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Investors to build 1,400 hotel rooms in Petra despite tourism slump

A group of tourists sees Petra for the first time. Visitor numbers from Europe and North America are down sharply Grant Rooney/Alamy via Reuters
A group of tourists sees Petra for the first time. Visitor numbers from Europe and North America are down sharply
  • Occupancy fell to 3% in November
  • Funders confident of recovery
  • January-May revenue at $2.6bn

Local investors are proceeding with plans to build 1,400 hotel rooms in Petra, a tourism official has said, as Jordan grapples with the impact of the Gaza conflict.

Petra’s hotel occupancy rates tumbled to a record low of 3 percent last November and have remained in the single or the low double digits since then.

Fares Al Breizat, chief commissioner of the Petra Development and Tourism Region Authority, told the Jordan News Agency that the investors were confident visitor numbers would recover. 

He highlighted government efforts to support tourism businesses, including marketing initiatives and rent waivers, alongside social security and tax relief measures.

The ministry has also set up a Tourism Development and Resilience Fund to provide financial assistance.

Jordan’s tourism revenue was $2.6 billion in the first 5 months of 2024, down 6.5 percent on the same period last year, according to the Central Bank. Visitor numbers were down 10 percent.

In January 2023, officials reported a 122 percent year-on-year increase in tourism revenues. The sector contributed more than 14 percent to gross domestic product last year.

Since the start of the conflict in Gaza, the number of European and North American visitors to Petra has fallen most steeply. This drop has been partially offset by an increase in visitors from the Gulf and trips by Jordanian expatriates.

Flight cancellations by major carriers, including Transavia, Wizz Air, Edelweiss Air, EasyJet and Ryanair, have increased pressure on the sector. In addition, 49 cruise ship trips have been cancelled for the 2023-24 season.

Cruise ships and airlines have cancelled or reduced services to PetraUnsplash/Alex Vasey
Cruise ships and airlines have cancelled or reduced their services to Petra

Inbound tour operators reported a 90 percent cancellation rate for tourist groups between October 2023 and January 2024. The rate is forecast to rise to 93 percent for February to June 2024.

If this trend continues, the potential loss could reach JD599 million ($845 million) for the whole of 2024.

The Ministry of Tourism said it aims to tap new markets, including China, Russia, Africa, India, Pakistan, Malaysia and Indonesia, as well as Arab markets. 

Marketing will focus on segments such as medical and wellness tourism, faith tourism, adventure tourism, and business events.

Jordan’s GDP grew 2 percent year on year in the first quarter of 2024 despite regional geopolitical challenges.

The extractive industries (mining and quarrying, including oil and gas) reported the highest growth at 6.3 percent. Agriculture increased by 5.7 percent, the electricity and water sector by 4.8 percent and manufacturing by 3.9 percent.

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