Extending its reach: Business, education, sports and culture segments drive expansion

As an ancient pearl fishing centre, Qatar was once part of an historic trade network stretching across the Indian Ocean and connecting the merchants of Arabia and East Africa to their counterparts in South Asia. Ships navigated with seasonal winds and built an expansive economic-cultural sphere, helping establish the region’s tradition of trade, travel and cultural exchange. The modern State of Qatar continues to show a commitment to building on its cosmopolitan history to attract travellers to its shores and expand its dynamic tourism offerings.

REGULATION: Qatar Tourism Authority (QTA) was established to organise, promote and supervise the growth of the state’s tourism sector. Launched in 2000 by Emiri decree, the organisation has designated five pillars for the development of the industry: meetings, culture, education, sports and leisure. Indeed, the state’s tourism sector has been casting a wide net to continue attracting a diverse range of visitors.

First quarter indicators from 2012 are positive across the board. Arab tourists were up by 22%. Visitors from neighbouring GCC states in particular saw a spike in the first quarter of 2012, to 9592, QTA’s director of tourism, Abdullah Al Bader, said in August 2012.

In line with the state’s long-term tourism development plan, Qatar National Hotels, the Qatar-based deluxe hotel company, which was rebranded as Katara Hospitality in May 2012, is looking to expand its reach. According to the company, the new identity is hoped to herald a new era of opportunity for the hospitality firm. With more than 4000 hotel rooms already operational or under construction, Katara Hospitality has a number of openings on the horizon, including two new local projects. The company has several internationally branded hotels in Qatar, while maintaining an international portfolio of hotels.

BUSINESS TIME: Business tourism remains a mainstay of the state’s tourism sector, accounting for 72% of total visitors in 2011, according to Al Bader. A growing financial services industry, large-scale construction and infrastructure projects, and new academic and scientific institutions are pulling in a broad range of workers, from construction crews and investment bankers to storeowners and project managers.

MEETING UP: To capitalise on its growing status as a centre for international business, Qatar is investing in infrastructure for its meetings, incentives, conferences and exhibitions (MICE) segment. This received a significant fillip with the opening of the Qatar National Convention Centre (QNCC) in December 2011. Qatar Foundation (QF) – a national organisation headed by Sheikha Moza bint Nasser that aims to increase education and research in Qatar – oversaw the establishment of QNCC. The facility has an exhibition area of 40,000 sq metres that can host up to 10,000 delegates. The centre’s designer, Japanese architect Arata Isozaki, took his inspiration for the building’s form from the sidra tree, a plant native to Qatar and the insignia of QF. The building has 3500 sq metres of rooftop solar panels, which provide 12.5% of its power supply. Thanks to the building’s innovative design, it became the first in Qatar to attain the US Green Building Council’s Leadership and Environmental Design certification. In December 2011 the QNCC hosted the 20th World Petroleum Congress, one of the largest conferences in the world, and its 5000 delegates.

Other major MICE venues include the Doha Exhibition Centre, a 15,000-sq-metre structure built in 2007, and several five-star hotels with MICE facilities.

To ensure that conference infrastructure in the country has the human resources needed, the state has invested in several educational programmes to prepare a workforce that is capable of planning and executing a wide range of event types and sizes. Among these are a hospitality management programme at Stenden University in Education City and the Qatar MICE Development Institute, a joint venture between QF and Singex Global, a Singapore-based conference and exhibition management powerhouse.

Qatar has also been hosting a growing number of scientific and education conferences with Education City and QF. On March 5-7, 2012 the second annual QITCOM information and communications technology conference took place in the QNCC. Other major events include the sixth International Conference on Environmental Mutagens in Human Populations and the Qatar International Conference on Stem Cell Science and Policy. Such events help raise Qatar’s profile as a centre for education and research, as well as supporting the local tourism sector.

SPORTING LIFE: Although business interests will continue drawing many visitors, more and more guests are expected to arrive to Qatar for athletic attractions. Through its successful bid for the 2022 FIFA World Cup, and as the host of the 2020 Olympic games, Qatar has made clear its intention to build itself into an international sporting destination, and these efforts can be a boost to the country’s sport tourism sector.

