Doubling the tourism industry is a bold task
The strategic aim of doubling the contribution to the Qatar economy made by tourism is achievable, but it represents a challenge that will require significant changes.
Some 80% of the world’s population lives within a six-hour flight of Qatar, as it is located on the intersection between Europe, Africa and Asia. Given its location, warm climate and coastline, there is significant potential to increase tourism.
Hosting the FIFA World Cup last year obviously gave rise to a huge boost in visitors, with more than 1 million arrivals into the country in November and December. Before the tournament, there was a strategic commitment to continue to attract tourists on an ongoing basis, and to use the World Cup to boost the image of Qatar as a safe, enjoyable and enriching place to visit – both through a positive experience for visitors, and raised profile through television coverage.
Increased capacity in transport services and tourism accommodation needed for hosting the tournament gives extra incentive to continue the push to attract visitors from 2023 and beyond, to avoid significant closures of hotels and restaurants, and to develop tourism as an industry. There is a strategic aim to grow the economic contribution of tourism as a sector to 10-12% of GDP by 2030. This compares with 3% in 2019. Over the same period, there is a goal of increasing the annual number of visitors from 2 million to 6 million. This is a bold ambition.
Current initiatives have helped boost the attractions of Qatar as a tourism destination, but bolder measures could be considered to accelerate progress towards the 2030 goals.
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A commercial success story is Qatar Airways, a world-class airline and highly profitable. Expansion of Hamad Airport in Doha should ensure that the international transport infrastructure is being scaled up in response to the ambitions for the industry for 2030. It would help, however, if more destinations could be served, by opening more slots to different airlines from countries with significant numbers of households with high purchasing power. This could include potentially the major European budget airlines EasyJet and Ryanair. Boosting the number of direct flights from target markets would increase the convenience and lower the cost for many visitors. Also, Qatar Airways should adopt a three-year strategy to lower fares (at break-even or below cost) for direct flights to Qatar from those target nations.?This will have small effect on their profitability but provide a significant boost to the local economy, helping the government to compensate for the loss of revenue from the national airline.
One advantage of Qatar’s location and the success of the principal airline is to attract tourists to visit for a short stay while they are en route between east Asia and Europe or the Americas. While this is a niche tourism offering with much potential, there is also a need to promote Qatar as a principal destination. People will tend to have a higher daily and aggregate spend in the local economy when enjoying their main vacation than when staying for two or three days on their way somewhere else.
A more ambitious step still would be for the Qatar Tourism, the government-owned agency, to enter the market directly by block-buying hotel rooms in a reverse auction process, and organising package deals to market internationally. Greater convenience as well as competitive prices would make the destination more attractive to holiday-makers, as it can be time-consuming to put together your own travel and accommodation arrangements. Also, this will provide a boost to local hospitability businesses as they will have guaranteed room sales, helping to ensure their survival.
The infrastructure, in terms of air, sea and land transport, and hotel capacity, were scaled up sufficiently to enable Qatar to host a highly successful World Cup competition in 2022. There are nearly 31,000 hotel keys. Ensuring continued or improved utilization of these resources, and to ensure tourism is a significant export earner, requires both commercial ingenuity and some bold plans.?