Backed by an active tourism market, the GCC hospitality industry remains firm on its growth trajectory. Though drop in oil prices and currency depreciation is currently affecting demand, the sector’s long-term outlook remains strong. Government measures to bolster tourism activities in the region like encouraging private sector investments, building new attractions, expanding airport capacity, and increasing international promotion campaigns are providing impetus to the growth of the Hospitality sector in the region. A thriving segment of meetings, incentives, conferences, and exhibitions (MICE), spate of technological advancements, and brisk development of midscale hotel properties are amongst the key factors elevating the appeal of the GCC hospitality sector.
The GCC Hospitality market is expected to grow at a 7.6% CAGR from an estimated US$ 25.4 billion in 2015 to US$ 36.7 billion in 2020, driven by a robust pipeline of hotels and serviced apartments coupled with a continual rise in tourist arrivals.
The market size of the GCC hospitality sector is anticipated to decline in 2016, however growth is likely to recover from 2017. The key operating metrics of the sector is expected to remain under pressure in the short-term, mainly in the UAE and Qatar, but is likely to rebound in the long-term supported by demand.
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