Qatar’s ability to secure the right to host these events was the result of a focused strategy orchestrated by the government, the private sector and nongovernmental entities. A successful bid for the 2006 Asian Games was one of the state’s first forays into high-profile international sport. In preparation, the government built and renovated a number of venues, including a complete upgrade of the Khalifa Stadium, originally built in 1976. Momentum gathered as Qatar hosted the 2010 World Indoor Championship and the 2011 AFC Asian Cup. In 2011 the World Arabian Horse Organisation selected Doha as the site of its annual conference, which was hosted by the Qatar Racing and Equestrian Club. Also in 2011, for the first time Doha also hosted the Pan Arab Games, a regional multi-sport event, which took place in December of that year.

GEARING UP: Qatar is serious about its ongoing preparations for the FIFA 2022 tournament. In the lead-up to one the world’s most widely viewed and anticipated sporting events, Qatar has prepared a long list of infrastructure projects, including the construction of an inter-city railway, a metro system, the Doha New Port Project and the Doha New International Airport.

These projects are estimated to cost between $80bn and $100bn, according to a report by market researcher Business Monitor International.

In March 2012 the Qatar 2022 Supreme Committee welcomed representatives from FIFA for the first time since the successful bid. During the visit FIFA representatives met with stakeholders, such as those of the new airport, Qatar Rail, the Gulf Organisation for Research and Development, QF and Qatar’s Central Planning Office. “It was FIFA’s first visit since the bid inspection. We are impressed by the overall vision developed by the Qataris and the first steps of preparations already taken,” FIFA’s director of competitions, Mustapha Fahmy, said during the visit. “We look forward to continuing the path started over the last few days and seeing these visionary projects come together ahead of the first FIFA World Cup in the Middle East.”

UPGRADES: The tournament is known to attract a massive number of tourists. During the 2010 World Cup in South Africa, between 200,000 and 450,000 people arrived in the first three weeks of the event. Visitor spending also spiked. According to Visa, the global credit card company, credit card spending grew over 50% compared with 2009. Although South Africa did not directly recoup the $1.4bn spent preparing stadiums, renovating airports and expanding the police force, the reputational boost and infrastructure upgrades will provide returns on investment in the long run, according to consultancy Grant Thornton.

ACCOMMODATING: To handle the influx of visitors, steady growth of hotel capacity will be crucial in the lead-up to the World Cup. The country aims to have 30,000 rooms by 2013 and over 90,000 by 2022, and about 130 new hotels are being built to meet demand.

The hotel situation for the event presents two major challenges: building enough capacity to support the droves of fans expected to arrive, and avoiding overcapacity before and after the event. To meet growth needs, the state has begun a gradual ramp-up to 2022. The opening of eight new hotels in 2011 increased the state’s overall capacity to 11,341, from 5974 in 2010. As a result, occupancy rates for the year remained about the same, at just under 60%, despite a larger number of visitors. Capacity is set to grow by an additional 3500 rooms in 2012, according to QTA.

The second challenge, the possibility of oversupply post-2022, already has stakeholders thinking of solutions. “There could be an over-capacity issue,” Gordon MacKenzie, general manager of the Ramada Plaza Doha, told OBG. “[However,] when we get to 2022 and there is a bit of oversupply, we will sort something out.” Indeed, Qatar has several options when it comes to facing the challenge. Just as some of the new football stadiums will be deconstructed and converted for other uses, temporary lodgings can fulfil some demand. Moreover, with the completion of the Qatar Bahrain Causeway, visitors could utilise hotels in Qatar’s northern neighbour. Cruise ships are another way to boost lodging capacity without building permanent facilities. During the 2006 Asian Games, three cruise ships were used to increase hotel capacity by 2500 rooms.

