MKG Hospitality Exclusive: The hospitality market in the Middle East and North Africa

3 min reading time

Published on 10/12/12 - Updated on 17/03/22

From the point of view of the analysing of tourism and hospitality issues, MENA (Middle East North Africa) includes countries with very different characteristics. Differences in levels of economic development, political structures and differences in geographical characteristics are such that it is difficult to consider the area as a uniform entity. However, tourism is often seen as a promising sector in the whole area. The recent MENA Hospitality Report produced by MKG Hospitality decrypts the different areas.

A first group of countries can be identified, countries whose economy is based on oil and gas: Saudi Arabia, Bahrain, Oman, Qatar, Kuwait (in descending order of the hotel offer’s importance). In these countries, located in the Arabian Peninsula, the tourism sector is seen by local authorities as a source of income diversification, preparing for the post-oil era. The strategies that have been put into place are often the creation of internationally recognized resort destinations, while continuing to support the growth of business hospitality. In this respect, the United Arab Emirates are ahead of this diversification due to low petroleum resources. The hotel offer is already substantial in the hands of various actors. These include the major European and American leaders in the worldwide hospitality industry, as well as domestic groups. In other states of the peninsula, the hotel offer is less structured and major hotel groups are looking for "virgin" land to develop. Saudi Arabia is a special case because of the size of the country and the growing importance of the development of religious tourism. But again the extraordinary hotel offer is undergoing a transformation. Development projects augur a doubling of the hotel chain offering on the horizon in 5 or 6 years.

Other countries in the MENA region, from Morocco to Jordan through Tunisia, Turkey and Egypt, are often traditional destinations for the leisure hotellerie, which offer many resort facilities (Tunisia, Egypt, Turkey) and / or near the historic centers of world renown (Petra, the Great Pyramids, etc.). Tourism is also a strategic issue. It is often about supporting the continued development of the leisure hotels, while accompanying the economic development of the country by structuring a business hotel offer.

Observation of leading groups in the area reflects the duality of hotel development. TUI, the German specialist in resort offerings is the area leader in number of rooms. Accor and IHG took the podium in 2nd and third position with more of a business orientation, but do not completely abandoned leisure hotels. The vast majority of countries in the MENA region have suffered from the crisis in 2011. The economic slowdown, terrorist attacks (Marrakech) and the Arab Spring revolutions have led to a drop in demand. Unsurprisingly, Tunisia and Egypt have seen activity levels fall, revenues per room built (RevPAR) showing respectively a decrease of 28.7% and 44.8%. Turkey has taken advantage of the situation and has attracted a number of customers fleeing the southern shores of the Mediterranean. Hotels have seen their RevPAR increase of 22.7%. The year 2012 got off to a better start. Most countries in the region recorded hotel performance indicator increases in the first half. Political stability is essential for the tourism development, as pointed out by the negative impact on hotel performance during the revolts and revolutions of 2011. Generally, hotel groups demonstrate their confidence in the MENA region. Still to prove: the projects that have been slated for the next 5 years will add some 96,000 rooms to the current 250,000 room supply chain.

The MENA Hospitality Report 2012 examines:

• 13 countries: Morocco, Algeria, Tunisia, Egypt, Turkey, Lebanon, Jordan, Kuwait, Bahrain, Qatar, Saudi Arabia, UAE, Oman. • The hotel offering: volume of the global offering, chain penetration rate, groups and their brands, each country’s pipeline • performance indicators: annual data from 2007, monthly data (graphs) from January 2010 to June 2012.
For further

Every week, the HON team brings you an expert look at the world of hospitality. By becoming a member, you will have access to a complete ecosystem: exclusive content, jobs, etc.

BECOME A MEMBER

Sign up to add topics in favorite. Sign up to add categories in favorite. Sign up to add content in favorite. Register for free to vote for the application.

Already signed up? Already signed up? Already signed up? Already registered?