per cent of the country’s economy, WTTC said.

The sector created more than 89,000 jobs last year, bringing the total to about 751,000 on a countrywide level.

“2022 saw the return of international travellers to the UAE, with India, Oman, Saudi Arabia and the UK leading as source markets for international arrivals,” the report said.

Last year, international visitors contributed Dh117.6 billion to the Emirates' economy, marking a 65.3 per cent year-on-year growth, but still down 19 per cent from 2019 levels.

Meanwhile, domestic spend surged by nearly 36 per cent to reach Dh46.9 billion, up 10.6 per cent from pre-pandemic levels.

“The future for the sector looks positive. By the end of this year, the sector’s contribution will level that of 2019, and over the next decade, growth will outstrip the national GDP and create more than 114,000 new jobs, representing one in nine jobs,” said Ms Simpson.

Dubai International Airport remained the world's busiest international hub for passengers last year for the ninth year in a row, as long-haul travel demand surged, rankings by the Airports Council International showed in April.

The tourism sector, an important pillar of Dubai’s economy, has strongly rebounded from the coronavirus-induced slowdown.

The emirate recorded 14.36 million international visitors in 2022, inching closer to the 16.73 million tourists welcomed in 2019, according to data from the Department of Economy and Tourism.

It aims to exceed the pre-pandemic annual number of international visitors this year, after the emirate recorded a 17 per cent increase in the tourist numbers in the first quarter of 2023, Issam Kazim, chief executive of the Dubai Department for Tourism and Commerce Marketing, told The National earlier this month.

“Our report highlighted the appeal tourist destinations across the country, such as Dubai and Abu Dhabi, continue to hold for international travellers. These cities have shown an incredible resilience and strong leadership,” said Ms Simpson.

The WTTC expects the sector to grow its GDP contribution to Dh235.5 billion by 2033, representing 10.2 per cent of the country’s economy.

Over the next decade, the travel and tourism industry is projected to give employment to more than 872,000 people in the UAE, accounting for about 12 per cent of the total workforce, the WTTC said.

The UAE, the Arab world’s second-largest economy, is estimated to have grown by 7.6 per cent last year, marking its highest expansion in 11 years, after GDP rose by 3.9 per cent in 2021, according to the UAE Central Bank.

It is expected to grow by 3.9 per cent this year and accelerate further to 4.3 per cent in 2024.

Meanwhile in the Middle East, the WTTC expects travel and tourism sector's GDP contribution to exceed Dh1.5 trillion, nearing the 2019 high.

The sector will recover almost all of the jobs lost during the pandemic by the end of 2023, the report said.

In the Mena region, real GDP grew by 5.3 per cent in 2022, reflecting strong domestic demand and a rebound in oil production, according to the International Monetary Fund. However, growth is expected to decelerate this year to 3.1 per cent before picking up slightly to 3.4 per cent next year.

  • Dubai's post-pandemic boom has made it one of the most visited places in the world today. Further to that, the city has seen tens of thousands of new residents arrive to settle down. Reuters
    Dubai's post-pandemic boom has made it one of the most visited places in the world today. Further to that, the city has seen tens of thousands of new residents arrive to settle down. Reuters
  • Between late 2020 and spring 2022, the city's population grew by close to 100,000 people. Karim Sahib / AFP
    Between late 2020 and spring 2022, the city's population grew by close to 100,000 people. Karim Sahib / AFP
  • Lifestyle and a growing jobs market has attracted many residents to flashy communities such as Jumeirah Beach Residence. Reuters
    Lifestyle and a growing jobs market has attracted many residents to flashy communities such as Jumeirah Beach Residence. Reuters
  • Population growth is a major part of Dubai's 2040 Urban Plan, which seeks to boost the population to 5.8 million. Chris Whiteoak / The National
    Population growth is a major part of Dubai's 2040 Urban Plan, which seeks to boost the population to 5.8 million. Chris Whiteoak / The National
  • There are plans to physically expand Dubai, creating new beaches and parks for the larger population. The government wants 60 per cent of the city to be green parks and reserves. Photo: Dubai Media Office
    There are plans to physically expand Dubai, creating new beaches and parks for the larger population. The government wants 60 per cent of the city to be green parks and reserves. Photo: Dubai Media Office
  • The past two years have \seen a rush of foreign investors looking to buy new property in places such as Palm Jumeirah, where prices have risen significantly. AP Photo / Kamran Jebreili
    The past two years have \seen a rush of foreign investors looking to buy new property in places such as Palm Jumeirah, where prices have risen significantly. AP Photo / Kamran Jebreili
  • Landmarks such as Bluewaters Island and Ain Dubai, the world’s largest observation wheel, have put Dubai on the map as a global lifestyle destination. Reuters
    Landmarks such as Bluewaters Island and Ain Dubai, the world’s largest observation wheel, have put Dubai on the map as a global lifestyle destination. Reuters
Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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Rating: 4.5/5