RIDING THE WAVE: Local stakeholders believe the bid’s success can highlight Qatar’s role in international sporting and add purpose to preceding events. New sports organisations have been developed with this in mind. Formerly known as the Sports City Project, Aspire Zone Foundation is an international sports venue that operates a sports high school, Aspire Academy for Sports Excellence; a sports medical centre, ASPETAR; and a sports logistics business unit, Aspire Logistics. The organisation was established on January 1, 2008 by Emiri decree with a mission to train top athletes, promote healthy lifestyles and kick-start the state’s sports economy. With the Aspire Academy’s sports curriculum and by making the organisation’s facilities available to local communities, the foundation has been able to educate and promote an active day-to-day lifestyle for Qataris. ASPETAR Sports Medicine and Orthopaedic Hospital offers both athlete care and research on sports medicine. The Aspire Logistics unit, meanwhile, runs the country’s sports venues and works to attract global sporting events to its shores. Increasingly, Aspire aims to create its own public athletic events, such as runs and triathlons.

Local institutions like Aspire increase Qatari interest in sports and build expertise in hosting events, which boosts the country’s future competitiveness as a sports destination and fuels the tourism economy. Qatar has already succeeded in attracting major international conventions in sports like golf, cycling, tennis, football, sailing and horseback riding. “It is very important to sustain the international events here in Qatar. This way we keep attracting visitors who stay past the event to explore the sights and activities available in Qatar,” Sami Jassim Al Boenain, general manager of the Qatar Racing and Equestrian Club, told OBG. “This is growing the tourism industry and raising the awareness of the potential for tourism in Qatar”

FLOATING ALONG: Leisure tourism, one of the five pillars for sector growth identified by QTA, is seeing expansion in the cruise segment. Over the past decade, the industry as a whole has had a significant upswing. Cruise Lines International Association (CLIA), a trade organisation of 26 of major industry players, reported an average annual passenger growth of 7.5% between 1980 and 2011. The GCC has played a big role in this trend. In May 2011 the UK-based Passenger Shipping Association reported that the Gulf was one of the industry’s fastest growing zones in 2010. In the neighbouring UAE, Dubai Passenger Cruise Terminal has seen five-fold growth since its inauguration in early 2010. Abu Dhabi opened its cruise terminal at Mina Zayed in late 2011, and in 2010 Oman opened its first dedicated passenger terminal in Muscat. These infrastructural investments are mutually beneficial, as more regional stops could make for a greater draw for cruise passengers from abroad.

A CLOSER CALL: As cruise tourism continues to grow, its passenger makeup is also diversifying, a trend that could bode well for the industry in the Gulf. Traditionally, North Americans have made up the vast majority of cruise passengers – accounting for roughly 91% of passengers in 1980. In the past 30 years, the breakdown has shifted. In 2011 North Americans made up just 72.8% of passengers travelling with CLIA member lines, with the proportion of European passengers growing. More Europeans taking cruise holidays is good news for the Gulf market, which is less of a long-haul destination for these travellers. Moreover, because the region enjoys sunny weather and more comfortable temperatures year-round, these prospects are especially promising for the European winter market.

Currently, cruise ships that are destined for Qatar call at the Doha Port. With its central location, passengers are within a 15-minute taxi ride of major tourist attractions like the Museum of Islamic Art, the Museum of Modern Arab Art, Souq Waqif and the Corniche, a green pedestrian walkway wrapping around Doha Bay. To boost capacity, there are plans to construct a $5.5bn cruise ship terminal at the Doha New Port Project, which would be able to dock two to three ships at a time. This also ties in with plans mentioned above for temporary expansions in local accommodation capacity during mega-events, such as the 2006 Asian Games and the 2022 FIFA World Cup.

VISUAL TREASURES: Raising Qatar’s status as an international cultural destination is an important part of the state’s tourism development strategy. Qatar Museums Authority (QMA) has been working steadily to expand the country’s art collections and display venues. The iconic Museum of Islamic Art and the Qatar National Museum, both designed by internationally acclaimed architects (IM Pei and Jean Nouvel, respectively), demonstrate Qatar’s commitment to making Doha a high-profile international arts venue. These global aspirations are matched by local ambitions. Smaller galleries and exhibition spaces are sprouting up in areas like the Katara Cultural Village, Mathaf: Museum of Modern Arab Art and the Museum of Islamic Art Park, building on QMA’s goal of weaving more art into local life (see analysis).

