Boom time for Kuwait's hotels
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The Economist, 27 March 2004 Hotels in Kuwait have long ranked among the most expensive in the world,
thanks to the government's rigid price fixing. But the also used to be among the emptiest, rarely more than half full. In 2002 Kuwait City came 127th na list of hotel occupancy issued by Deloitte, a professional services firm. Last year, however, it shot up to number one with 85% of its hotel beds being slept in on average a night.
Thank events in Iraq. Big companies like Halilburton, the oil-services firm, take over entire hotel wings. But an array of small town travelling salesmen, touting anything from components to coconuts, use Kuwait as their launch-pad too. It is now the second-most lucrative place in the world to run a hotel, says Deloitte, with an average room costing $172. Only Venice apparently makes more of a profit out of its standard visitor.
So international chains are keen to join the party. Marriott has recently arrived, taking over Kuwait City's Meridien property; it has also done a deal to run the city's grand Arraya Convention Hall when it opens next month.
The boom may not last. Big companies will decamp to Baghdad and Basrah when Iraq gets safer. But optimistic foreign hotiliers think Kuwait will take off anyway. "We're very, very confident Kuwait will develop into a structured, cosmopolitan, gateway city - and a thriving capital", says Jeff Strachan, Marriott's sales and marketing manager in Kuwait. Domestic investment is booming, Kuwaiti businessmen are no longer loth to invest in their own backyard, lest Saddam Hussein sends his army in again. Kuwait is slowly liberalising is commercial laws to lure foreign direct investment. Earlier this year, parliament approved plans to let foreign banks open branches. Similar legislation is expected for oil. And Kuwait's glittering shoppping malls are luring ever greater numbers of Saudi weekend tourists.
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