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Tourism Sector Developments in Egypt
The latest developments in the tourism sector in Egypt with focus on market segmentation and investment opportunities.
(January 2005)
Members: LE250, Non-members: LE350, Int'l Price: $350
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Overview
Tight economic conditions in some major tourism generating markets together with the 9/11 events in the U.S., and the subsequent wars in Afghanistan and Iraq have dampened the growth of global tourism. Egypt has no doubt been affected by these international developments, experiencing below average growth rates in tourism activity. Nevertheless, tourist arrivals were 10 times higher than the global average during 2000 – 2003, and attracted some 25% of tourist arrivals to the Middle East. This growth in International Tourist Arrivals (ITA) has generated $4.6 billion in tourism receipts that account for 22% of total exports of goods and services and 39% of services exports, making tourism the largest foreign currency earner in Egypt. Estimates indicate that tourism will generate some $6.1 billion in 2004, thus ranking the Egyptian tourism market as the 28th largest market in the world.
To meet the growth in demand, tourism accommodation capacity has also been growing. It outpaced demand growth with a 7% increase in capacity over 2000 – 2003. South Sinai has the highest capacity growth followed by Luxor and Alexandria. Matrouh is also beginning to undertake vast expansions and development. In addition, there has been observed growth of tourism-related services and facilities during 2000 – 2003, such as travel agencies, restaurants and cafeterias. Moreover, environmental awareness is increasing as shown by the growing number of existing nature protectorates. Furthermore, the planned expansion and development of cultural and infrastructure facilities should further enhance tourism performance in the coming year.
SECTOR HIGHLIGHTS
- Tourism activity is a major contributor to GDP, employment and investment and the largest foreign currency earner in Egypt.
- The appointment of the new body of the Ministry of Tourism in July 2004 signifies the start of a solid long-term vision for the tourism sector in Egypt.
- The European market constitutes the largest generating market for International Tourist Arrivals (ITA) to Egypt.
- Air travel is the most popular mode of transportation for ITA to Egypt, accounting for 80% of all travel to the country.
- Egypt is a rich destination in the multi-attractions market, offering cultural, leisure, business, health, study and other touristic activities.
- Recreation is the major reason for visiting Egypt – although MICE tourism is gaining huge momentum
- On the supply side, accommodation capacity grew at an average annual rate of 7% during 2000 – 2003, outpacing tourism demand growth by 4%.
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