Emerging middle class will define the next decade of MENA tourism, says Richard Lung, Senior Director and International Economist, Visa Performance Solutions.
The rise of an emerging middle class will define and transform the travel and tourism industry in the Middle East and North Africa (MENA) over the next decade, according to global payments technology company Visa.
Speaking at the Visa Travel and Payment Trends Seminar in Dubai recently, the company’s Senior Director and International Economist, Richard Lung, identified three key global trends that will shape the industry between now and 2025: a new ‘travelling class,’ increasing digital connectivity, and an ageing population.
By 2025, annual spending on global cross-border travel will
reach $1.5 trillion in today’s dollars, from $1.1 trillion currently, with growth driven by an increasing number of middle
income families, according to Visa’s “Mapping the Future of Global Travel and Tourism” study. Households making $20,000 or more annually account for 90 per cent of all international travel. Visa
estimates that more than 37 million MENA households will
fall into this category by 2025, with more than 40 per cent of
this new travelling class taking at least one international trip
Visa estimates that the MENA region will see the number of annual outbound trips rise from 42 million in 2016 to 65 million by 2025. This may in turn lead to regional outbound travel spend increasing annually by 3.6 percent, from $77 billion to $110 billion by 2025,
with the middle class accounting for approximately two thirds
of growth. In addition to spending more, these travellers will
be fully connected digitally and consequently better informed
about their destination options, modes of transportation,
accommodation choices, and costs.
Visa says this will foster not only greater spontaneity in travel among tourists from the MENA region, but also a broader array of personalised travel and tourism options as well. “Global tourism finds itself at a crossroads, with three key megatrends all pointing towards an era of transformation. The MENA region is not
isolated from these forces, and indeed is set to gain more
than most given the extent of its growing middle class.
The next decade will be one of significant change for the
travel and tourism industry and all participants need to
start planning for an exciting new future now,” Lung said.
The MENA region’s young demographics, where two-thirds of the population is under 35, will help to counter the impact of the third key trend, an ageing global population. Approximately
one in 10 people globally will be over the age of 65 by 2025, with older travellers taking about only half as many trips as the average person. The focus for many in this group is comfort and health rather than saving money. Visa says that destinations like
Dubai and Abu Dhabi, which have invested heavily in their healthcare infrastructure, could be positioned to benefit
from this trend.