Dubai tourism plunges up to 80% amid regional conflict

Dubai’s tourism industry is facing a severe downturn as the US–Israel war with Iran has slashed visitor numbers by up to 80%, forcing businesses across the emirate into survival mode.

The city welcomed 19.59 million international visitors last year, making it one of the world’s most visited destinations. However, the conflict, which began on 28 February, has sharply disrupted that momentum, reports BBC.

Natasha Sideris, owner of the Tashas hospitality group, which operates 14 outlets and employs more than 1,000 people, said restaurants reliant on tourists have seen revenues fall by 70–80%. Even venues catering to residents reported declines of around 50%. The crisis has forced her to implement a 30% salary cut across all staff, including herself.

“The current situation is brutal,” Sideris said. “I had a choice: either lay off 30% of my staff or cut salaries to save jobs. For now, I have chosen the latter.”

A senior executive at another restaurant chain, speaking anonymously, confirmed that footfall had dropped to just 15–20% of normal levels. The company has placed more than half its workforce on unpaid leave and temporarily closed several outlets.

The wider UAE has endured repeated attacks, with Dubai among the key targets of Iran’s military response following US and Israeli strikes. Authorities said more than 2,400 missiles and drones had been launched towards the UAE, targeting airports, ports, hotels and residential buildings, with over 90% intercepted.

Debris has fallen across Dubai, including in major residential areas, hotels and near the airport. Images of fragments striking the Fairmont hotel on the upscale Palm Island circulated widely online. So far, 11 people have been killed and more than 185 injured across the UAE, according to officials.

The conflict has also disrupted regional air travel. Tens of thousands of visitors were stranded in the early weeks before being evacuated on special flights. Thousands of scheduled flights have been cancelled since the conflict began, at times bringing one of the region’s busiest travel hubs to a standstill.

Dubai International Airport, the world’s busiest for international passengers, handled 95.2 million travellers last year. Flag carrier Emirates is now operating a reduced flight schedule while working to restore full network operations.

Hotel occupancy across Dubai dropped to between 15% and 20% of usual levels for this time of year in the weeks following the outbreak of war, according to Mamoun Hmiden, chief business officer at travel booking firm Wego. Hotels have responded with deep discounts, particularly during the Eid period, with some luxury properties on Palm Jumeirah cutting prices by as much as half.

Hospitality chains have temporarily shut properties or closed sections, citing scheduled renovations typically undertaken during quieter summer months. A senior executive at an international hospitality group said occupancy at some properties had fallen to single digits. “It made sense to cut operational costs by shutting down for a few weeks and reviewing the situation later,” he said.

Business hotels are also under pressure, as Dubai — a major hub for conferences and events — has seen organisers cancel or postpone large gatherings. Majestic Hotels, which operates around 450 rooms across three properties, reported occupancy had dropped to record lows. “We are seeing cancellations beyond April,” said Varun Raj, cluster director of sales and marketing. “Many events have been cancelled, making it difficult for travellers to plan ahead.”

Data firm AirDNA reported that more than 226,500 short-term bookings were cancelled across the UAE between 28 February and 29 March, the first month of the conflict.

The downturn has severely affected the migrant workforce that forms the backbone of Dubai’s hospitality sector. Many workers have seen their hours reduced or have been placed on unpaid leave. “It feels like we are back in the Covid-19 period,” said a South Asian waiter at a high-end restaurant. “There are fears we could lose our jobs again and be forced to return home.”

Some hotels, including five-star properties, have begun laying off staff. Rights groups note that many migrant workers in the UAE remain financially vulnerable, with some still carrying debts linked to recruitment fees.

Research by Tourism Economics suggests that between 23 million and 38 million fewer people could travel to the Middle East this year, depending on how long the conflict lasts. Visitor spending losses could range between $34 billion and $56 billion.

Dubai has announced a support package worth $272.26 billion for businesses, including the tourism sector, over the next three to six months. Hotels will be allowed to defer sales-related fees and the tourism dirham levied on guests.

Authorities are also preparing recovery plans, including new campaigns and promotional offers once the conflict subsides. “The war is beyond our control,” said one official. “But we are preparing for when it ends.”

Sideris said she hopes landlords will offer rent relief through deferred or reduced payments. She added that recovery could begin as early as October if the war ends soon. “We have enough cash to see us through a month or two — three at most. Beyond that, we will have to make tougher decisions. Hopefully it won’t come to that, and this situation ends soon,” she said.