UAE nationals and expats heading to the UK this summer are expected to splash out on fancy hotels, upgrades, dining and entertainment as a result of the pound’s value slumping post-Brexit.
Sterling dropped to below AED5 ($1.36) in the aftermath of the UK’s decision to leave the EU, which has also fueled a surge in GCC investors seeking to buy London assets given the strength of the dirham.
One Dubai-based travel agent told Arabian Business that UAE residents who had already booked trips to the UK would splash out on extras as a result of the favourable exchange rate.
“We are definitely seeing an increase in interest to the UK,” said Michelle Smith of travel website Flight Centre UAE.
“In terms of travellers cashing in on the low exchange rate, this is most immediately being seen on the amount spent on experiences while in destination.
“The short-term effect is happening for travellers who have already booked their travel prior to the Brexit vote and are now cashing in on the exchange rate. So the intention to travel to London and the UK already existed. The Brexit [vote] hasn’t triggered any immediate travel plans.
“We are seeing some customers opt for a four or five-star hotel option, when they would [usually] have opted for a three-star or less expensive option due to the exchange rate – effectively they are taking advantage of the opportunity to heighten their experience. However, the actual trigger to travel to London already existed.
“I think a lot of customers are reflecting this way of thinking and heightening their experiences in destination — this is great news for the UK economy and tourism industry.”
Air fare prices to the UK have remained unchanged following the EU referendum due to the continued popularity of London and other cities across England and Scotland amongst UAE travellers.
But lower prices in the UK and a stronger dirham could lead to more UAE residents booking British trips, Smith told Arabian Business.
“London is consistently the most popular destination for both of our businesses (Flight Centre and FCM),” she said. “With 19 direct daily flights from the UAE to London alone, not to mention the flights via Doha and also to other UK cities, demand is already huge and we are definitely seeing this continue.
“In terms of booking flights, the cost of air fares to London has stayed steady so this has not affected demand.
“In the longer term, if the exchange rate does maintain at this level, it will position London and the UK as a more affordable city to visit. London in particular is notoriously expensive and many of our customers view it as an aspirational destination. With the lower exchange rate, travellers on the ground [are expected spend more on] expenses such as accommodation.”
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