Abu Dhabi: Growth in business travel

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Efforts to galvanise business tourism by investing in infrastructure look to be paying off for Abu Dhabi, with figures showing that the number of events taking place in the emirate is on the rise.

Abu Dhabi has significantly expanded its business travel market in recent years, particularly the meetings, incentives, conferences and exhibitions (MICE) segment.

Forecasts from the Abu Dhabi Tourism and Culture Authority (ADTCA) now estimate that the MICE market should double in value by 2020 to reach almost $1.4bn, with the segment earmarked to play a significant role in Abu Dhabi’s overall economic expansion.

The move to channel funding into infrastructure for business tourism has helped the emirate strengthen its position as an events destination despite tough regional competition. A report commissioned by the ADTCA and issued on March 26 said the direct economic impact of business events was expected to expand 7% annually between now and 2020. The ADTCA has already set itself an ambitious target of increasing four-fold the number of MICE events staged and doubling visitor numbers for the segment by 2015.

Lois Hall, the director of the annual Gulf Incentive, Business Travel and Meeting Exhibition (GIBTM), which is held annually in Abu Dhabi, believes that the rolling out of new infrastructure in the emirate has provided the foundations for growth in the emirate’s MICE segment.

“Abu Dhabi’s business tourism, meetings and incentive infrastructure has expanded significantly over the past year,” she said in an interview in the March edition of Travel and Tourism News. “Business tourism currently accounts for approximately 70% of Abu Dhabi’s hotel guest profile, with 10% of this emanating from the MICE segment.”

While the Abu Dhabi National Exhibition Centre, which is the largest venue of its kind in the Middle East, remains a popular choice for major events in the emirate, a number of hotels have added conference and exhibition halls to their facilities as they look to capitalise on growth in the market.

Omer Kaddouri, the chief operating officer at Rotana Hotels, said MICE was a core component of the group’s business plan. “Everyone’s after MICE,” he said in an interview with UAE daily The National on March 27. “MICE brings volume of business, it brings food and beverage, [and] MICE fills the rooms.”

He added that with competition in the domestic market rising, prompted in part by a wave of newly opened hotels and venues, events organisers were likely to find Abu Dhabi more affordable as a meetings destination.

While Abu Dhabi has to vie with its regional competitors for a larger slice of the MICE market, the emirate has been able to use its position as the capital to its advantage. But competition still remains tough across the region, particularly from Dubai, which began building up its services sector and positioning itself within the international MICE segment several years ago.

A report produced last year by Reed Travel Exhibitions and meetme magazine ranked Dubai just ahead of Abu Dhabi as the top Middle East and North Africa MICE destination, while other countries in the region, including Kuwait, Qatar and Bahrain, are working to promote themselves in the global events market. Qatar in particular is set to gain media coverage after winning the rights to stage the 2022 World Cup, which will provide it with plenty of opportunities to showcase its hospitality facilities.

While prospects for business tourism in Abu Dhabi look promising, concern remains that the segment could yet feel the ripple effects of the global economic crisis if bookings drop, particularly from markets in Europe. To date, the impact of the European debt crisis appears to have been minimal, with figures issued by the ADTCA in late March showing that hotel guest numbers were up 16% for January and February in a year-on-year comparison.

While the MICE segment’s performance could waver if international firms are forced to curb spending on trade fairs and conferences, industry players will be hoping that the resilience displayed by the market so far suggests business leaders are giving a priority to maintaining their profile on the global stage, even in tough times.

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