According to an Economic Intelligence Unit report, the rapid population growth witnessed in 2006-08 in the UAE has now gone into reverse as expatriate jobs are cut in the construction, real estate, tourism and financial services sectors. “This will affect private consumption in both the short and medium term,” it says. But Graham Cooke, the founder and managing director of the World Travel Awards, says it is all part of a growth curve and the region is no different.

“Whenever a new destination is discovered, tourist numbers rise drastically and then level off. What Dubai did for the Middle East’s tourism sector was fantastic - it put them on the map and brought everyone’s focus to this region. Now the region’s tourism destinations should think how they can build from that,” he says. The trouble is, three of Dubai’s key tourist markets - the UK, the euro zone and Russia - are in recession, with depressed consumer confidence and rising unemployment.

Cooke admits the number of tourists and business travelers will decline given the global financial situation, but that’s not the end of the road.  “As long as these destinations continue to remain competitive, their airlines continue to offer world-class service, and their tourism experience continues to diversify, tourists will keep coming,” he says. “I don’t think it will be as catastrophic as people make it to be. If the projected number of tourists don’t show up in the Gulf countries there will still be a tourism sector.”

Nevertheless, despite those encouraging words, the sector is not investor grade in the near future. The Jones Lang LaSalle “Hotel Investment Outlook 2009″ report bluntly sums up the future with a simple chronology: “2009 will be the year of correction, 2010 will bring market stability ahead of general recovery in 2011.”

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