Oxford Economics: the tourism rise of the Middle East has not been halted, but short-term risks have become significantly more pronounced
Oxford Economics and its specialized unit Tourism Economics assess that the Middle East remains one of the most promising long-term markets in global tourism, although the region is currently facing serious security and geopolitical pressures. In an analysis published on May 8, 2026, it is stated that the war connected with Iran, disruptions in air traffic and the heightened perception of risk have strongly affected short-term expectations for travel to the region. Nevertheless, the same analysis emphasizes that long-term confidence in tourism growth in the Middle East has remained at an exceptionally high level, primarily because of major investments, business travel, international events and government policies through which tourism is being positioned ever more strongly as a strategic economic sector.
A region that is simultaneously recording records and feeling the consequences of crisis
The picture of Middle Eastern tourism in 2026 is not simple. On the one hand, the latest data from the World Travel & Tourism Council show that the travel and tourism sector in the Middle East grew faster than the global average in 2025. The WTTC states that the regional sector grew by 5.3 percent, while the global average was 4.1 percent, and the contribution of travel and tourism to the region's GDP reached 385.8 billion US dollars. According to the same source, the sector supported 7.1 million jobs, which confirms that tourism is no longer a marginal activity, but one of the instruments of economic diversification in countries that for decades were strongly dependent on energy, trade and financial services.
On the other hand, Oxford Economics warns that the short-term expectations of tourism professionals in the region have weakened sharply. The analysis relies on the Tourism Economics Travel Industry Monitor, a survey that includes insights from more than 30 tourism experts based in the Middle East. According to that survey, expectations for visitor numbers and hotel occupancy in the next quarter and over the next 12 months have become markedly negative. The reason is not a lack of capacity or weak price competitiveness, but the issue of security, risk perception and the ability of destinations to convince markets that travel can take place steadily and predictably.
Saudi Arabia as the main engine of change
Most of the attention is focused on Saudi Arabia, which in only a few years has established itself as the most dynamic tourism project in the region. The WTTC estimates that Saudi Arabia accounted for 46 percent of the total tourism economy of the Middle East in 2025, with the sector contributing 178 billion US dollars to GDP. Growth in tourism GDP in Saudi Arabia amounted to 7.4 percent, which is almost twice the global sector average. The business travel segment was especially strong, growing by more than 55 percent according to the WTTC, reflecting the expansion of conferences, investment forums, trade fairs, sporting events and major development projects.
According to preliminary data from the Saudi Ministry of Tourism reported by regional media, the country recorded more than 122 million domestic and international tourist visits in 2025, with total tourism spending of approximately 300 billion Saudi riyals. These figures bring Saudi Arabia closer to the revised target from the Vision 2030 program, according to which the country should reach 150 million annual visits by the end of the decade. This is a target that includes both domestic and international travel, so it should be distinguished from the classic measurement of foreign tourist arrivals.
The Saudi model is based on a combination of several trends: liberalization of the visa regime, opening the country to international events, huge investments in hotels and transport infrastructure, the development of destinations such as AlUla, projects on the Red Sea and NEOM, and the ambition for the country to position itself simultaneously as a business, cultural, religious, sporting and luxury destination. Such an approach also carries risks. Megaprojects require enormous capital expenditure, long-term operational sustainability and constant demand from high-spending guests, while global travel markets are reacting increasingly sensitively to security crises, air ticket prices and reputational challenges.
Dubai and the UAE retain the advantage of a global air hub
The United Arab Emirates, and especially Dubai, remain the most visible example of how aviation, hospitality, trade, events and luxury tourism can be connected into a single urban model. Dubai International Airport announced that in 2025 it received 95.2 million passengers, 3.1 percent more than a year earlier, thereby achieving the busiest year in its history and the highest annual international passenger traffic recorded by a single airport. Dubai Airports also states that DXB was connected at the end of 2025 with 291 destinations in 110 countries and that it was served by 108 international airlines.
Dubai's tourism picture confirms the same dynamics. The Dubai Department of Economy and Tourism announced that in the period from January to October 2025, the emirate received 15.70 million international overnight visitors, which was 5 percent more than in the same period of 2024. Full-year data reported by regional business media speak of 19.59 million international overnight visitors in 2025, also with growth of approximately 5 percent. Although the final publicly available details differ by source and publication date, the basic trend remains clear: Dubai entered 2026 with a record tourism base and exceptionally strong air connectivity.
