With the pound at new lows against the euro and the dollar at the end of last year, Britain looked good value to Mario and Josanne Cassar, a couple from Malta. They bought two suitcases to get all their purchases home.
"It's almost ridiculous, the prices we are paying," Mr Cassar said as he and his wife visited St Paul's Cathedral in London.
They are not the only tourists drawn to Britain by more than the sights of Big Ben, Stonehenge or Shakespeare's birthplace. On top of the weak pound, steep discounts offered by cash-strapped retailers are bringing people to shop.
"Accommodation is cheap, food is cheap and we have bought lots of clothes," Mr Cassar, 50, said.
With Britain's economy in reverse and interest rates at their lowest in history, last year was the weakest year for the pound since 1971. Sterling fell 27 per cent against the dollar and the euro gained 30 per cent against it to bring the two within striking distance of parity for the first time.
Britain's currency last Tuesday also hit a near 14-year low against the yen.
In the past month, the Eurostar cross-channel rail service has recorded a 15 per cent rise in passengers from Brussels and Paris.
But if Britain is becoming a magnet for bargain hunters, Britons abroad face dwindling spending power and some are contemplating cheaper domestic holiday destinations. The tourist industry wants to tap this trend to promote Britain as the "best-value country in the western world".
It has already launched a campaign to entice Britons to stay at home, and in April a £6.5 million (Dh35.1m) promotion, backed by the government and the industry, will kick off in an attempt to lure visitors, mainly from euro-zone countries and North America.
"I can truly say there has never been a better time to visit Britain," said Christopher Rodrigues, the chairman of the national tourism agency VisitBritain.
"We must take advantage of the unprecedented position of the pound. This is a great opportunity to merchandise Britain."
Mr Rodrigues cited the country's arts, culture, sport, heritage and countryside: much is at stake.
Tourism generates £85 billion a year directly for the British economy, 6.4 per cent of GDP, or £114bn when indirect business is included, making it the country's fifth-largest industry. The bulk of the revenue - £66bn - comes from domestic spending, so the industry needs holidaymakers to stay home.
Cash-conscious Britons are exploring cheaper holidays such as camping: the Camping and Caravanning Club said it has seen a 23 per cent increase in bookings for this year since November, compared with the same period last year.
"We expect to see a lot of growth," said its spokesman Matthew Eastlake.
But even before the credit crunch, tourism in the country was in the doldrums, underperforming global average growth, the trade body Tourism Alliance said.
It said Britain's share of global tourism receipts had fallen by almost 20 per cent over the past 10 years, and domestic tourism revenue was down by more than 25 per cent.
The decline was triggered by an outbreak of foot-and-mouth disease on British farms in 2001, which shut off much of the countryside to visitors, and bomb attacks on London's transport network in July 2005, while a lack of investment and the availability of cheap foreign holidays added to the problem.
In addition, poor weather and a lingering impression of grubby hotels, poor value and surly service have not helped, Mr Rodrigues said.
He acknowledged that visitors have had to put up with a failure to provide basics such as clean towels and service with a smile, and warned that tens of thousands of jobs were at risk during the recession unless standards were raised.
"We're now in an environment where you have to do quality," he said.
Mr Rodrigues also pointed to improvements. Depressed urban areas, such as Liverpool, have seen regeneration.
The northern city, known around the world as home to the Beatles and the football club Liverpool, was rebranded last year as European Capital of Culture.
Gordon Brown, the prime minister, last summer did his bit to promote British tourism, holidaying in Suffolk, on the east coast, in contrast to his predecessor Tony Blair's fondness for Italy.
Britons' interest in booking flights abroad fell 42 per cent in the first week of this month from the same period last year, according to web activity monitor Hitwise.
But it does not mean they will stay home.
"It looks like the weak pound is putting people off flying to the euro zone and the US, and they are looking at destinations with more favourable exchange rates, instead," said Robin Goad, its director of research.
The Association of British Travel Agents (ABTA), which represents travel agents and tour operators, said Britain would still face stiff competition from cheaper resorts such as Turkey, Egypt and Morocco, which are attractive to Britons in search of sun and good value.
"Although the pound is weak there are countries outside the euro zone where there is a good exchange rate," said Sean Tipton, an ABTA spokesman.
But Dorleta Otaegui, 30, and her partner Inaki Olavarrieta, 30, from San Sebastian in northern Spain - a country already officially in recession and with the highest unemployment in the EU - came to London specifically for the bargains.
"We are happy... we have more money," said Ms Otaegui. "Things here are very, very cheap."
* Reuters
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
Need to know
When: October 17 until November 10
Cost: Entry is free but some events require prior registration
Where: Various locations including National Theatre (Abu Dhabi), Abu Dhabi Cultural Center, Zayed University Promenade, Beach Rotana (Abu Dhabi), Vox Cinemas at Yas Mall, Sharjah Youth Center
What: The Korea Festival will feature art exhibitions, a B-boy dance show, a mini K-pop concert, traditional dance and music performances, food tastings, a beauty seminar, and more.
For more information: www.koreafestivaluae.com
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Ms Yang's top tips for parents new to the UAE
- Join parent networks
- Look beyond school fees
- Keep an open mind
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
Napoleon
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MOST%20POLLUTED%20COUNTRIES%20IN%20THE%20WORLD
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Indika
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The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
The Brutalist
Director: Brady Corbet
Stars: Adrien Brody, Felicity Jones, Guy Pearce, Joe Alwyn
Rating: 3.5/5
Venom
Director: Ruben Fleischer
Cast: Tom Hardy, Michelle Williams, Riz Ahmed
Rating: 1.5/5
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Europe’s rearming plan
- Suspend strict budget rules to allow member countries to step up defence spending
- Create new "instrument" providing €150 billion of loans to member countries for defence investment
- Use the existing EU budget to direct more funds towards defence-related investment
- Engage the bloc's European Investment Bank to drop limits on lending to defence firms
- Create a savings and investments union to help companies access capital
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
The biog
Name: Abeer Al Shahi
Emirate: Sharjah – Khor Fakkan
Education: Master’s degree in special education, preparing for a PhD in philosophy.
Favourite activities: Bungee jumping
Favourite quote: “My people and I will not settle for anything less than first place” – Sheikh Mohammed bin Rashid.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
UAE currency: the story behind the money in your pockets