BURIED TREASURES: Unearthing Qatar’s past has also played a role in developing the tourism industry. Several excavation projects directed by QMA aim at protecting and displaying the state’s cultural heritage sites. QMA has identified a long list of forts, castles and towers for preservation and restoration, including Al Zubarah (the archaeological site of an ancient fort), Al Ghuwair, Marwab and Umm Salal Mohammed. The goal is to preserve cultural heritage areas while constructing visitor facilities with the long-term aim of fully restoring and building accompanying exhibits for visitors. As projects help spread investment across the peninsula, sites like Al Ruwais, Al Wakra Madinat and Al Khor benefit from preservation efforts.

With its mandate to protect and make Qatar’s past available to the public, QMA works closely with archaeologists to unearth historical structures and artefacts. The organisation is currently overseeing two major excavation projects, one in the northern city of Al Khor and one on the west coast in Marwab. Al Khor includes the Abdulwahab Mosque No 456 and a fish souq, both proposed for restoration. In Marwab stands the Marwab Fort, which was built on the foundations of a fort from the Abbasid era.

CAMPING & ADVENTURE: Qatar’s rural areas also possess a range of unique and stunning landscapes. Over 25% of the country’s territory has been declared a natural reserve, which helps the government’s drive to boost adventure tourism. In recent years, deserts, dunes and coastline have all been developed to host growing numbers of visitors.

One of the most popular areas outside of Doha has been the Khor Al Udaid, or Inland Beach. Located 78 km south of the capital along Qatar’s border with Saudi Arabia, the inland sea features sand dunes that reach as high as 40 metres overlooking Gulf beaches. “Qatar is the only country in the world with easy access to the desert where the sand dunes are directly on the beach, and where it is safe to have tours with families,” Walid Al Jaouni, managing director of Qatar International Adventures, told OBG. The area hosts a diverse ecosystem of oryx, osprey and turtles. Since getting to Inland Beach requires off-road transportation, local tour operators provide trained drivers and 4-wheel vehicle services on a daily basis. The area has experienced a steady uptick in adventure tourism activities, including 4-wheel “dune bashing”, sand skating and camel rides. Desert camping is also popular, especially among Qataris.

The government and private operators have cooperated in the desert’s development. The state allows private companies to build up tourism infrastructure without fees, but in return private companies must adhere to guidelines based on traditional methods that trace their history back to Bedouin camps. The government works with visitors and operators to create guidelines that ensure camps are set up in ways that are environmentally sustainable and compatible with local tradition. “They are encouraging companies to open, invest and do maintenance.” Al Jaouni said. The idea is to allow private companies to continue investing in tourism infrastructure, but not at the cost of the environment or long-held traditions.

OUTLOOK: With diversification in the MICE, sports, adventure, leisure and culture segments, the tourism sector is reaching far and wide. As Qatar presses on with plans to build up tourism, the government is ready to meet the challenges. One issue currently being addressed is infrastructure congestion. A combination of upgrades like the New Doha Port, New Doha International Airport, and a sprawling network of new bridges and highways is meant to ease bottlenecks in the coming years. In the meantime, coordination of resources among government bodies like Qatar Ports Management Company, the Ministry of Business and Trade, and QTA can further the goal of utilising existing resources with maximum efficiency.

The government is also working to meet the human resources needs of the sector. Demand for skilled labour is likely to rise along with the niche tourism markets. Although knock-on effects are most visible in areas like retail, construction and transportation, growing specialised segments like cultural, sports and educational tourism could boost the need for an educated workforce. From consultants and researchers to coaches and sports therapists, the state’s want ads will likely be seeking a wider range of high-skilled positions in coming years. In the short term, partnerships with international organisations can bring in expertise from abroad, while in the long term, educational programmes can prepare greater numbers of Qataris to fill these roles.

Development of niche tourism segments complements long-term diversification plans by expanding the knowledge-based areas of the tourism economy. Although an ambitious goal, the Diwan has shown that it has both the political will and necessary financial resources to meet the challenges as they arise.