The high cost of airfare within the Gulf Cooperation Council (GCC) is proving to be a significant hurdle for the region’s travel and tourism sector.
Intra-region air travel costs are notably higher than in other parts of the world, such as Europe and Asia, where passengers benefit from a wider array of low-cost carrier options.
Several GCC routes face capacity constraints, leading to elevated airfares. Industry executives in the UAE remain hopeful that the introduction of a single GCC tourist visa and an increase in budget and ultra-low-cost carriers will invigorate the travel sector and reduce travel costs in the coming years.
Unlike other regions, the GCC has limited domestic travel options, with Saudi Arabia being an exception. The region relies heavily on intra-region traffic, particularly between the UAE, Saudi Arabia, Oman, and Kuwait. Dubai, as a regional tourism hub, attracts numerous visitors from neighboring Arab countries.
A study by Roland Berger highlights that GCC flights are more expensive compared to their European and Asian counterparts, which offer significantly lower fares for intra-region travel. Industry insiders attribute the higher fares within the GCC to the strong purchasing power and high per capita income of the oil-exporting countries.
TP Sudheesh, General Manager of Deira Travel and Tourist Agency, notes that regional airlines prefer operating outside the GCC due to better revenue opportunities. He suggests that the introduction of a single tourist visa could boost intra-region air traffic and attract more airlines, thereby driving down prices.
Mir Wasim Raja, Manager for MICE and Holidays at Galadari International Travel Services, points out that it is cheaper to travel within Europe than within the Gulf region. He emphasizes that while GCC residents have strong buying power, the region’s budget airline sector is still developing. He believes that as low-cost airlines become more prevalent in the Gulf and the demand-supply balance shifts, airfares will eventually decrease.
