Introduction
In recent years, the United Arab Emirates (UAE) has been investing heavily in the tourism industry upon the realization of the potential of the sector to grow the Emirate’s economy. Currently, the UAE is regarded as one of the internationally preferred tourist destination.
Industry’s Dominant Features
Abu Dhabi’s primary determination is the development of tourism based on cultural infrastructure. Since 2004, Abu Dhabi government has invested heavily towards the development of local cultural districts and large scale strategies to transform metropolitan areas founded on abstract basis of cultural infrastructure. Outlined in the emirate’s Vision 2030 plan, the development includes the concept of tourism as an economic activity. Among the contributing features to the rapidly increasing domestic and international tourism is political stability. The Middle East and the Arab countries have been experiencing political instability. The UAE is politically stable and financially endowed. Economic resources are largely derived from the exportation of oil.
SWOT Analysis
Strengths
The UAE is among the world’s strongest economies. It has natural resources in the form of oil. The oil earns the emirates billions of dollars. In this regard, Abu Dhabi has utilized the financial endowment to construct and develop world-class airport facilities. It has lounges fitted with cutting edge technology. Tourists and businesspersons can access the internet and subsequently their bank accounts and email from the comfort of these lounges. Abu Dhabi Gold is a world renowned facility that offers services to virtually every tourist.
Abu Dhabi has high quality of road network, almost perfect port system and commendable airport infrastructure. These ensure that incase of failure of one system, the others effectively act as an alternative. Therefore, tourists are never stranded due to failure of one facility. These facilities include Metro, public buses, taxi and water transport. The authorities responsible for running these systems are highly trained. In fact, Abu Dhabi is one of the economies that source trained and skilled manpower from abroad to ensure effective running of its systems. Foreigners are known to apply for employment in Abu Dhabi in large numbers due to the lucrative opportunities offered.
Tourists seek to utilize every moment of their vacation to access as many sites as possible. Abu Dhabi entertainment and heritage places have welcoming and flexible opening times. These places can be accessed even at night offering an opportunity for those who may be engaged in other activities during the day. Effectively, the strategy converts Abu Dhabi into a 24-hour economy. In case of flight delays, travellers can access heritage places as they await their flight.
Statistics indicate that UAE is among the leading countries in terms of safety and security. The security system implemented by the government is based on the fact that the country lies in a region of instability. In the neighboring countries, terrorism is a typical occurrence. The government has prioritized security to ensure that the economy is not hindered by insecurity particularly terrorism. Surveillance trucks can be seen throughout the emirates with uniformed police in major tourist sites and malls. Undercover police are also said to roam the streets in large numbers.
Weaknesses
The UAE is an emerging and fast growing economy. Prior to the development of proper infrastructure to harness and sell oil, the country virtually had no tourists due to its poor transportation network. Majority of the people were living in abject poverty. As the infrastructures improved upon trading in oil, every citizen is now engaged in economic activities. Consequently, Abu Dhabi has feeble national tourism. The domestic tourists are few and hence do not contribute significantly to national tourism (Hernandez par. 4).
The UAE is composed of several emirates. Each emirate runs its own affairs. There is low collaboration between diverse emirates in view of economic activities such as tourism considering that Abu Dhabi has established its own agency to oversee tourism activities. The agency accountable for cultural growth is Abu Dhabi Tourism and Cultural Authority (TCA). TCA was formed upon the realization that other emirates were concerned with other economic activities while Abu Dhabi considered tourism and cultural development as one of its major economic activities to complement oil trade.
Opportunities
Abu Dhabi stands the chance to make tourism an economic opportunity. Upon marketing itself as a preferred tourist destination, the emirate will become a hub in the region considering the cultural heritage it enjoys. The emirate has the opportunity to market itself the global arena in tourism. There are many sites that are yet to be attended in terms of finance. The government requires making these sites accessible in terms of infrastructure and marketing.
