Analysis of emerging tourism industry in qatar

2011
Analysis of Emerging Tourism
Industry in Qatar

Paritosh Kashyap

Analysis of Emerging Tourism Industry in Qatar

Qatar considered is considered as one of the fastest growing economies across the world. The

success saga of Qatar in the recent past is commendable. It is estimated that the Gulf state

enjoys one of the highest per capita income across the globe.

. In spite of achievements in various fields, it is important to note that the tourism industry in

Qatar is in its nascent phase. The Gulf state is making huge investments in developing state of

the art infrastructure. However the tourism industry in Qatar, where 95% of tourists are

business travelers, is still in its inception stage and has a long way to go. The given research

analysis will analyze the emerging tourism sector of Qatar and benchmark its capital Doha

against another oil rich emirate, Abu Dhabi

Tourism Industry: General overview

Qatar where petroleum constitutes 70% of its govt. revenue and 85% of export, has ambitious

plans for diversifying into various other alternate sectors-tourism is one of them. Though

tourism sector in Qatar is not much matured, it’s surely is high up on the govt. agenda and is

attracting huge investments, direct as well as indirect.

In 2009, Qatar’s total tourism revenue had been US $ 0.7 billion, lagging behind Bahrain’s US $

1.1 billion and UAE’s US $ 7.2 Billion (Euromonitor blog, 2010). The biggest driving force for

the sector is Qatar’s winning the bid to host football World Cup 2022 which is considered as the

biggest sporting event across the world. Qatar will be the 1st Arab state to have the privilege of

hosting such a huge sports event. In order to prepare for the World Cup, the nation is seeking

huge of huge investments in infrastructure, hotels, and sporting utilities.

Besides the preparation for the soccer world cup some of the other major infrastructure projects

include Lusail city, Qatar Entertainment City, Pearl Project, Qatar Metro Project, international

airports, football stadiums etc.

Paritosh Kashyap Page 2


The following figure shows the inflow of tourists over the period of time. The slight spike in

2006 over 2004 is on the account of Asian games 2006, conducted in Doha (Source of data:

Euromonitor Blog).

1.8
1.8
1.6 1.4
1.4
1.1
1.2 1.00
0.9
1
0.8 0.6
0.6
0.4
0.2
0

Qatar is vigorously building new hotels to bolster its emerging tourism industry. It already has

a wide range of luxury hotels and is currently focusing more on development of 3 star and 4

star hotels. In 2010, it was estimated that it had added 2,500 new rooms thereby bringing the

total number of rooms to more than 11,000. (Arabianbusiness.com, 2010) The following graph

reflects the number of hotel rooms including past as well as future projections:



90,000
90,000 80,000
80,000
70,000
60,000
50,000
40,000 29,000
30,000
20,000 11,000
6,000 7,500
10,000 3,700
0

(Source of data: arabianbusiness.com, Qatarliving.com, trimdeast.com)

The following figure shows percentage of inbound tourists from various countries in the year

2008

Bahrain
1% 1%
2% France
8% 4% Iran
4%
40% 4% Jordan
Kuwait
Lebanon
23% Oman

4% Saudi Arabia
7%
Syria
UAE
1%
1% UK
Yemen



Types of tourism in Qatar

Qatar’s tourism industry primarily depends on business tourism and as mentioned earlier- 95%

of the travelers are business travelers. Along with business tourism, other forms of tourism

which are evolving are luxury tourism, sports tourism and desert tourism etc.

Business Tourism: The high end business tourism is the corner stone of the tourism

industry at Qatar. Qatar’s vibrant economy and emergence as a constructive place to

do business has been helpful to the business tourism industry in the state. The capital

city Doha is considered as a powerful MICE (Meetings, Incentive travel, Conferences and

Exhibition) venue along with other Middle Eastern counterparts, like Dubai, Abu

Dhabi, and Cairo. In order to support its MICE industry, Qatar has established an

institution named QMDI-“Qatar MICE Development Institute”, which is in the

business of advising, supporting and conducting top notch business events at Qatar

with international expertise. Presently, there are international hotel chains along with

Culture and Heritage Village and Doha Exhibition Center- effectively catering to the

MICE segment. Next year, in 2012, the QNCC (Qatar national exhibition center) with

a massive space of 40,000 Sq meters is expected to be operational, adding further

strength to the MICE industry.

Lifestyle tourism: Qatar is a place where modern brilliance blends well with the

traditional Qatari charm. Blessed with exotic desert landscapes and magnificent coast

line, Qatar has a wide range of things to offer for life style tourists, hailing from all

around the globe. It is seeking huge investments in building lifestyle tourism avenues

which includes luxury hotels, resorts, spas, marinas, golf courses, exotic islands,

coastline development, cultural museums etc. Though still in its initial phase, Qatar is

coming up with multi-billion dollar master plans to transform itself into a magnificent

lifestyle tourist destination.



