Dubai Tourism up 18% in the first fourth months of 2023

Dubai’s tourism sector continued its strong performance in April. The city attracted 6.02mn visitors during this period, up 18% y/y but still slightly below pre-pandemic levels by 4%. The sector has set a new record for the number of visitors during Ramadan, according to our calculations, with 1.35mn visitors during the holy month, a 19% increase y/y and a 50% increase from pre-pandemic levels in 2019.

Number of visitors in the first four months of the year

Source: DTCM, Emirates NBD Research

Number of visitors during Ramadan

Source: DTCM, Emirates NBD Research

Decline in the number of GCC visitors

The number of visitors from the GCC has declined by 21% y/y to 843k visitors from 1071k visitors in the first four months of last year. The GCC is the only source region that showed a major decline year to date. The decline was attributed to the drop in the number of visitors from Oman, which fell sharply by 41% y/y. The GCC, which has traditionally been a top two source region for visitors to Dubai, has dropped to fourth place after the decline. The GCC’s share of total visitors has fallen from 21% to 14% y/y.

Western Europe was the largest source of visitors, making up 22% of the total volume in the year to April, followed by South Asia making up 16%, Eastern Europe making up 15% and the GCC making up 14%.

India was the largest source of tourists with 806k visitors followed by Russia with 474k, the UK with 391k, Saudi Arabia with 352k, and Oman with 348k.

Number of visitors by source region

Source: DTCM, Emirates NBD Research

Pickup in the number of Chinese Visitors

The number of Chinese visitors to Dubai has been gradually recovering since zero-covid restrictions were eased at the end of 2022. The number of monthly visitors has more than doubled between January and April, and on a cumulative basis is up 265% y/y in the first four months of the year. The numbers are still around 61% below the pre-pandemic levels but we expect the rebound to continue over the rest of the year.

Number of monthly Chinese visitors 

Source: DTCM, Emirates NBD Research

Dubai airport passenger traffic up 56% y/y

Dubai International Airport saw a 56% y/y increase in the number of passengers, registering 21.3mn passengers in Q1 of 2023. Airport passenger traffic has reached 96% of the pre-pandemic levels, highlighting the strong rebound in the travel industry. According to the International Air Transport Association (IATA), air traffic globally has reached 91% of pre-pandemic levels in April. Total traffic, which is measured in revenue passenger kilometers, increased by 46% y/y.

A record hotel occupancy rate in Ramadan 

The average hotel occupancy for the first four months of 2023 rose to 79.8%, a 3.5pp increase over the same period in 2022. The highest hotel occupancy rate in Ramadan was registered in April at 71.1%, a 12.5pp increase y/y and 19.3pp increase over the same period pre-pandemic. The guests’ length of stay has declined from 4.4 nights to an average of 4 nights and the average daily rate has declined by 6% to AED 599, driving the average revenue per available room down by 2% y/y to AED 478. The supply of available rooms increased 6% y/y to 148,949 rooms. 

Hotel Occupancy and RevPAR 

Source: DTCM, Emirates NBD Research

The strong tourism numbers in Ramadan, which has been a traditionally a low activity month, suggests that the outlook for Dubai’s tourism for the rest of the year is very positive. Despite the surge in travel costs, the demand for travel remains strong. With 6.02mn visitors in the first four months of the year, Dubai’s tourism seems to be on track to break the record of 16.7mn visitors that was registered in 2019.