Threats
Tourism is an economic activity conducted by many countries. Abu Dhabi tourism faces cutthroat competition from countries that are rich in culture, sufficient wildlife and natural sceneries. International competition comes from globally popular tourist destinations such as Kenya, Malaysia and South Africa.
There are new tourist destinations that are emerging in the marketplace. The result is decrease in the number of visitors to Abu Dhabi. The Abu Dhabi government requires investing heavily in the effort to market itself as a permanent tourist destination.
Security is paramount for any economy. The emirate lies in a region of security instability emerging from terrorist threats. As a result, there is vigorous identification processes in its airports that discourage tourists from making a return tour to the emirate.
Broad Macro-Environment
Political
The UAE is substantially politically stable. Typically, Emiratis are conservative. The UAE is among the most open-minded countries in the Gulf. In Abu Dhabi, other cultures and spiritualties are accepted. However, the country leadership is authoritarian. The Arab Spring did not affect Abu Dhabi reflecting the stability of the leadership. In 2012, tourism was slightly impacted when the government imposed internet restrictions to avert the possibility of the Arab Spring hitting the country.
Economic
Prior to the discovery of oil, Abu Dhabi largely depended on fishing and the weakening pearl industries. Abu Dhabi became the first emirate to export oil. The society and the economy transformed rapidly. The Abu Dhabi community enjoy affluent living standard derived from oil wealth. The government sought to minimize the dependency on oil through diversification to other economic activities. It created business opportunities and vigorously pursued the development of tourism (Patrice par. 7).
Socio-cultural
Abu Dhabi has undergone huge transformation for the last six decades. It was a small village engaging in fishing with a population of 5,000 inhabitants. The discovery of oil contributed to the transformation of lifestyle due to improved living standards. The Emiratis are welcoming and Abu Dhabi is hospitable. They are essentially liberal and tolerate different cultures. The most common cultural event is camel racing that has been in existence for decades. The event attracts many tourists from different global locations (Gems 20).
Technological
Abu Dhabi is technologically advanced. It has a telecommunication capacity that allows it to be the centre of communication services for the Gulf region. The technology sector includes wired and wireless services. There is high-density data transmission that allows businesspersons to continue with their transactions while on holiday. The emirate’s financial ability allows it to acquire and adopt emerging technologies.
Legal
In 2012, Abu Dhabi president issued a legal notice to found the Abu Dhabi Authority for Tourism and Culture. The TCA is meant to promote tourism with domestic legacy as the hinge of tourism growth. The legal structure of the emirate does not inhibit tourism. The law is structured in such a way that visitors from all global locations are welcomed without restrictions except where national security is threatened.
Environmental
TCA has been mandated to ensure that tourism thrives in Abu Dhabi. The responsibility includes the creation of an appropriate environment where entrepreneurs can invest in diverse ventures to promote business and tourism. In 2010, TAC initiated the world’s first Environment, Health and Safety Management System (EHSMS) for the whole leisure industry. The initiative is aimed at ensuring progressive local sector reaction and support. The initiative covers all the emirate’s hospitality facilities. Currently, Abu Dhabi has the largest concentration of accommodation facilities with EHSMS compliance globally. The programme was designed with mutual tourism sector collaboration. It affords systematic EHS training to the industry partnersThe programme also ensures a built-in classification on environmental performance for TCA’s desert camp categorization system (Rettab and Mellahi 14).
Porter’s Five Forces
Threat of Substitute Products
The range of tourist attraction packages in Abu Dhabi is limited. The packages include world-class hotels, lounges and airports, camel racing, cultural sites and desert camps. Competing countries such as South Africa, Kenya and Malaysia may have the capacity to construct and develop world-class airports, lounges and hotels as is currently the case. However, the competitors will not enjoy the natural setting of camel racing. Camel racing is part of the Abu Dhabi heritage. In addition, these countries lack vast deserts where tourists can practice cultural activities such as falconry. Falconry is entrenched in the UAE community culture as a sport. Tourists visit Abu Dhabi en-route to the falconry sites. Many remain in the emirate for weeks practicing falconry (Nicoleta 47).
