The UAE has the potential to become a world-class leisure destination, but it must first overcome several obstacles, says professional services consultancy PwC.
The country has set out ambitious plans to expand its tourism industry by adding huge, new theme park developments. They are mainly those being built near the Jebel Ali free trade zone by Dubai Parks and Resorts, a division of Meraas Holding.
The Government aims to double the number of tourist arrivals over the next six years to more than 30 million visitors a year. It seeks to build on Dubai International Airport’s recently-achieved status as the world’s busiest international airport, with annual passenger traffic of nearly 70 million.
The theme parks that Dubai Parks and Resorts is developing, including Legoland Dubai, are expected to generate Dh2.4 billion in revenue in their first year of operations and create 5,000 new jobs, said the company in February.
The linked theme parks are due to open in October next year and will include Motiongate Dubai and Bollywood Parks Dubai, the first of its kind in the world. They are expected to collectively draw 6.7 million visits in the first full year of operations.
There is a gap in the regional leisure market that can be filled by the UAE’s developing leisure sector, according to Philip Shepherd, PwC’s head of leisure and hospitality for the Middle East.
“Regionally, there is very little competition at the moment and within four hours flight time there is a potential market of some three billion people in Asia and on the subcontinent,” he said.
“It is, as we say, very ‘under-parked’. No leading theme parks exist in our region.”
But he cautioned against competition between the emirates for visitors.
“One of the challenges we see is that all the players in the country need to coordinate,” said Mr Shepherd.
“Each emirate brings something unique. Ras Al Khaimah has got the mountains, something quite distinct with its wilderness, Abu Dhabi has the Grand Mosque and is carving out a position for itself culturally with the Guggenheim and Louvre museums. Competing would be a mistake.”
Abu Dhabi also has Ferrari World and Yas Waterworld on Yas Island, as well as the annual Formula 1 Grand Prix and the off-season track activities, but these attractions have yet to reach their potential.
“In their own right, they are not yet substantial enough to say it is a leisure destination,” said Mr Shepherd. “But what is being built now is of considerably greater scale.”
In a new PwC report he co-authored, Mr Shepherd wrote that the UAE “cannot rely on a ‘build it and they will come’ approach.
But “if the UAE takes a holistic approach to its destination management, offering an Emirates-wide vision and coordination, encouraging collaboration and partnerships between all stakeholders, it can exploit its unique geographical location and deliver high-quality attractions”.
One missing element is budget-priced hotels. “In the Mena region it is a reverse pyramid, with a lot of premium hotels but very few lower priced options,” said Mr Shepherd.
“More investment is needed in the budget hotel range. That isn’t saying you have to have cheap and nasty hotels, but more affordable ones – for families.”
According to the report, the UAE has the potential to be the regional version of Orlando, Florida. The US city is home to a Walt Disney World resort and its related theme parks and activities, which attract about 60 million visitors a year.
The idea is that the theme parks expand the reasons for people to visit the UAE, said Mr Shepherd. They add to existing attractions such as shopping, desert safaris, and the budding cultural draws.
He cited Singapore as having a well-developed system of city-wide coordination for tourists to find a wide range of activities.
Tailoring that for the regional market would be the key to the UAE’s success in tourism, said Mr Shepherd.
“The Bollywood park, now that’s the really innovative one,” he said. “Is it a huge risk or is it genius? We shall see.”
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