Business Report on the evolution of hotel industry performance in Dubai in the pre
COVID-19 period
Introduction:
In respect of increasing technology, hospitality and infrastructure, Dubai has made great progress
in its hotel industry. Being as shopping mall and famous visitors’ location, Dubai is recognized
for its facilitated hotels and restaurant. The hotel of Dubai has so many tourists that the
government of Dubai is investing so much money to make more destinations for tourists. This
report presents the evolution of hotel industry performance in Dubai in the pre COVID-19
period. A lot of international hospitality groups want to take part in the relished hospitality of
Dubai. The hotel industry of Dubai is very wide globally. There is huge occurrence of economic
activities going on inside the hospitality industry of Dubai. Dubai has excellent services in hotel
industry. It is designated as the biggest and preferred hospitality market worldwide. This
fascination and attractiveness requests excited and experienced specialists who can deal with the
business and serve energetically. Specialist can select particular sector in hotels and restaurants
according to their knowledge about selected sector. There are many hotels in Dubai and require
a lot of employees. The hotel and restaurants of Dubai requires experts with vast information
about the business of hotel and central reservation systems. Organizations expect that experts
will have insight and information in making networks or business creation and development.
Annually, the hotel trade show in Dubai is an ideal stage for hospitality specialists in which they
can connect, transmit and interchange ideas. Hotel profession in Dubai additionally incorporates
desert visits, catering and resorts.
Literature Review:
An analysis of literature on hotel industry throws light on different features of human capital.
The necessary development of Dubai hotel industry is result of strategy used by government of
Dubai to make a large centre for tourists in Dubai. It is understood that the hotel industry of
Dubai is a hotpot of economic activities. Globalization is very important in international industry
and it affects all sectors and industries. The most important segment is that globalization has
created different opportunities for hospitality industry. The scope of hospitality is very wide.
Basically, the word “Hospitality” is concerned with the domain of hotel and restaurant. It is not
incorrect to say that the industry of hospitality and its importance is very wide and consists of all
the characteristics of entertainment and other factors that contribute in serving the guests and
welcoming the guest with freedom and kindness. Reports showed that the hotel industry of
Dubai has many competitors. All types of facilities are given by hotel industry of Dubai. It is not
unexpected to see that Dubai possesses vast line of facilities and thriving structure.
The example of hospitality industry of Dubai is Dubai Marina Hotel and Resorts that are
enchanting and exploring all over the world and usually tourists seeking for luxuries.
(Boermeester, p.52)
Another example of hotel industry of Dubai is Palm Spring Island and Burj Al Arab Hotel with
many facilities and is recognized all over the world. (Ahmed Hussanien, 2010, p.14)
The hospitality sector of Dubai has acknowledged firm development in the past decade. This
sector contributes to the gross domestic product (GDP) of Dubai and is elevated by 138 percent
and the employment rate increases to 119 percent in 2007 to 2017. In 2017, the industry of hotel
contributed to 4.6 percent in the gross domestic product (GDP) of Dubai and gives nearly
570,000 jobs showing 4.8 percent of entire employment. As stated by Federal Competitiveness
and Statistics Authority of Dubai in 2017. Dubai received 20.4 million hotel guests. This makes
Dubai one of the most preferable destinations for visitors. Looking ahead to the following
decade, Dubai has increased its rooms of hotels to 165,000 in 2020 and this shows the bright
future of hospitality industry of Dubai. The leisure and entertainment market of Dubai is also
developing as 45 million tourists are predicted in 2021 consisting of 30 million international
visitors. The hospitality industry of Dubai is the most important industry of United Arab
Emirates. There are 15.8 million tourists in the hotels of Dubai in 2017. There are 703 hotel in
Dubai and 111,864 rooms in 2018. In the region of Middle East and North Africa (MENA), the
occupancy rate of Dubai is the most highest in 2017. The highest rate of International overnight
tourist has been recorded by Dubai in 2017 with visitors paying 29.7 billion Dollars. When the
city is prepared for Expo 2020, it had large number of rooms in hotels under construction in the
region of Middle East and Africa (MENA). Analysts anticipated that in 2020 will stay in Dubai.
Due to the strategy of economic diversification, the hospitality industry is growing well. In 2017,
the hospitality industry experienced decrease in profit. Number of visitors come to Dubai has
been decreased due to lower prices of oil and therefore, the economic activities also lessened.