But it is precisely that connectivity that makes it vulnerable to disruptions. The air corridor through the Gulf is one of the most important in the world because it connects Europe, Asia, Africa and Australia through hubs such as Dubai, Doha and Abu Dhabi. When geopolitical tensions lead to the closure or restriction of airspace, the consequences are felt not only in local tourism but also in global transfer flows. That is why Oxford Economics emphasizes that recovery does not depend only on destination promotion or price reductions, but above all on restoring confidence in safety and operational stability.
Qatar is building post-World-Cup tourism on events and hospitality
After the 2022 FIFA World Cup, Qatar sought to turn a one-off global event into a more lasting tourism momentum. Qatar Tourism reported that the country received 5.1 million international visitors in 2025, representing annual growth of 3.7 percent. The largest share of arrivals still came from the Gulf Cooperation Council countries, with 35 percent, while Europe accounted for 25 percent. The data also show the diversity of transport flows: 61 percent of visitors arrived by air, 32 percent by land and 7 percent by sea.
Hotel indicators further explain why Qatar is considered an important part of the regional tourism puzzle. The number of room nights sold in 2025 exceeded 10.8 million, which is 8.6 percent more than in 2024, while average market occupancy rose to 71 percent. For a country that significantly increased accommodation capacity ahead of the World Cup, maintaining demand after the end of the event is crucial for the long-term profitability of investments. At the same time, Qatar is increasingly using a calendar of sporting, business and cultural events to reduce seasonality and attract guests from more source markets.
Tourism as part of a broader economic transformation
The tourism growth of the Middle East cannot be viewed separately from the broader strategy of economic transformation. Saudi Arabia is trying to reduce its dependence on oil and create new jobs in services, entertainment, culture and hospitality. The UAE is trying to maintain its status as a global hub of capital, transport and consumption. Qatar wants to capitalize on the infrastructure built for the World Cup and strengthen its recognition beyond the energy sector. Oman, Jordan and other destinations are trying to take advantage of regional momentum through niche, cultural, nature-based or business tourism.
In its analysis, the WTTC emphasizes that investments in infrastructure, air connectivity, destination development and public-private cooperation are crucial for continued growth. This aligns with the policies of numerous governments in the region, which see tourism as a way to create jobs and attract foreign capital. However, such a strategy presupposes continuous political stability and the ability of destinations to maintain a reputation as safe, well-connected and well-managed places for holidays, business meetings and major events.
Long-term optimism remains, but the market demands security
Oxford Economics therefore does not claim that the tourism rise of the Middle East has been interrupted, but that it has entered a more sensitive phase. Short-term sentiment indicators have worsened because of security circumstances, and expectations for arrivals and hotel occupancy in the near term are significantly weaker than at the global level. Nevertheless, the long-term foundations remain strong: the region has capital, ambitious government strategies, global airlines, a growing hotel offering, large event calendars and the political will for tourism to become one of the pillars of development.
For the tourism industry, this means that the coming period will not be marked only by a race in the number of new rooms, terminals and luxury resorts, but also by the ability to manage risk. Destinations that manage to communicate safety convincingly, maintain air connectivity, diversify source markets and offer content beyond short-term spectacles will have a better position in global competition. In 2025, the Middle East showed that it can grow faster than the global average; in 2026 and beyond, it will have to show that this growth can also withstand periods of political and security instability.
Sources:
- Oxford Economics / Tourism Economics – analysis “Long-Term Optimism for Middle East Travel” on short-term security pressures and long-term optimism for Middle East tourism (link)
- World Travel & Tourism Council – data from the Economic Impact Research on travel and tourism growth in the Middle East in 2025 (link)
- Dubai Airports – official data on the record traffic of Dubai International Airport in 2025 (link)
- Dubai Department of Economy and Tourism – tourism report for the January-October 2025 period (link)
- Qatar Tourism – annual tourism report for 2025 with data on international visitors, overnight stays and occupancy (link)
- Qatar News Agency – announcement on 5.1 million visitors to Qatar in 2025 (link)
- Arab News – report on preliminary data from the Saudi Ministry of Tourism for 2025 and the target of 150 million visits by 2030 (link)
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