The financial crisis is beginning to curb Dubai's hotel industry but an even greater downturn in the sector is expected in 2009 as both corporate and leisure travellers further tighten their belts.
Dubai faces a number of challenges as it seeks to attract visitors to the emirate in the wake of the credit crunch.
One of the more glaring factors weighing on Dubai's tourism industry is the cost of its hotels.
The emirate ranked highest globally in terms of average room rate in October, with an average of $375 during the month, according to a report by STR Global.
Despite such high rates, Dubai hotels were able to achieve 82.8% occupancy levels in October, but those numbers are likely to trend downward, analysts say. To lure travellers some hotels in the emirate have begun offering special packages and discounts of 30% or more.
The decline of the euro and the pound against the dollar is also putting pressure on Dubai's tourism. 'In the space of the past three months the euro and sterling have depreciated against the dollar by 20%-25%. Since Dubai's currency is pegged against the dollar that means that hotel rooms overnight have almost become 20%-25% more expensive for that consumer set,' according to Alex Kyriakidis, Global Managing Partner of Tourism, Hospitality & Leisure at Deloitte.
destination management company dubai 
