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UAE duty free sales to be driven by India, China, UK over the next four years

The recovery in international travel post-pandemic has helped improve passenger spending

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India, China and the UK will be the top three source market for duty-free sales in the UAE over the next four years as travel spending will witness a substantial increase.

According to a new study released by Euromonitor International, recovery in air travel has pushed inbound duty free sales to way ahead of pre-pandemic levels in the UAE, surpassing $100 per arrival.

“The UAE has benefited from its relatively open approach to travel and tourism during the pandemic, plus its two main hubs of Emirates’ Dubai and Etihad’s Abu Dhabi, as well as the added uplift from the recent Football World Cup held in neighbouring Qatar. Dubai and Abu Dhabi are magnets for luxury brands and shopping,” it said in its latest report titled 'World Market for Duty-Free: Unlocking Value and New Opportunities'.

The recovery in international travel post-pandemic has helped improve passenger spending. Dubai Duty Free announced annual sales of Dh6.34 billion ($1.74 billion) in 2022, representing a 78 per cent increase over the previous year while Dubai International, the world’s largest airport in terms of international passengers, saw passenger traffic more than doubling to over 66 million in 2022.

“With several sporting events expected to be hosted in the country, Dubai Duty Free is set to benefit further from the associated influx of passengers,” it said.

The international duty-free market was dealt with a severe blow during the pandemic, with the loss of tourism demand as borders were shut and restrictions put in place. In particular, it felt the loss of high-spending Chinese visitors, a critical source of both tourism and duty-free sales.

Moreover, the three main source markets of India, China and the UK are also among the biggest source market in terms of tourist inflows into the UAE.

As per Euromonitor report, the UAE has also been ranked the sixth largest market in terms of average spending on duty free sales per outbound departure.

The study projected that outbound passenger spend will substantially increase over the next four years.

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