The results of this lessened economic development intensified have been intensified by initiating
the Value Added Tax (VAT) in 1st January 2018. The industry of hospitality is not excluded
from Value Added Tax (VAT) and is charged at the rate of 5 percent. The oversupply of rooms
of hotels in United Arab Emirates (UAE) negatively impacts the hospitality industry. Therefore,
the occupancy rate nominally decreased in UAE. Resultantly, in an ambiance of intense
competition, the average rate of rooms of hotels decreased to nearly 4 percent in December 2017
in contrast with the December of the earliest year. Furthermore, the revenue per room an
important measure in determining the functioning of hospitality sector also decreases 3.3 percent
in 2017. Due to these reasons, UAE revived its economy and by taking essential measures.
People visiting the United Arab Emirates entitled in November 2018 to collect refund of Value
Added Tax (VAT) spend on purchase created at chosen retailor. Federal Tax Authority declared
that it is preparing an average of 3,800 refunds every day (Anthony Brien, 2019). The
government of Dubai declared that it will give free travel visas for almost ninety six hours to
travellers travelling all through the UAE airports. In June 2008, Dubai and Abu Dhabi declared
plans to decrease tourism and tax implemented on stays of hotels and their food and drink
outlets. To boost the medium sized hotel contributions, the tourism authorities of Dubai declared
that they will defer 10 percent district charge demanded on each hotel’s daily room for new three
and four star hotels that started development between October 1, 2013 and December 31, 2017.
Various significant framework and projects of transportation like 4.08 billion Dollars invested in
roads of Dubai in 2020 which are in progress reinforcing development possibilities. The tourism
of Dubai reinforced the Emirates travel industry in January 2019 by disclosing nearly 68.6
million Dollars in bank guarantee provided by travel industry related assistance providers.
Because of these measures and drivers of development mentioned in the previous discussion,
analysts foresee that the hospitality industry of Dubai will proceed to flourish and play a vital
role in economy of United Arab Emirates (UAE) in forthcoming years (Desai and Sikanadar,
2013). The recent trends showed that in Dubai, the trend of takeaways and home deliveries is
also increasing as Dubai is developing and citizens becoming very busy. This is an extraordinary
increase in food and options of delivery which rescues time and cash. The use of applications of
food delivery is increasing day by day in Dubai and all over the world and the acceptance of
packed food is also increasing. The next major trend is that the working of independent
restaurants and hotels working in partnership. Both hotels and restaurant have determined to
work in partnership to give their consumers a much varied exposure (USUAE Business Council,
2019). This trend unfolds new opportunities in the hospitality industry of Dubai, decreasing the
stress of prize included and has heavy economic results. Because of this partnership, the
hospitality industry of Dubai is developing at high speed.
Conclusion:
This report shows the evolution of hotel industry of Dubai. The hotel industry of Dubai is very
vast and is recognized worldwide. Every year many tourists visit Dubai and this trend is
increasing day by day. Dubai has faced many challenges but then, revive its hotel industry.
United Arab Emirates has major hotels and restaurants which attracts tourists. The government
ofDubai is investing in its hotel industry to make it better. Infrastructure is developing and the
use of technology is also increasing in hotel industry of Dubai. New trends are observed in the
hospitality industry of Dubai. The hotel industry of Dubai plays an important role in the
economic activities. Number of tourists’ decreases because of decreased price of oil but then,
government of United Arab Emirates has taken necessary measures to revive its economy.The
hotel industry of Dubai plays an important role in increasing the gross domestic product (GDP)
and the employment rate of the country. The hotels and restaurants of Dubai are working
together to give customers new exposure and it unfolds new opportunities in the hotel industry of
Dubai. In this way, hotel industry of Dubai is progressing day by day in all over the world.
References:
Anthony Brien, A. A. (2019). Human capital in the Dubai hotel industry: A study of four- and
five-star hotels and the HR challenges. Journal of Human Resources in Hospitality &
Tourism, 20.
Council, U. U. (2019). Hospitality, Tourism and Leisure in the UAE. U.S UAE business Council,
22.
Deloitte. (n.d.). Middle East Hotel Market Insight Report. Retrieved April Monday, 2021, from
Deloitte: https://www2.deloitte.com/ly/en/pages/consumer-business/articles/me-hotelmarket-insight-report-issue1.html
Desai, S. S. (2013). An Analysis of the Competitive Marketing Strategies of the Hospitality
Industry in UAE. IUP Journal of Management Research , 10.
Sadaqat, R. (2021, April 2). Dubai a leading example of overcoming challenges in hospitality
sector. Khaleej Times.
SOEG. (2020, october 1). AN OVERVIEW OF THE HOSPITALITY INDUSTRY IN DUBAI.
Retrieved April Monday, 2021, from SOEG: https://www.soegjobs.com/dubaihospitality-industry-overview/