Gulf states Archives

CruiseXplore builds Mideast business with mini-holidays to Gulf, Red Sea resorts

While cruise ships teem with Middle East travelers heading to the Greek Islands, Hong Kong and the Caribbean, Lakshmi Durai is trying to introduce more people to shorter luxury trips sailing between the Gulf states and along the Red Sea.

As founder and CEO of CruiseXplore, an internet booking platform that fills cabins for some two dozen cruise lines, including Carnival, Norwegian and Disney, Durai has lately teamed up on the mini-holidays with Aroya Cruises, which is backed by Saudi Arabia’s Public Investment Fund.

“This is a very high-potential market,” Durai, a 30-year veteran of the industry, told The Circuit during this month’s annual Arabian Travel Market exhibition in Dubai. “It’s an easy way for people to experience cruising for the first time.”

Jeddah-based Aroya opened for business just two years ago and runs a variety of cruises to nearby ports of call including Egypt’s Sharm el-Sheikh, the Jordanian resort city of Aqaba and Jabal Al Sabaya Island in the Red Sea. Its sole 18-deck ship has more than 1,600 cabins, along with swimming pools, spas, restaurants and a no-alcohol policy.

Cruise revenue in the Middle East and Africa is projected to grow some 60% over the next five years to $230 million, according to Horizon Grand View Research. That’s a minuscule 1.6% of the global market, which an optimistic Durai sees as providing even more room to grow.

The interview has been edited for length and clarity.

What sets CruiseXplore apart from other international players?
We are a cruise consolidator working with over 30 cruise brands. Each brand might have 10 to 20 ships, sailing from more than 300 destinations worldwide. Our team includes experienced cruise professionals, so we really know the market.

Cruising isn’t one-size-fits-all. There are family cruises, couples cruises, destination-focused cruises, and luxury cruises – each with unique features. Our job is to match the right cruise to the right guest, based on their style of vacationing. We don’t just sell cruises; we sell the experience.

How do you decide which cruise lines to partner with?

Every cruise line is beautiful in its own way. We don’t categorize any cruise line as better or worse. It’s about understanding the product – what it offers, who it targets, and what kind of people it attracts. If a cruise line operates professionally, we are open to working with it. We’re here to sell anything that sails on water!

What cruise destinations are most popular with your customers?

Globally, cruises operate in the Mediterranean, Northern Europe, the Caribbean, Alaska, Australia and even unique places like the Arctic, Antarctica, and the Amazon. But for this region, European cruises are very popular due to proximity and ease of travel.

First-timers often choose Mediterranean routes – Spain, Rome, France, Greek Islands, and Turkey – because of the history and scenic coastlines. Others who prefer cooler climates opt for Northern Europe, especially Norway and its fjords. Those cruises are getting very popular.

What about Saudi Arabia? Is the Red Sea becoming a cruise destination?

Saudi Arabia launched its own cruise line, Aroya Cruises, last year. It’s a beautiful ship that operates in the Red Sea. Aroya is the only GCC-based cruise brand, but we work with over 30 international cruise lines. MSC, Costa, and others also operate in the region, sailing into GCC ports.

What are the industry trends that look promising for the Gulf region?

Local cruising is becoming quite popular – it’s an easy way for people to experience cruising for the first time. Still, a large portion of the Middle Eastern population hasn’t been on a cruise, so this is a very high-potential market.

Having local cruises means people can try it without flying abroad. It helps raise awareness and builds confidence for them to book international cruises later. And for visitors, cruising makes it easy to visit multiple countries – Oman, Bahrain, Qatar – without needing to arrange separate flights or accommodations.

What investments does the Middle East cruise industry need?

More ports and attractive destinations. The GCC countries have already made great improvements in infrastructure, but the more ports of call we have, the more appealing the region becomes for cruise tourism.

Can you tell me how the industry has changed since you started in the 1990s?

