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Jordan Hopes Millennium, Peace Invigorate Tourism
Hotels / April 2000

By Larry Luxner

AMMAN -- Open the Bible to just about any page, and chances are you'll find a geographical reference to Jordan. Well aware of that fact, Jordanian tourism officials -- mindful of the Biblical significance the year 2000 has for Christian pilgrims -- are rushing to spruce up holy places and archaeological sites from the Greco-Roman ruins of Jerash in the north to the ancient Nabatean city of Petra in the south.

The millennium, combined with Jordan's 1994 peace treaty with Israel, has also sparked a hotel explosion throughout the country, especially in Amman, Petra, Aqaba and the Dead Sea area. With 500 rooms, the Inter-Continental is still Jordan's biggest hotel. But it will soon be rivaled by Sheraton, Four Seasons and Le Royale, which are all building properties of between 250 and 300 rooms each.

According to Marwan Khoury, managing director of the Jordan Tourism Board, over $600 million has been invested since 1995 in new hotel construction; in the past two years, some 6,000 rooms have come onto the market, for a total of 18,000 rooms.

That's made things difficult for existing hoteliers, says Lawrence Steeman, executive assistant manager of the Radisson SAS Hotel in Amman, who claims his 61% occupancy rate last year was the highest of any five-star hotel in Amman.

"There is too much supply, and not enough demand," Steeman complains. Jordan as a whole registered an occupancy rate of just 45% in 1998, the latest year for which statistics are available. The numbers have since improved, though tourist arrivals still have plenty of room for improvement.

Yet in the long run, predicts Khoury, the Palestinian issue will be solved and the Arab-Israeli conflict will be put to rest -- sparking tourism, new business opportunities and the demand for new hotel rooms.

"To me, what's important is that all international chains are now in Jordan. We are now in the process of promoting Amman as a MICE (meetings, incentives, conferences and events) destination," he says. "We have good facilities, a diversified tourist product, safety and hospitality. When you have a Mövenpick, an Inter-Continental and a Marriott, it's easy to sell your destination." He adds that "he people who invest here see things locals don't see -- that a comprehensive peace will open up the area. The money being invested here is private-sector money. I assume these investors know what they're doing."

One of the biggest investors is Zara Investment (Holding) Co. Ltd., which recently poured $40 million into the Mövenpick Resort & Spa along Jordan's Dead Sea coast. In addition to 233 guest rooms in two-story village buildings of traditional stone and plaster construction, the complex also includes the Sanctuary Zara Spa -- billed as the largest luxury spa in the Middle East.

"The spas on the Israeli side are very sophisticated for medical treatment, but from the luxury point of view, we're the only Dead Sea spa on either side of the border," says Diana Kassih, public relations manager at the Mövenpick. "Being at the lowest point on Earth, you get very relaxed here. The bromide in the atmosphere acts like a valium. Also, the Jordanian side is not very developed. It's still clean. This is one thing I hear from guests who have been on both sides."

Right now, the largest groups of tourists coming to the Mövenpick are Swiss, Germans and Italians -- though increasing numbers of Israelis are also hopping over the border, attracted by the relative peace and quiet, and by the fact that even at $500 for a week of treatments, not including the hotel room itself, the Mövenpick is still cheaper than Israel's own Dead Sea resorts.

Zara, which owns not only the Mövenpick but also the Hyatt, the Inter-Continental and other resorts, isn't the only investor who views the Dead Sea as anything but dead. A 220-room Marriott is also rising nearby, while the French group Accor plans a $25 million thermal resort. Eventually, the Jordanian side of the Dead Sea will have five or six resorts.

"People want to make up for lost time," says Abdullah Shahin, a financial analyst at the Atlas Investment Group in Amman. "In 1995, the government approved an investment promotion law that grants lucrative tax breaks for hotels. That, plus the Year 2000 pilgrimmage, the Pope's visit in March and the peace treaty with Israel have all coincided, and all of a sudden, all these new hotels are popping up. The big question is, will those people flock to Jordan?"

Last year, 1.35 million tourists came to Jordan, a number expected to reach 1.5 million this year. The largest contingent comes from Saudi Arabia and other Gulf states, followed by Israel, which sent 125,000 tourists in 1999. Interestingly, about 75% of those were Israeli Arabs or Palestinians on family visits, though Khoury says he wants to target Israeli Jewish tourists, who generally have more money to spend and are more likely to stay in hotels.

"The Israelis only know Petra. They don't know about anything else we have to offer," he said. "We need to do promotional work in their own language, Hebrew. We have an embassy in Israel, but we cannot rely on embassies. We're therefore considering appointing a public-relations rep in Tel Aviv, though that probably won't happen this year."

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