Intensity of Competitive Rivalry in the Industry
Abu Dhabi is rapidly facing positive growth in tourist arrivals. It is among the few outstanding benign destinations in the Middle East and North Africa. The positive economic expansion places Abu Dhabi in a financial capacity to invest substantially in its tourism infrastructure. Regardless of competition from Dubai, Qatar and Oman, Abu Dhabi’s suitable position as a luxury, high-end destination appear to be favoring Abu Dhabi. However, other countries that are frequented by tourists pose a threat to Abu Dhabi’s tourism. Countries such as Kenya have a wide range of tourist attractions including the seasonal Wild Beast migration.
During this season, the number of tourists to Abu Dhabi reduces significantly. Kenya has advantage over Abu Dhabi considering that it lies along the equator. The weather is favorable throughout the year with many different sites to visit including the Great Rift Valley and the famous Maasai Mara game reserve where wild animals can be viewed in their natural setting.
Threat of New Entrants
Many countries have realized the lucrative business that is accompanied by tourism. Emerging and developing economies are investing heavily in the effort to make tourism an economic activity. Many countries in Asia and Africa are beginning to open their locations as prospective tourist destinations. They are investing heavily in technology and infrastructure as well as vigorously marketing their destinations. The availability of the internet in these places means that tourists can camp in these places and continue communicating with business associates, families and access the global current affairs at the click of a button.
The Power of Buyers
In tourism, the buyers are the visitors to a particular destination. These buyers are attracted by various things. These include sceneries they have never seen before, quality of service at the destination, political stability and the accessibility of the destination. Considering that there are many global locations that act as tourists attractions, the Abu Dhabi government has no power over the ‘buyers’. It is the prerogative of the ‘buyer’ to determine whether or not to travel and to what destination. The government hence must market its tourism as an attractive package with value for money.
Porters Diamond – Abu Dhabi Tourism
Value, Rarity, Imitability and Organization (VRIO) Analysis
Value
Abu Dhabi continues to be financially endowed as it exports oil to global consumers. The country gets billions of dollars from the sale of oil. The government has been investing the revenue to develop its infrastructure. Abu Dhabi is currently among the global locations with sophisticated transportation and communication infrastructures. It has world-class hospitality facilities such as lounges and hotels. The government has taken advantage of financial endowment to market Abu Dhabi as a destination of choice.
The UAE is politically stable and lies at a strategic position on the Gulf where the neighbors are in constant conflicts. The country acts as the entry point into the Gulf. It has managed to pose itself as the communication hub of the Gulf. The efficient utilization of oil money has enabled Abu Dhabi to take advantage of these factors to emerge as preferred tourist destination.
Rarity
Tourism cannot be termed as scarce considering the many global destinations in all continents. Every country has a unique attraction that an individual may want to see. World-class hospitality facilities spread across the globe. Super-infrastructures are virtually found in every country. Communication is availed in every place through satellites and the internet (Lemelin et al. 77). The only rare aspect of tourism that is unique to Abu Dhabi is the combination of camel racing, falconry and desert camping making Abu Dhabi unique as a tourist destination. No other country enjoys this unique combination of tourist attractions.
Imitability
The uniqueness of Abu Dhabi tourism industry arise from the combination of falconry, desert camping and camel racing. Camel racing has been attempted in other desert countries such as northern Kenya and most North Africa countries where the inhabitants perceive it as a traditional sport. However, it does not attract as many tourists as it does in Abu Dhabi. Falconry has also been practiced in European countries. Desert camping has also been practiced in some desert countries. However, the combination of the three attractions has not been duplicated anywhere else in the world.
Organization
The Abu Dhabi government appreciates the economic value of tourism. It has put considerable effort towards growing the industry. The launching of TCA was an indication of the value the government place on tourism. The authority is expected to ensure the prosperity of culture as an essential element of tourism. Since its launch, the initiative has made significant steps towards the achievement of the emirate’s Vision 2030. The UAE leadership in general supports the development of tourism in the region.
