Although international travellers are still put off by its proximity to Iraq, VFR traffic and a thriving business travel market keep Kuwait's hotel rooms full.
Squeezed between the borders of Iraq, the Kingdom of Saudi Arabia and the shores of the Persian Gulf, Kuwait still bears the scars of a troubled history, but oil dollars and the arrival of new businesses are driving the growth of business tourism and attracting some international hotel operators to consider the leisure option.
Prior to the Iraqi invasion in 1990, the oil and petroleum industry made Kuwait a hub for international business travel, but the majority of the five-star hotels in the city were either destroyed or burned out during the Iraqi occupation, leaving the city bereft of quality accommodation when visitors started to return.
The oil rich nation has ultimately recovered economically from its injuries but some corporate travellers are still put off by Kuwait's proximity to Iraq, and the leisure market is yet to really emerge, except for a handful of Saudi Arabian holidaymakers who head to Kuwait City during the summer months.
The corporate travel and visiting friends and relatives (VFR) markets are key drivers of the region's air travel growth.
With new hotels coming online in the business sector, the aggressive growth of Jazeera Airways, and the imminent expansion of national carrier Kuwait Airways, the country's business tourism industry is thriving.
When Jazeera launched in October 2005, it flew to five destinations from its first hub in Kuwait, and in the course of one year, it nearly doubled the number of passengers flying in and out of Kuwait International Airport.
"Kuwait has already established itself as a hot destination for business," explains Jazeera's president and CEO, Marwan Boodai.
"We will continue to build and create easier access to the country through more destinations, higher frequencies, and lower fares. As for having a holiday division, I wouldn't rule it out. However, our focus at the moment is to continue building our destinations network, continue building our fleet, and launch additional hubs in the Arabian Peninsula."
Kuwait Airways' director of marketing and sales, Ahmed Al-Hilal explains that regional leisure visitors do come to Kuwait at certain times of year, but that other factors continue to hamper the growth of the market.
"During Eid we do receive a lot of families from the GCC - mainly from Saudi Arabia and Bahrain - but normally those visitors already have friends or relatives that are living in Kuwait," he says.
"There is a growing demand in the region, but unfortunately the government is still very restrictive with visas."
GCC nationals don't require a visa, but other nationalities do, and the application process is unclear and often changes, he adds.
Al-Hilal says services to Beijing, South Africa and Manchester will be launched by the end of this year, while a recent press statement claimed that flights to the US and Canada are on the cards.
The airline is also in talks with Boeing and Airbus concerning the expansion of its fleet, with plans to purchase between 30 and 34 passenger aircraft.
While tour operators facilitate the comings and goings of corporate travellers, there are only a handful of Kuwait-based inbound operators that cater to the leisure market.
Kuwait Tourism Services Company (KTSC) was formed by the Kuwait Airways Corporation in mid 1997 to promote inbound tourism. Today the company offers visitors a range of sightseeing tours in and around the city.
Leisure tourists who do venture into Kuwait will find a typical selection of Arabic cultural attractions ubiquitous throughout the Middle East; traditional dhow cruises, Bedouin art, and mosques and desert safaris, but those who delve a little deeper can find some unique attractions that are 100% Kuwaiti.
For example, KTSC offers a programme called Black Gold Adventure, which takes visitors on a tour of the Kuwait Oil Display Centre 40kms away from the city.
The trip also includes a visit to the ruins of the Al Qurain Museum, or Martyrs House, which gives a brief history of the resistance force that fought during the 1991 invasion of Iraq, a tour of the Kuwait Marine Museum, and a photo stop at Al Boom Dhow Restaurant & Al Hashemi II, the world's largest wooden dhow.
Oil dollars pushing up prices
For hotels, the constant demand that comes from the petroleum and construction industry, as well as numerous military and governmental delegations ensures a steady flow of guests, which in turn grants hoteliers license to determine their own rates accordingly.
Rotana has recently opened a new 250-room property, the Al Manshar Rotana Hotel, in Fahaheel, Kuwait's burgeoning oil district, which is part of a ‘mega complex' with shopping and entertainment facilities, located around 45kms from the Saudi border.
"We do expect to have some leisure from Saudi Arabia, but 60-80% of the business will be purely corporates," explains Daniel Hajjar, corporate vice president of sales and marketing, Rotana Hotels.
"There are several issues that you have to be careful of in Kuwait. You have obviously the lack of liquor so that makes it a challenge [to win over the leisure market] and secondly, all the five-star hotels [belong to] a cartel and they set the rates they want.
"We are away from that; as a strategy we don't want to be part of it and we hope they don't oblige us to be part of it. When you have a minimum rate of KD 65 or 70 (US $225 - $242), for the five-star hotels, it's a bit challenging to get leisure tourism when you have other challenges to add to that."
The existing resort properties in the city generally cater to domestic Kuwaiti guests and Saudi Arabian visitors who come for weekend breaks, but there is also good money to be made from the local ex-pat community, according to Hassan Hassanein, director of sales and marketing at the upcoming Mövenpick Resort and Residence Al Bidaa.
The 306-room property is set to open up on a 200-metre stretch of beach in the tourist hotspot of Salmiya on May 1.
"It's a city resort with long-term facilities but it gives you the impression that you are actually inside a real resort anywhere else in the world," explains Hassanein.
"Our main feeder market will be the Saudi Arabians who live in the eastern part of KSA and come here at weekends and for their holidays. We will be attractive to the Dubai and Doha business people too."
As an introductory offer, the hotel is offering guests who book rooms ahead of the May 1 opening a 20% cash back voucher on the value of the room that can be redeemed at any of the facilities or F&B outlets at the hotel.
The property has a mixed inventory with a selection of villas, studios, royal suites and deluxe sea-view rooms. Five swimming pools, three tennis courts and a health club and spa make up the leisure offering, while corporate visitors can choose from three meeting rooms and one 300-capacity boardroom.
Hassanein says the main competitors for Mövenpick are the nearby Hilton Kuwait Resort and the 200-room Radisson SAS Hotel, Kuwait.
According to Marcello Nisi, director of sales and marketing at the Radisson SAS, more than 85% of guests at the property are business travellers and overall, some 42% comes from within the Middle East.
"A lot of effort [is made] to promote tourism, and we see a constant progress especially from the GCC countries," he explains.
"The supply on the five- and four-star market is increasing at a very rapid pace, creating an imbalance between demand and supply."
The property is located close to the Salmiya shopping area, five minutes away from the International Fair Ground, which consists of six exhibition halls, the largest spanning 7000m², which play host to around 45 major national and international exhibitions annually.
While the government works hard to attract new investment, and hotels with conference facilities try to attract the meetings industry back to Kuwait, inbound operators developing the leisure sector should learn lessons from the scores of journalists and curious ‘danger tourists' who now visit Kuwait.
Operators who can put together itineraries that include visits to the sites of major battles or the oilfields could carve out a niche, and in doing so, create an new interest in the country as a leisure destination.