Market Vision's Press Release -April 25, 2010

UAE residents spend US$ 10.8 billion on outbound travel in 2009 Dubai, April 25, 2010 — Outbound travel in the UAE generated US$10.8 billion (Dh39.5 billion) from 5.06 million trips and 76.7 million nights in 2009 according to the annual travel research undertaken by Dubai-based research and consulting firm, Market Vision. This translates to a $2,127 (Dh7, 806) spend per trip or US$140 (Dh514) spend per night in overseas destinations by the UAE's residents for business, leisure and other purposes. 2009 was a challenging year for world tourism, as it faced the impact of the global economic crisis and the outbreak of the influenza A (H1N1) pandemic. As per the United Nations World Tourism Organization (UNWTO), international tourist arrivals were estimated to have declined worldwide by 4 per cent in 2009 to 880 million from 920 million in 2008, and international tourist receipts were estimated to have declined by 6 per cent over the previous year. “In the UAE, the situation was further aggravated by the downturn in the construction and real estate sector that led to job losses, salary cuts and overall downward consumer sentiment in the economy. This negatively impacted outbound travel, especially in the first half of the year when much uncertainty prevailed with respect to business outlook as well as job security,” said Kumud Sengupta, Partner and Director of Market Vision, while releasing the third edition of its report, Travel Habits and Behaviour of the UAE Outbound Traveller in Dubai this week. The report provides the latest outbound travel trends from the UAE and provides detailed insights into the evolution in travel habits & behaviour of the UAE travellers since 2005. She further revealed that, “total outbound trip volume in 2009 declined by 5.4 per cent from an estimated 5.35 million trips in 2008, travel nights declined from 81.5 million to 76.7 million, while total travel expenditure in 2009 declined by 18.9 per cent from a total spend of over US$ 13 billion in 2008”.

UAE Outbound Tourism International Tourist Departures (1000) International Tourist Nights (million) Outbound Travel Expenditure (US$ million)

2008

2009

5,350 81.45 13,288

5,063 76.66 10,771

Change % 2009/2008 -5.4% -5.9% -18.9%

Source: Market Vision estimates; 2008 Outbound Travel Expenditure as per UNWTO

Given that over 80 per cent of the estimated 5 million UAE population is constituted of expatriates, the outbound travel sector is fairly resilient in that most expatriates do tend to travel to their home countries on vacation at least once in two years. As per Market Vision research, about two-thirds of UAE residents usually travel abroad at least once a year, and this figure has remained fairly consistent over the past several years, with the exception of last year (2009) when a marginally lower proportion - about 62 per cent - of the UAE population travelled overseas, 1

A breakdown of the 5.06 million trips undertaken abroad in 2009 shows that leisure and visiting friends and relatives (VFR) segments represent 69 per cent, business 24 per cent and other trips (health, religious and other personal trips) about 7 per cent of all outbound trips from the UAE. UAE Outbound Trips 2009 Total Trips: 5.06 million Business , 24%

Leisure, 33%

Other Religious, Health, Personal, 7%

VFR, 36%

Source: Market Vision Research

Based on ongoing research among UAE residents, Market Vision’s report also provides insights into the changing travel habits and preferences of UAE travellers with respect to leisure tourism, tracking the evolution in behaviour patterns since 2005. It notes that the past five years have seen significant changes in the UAE travellers’ frequency of travel, incidence of short haul trips, seasonality of trips, booking methods, use of internet etc. As an example, the incidence of taking short trips, defined as holidays or breaks of 1-3 nights duration, away from home, has increased by 12 per cent over the past five years among UAE residents. Further, among those who take short trips, the frequency of taking such trips has also seen steady increase over the years.

Un d e rtak e S h o r t T r ip s (1-3 n ig h ts )

69%

31% 2005 Y es

60%

57%

40%

43%

2007

2010 No

Nu m be r o f S h o rt T rip s p e r Ye ar (A m o ng th o s e w h o tak e s h o r t tr ip s ) 19%

16%

25%

35%

56%

49%

47%

2005

2007

2010

One

Tw o

26% 27%

Three or more

Source: Market Vision Research

Similarly, the role of the internet in influencing travel choices has significantly strengthened as a far larger proportion of the UAE residents use it for travel planning and research compared to five years ago. 2

Role of Internet in travel planning & decision making

Use of Internet as information source for travel planning & research

2005 43%

2007 56%

2010 64%

Internet is key influencer in travel decision making

14%

19%

22%

Source: Market Vision Research

Role of Internet in Travel Planning & Decision Making 64%

70% 56%

60% 50%

43%

40% 30% 20%

19%

22%

14%

10% 0% 2005

2007

2010

Use of Internet as information source for travel planning & research Internet is key influencer in travel decision making

“The implications of these and other such trends are important considerations for strategic planning efforts by travel marketers looking to attract UAE travellers,” added Sengupta. The full report is available for subscription from www.market-vision.com Established in 1997, Market Vision is an independent research and consultancy services company based in Dubai, United Arab Emirates. It provides its services across a diverse range of industry sectors, with specialization in the tourism and hospitality sector. It conducts studies on inbound & outbound travel and on tourism trends on behalf of tourist authorities & commissions and travel & tourism organizations from around the world. Its clients include the United Nations World Tourism Organisation, European Travel Commission, Tourism Development & Investment Company (Abu Dhabi), Agence France-Muséums, Maison de la France, Tourism Board of Spain and Club Mahindra Holidays (India).

###

3