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Sun 4 Dec 2011 10:40 AM

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Thomas Cook to offset Arab Spring pinch with UAE boost

European agency ramps up tour deals to Gulf state as Egypt, Tunisia profits slump

Thomas Cook to offset Arab Spring pinch with UAE boost
Some 7% of Thomas Cook profits came from Egypt before the Arab Spring unrest

Thomas Cook, Europe’s second-largest tour operator, plans to
ramp up its holiday packages to the UAE in 2012 in an attempt to offset losses
caused by political unrest in the Arab world.

The world’s oldest travel firm said it would broaden its
tour offerings to a number of UAE emirates, to capitalise on the Gulf state’s
safe haven status.

“[The company] has expanded its portfolio of hotels in the
fastest-growing destination in the Middle East, Abu Dhabi, to take advantage of
this destination
,” a spokesperson said in a statement to Arabian Business,
adding its holiday offers had “expanded significantly”.

“New product is available in Ras Al Khaimah, Ajman and in
Dubai on The Palm. Abu Dhabi has been extended to include desert, beaches and
island experiences, including Yas Island.”

The company also offers package deals to Oman.

Netflights, the internet-based travel agency bought by
Thomas Cook in 2008, has featured the UAE for nearly 20 years but also plans to
expand its packages available for the 2012 season.

Thomas Cook said Nov 25 that it had secured a rescue package
from its lenders after a string of profit warnings over the last year caused,
in part, by assisting holidaymakers affected by the Arab Spring turmoil.

The tour agency warned earlier this year it might be forced to
cut at least 1,000 jobs and close nearly a fifth of its 1,100 stores. The cost of
cancelled trips to Egypt and Tunisia and of repatriating customers took a £20m
the company said in February.

Egypt previously accounted for around seven percent of
Thomas Cook’s profits.

The Arab Spring has taken a toll on tourism in cash-strapped
nations from Jordan and Egypt to Morocco and Tunisia, costing the region more
than $7bn
, according to the Arab Tourism Organization in Jeddah, Saudi Arabia.

The number of visitors to North Africa and the Middle East
dropped 13 and 11 percent in the first half of 2011, said Taleb Rifai, of the
United Nations World Tourism Organization.

Tourism is the world’s third-largest industry, contributing
$1.2 trillion - or 5.2 percent of the global economy - every year. The industry
is responsible for one in every 12 jobs.

The UAE is likely to see increased interest from foreign tour
operators as they struggle to find new Middle East locations to replace
protest-hit hotspots such as Egypt and Tunisia, said Basel Abu Alrub, managing
partner of Dubai-based travel agency Utravel.

“Not only Thomas Cook is expanding their package in the UAE,
but all other major players as well,” he said. “This is indicative of the
booming tourism sector in the UAE which, comparatively speaking, was not
entirely impacted by the economic crises.”

Dubai and Abu Dhabi hotels saw a spike in visitors during
the winter season, as travellers sought to avoid the Arab Spring turmoil, he

Tourist arrivals to the Middle East are predicted to fall
six percent across 2011
due to the impact of regional political unrest, the World
Travel Market Global Trends Report 2011 said last month.

The paper said the region would see a 1.8 percent decline in
incoming tourist receipts, and that airlines would see a 10.3 percent drop in
US dollar receipts.

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Red Snappa 8 years ago

Having talked to my fellow countrymen in droves across Europe, Thomson's focus on UAE will not bring millions of new European and UK tourists to the UAE.

The simple reason is that long haul holidays are increasingly going out of the window because of the sheer austerity of spending cuts that EU countries are having to make at a family and household level. Food prices are rocketing and the system is literally haemorrhaging public sector jobs, with the private sector unable to absorb anywhere near the number of jobs being lost.

So the cash conduit from the Northern Hemisphere will be squeezed tight. 2012 spells stormy economic waters, that affects Russia and Turkey too.