Gulf business travel 'on cloud nine'
Dubai, September 12, 2012
High oil prices, a growing non-oil economy and major investment in transport and power infrastructure projects are driving business travel in the Gulf region once again, according to an expert.
“Analysis of hotel rates and occupancies, aircraft passenger loads, airport arrivals et al throughout the region have been well documented, but another statistic which supports the notion that the demand for business travel is growing steadily is the increase in the ‘per diem’ rates,” said Lois Hall, the exhibition manager, for the upcoming Gulf Incentive, Business Travel and Meetings Exhibition (GIBTM).
Per diem rates are amounts agreed for executives travelling on business, mainly for hotel accommodation and meals. Any increase in this amount, indicates higher hotel rates and or increased cost of meals as business demand picks-up.
A leading platform for the incentive, business travel and meetings industry in the Middle East, GIBTM runs from March 25 to 27 in Abu Dhabi next year.
Now in its seventh year, the expo attracts more than 2,400 industry professionals each year. New for the 2013 edition, and in response to increasing demand for business travel services in the region, GIBTM has launched its first dedicated Business Travel Pavilion.
The show also hosts 300 regional and international senior level buyers with a combined budget of over $827 million, who through 7,600 pre-scheduled appointments over the two and a half-day exhibition, meet with more than 350 exhibitors from 36 different countries.
“GCC budgets doubled in 2011 producing a $106.7 billion budget surplus, and that was after a 19.3 per cent increase in public spending over the previous year,” said Hall citing an analysis by the Emirates Centre for Strategic Studies and Research.
"Clearly money is available to fund these and future infrastructure projects, driving the non-oil economy, which is now generating around 14 per cent of total GCC revenues and helping to diversify its economies,” remarked Hall.
"One such non-oil economic sector that is clearly benefiting from increased commercial activity is aviation and hospitality, particularly from corporate travelers, keen to tap into region’s business markets as business opportunities in some of the more mature economies dry-up," she pointed out.
“If there is one unique aspect of GIBTM it would have to be the quality Hosted Buyer Programme,” Hall added.
Hosted Buyers are international elite organisers, influencers or budgetary decision makers from major corporate, association or agency organizations.
After clearing a qualification process, Hosted Buyers receive complimentary benefits such as air travel, accommodation and a full diary of appointments.
“The Hosted Buyer pre-scheduled appointment system, brings exhibitors face to face with three essential ingredients - money, authority and need, it is highly efficient and cuts through the clutter,” she explained.
In the recent IBTM Global Research Study, the top ten destinations where Hosted Buyer’s plan to place business for next year are the UAE, France, Germany, Qatar, Italy, Switzerland, Spain, Morocco, Oman, and Czech Republic.
Middle Eastern buyers indicated that India, Thailand, Malaysia, Africa, Turkey, Sri Lanka, Bangladesh, Maldives, France, Japan and the UK were most sought after.
According to BCD Travel Consultancy Advito, hotel rates for business travelers in the Middle East will increase 6 to 7 per cent this year. Saudi has predicted 2012 increases of 13 to 15 per cent with cities such as Dubai and Doha, witnessing modest rises due to the influx of new hotel room stock.
Muscat remained the most expensive city in the Middle East in 2011 with a per diem of $493, up 4.6 per cent from a year earlier. Although hotel rates were flat, food costs jumped 14 per cent.
Riyadh was in second place with a per diem of $479, up 5.8 per cent year-on-year, this time it was hotel rates that rose 10.6 per cent, she explained.
The other regional cities included in the index were Doha, with a per diem of $457 up 1.3 per cent and Kuwait City which recorded a per diem of $427 up 2.9 per cent, said Hall.
The per diem for Dubai was $422, an increase of 4.1 per cent and finally Abu Dhabi with a per diem of $387 down 3.1 per cent, she added.-TradeArabia News Service