UAE to benefit from the resumption of global travel; Report

By Shilpa Annie Joseph, Trainee Reporter
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US-based leading financial institution, Bank of America Merrill Lynch (BAML) has revealed that the UAE could be one of the main beneficiaries if global travel resumes in the second half of the year.

The bank has named Dubai-based bank Emirates NBD as its top local play for investors as it was likely to “benefit from tourism-driven economic growth, credit demand, and asset quality.”

The financial institution further added that Egypt is poised to make a strong comeback, especially if direct flights between Russia and the Red Sea are restored. Before the suspension of all flights in 2015, Russians accounted for almost a third of all arrivals.

Jean-Michel Saliba MENA economist said in a report that, “The UAE’s exposure to tourism and global trade, as well as its proactive vaccination program, suggests it could benefit from a global recovery if the COVID pandemic dissipates.”

Both the UAE and Egypt had established flourishing mass tourism industry before the pandemic crippled global travel a year ago. Now both countries are attempting to capitalize on the increasing global demand for travel by vacation-deprived consumers.

A relatively recent bonus for the UAE tourism industry has been the normalization of ties with Israel. Over two months after the first commercial flight between the UAE and Israel took off in November, nearly 70,000 Israelis have visited the country.

According to the reports, “As both countries have some of the world’s fastest vaccination programs, authorities have suggested a bilateral quarantine-free corridor is one potential option.”

The bank further noted that the rescheduled World Expo 2020 could boost growth. “The event will now take place from October 2021 to March 2022, which may tie in with a loosening of global travel restrictions while also corresponding to the peak travel months,” as per the reports.

The bank also stated that the resumption of global travel will favor Greece and Turkey.

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