I actually started in 1994, so it’s been 30 years. I was very young then! I came to Dubai that year and joined the cruise industry right away. I gradually moved up the ranks and started managing cruise brand representations as a director. After 20 years, I decided it was time to do something on my own, and that’s when we launched CruiseXplore in 2014. We just completed 10 years.

Back then, cruising was a very new concept in the region. We had to explain to people what a cruise was, and there were a lot of misconceptions. There weren’t even ships docking in the Middle East. That changed around 2008-2009 when major cruise lines like Royal Caribbean and Costa started operating here. People began to see ships in local waters, and awareness increased. Today, thanks to the internet, cruising is becoming very popular.

Gulf mining firms see promising opportunities in metal markets

As Gulf states seek to reduce their dependence on oil sales, they’re finding new markets for copper, lithium and other metals needed for the energy transition.

Mining companies in Oman, the UAE and Saudi Arabia are planning to launch metal trading firms to tap the growing demand, the Financial Times reports.

Abu Dhabi-based International Resources Holding, a mining company that is part of a conglomerate chaired by Sheikh Tahnoon bin Zayed, has hired a 60-person trading unit to handle energy and metals.

Minerals Development Oman, the state-owned mining company, is also in the process of hiring a top executive to lead a 25-person trading team, the FT says.

Gulf-Israel train project chugs into political, financial obstacles

AMMAN, Jordan – Knitting together the Middle East with a network of train tracks has been a dream of transportation planners for over a century. The vision persists today as part of ongoing efforts to link the six Gulf states through an east-west rail network that would span Saudi Arabia and connect with the Red Sea.

However, tying the project to a northern route that leads through Jordan to Israel’s Mediterranean port of Haifa – a notion floated amid the exuberance of the Abraham Accords – is still a long way off. Just as the megaproject was suspended more than 100 years ago, the politics and multibillion-dollar cost involved mean it will probably remain on the shelf for years to come.

“The success of a railway link would be dependent on the willingness of Saudi Arabia to support such a project,” RAND Corp. researcher Daniel Egel told The Circuit. “I think that they would have to be incentivized to include Haifa as a primary terminus for the railway” – given the current absence of diplomatic relations with Israel.

The history of the never-completed Hejaz railroad, which was built by the Ottomans in 1908 so that Muslims from parts of Asia and Europe could make the hajj pilgrimage to the holy city of Mecca, is a saga that illustrates the idea’s appeal and serial failures.

Designed at the beginning of the 20th century by German engineers, the railway ran some 820 miles (1,320 kilometers) of rocky desert trail from Damascus to Medina, Islam’s second holiest city, stopping 220 miles short of Mecca. It wasn’t until four years ago that Saudi Arabia built the high-speed Haramain rail line connecting the two sacred sites at a cost of about $16 billion. By then, the Hejaz was a tin-can artifact with no connection across the Saudi border.

Besides its original north-south route, the Hejaz – named for the ancient western kingdom in Saudi Arabia – included a branch line running west through Palestine to connect with Haifa. The project was built solely through Islamic financing and donations from wealthy Muslims, under the principle that Western money was inappropriate for its religious nature.

Instead of the arduous 40-day journey by camel or horse, the Hejaz’s steam engines enabled pilgrims to complete the trip in three days. By 1912, train travel between Damascus and Medina carried an annual 300,000 passengers.

The railway’s builders had to overcome rocky terrain and other obstacles in southern Jordan and Saudi Arabia, where flooding in desert ravines required construction of bridges and viaducts. Bedouin tribes, which for many centuries lived off servicing pilgrims on the long overland routes to Mecca, lost business because of the Hejaz, leading them to attack the trains and sabotage the tracks.

“The railway reignited long-standing conflict between the Bedouin tribes and the Ottoman rulers of the Hejaz and Greater Syria,” Oxford archeologist John Winterburn told The Circuit.

The Hejaz line also connected the Ottoman Empire’s main urban centers with distant provinces in the south, facilitating movement of its military troops. The railway later became a security headache for the British Mandate forces, who saw it as a potential means for Germany to invade Egypt.

