Passenger traffic for Middle East airlines grew by 17.5 per cent last month, pointing to a recovery in the global economy and tourism.
Passenger traffic for Middle East airlines grew by 17.5 per cent last month, pointing to a recovery in the global economy and tourism.

Gulf travellers lead global recovery

The recovery in global travel has taken off faster than expected, led by traffic through the Gulf's big airports. International tourism arrivals in the Middle East climbed 33 per cent in the first four months of the year compared with the same period of 2009, the highest of any region, according to the World Tourism Organisation. This compares to 7 per cent growth for the global travel industry, even after the disruption caused by a volcanic eruption in Iceland.

Tourism and air travel in the region are outperforming Europe, Africa, North America and Asia Pacific, fuelling optimism about a recovery in the regional economy. Tourism accounts for almost a fifth of Dubai's economy. "This growth confirms the recovery trend beginning in the last quarter of 2009 and comes despite the challenging conditions of recent months," the organisation said. Middle East airlines saw passenger growth of 17.5 per cent last month compared with May last year, the second-largest increase worldwide after Latin America, the International Air Transport Association (IATA) said.

Traffic on European airlines grew by 8.3 per cent, while Asian airlines sold 13.2 per cent more tickets last month than in May last year. The gains, though smaller than the more-than 20 per cent increases recorded earlier this year, underscored the regional airlines' growing role in connecting long-haul transfer traffic via their hubs in the region. Middle East airlines currently account for 10.5 per cent of global air traffic. But the importance of Emirates Airline, Etihad Airways and Qatar Airways in particular is expected to grow throughout the decade as they carry out one of the greatest fleet-building programmes in civil aviation history.

The three airlines have placed orders for more than 440 aircraft worth a total of almost US$110 billion (Dh404bn), according to Flightglobal Insight, a research service. More than 90 per cent of that order is for wide-body aircraft including the Airbus A380 superjumbo, which can carry more than 500 passengers. In the UAE, tourism and aviation are key economic engines. The growth of Emirates and its tourism properties such as Arabian Adventures helped Dubai to diversify away from a reliance on its modest oil reserves in the 1980s and 1990s.

In Abu Dhabi, Etihad, the Tourism Development and Investment Company and the Abu Dhabi Tourism Authority are working together to increase international tourism arrivals and create a more dynamic local economy. The oil-rich Al Gharbia desert region, for example, is now home to luxury resorts such as the Qasr Al Sarab in Liwa and the Desert Islands Resort and Spa on Sir Bani Yas Island. The World Tourism Organisation cautioned that the chart-topping growth in Middle East tourism should be viewed in the context of a low starting point early last year. More recovery was needed, the organisation said. "Challenges remain and the sector still has a long way to go to make up lost ground," it said.

The same worries remain for airlines, which lost $50bn over the past decade. This year, strong traffic growth is strengthening the industry's bottom line, and airlines are expected to post a $2.5bn profit this year in a dramatic turnaround from the $9.9bn they lost last year, IATA said. "This is good news, but it is only a 0.5 per cent margin. We are still a long way from sustainable profitability," said Giovanni Bisignani, the chief executive and director general of IATA.

This year, high-profile events - including the Winter Olympics in Vancouver, the FIFA World Cup in South Africa, Expo 2010 Shanghai and the Commonwealth Games in India - will enable the recovery of tourism and air travel. But natural disasters could pare away some of the gains, the travel body said, citing earthquakes in Haiti, Chile, southern California and Guatemala, and flooding in a number of tourism destinations including Peru's Machu Picchu and parts of Europe.

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