Dr Ghassan Aidi, president of the International Hotel and Restaurant Association (IH&RA), talks to Routes News about the latest trends in the global hospitality sector.
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How did the global hotel industry perform in 2012?
The hotel industry performed extremely well last year. The average room rate is high once again, increasing by 4% in the first half of the year, while the revenue per available room (revPAR) was also excellent at between 6%–7%. 2012 was also the first year in which one billion tourists travelled internationally.
We are one of the fastest-growing global industries and we are forecasting we will reach 1.6 billion tourists by the year 2020.
Which parts of the world are seeing the biggest growth in visitor numbers and the most new hotels being constructed?
The top performing markets are Asia, South America, USA and Europe in that order and the demand for new development is huge. In 2012, 458 new hotels with 82,476 rooms opened in the Asia-Pacific region and some 1,767 hotels totalling 385,113 rooms are in the pipeline.
Remember that each single day 10 new hotels are opening somewhere in the world.
What are your key objectives in 2013 for IH&RA?
A key objective for IH&RA is to continue to champion sustainability in the hospitality sector. Tourism is a fast-growing sector, and is a major contributor to local job creation and increasing the standard of living, but we also need to encourage environmental and social responsibility to reduce the impact of its growth.
This is why we have launched the Emeraude Hotelier certification, which is a set of hospitality management guidelines to help hotels of any size implement environmental programmes and reduce their emissions footprint.
Other key objectives are increasing our lobbying work with the UNTWO; we will continue to defend the interests of our members and the sector in general worldwide.
What are the big challenges facing the international hotel industry?
In order of importance: labour issues, sustainability, the need for a global standard of hotel classification, improving room rates, RevPAR, NOI and access to banks loans which can be invested in new hotels and modernising existing buildings.
How can the hospitality industry and the aviation industry work together to encourage greater visitor numbers?
Creating, together, packages for a given destination which will allow tourists to find out everything they need to know through a one-window shopping experience.
Are guests expectations of what a hotel should offer changing?
Yes, it is no longer enough just to offer good customer service and facilities; technology is a must. Guests are looking for the hotel that offers them both a free breakfast and free Wi-Fi broadband. Hotels must also embrace technology and the Internet if they are going to continue to attract international customers.
What would you like to see governments do to support the hotel sectors in their respective countries?
The first thing they need to do is to lower VAT; some countries look at the hospitality industry as a cash cow to generate the revenue they have been unable to make elsewhere. New York is an example, which charges enormous taxes equal to 15%. In Croatia, VAT is 23%.
We need to cut the red tape and make the facilitation process to obtain a licence to build and operate a hotel much smoother. In India, you need to obtain 100 permits in six years before you can open a hotel. Finally, governments need to leave the job of classifying their hotels to their local hotels association and it simply distorts the market.