Sports tourism: Like other Middle Eastern/GCC cities such as Dubai and Bahrain,

Doha is emerging fast as a sports tourism destination. The very 1st major sporting

event in Qatar was Asian Games 2006, the second largest sporting event after the

Olympics. Qatar built around 30 sports facilities for the same. The Asian Games 2006,

the biggest Asian game of its time, saw 45 countries participating in 40 competitive

events. (European business review, 2005). Since then, Qatar has conducted some

world class events like, SonyEricsson WTA Tour, ExxonMobil Tennis Open, Qatar

Masters Cup (golf) and Asian Cup Football 2011 etc. QTA (Qatar tourism authority),

QSI (Qatar sports investment) and the Qatar Olympic Committee, in association with

other private players have invested extensively in developing world class sporting

complexes such as Aspire Zone, Khalifa stadium, Doha golf course, Lusail

international race circuit etc- equipped with state of the art facilities. However the

biggest success which Qatar has got in this area was winning the bid for hosting 2022

Football World Cup.

Major tourism development projects

The tourism industry in Qatar is expected to go through a very interesting phase in the coming

years. There is plethora of massive projects underway including a new airport. Some of the

major construction projects are mentioned below-

Lusail city: It’s a US $ 7.2 billion real estate development project which can

accommodate 200, 000 individuals. Spread across an area of 37 Sq Kilometer, it consists

of residences, towers, resorts, hotels and an offshore island with 500 villas. The project

was announced in 2005 and is expected to be finished by 2020. ( Arabianbusiness.com,

2010)



Qatar Entertainment City: Qatar entertainment city, a project funded by ADIH (Abu

Dhabi investment house), it is part of grand Lusail city development project. It aspires to

transform Doha into world class tourist destination. Spread across an area of 10 Sq

Kilometer with a unique Kilometer long waterfront, the project will serve three purpose-

residence, retail and entertainment. Along with sea front apartments and villas, five star

hotels and retail outlets, the US $ 10 billion entertainment city project will provide a

wide range of entertainment options such as roller coasters, theme parks, cafes, go

carting, rain forests, theatres etc. (ecqat.com, 2011)

Pearl island project: The US $ 20 billion pearl island is a manmade island spread across

an area of four Sq Kilometer, developed by United Development Company (UDC), the

biggest private equity firm in Qatar. The mixed used project will be consisting of world

class apartments, villas, sea front accommodations, hotels and resorts along with wide

range of entertainment facilities such as Marinas with around 1000 boats, yacht club,

Restaurants etc. The project was started in 2006 and is expected to finish by 2011. Once

completed the island will havek 18000 luxury houses, capable of accommodating 41,000

individuals along with 2 million Sq feet of retail space used for retail outlets, restaurants

etc. (pearl island homepage, 2011)

New Doha international airport: By 2012, the new Doha international airport (NDIA)

will be operational. The US $ 11 billion airport with an annual capacity of 24 million

passengers (once fully complete, it can handle around 50 million passengers) and 1.3

million cargos, is expected to be one of the most high tech airports in the

world(Constructionweekonline.com, 2009).

2022 World Cup: Preparations

One of the biggest successes that Qatar witnessed in the recent past is winning the bid to

conduct Football World Cup 2022. The entire state is very excited and is not keeping any stone



unturned to make the event a grand success. In order to conduct the event huge investment

plans are on cards. The following part will discuss the road map of preparation for the world

cup:-

Road, railways and sea networks: It has been estimated that during the World Cup,

400,000 fans will be visiting Doha from all around the world. In order to facilitate their

smooth and fast movement, Qatar is seeking huge investments. It includes allocating US

$ 20 billion for the development of road and highway networks, US $ 11 billion for the

new airport discussed above, US $ 5.5 billion for deepwater port, US $ 4 billion for

building a bridge between Bahrain and Qatar over the sea. There will be an investment

of approximately US $ 40 billion in developing a 340 Kilometer, 98 station metro railway

networks for Doha and its outer skirts. (Dubaimetro.eu, 2011)

Football stadium: There is a US $ 4 billion investment plan for building nine stadiums

and renovating three existing stadiums. In order to cope with the intense heat, prevalent

in this part of globe during the time of world cup, Qatar will implement cutting edge

climate technologies which can keep the temperature with in 28 degree Celsius.

(worldarchitecturenews.com, 2010)

Hotels: To accommodate the vast pool of fans coming from all around the world, Qatar

has invested religiously in developing 3 star and 4 star hotels. It is expected that by 2022

Qatar will have around 90,000 rooms. Along with the existing 100 properties, 140 new

properties will be used for meeting the accommodation requirements. Qatar is also

planning to use a cruise ship with 6000 rooms for accommodating the fans.

(HotelierMiddleEast.com, 2010)

Doha vs. Abu Dhabi



Both Qatar and Abu Dhabi are considered as emerging tourist destinations and have

striking similarity. In the following part the tourism industry of Qatar and Abu Dhabi will

be compared across various parameters.

