UAE boosts investment in tourism sector with competitive incentives

The United Arab Emirates has recorded exceptional strides in the tourism sector, both in terms of its growing appeal to visitors from around the world and its ability to attract investment drawn by strong returns supported by a highly competitive investment environment.

These achievements form part of an integrated national strategy aimed at reinforcing the UAE’s position among the world’s leading tourist destinations.

The UAE has introduced significant incentives to attract investment and stimulate entrepreneurship and innovation in a sector experiencing sustained growth, underpinned by powerful tourism drivers. Chief among these are the country’s natural, social and legislative assets, which have positioned the UAE as a year-round destination, particularly during its mild and distinctive winter season.

These advantages include the country’s strategic location linking East and West, its rich biodiversity that blends deserts, oases, mountains, valleys, plains and beaches, as well as economic and political stability, a society rooted in values of religious tolerance and coexistence, year-round events supported by robust infrastructure, and a wide range of accommodation options.

As a result, the UAE has secured leading positions in global tourism rankings. It has been placed among the world’s top seven destinations for international tourist spending and ranked first globally in several competitiveness indicators related to aviation and travel, notably the quality of air transport infrastructure.

The tourism and travel sector also posted strong growth rates in the first half of the current year, with hotels welcoming more than 16 million guests. By the end of the first half, the country had 1,243 hotel establishments offering over 216,000 rooms, while 16 new hotels entered the UAE market during 2024.

The 'World's Coolest Winter' campaign, launched this year under the slogan 'Our Winter is Entrepreneurial', highlights the incentives and facilitation measures supporting investment in the sector and advancing the businesses of tourism entrepreneurs.

The UAE has further strengthened its tourism appeal and enhanced investment returns through the launch of several national initiatives and projects, most notably the National Tourism Charter, the UAE Hospitality Summer Camp initiative, support for domestic tourism and promotion of new destinations, expanded international engagement with global tourism organisations, and the integration of tourism concepts into educational curricula.

The Ministry of Economy and Tourism is currently implementing a suite of digital initiatives and projects under the UAE Tourism Strategy 2031, including a project to electronically link hotel establishment data with local tourism authorities.

In 2026, the ministry plans to develop new projects focused on diversifying and enhancing tourism products, accelerating digital transformation through innovative solutions and advanced technologies, and embedding sustainability across all tourism activities and services.

Over several decades, the UAE has enabled extensive investment in the tourism sector by government entities, Emirati investors and international investors alike. This has encompassed major infrastructure such as airlines, airports, hotels and distinctive tourism and leisure facilities, alongside the development of modern tourism products, premium experiences, and cultural and heritage programmes, particularly over the past decade.

The tourism sector continues to witness broad-based growth, supported by the large-scale expansion of tourism and hospitality infrastructure projects that bolster investor confidence and open new horizons for growth. Government tourism authorities are working closely with private-sector companies to accelerate sectoral growth, establish global partnerships, ensure the highest standards of service quality, align hotel classifications with service benchmarks, and deliver value that meets visitors’ expectations.

The UAE offers extensive facilitation measures for entrepreneurs seeking to develop tourism investments, including tax exemptions, 100 per cent foreign ownership of businesses, flexibility in selecting from more than 40 free zones across the country, the ability to conduct all economic activities without the requirement of a local sponsor, no minimum capital requirements, no income tax, and full profit repatriation.

These advantages are complemented by long-term residency permits ranging from five to ten years, ease of recruiting skilled labour, and a flexible labour framework that positions the UAE as a global hub for talent, human capital and innovation. Additional support includes initiatives promoting innovation and technology, development of advanced tourism infrastructure and products, and updated policies and legislation aligned with global economic trends.

To further enhance the attractiveness of the sector and ensure seamless market entry for investors, the UAE introduced the most extensive legislative amendments in its history starting in 2021, updating laws and regulations to enable economic sectors to keep pace with future transformations. The government also launched the National Tourism Strategy 2031, which aims to strengthen the UAE’s global tourism identity and consolidate its status as a leading destination built on the diverse offerings of the country’s seven emirates.

Through cooperation and coordination between public and private-sector partners, the strategy targets raising tourism’s contribution to national GDP to Dhs450 billion, achieving annual growth of Dhs27 billion, attracting Dhs100 billion in new tourism investments, and welcoming 40 million hotel guests in the coming years.

The impact of these extensive investment facilitation measures is reflected in record figures that underscore the economic viability of national tourism strategies. Tourism investments attracted by the UAE reached Dhs28.8 billion in 2023, increased to Dhs32.2 billion in 2024, and are projected to reach Dhs35.2 billion in 2025.

During the first eight months of 2025, the country’s airports handled approximately 102.9 million passengers, marking a 5.3 percent increase compared to the same period in 2024.

International visitor spending totalled Dhs217.3 billion in 2024, up 5.8 per cent from 2023 and 30.4 per cent compared to 2019, while domestic tourism spending reached Dhs57.6 billion, an increase of 2.4 per cent year-on-year and 41 per cent compared to 2019.

In recognition of its performance, the country ranked first regionally and 18th globally in the World Economic Forum’s 2024 Travel & Tourism Development Index (TTDI). The UAE leads the world in travel and tourism data provision and air transport infrastructure, ranks second globally in infrastructure and services, and is third in data comprehensiveness, efficiency of air transport services, and travel and tourism policy and infrastructure.

WAM