Climate of discord shakes confidence

on 03 December, 2015

Last month duty-free executives headed to the stunning Red Sea-based King Hussein Bin Talal Convention Centre for the annual Middle East & Africa Duty Free Association (MEADFA) Conference. Despite the spectacular setting, the mood there was likely to have been sombre.

The Russian jet crash in Egypt, the worsening ISIS-linked conflicts in Syria and Iraq and the appalling terrorist attacks in Beirut and Paris are going to have serious ramifications for anybody working in or dependent on tourism and the travel industry.  

The era of borderless travel in the Schengen area of the European Union, for so long one of the cornerstones of the EU project, is now no longer looking tenable in the light of what has happened. And given what fate befell Metrojet Flight 926, the airport security procedures are going to have to be tightened once again. Longer security queues for passengers, shorter dwell times and better vetting of anybody working airside are the likely consequences of recent events.

Egypt’s already fragile tourism business has been devastated. In Cannes at the TFWA World Exhibition I sat with the general manager of one of Cairo airport’s main duty-free operators. He was generally upbeat about the stabilising political situation in the country after the recent elections and the renovations at the airport, but of course, this latest tragic event puts that recovery process on hold.

However, in the Gulf the duty-free business continues to thrive on the back of strong passenger growth and continued airport expansion. Dubai airport is about to open Concourse D in the next few weeks. It will add another 7,000 square metres of retail space and take the airport’s total annual passenger capacity to 100m. And Dubai Duty Free (DDF) is still on course to achieve a turnover of $2bn in 2015, up over 5% on the previous year.

Big-ticket liquor sales are still occurring at the airport too. In November Dubai airport’s fine wine and spirits retailer Le Clos reported that an international wine collector had splashed out $17,000 (£11,181) on a rare bottle of Château Lafite 1895, a wine produced only 40 years after the Bordeaux Wine Official Classification of 1855 awarded Château Lafite its First Growth status.

According to Le Clos general manager Ben Odgers, “the collectors’ market in Dubai is still buoyant”, the retailer having recently sold other rarities such as a bottle of Château Lafite 1961, a magnum of Cheval Blanc 1961 and The Macallan Fine & Rare 1946.

Walking around the Palais des Festival during October’s TFWA World Exhibition I was puzzled by quite how many ultra-premium releases were on show. At a time when Russian travellers are supposedly tightening their belts and the bottom has fallen out of the Chinese gifting market it was amazing to see how many hand-blown, individually numbered crystal decanters there were on the stands.

Among the new releases that caught my eye at the show were Patrón en Lalique: Serie 1, the oldest and most expensive tequila ever released by the company, priced at £4,950 and limited to just 500 pieces. The $40,000 (£26,309) Macallan Golden Age of Travel is the first in a series of five Lalique decanters inspired by travel, while the new £1,750 Glenfiddich Cask Collection Finest Solera comes in a Baccarat decanter with hand-engraved copper stopper and a luxury presentation box.

These amazing creations will certainly make the balance sheets of the French crystal decanter producers look healthy. Let’s just hope there are still some travellers out there with deep enough pockets to actually buy them.    


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