OBG: Regional Volatility Hits Tourism

A concerted drive is underway to reinvigorate Jordan’s important tourism sector that has been shaken hard by regional instability.

Jordan’s all-important tourism sector is having a rough time of late. According to the Jordan Tourism Board (JTB), the number of visitors to Jordan in 2014 dipped 1.2 percent year-on-year, reaching 5.3 million. The number of tourists arriving on day trips slipped 7.4 percent over the same period to 1.3 million. While the amount of overnight visitors fared slightly better, rising 1.1 percent to reach nearly 4 million (but according to the latest data, the tally for January and February is down 8.3 percent).

But despite the drop in overall numbers, tourism receipts remained stable throughout 2014, totaling JD3.1 billion, according to Central Bank of Jordan data, up 6.3 percent on the previous year, thanks in part to a rise in tourists from the Gulf region.

Jordanian expatriates accounted for the largest number of all visitors in 2014, making up just under a third of all overnight stays in 2014, marking an increase of 10.8 percent on the year before. Overnight arrivals from Gulf countries, which made up 17.3 percent of the total number of visitors, rose 3.1 percent. However, visitors from other Arab countries, which represented the largest group of visitors in 2013, slipped 7.6 percent to make up 27.6 percent of total overnight arrivals in 2014.

Industry figures believe regional instability, typified by the rise of Islamic State in neighboring Syria and Iraq, is largely responsible for visitors staying away, even though internally Jordan remains stable. “A lot of winter bookings were cancelled in the wake of the Gaza conflict and since then the issue of Islamic State … has become more and more prominent,” said Peter Hoesli, general manager of the Mövenpick Resort Dead Sea.

The fall in visitor numbers has prompted the authorities, supported by industry representatives, to introduce measures aimed at boosting activity. A cabinet reshuffle in early March led to the reappointment of a dedicated minister for tourism in a widely welcomed move.

Later in the month, the Ministry of Tourism and Antiquities launched a campaign in conjunction with the JTB and tour operators to rally domestic tourism. The campaign includes promotions on travel packages to the Dead Sea and historical sites such as Petra.

But keen to see more done, industry players have also drawn up a number of other proposals, which include a reduction of entry fees to Petra for visitors staying in nearby hotels, as well as proposals to support the struggling hotel industry with tax cuts and lower electricity prices.

As well as this, it’s hoped new developments in the aviation sector could prove instrumental in boosting visitor numbers to the Kingdom. The UAE-based budget airline Air Arabia recently bought a 49 percent stake in Jordanian charter carrier Petra Airlines, which is being rebranded Air Arabia Jordan.

The firm plans to open a new international hub at Amman’s Queen Alia International Airport (QAIA), becoming Air Arabia’s fifth in the region and operating flights to Europe, the Middle East, and North Africa. “The acquisition is good news for the industry, as Air Arabia represents a new, large potential source of capital,” said Kjeld Binger, CEO of Airport International Group, which manages QAIA. “It will bring more jobs and contracts for services, and more competition will give rise to market growth and more innovation.”

Directives from the government to boost tourism numbers are spurring other carriers into action. In March, the national flag carrier, Royal Jordanian, announced plans to offer discounted tickets to tour operators for use in package deals. The initiative is targeted primarily at the GCC and European markets, which, between them, account for almost half of overnight arrivals before the inclusion of Jordanians living abroad.

The tourism industry is also calling for other measures to be introduced including the abolition of a departure tax for charter flights and low-cost carriers using Amman Civil Airport at Marka.

Whilst perhaps little can be done to boost sentiment amongst travelers, the Jordanian authorities and stakeholders in the tourism sector are looking to do all they can to try to create an environment for the industry to grow. In the long-term, they will certainly be hoping for more favorable regional headwinds.

Oliver Cornock, Regional Editor THE INSIDE EDGE