Parameters Doha Abu Dhabi

No. of tourists in 2008 0.9 million 1.4 million

No. of tourists in 2012 1.4 million 2.7 million
(estimated)

No. of hotel rooms in 2008 6,000 12,000

No. of hotel rooms in 2012 29,000 25,000
(estimated)

Worth of tourism projects US $ 122.7 billion US $ 131.3 billion
underway #

National carrier, fleet size Qatar airways, 93 +139 Etihad airways, 57 +
and destinations served (orders), 100 102(orders), 66

Business travelers as 95 percentage 72 percentage
percentage of total visitors

Tourism is high up on the agendas for both the Arab state- Doha (Qatar) as well as Abu

Dhab, and both are seeking huge investments in tourism infrastructure and marketing

them very aggressively. While Qatar is preparing hard for 2022, Abu Dhabi aspires having

around 7.9 million tourists by the end of 2030, as a part of its vision 2030.

They have their similarities as well as individual competencies. While going by the table, it

can be inferred that Abu Dhabi has narrow advantage over Qatar, on account of various

parameters such as number of, tourists, hotel rooms etc, Qatar’s advantage lies in its

robust economic growth, escalation and expansion plan for its tourism industry,



emergence of its national carrier Qatar airways as a world class carrier and winning the

bid for organizing football world cup 2022 which can do unprecedented marketing for

Qatar as a destination. Another interesting point that has to be observed is that since both

the Arab state share a lot of similarities and are also geographically closely placed, their

ambitious plans for tourism are bound to clash at some point of another. One’s gain may

be another’s loss.

Recommendations for tourism industry at Qatar:-

Unique Brand Proposition: - In the near future Qatar needs devise a unique

positioning plan for itself. Qatar may have made a mark as one of the fastest

economies in the world but as far as tourism is concern there is hardly anything

differentiating Qatar from other Arab states such as Abu Dhabi, Bahrain or Kuwait.

In line with other states it is also perceived as a cash / oil rich Gulf state with

upcoming real estate projects, sky scrapers, shopping malls, spas and resorts etc.

Qatar needs to build a unique promotional campaign which can directly differentiate

Qatar from rest of the Gulf States.

Some of the possible unique brand propositions could be its Arabic heritage,

economic growth, safety, friendly populace etc.

2022 world cup: 2022 world cup will provide a great opportunity for Qatar to

showcase its grandeur to the globe. After winning the bid, Qatar is attracting a lot

of international attention. The entire process of preparation for the world cup can



do wonders in building brand Qatar. The overall world cup preparation needs to

be aligned with Qatar’s brand building campaign.

Utilization of hotel rooms post world cup: Qatar is planning to build 90,000 hotel

rooms for the world cup. Once the world cup is over, further utilization of such a

large inventory of hotel rooms will be an upheaval task. In order to handle the

given possibility, Qatar needs to develop a strong market for a wide range of

tourism such as, leisure, life style, sports, desert, cultural, tourism.

Engage business travelers: 95% of the inbound travelers visit Qatar for business

purpose. Qatar needs to engage such travelers well, as it has been observed that

business visitors had high chances of revisiting the location for leisure purpose.

Strong focus on inbound tourism: With a per capita GDP of US $ 93,000 in 2008,

(Euromonitor, 2009) Qataris are among the richest individuals in the world. Hence

tourism authorities at Qatar should also emphasize on domestic tourism, given the

fact that Qatari nationals have huge disposable income to spend.

Reference:

1> Euromonitor blog, 2010, Qatar’s ambition to develop its tourism sector, available at <

http://blog.euromonitor.com/2010/06/qatars-ambitions-to-develop-its-tourism-

sector.html>

2> Arabianbusiness.com, 2010, Qatar to see big increase in hotel rooms in 2010, available

at < http://www.arabianbusiness.com/qatar-see-big-increase-in-hotel-rooms-in-2010-

9747.html>

3> Qatarconvention.com, 2011, homepage, available at http://www.qatarconvention.com/



4> European business review, 2005, Intercontinental hotel links regional development to

booming sports tourism sector, available at <

http://europeanbusiness.gr/page.asp?pid=532>

5> Arabian business.com, 2010, Lusail to complete Qatari city in ten years, available at

http://www.arabianbusiness.com/lusail-complete-qatari-city-in-10-years-349214.html

6> Ecqat.com, 2011, home page, available at

http://www.ecqat.com/en/news/pressrelease.html

7> Thepearlqatar.com, 2011, homepage, available at

http://www.thepearlqatar.com/SubTemplate1.aspx?ID=165&MID=115

8> Constructionweekonline.com, 2009, New Doha international airport, available at

http://www.constructionweekonline.com/article-4830-new_doha_international_airport/

9> Dubaimetro.eu, 2011, Qatar $ 40 billion investment for world cup, available at

http://dubaimetro.eu/construction-technology/6816/qatar-40-billion-investment-for-

world-cup

10> Newzglobe.com, 2010, Qatar: investment provides new business opportunities, available

at < http://www.newzglobe.com/article/20110421/qatar-investment-provides-new-

businesses-opportunities>

11> HoteleirMiddleEast.com, 2010, World cup fans housed at sea for Qatar 2022, available at

http://www.hoteliermiddleeast.com/10116-world-cup-fans-housed-at-sea-for-qatar-2022/

12> Euromonitor, 2009, Euromonitor international: travel and tourism in Qatar, p-48


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