Dubai Tourism: Visitor numbers up 134% on 2021 through October

Dubai’s tourism sector has maintained its strong performance in 2022 and has picked up pace as the final quarter of the year begins. A total of 11.40mn visitors were welcomed to the emirate over the January-October period, marking an increase of 134% on the 4.88mn welcomed over the same period in 2021 but still around 15% below pre-pandemic levels recorded in 2019 (13.50mn). This 15% difference in visitor numbers between 2022 and 2019 has largely been consistent throughout the year as the global travel industry has yet to fully recover from the effects of the pandemic and China - amongst the top 5 largest source of visitors pre-Covid – has pursued its zero-Covid strategy, limiting the numbers of Chinese visitors to Dubai.  However, there are signs that these restrictions will continue to be eased in the coming months, which should provide a boost to tourism numbers in 2024.

Dubai: International visitors (monthly)

Source: Department of Economy and Tourism, Emirates NBD Research

India remains the top source market with 1.4mn visitors since January whilst Oman, Saudi Arabia, the UK and Russia make up the rest of the top five. These countries have seen large increases in numbers since the year prior but, with the exception of Oman and Russia, are still below 2019 levels. Tourism arrivals from the GCC region represented the largest source of visitors at 22% followed closely by Western Europe at 20%.

International visitors by source region

Source: Department of Economy and Tourism. Emirates NBD Research

Hotel occupancy increased to 76.8% in October from 69.8% in September, but this was slightly below last October’s occupancy rate of 80.7%. Revenue per available room (RevPar) rose to USD 160 from USD 85 the month prior as high season pricing kicked in, but still 4% lower than last year’s October levels of USD 169.6. However, the apparent softness in hotel occupancy and RevPAR should be seen in the context of the increase in the supply of accommodation in Dubai.  The number of hotel establishments has risen 7% from 736 to 790, whilst the number of rooms has risen 8% from 134k to 145k.

Hotel occupancy and RevPAR rebound in 2022

Source: STR, Emirates NBD Research

Room supply has grown 9% in 2022

Source: Department of Economy & Tourism, Emirates NBD Research

Tourism numbers for Dubai tend to peak in the November to January period, and the hospitality sector will likely be buoyed by the FIFA World Cup in Qatar already underway, particularly in the months of November and December. However, in the latest PMI survey for Dubai (November), the travel and tourism sector index fell to 53.2, the lowest reading since January. Whilst there may be an improvement in December with the World Cup underway, the PMI survey points to softening sentiment for the upcoming year, as the effects of tighter monetary policy and slower global growth weigh on the sector.