The Arab Revolt of 1916 against the Ottoman Empire interrupted use of the Hejaz railway, and it fell into disrepair as its tracks started to rot.

“After the First World War, the railway was split into three separate sections – the Syrian sector, run by the French; the Transjordanian section, run by the British; and the southern section, which became part of the Kingdom of the Hejaz,” said James Nicholson, author of The Hejaz Railway. “In the north, the railway was repaired and by 1921, regular services were running between Damascus and [Jordan’s southern city of] Ma’an,” Nicholson told The Circuit. “The southern line was also patched up and occasional trains ran through to Medina.”

Until the Syrian civil war over the past decade made travel too dangerous, the Hejaz ran passenger service between Amman and Damascus, while the line south of Amman was utilized to carry phosphate from mines near Ma’an to Aqaba. But instead of stimulating regional trade, urban development and agriculture, the railway stagnated and became a neglected relic of the past.

Because of the war, the Syrian portion hasn’t been included in current plans for the railway’s restoration. Still, Nicholson said, “there has been some talk about the possibility of restoring the main line back to use.” The central argument against the revival of the railway is the availability of other forms of transport,” such as air and road travel, he added.

A renewed Hejaz would require that the decrepit railbed be completely replaced with modern infrastructure and has been under Jordanian government review for 11 years. Prime Minister Bisher Khasawneh said last year that the government is looking for private investors as partners because it doesn’t have the money to fund the whole project, which would include a link between Amman and the Red Sea port of Aqaba.

Across the border from Jordan, Israel started pitching its “Tracks for Regional Peace” initiative in 2018 to connect Israel with its Arab neighbors. It sought to promote the plan two years later when the United Arab Emirates and Bahrain agreed to normalize relations through the U.S.-brokered Abraham Accords.

The idea was to use the new railway Israel built between Haifa and its eastern town of Beit She’an, extend it to the Jordanian border and connect to an overhauled Hejaz. From there it would cross into Saudi Arabia and end up in Dubai connecting the Mediterranean with the Persian Gulf. The regional railway network would transport cargo and tourists, providing a regional network that would include Jordan, the Palestinian Authority, Saudi Arabia, the UAE and the other member states of the Gulf Cooperation Council. Annual trade flow through the land bridge, it was estimated, could reach $250 billion by 2030.

If relations between Israel and Saudi Arabia change and rail links became acceptable, the project would still face significant challenges, said RAND’s Egel.

“First, I am not convinced that it is economically viable, given the availability of cheap transport options by water,” Egel told The Circuit. “It would expand options for the eastern GCC [Gulf Cooperation Council] nations to export to Saudi Arabia and Israel, and it would create a second option for transport if the security situation degrades in the Gulf of Aden” – the sea passage between Yemen and Somalia.

Egel said he would be surprised if such a railway became a key component in regional transport of goods given the alternatives. “It would undoubtedly provide a security hedge, but an expensive one,” he said.

“Building a railway link will lower the transport costs associated with trade, but it will not impact the restrictions on trade and movement of people that Jordan and the Palestinians face,” Egel said. “The primary impediment is political. If the railway link was augmented with bilateral free trade agreements or a multilateral [free trade agreement] with Jordan, the benefits to Jordan could be large. Benefits to the Palestinians would be much harder to obtain, as their external trade is controlled by Israel,” Egel said.

Steve Monroe, a political scientist at Yale-NUS College in Singapore, said the free trade agreement signed by the UAE and Israel in May could spur ambitious projects like the railroad.

“The UAE is one of the few places today with capital to invest in Israeli firms and Bahrain will also benefit from greater trade with Israel,” Monroe told The Circuit.

Meanwhile, the idea of a rail network connecting Israel and the Gulf states through Jordan remains on the drawing board. Building the transnational route would require a thorough regional political realignment at a cost of tens of billions of dollars. The saga of the last century indicates that won’t happen soon.

“It comes up from time to time,” said Ben Moore, an Israeli Foreign Ministry spokesman. “If we sign for peace, it could be considered.”