Final analysis and final questions
Abu Dhabi has a vibrant entrepreneurial, cultural, entertainment and sports industries. The fast growing hospitality industry facilitated by well-performing oil trade and availability of skilled manpower makes the emirate a tourist destination of choice. Abu Dhabi has a positive appeal to tourists considering the large number of islands and diverse landscape, cultural and heritage assets. The unique combination of falconry, desert camping and camel racing makes the emirate one of the leading competitors for market share in the tourism industry. In enhancing the marketing of the tourism destination, TCA has launched numerous international offices in Europe. There are plans to roll out others in different global locations.
The significance of sustainable development to the tourism industry has been identified as essential in safeguarding the culture of the Emiratis by TCA. The authority actively implements an all-inclusive sustainable tourism structure as an aspect of sustainable development plan. The structure is focused on the development of long-term destination competitiveness. It seeks to ensure tourist experience through the support of the realization of a world-class products and services delivery. To realize this goal, the government ensures the existence of political stability. The Vision 2030 advocates for the industry to embrace workforce pool of fine-trained professionals. The skilled personnel should be dedicated to the preservation and protection of Abu Dhabi’s heritage, culture and environment. The interests of tourism stakeholders should also be given priority according to TCA.
For Abu Dhabi to compete effectively with existing and emerging tourist destinations globally, the government requires investing heavily in the expansion and upgrading of its tourism and cultural offering. Significant initiatives need to be implemented. The Saadiyat Island Cultural District is a good beginning for the promising prosperity of the tourist industry in the emirate. The emirate’s globally renowned museums and cultural institutions will be exposed to the outer world.
Considering that other countries are rapidly opening their space for tourism as an economic activity, we are yet to see whether or not the current efforts by the TCA will make a difference and win Abu Dhabi a bigger market share. Further, the emirate occasionally imposes censorship on the use of the internet attracting global accusations from different quarters. It remains speculative whether or not the emirate will consider reviewing its media policy.
Dominant forces acting in the Abu Dhabi tourism is competition. Other countries are making significant efforts in ensuring that tourism thrives as an economic activity. The TCA was established to ensure that emirate’s cultural heritage and tourism was sustained globally. The efforts made by the authority are credible to make tourism an economic activity. Considering the efforts that are made by the UAE government, the region will become a tourism hub in the next few years.
Supply Chain
Abu Dhabi government incurs expenses in marketing its tourism worldwide. In essence, it has international offices in virtually all countries that have the financial capacity in terms of GDP. The emirate has noteworthy world-class airports. It allows private planes to tour the emirates cultural sites.
Generic Strategy
Abu Dhabi has made significant steps in ensuring that it diversifies its economic activities. The emirate does not solely depend on oil exportation. The emirate has “Strategy and Policy Division”. The department runs relevant policies that ensure supportive decision making in regard to tourism. The authorities focus on tourism as an alternative economic activity.
Works Cited
Gems, Soren. Socio-Cultural Impacts of Tourism in Abu Dhabi: Analyzing Attitudes, Beliefs, and Behavior of Locals towards, Frankfurt, German : VDM Verlag Dr. Müller, 2008. Print.
Hernandez, Vittorio. Oil Trader Vitol, Abu Dhabi Investment Commission to Buy Shell’s Geelong Refinery Petrol Stations for $2.4B. 2014. Web.
Lemelin, Harvey et al. Last Chance Tourism: Adapting Tourism Opportunities in a Changing World. 2013. London, UK: Routledge, 2013. Print.
Nicoleta, Ecaterina. “The Competitive Advantage Theory as a Growth Strategy.” Management Marketing 1.1(2009): 1-40. Print.
Patrice, James. United Arab Emirates Profile. 2013. Web.
Rettab, Brik and Kelly Mellahi. “Corporate Social Responsibility and Corporate Governance in the United Arab Emirates.” Dubai Chamber Center for Responsible Business 21.2 (2010):1-25. Print.