Analysis Leisure & Hospitality Infrastructure needed to support Egypt’s tourism ambitions By Valentina Pasquali October 9, 2024, 11:21 AM Reuters/Mohamed Abd El Ghany A resort hotel in Sharm El-Sheikh. Egypt needs more investment in hotels and its airport infrastructure to realise its tourism ambitions, observers say Hotel operators keen to expand Airport investment needed Saudi Arabia a Red Sea rival Regional and international hotel operators are keen to expand in Egypt, but the country needs to improve infrastructure such as airports to support its tourism ambitions, industry sources have said. Egypt aims to emulate the high-end hospitality and entertainment development that the UAE and other Gulf countries have pioneered, at the same time bringing in more upmarket visitors to its world-renowned historic attractions. This presents a set of unique challenges. Egypt must preserve its role as guardian to the Pyramids, the Sphinx and many other ancient sites along the Nile River, while embracing more modern infrastructure and leisure-focused coastal development. Meanwhile, amid the region’s escalating geopolitical tensions and the continuing consequences of the Suez Canal shipping crisis, Saudi Arabia, just across the Red Sea, is seeking to replicate the Dubai-inspired model on a massive scale. As the uncertainty continues, regional and international hotel operators said that they are all very keen to enhance their footprint in Egypt. “We recently expanded the team to be able to focus more on Egypt in addition to other parts of the region,” says Elie Milky, vice-president for development at the Radisson Hotel Group. Radisson has properties in Cairo, Qusair (on the Red Sea) and Alexandria and is looking at development opportunities along the Mediterranean coast and in Cairo, New Cairo and the Red Sea. Milky says that abundant hospitality supply in the pipeline in Egypt and around Mena will help create a more inviting regional tourism ecosystem and lift all individual markets, even if it ramps up competition for visitors. Talking at the Future Hospitality Summit in Dubai last week, Milky said: “I believe the rise of Saudi Arabia has woken up many neighbouring countries to develop and relaunch their tourism strategies. “The more these countries establish themselves as tourism hubs and destinations, the more attractive the whole region becomes.” Egypt is looking to build a new beachfront city and resort in Ras El-Hekma, on its north coast, with a massive injection of funds from Abu Dhabi’s sovereign wealth fund ADQ. It is also exploring similar opportunities along the Red Sea, on the Ras Banas peninsula and in Ras Gamila. Mena hotel construction to focus on Saudi Arabia and Egypt Egypt’s tourism revenue rises 27% to $14bn Builder picked for luxury resort as Egypt tourism rebounds Last month Saudi investors discussed with the Egyptian tourism minister putting funds toward developing the country’s largely untapped tourism resources. As Egypt adds new coastal options to its well-established offerings in Sharm El-Sheikh and elsewhere, it can count on an unparalleled cultural and architectural heritage that will always make it stand out among regional rivals, observers say. Siegfried Nierhaus, head of development for the Middle East, India and Africa at H World International, formerly Deutsche Hospitality, says: “Egypt has defined its unique selling points: it’s nature, it’s the attractions they built thousands and thousands of years ago, it’s the Nile. It’s so beautiful. Do not transform it into a Dubai, please.” Nierhaus says that Egypt will have to make a “huge” investment to gradually improve airports, roads and other infrastructure. That will happen at its own pace and in accordance with its other national priorities, he says. H World International, a German-Chinese hospitality conglomerate, operates multiple properties in Cairo, along the Nile, in Alexandria and on the Red Sea, and Nierhaus calls the country one of his firm’s “home markets.” Philip Barnes, chief executive of the Abu Dhabi hotel brand Rotana, says his firm’s resort in Sharm El Sheik has been doing “very well” thanks to the support of regular clients. The company just opened on the north coast, and has a new “quite substantial” property in development in the centre of Cairo. “I’ve said this to a number of people, going through Egyptian airports is tough,” Barnes says. “I think the government needs to invest in the infrastructure to support tourism. Tourism is so important to Egypt and it should be at the top of every tourist bucket list, because it has such stunning history and culture.” Barnes says he will never forget visiting Karnak and Luxor. But Egypt needs to take a page from Saudi Arabia and better support visitors as they arrive and travel around the country, he believes. “If you look at what Saudi Arabia is doing, they’re really on the cutting edge of changing the approach and making it easy for people,” Barnes says “Egypt has got so much potential, but it needs to get over some of these hurdles.”