The specs

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Transmission: 9-speed auto

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Price: From Dh117,059

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Desert Warrior

Starring: Anthony Mackie, Aiysha Hart, Ben Kingsley

Director: Rupert Wyatt

Rating: 3/5

VEZEETA PROFILE

Date started: 2012

Founder: Amir Barsoum

Based: Dubai, UAE

Sector: HealthTech / MedTech

Size: 300 employees

Funding: $22.6 million (as of September 2018)

Investors: Technology Development Fund, Silicon Badia, Beco Capital, Vostok New Ventures, Endeavour Catalyst, Crescent Enterprises’ CE-Ventures, Saudi Technology Ventures and IFC

Dhadak

Director: Shashank Khaitan

Starring: Janhvi Kapoor, Ishaan Khattar, Ashutosh Rana

Stars: 3

The specs: 2019 Infiniti QX50

Price, base: Dh138,000 (estimate)
Engine: 2.0L, turbocharged, in-line four-cylinder
Transmission: Continuously variable transmission
Power: 268hp @ 5,600rpm
Torque: 380Nm @ 4,400rpm
Fuel economy: 6.7L / 100km (estimate)

The specs

Price: From Dh180,000 (estimate)

Engine: 2.0-litre turbocharged and supercharged in-line four-cylinder

Transmission: Eight-speed automatic

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Fuel economy, combined: 9.7L / 100km

The specs: 2018 Maserati GranTurismo/GranCabrio

Price, base Dh485,000 (GranTurismo) and Dh575,000 (GranCabrio)

Engine 4.7L V8

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Key figures in the life of the fort

Sheikh Dhiyab bin Isa (ruled 1761-1793) Built Qasr Al Hosn as a watchtower to guard over the only freshwater well on Abu Dhabi island.

Sheikh Shakhbut bin Dhiyab (ruled 1793-1816) Expanded the tower into a small fort and transferred his ruling place of residence from Liwa Oasis to the fort on the island.

Sheikh Tahnoon bin Shakhbut (ruled 1818-1833) Expanded Qasr Al Hosn further as Abu Dhabi grew from a small village of palm huts to a town of more than 5,000 inhabitants.

Sheikh Khalifa bin Shakhbut (ruled 1833-1845) Repaired and fortified the fort.

Sheikh Saeed bin Tahnoon (ruled 1845-1855) Turned Qasr Al Hosn into a strong two-storied structure.

Sheikh Zayed bin Khalifa (ruled 1855-1909) Expanded Qasr Al Hosn further to reflect the emirate's increasing prominence.

Sheikh Shakhbut bin Sultan (ruled 1928-1966) Renovated and enlarged Qasr Al Hosn, adding a decorative arch and two new villas.

Sheikh Zayed bin Sultan (ruled 1966-2004) Moved the royal residence to Al Manhal palace and kept his diwan at Qasr Al Hosn.

Sources: Jayanti Maitra, www.adach.ae

What's in the deal?

Agreement aims to boost trade by £25.5bn a year in the long run, compared with a total of £42.6bn in 2024

India will slash levies on medical devices, machinery, cosmetics, soft drinks and lamb.

India will also cut automotive tariffs to 10% under a quota from over 100% currently.

Indian employees in the UK will receive three years exemption from social security payments

India expects 99% of exports to benefit from zero duty, raising opportunities for textiles, marine products, footwear and jewellery

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UAE currency: the story behind the money in your pockets
Who is Mohammed Al Halbousi?

The new speaker of Iraq’s parliament Mohammed Al Halbousi is the youngest person ever to serve in the role.

The 37-year-old was born in Al Garmah in Anbar and studied civil engineering in Baghdad before going into business. His development company Al Hadeed undertook reconstruction contracts rebuilding parts of Fallujah’s infrastructure.

He entered parliament in 2014 and served as a member of the human rights and finance committees until 2017. In August last year he was appointed governor of Anbar, a role in which he has struggled to secure funding to provide services in the war-damaged province and to secure the withdrawal of Shia militias. He relinquished the post when he was sworn in as a member of parliament on September 3.

He is a member of the Al Hal Sunni-based political party and the Sunni-led Coalition of Iraqi Forces, which is Iraq’s largest Sunni alliance with 37 seats from the May 12 election.

He maintains good relations with former Prime Minister Nouri Al Maliki’s State of Law Coaliton, Hadi Al Amiri’s Badr Organisation and Iranian officials.

COMPANY PROFILE
Name: Mamo 

 Year it started: 2019 Founders: Imad Gharazeddine, Asim Janjua

 Based: Dubai, UAE

 Number of employees: 28

 Sector: Financial services

 Investment: $9.5m

 Funding stage: Pre-Series A Investors: Global Ventures, GFC, 4DX Ventures, AlRajhi Partners, Olive Tree Capital, and prominent Silicon Valley investors. 

 

First Person
Richard Flanagan
Chatto & Windus 

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Updated: May 17, 2023, 8:31 AM