Money Talks: Potential Impact of Tourism on the Middle East
Jonathan Bilzin, Edward (Blair) Ford, Kevin Linker and Neal Jacobs
War & Peace: The Middle East in Transition


INTRODUCTION

The Middle East is one the most unique regions in the world, as three major religions of the world (comprising over one billion affiliations) were conceived in the area. Because of the tremendous amount of history throughout the region, the Middle East offers an unprecedented opportunity to attract tourists from all parts of the world. However, the region has been afflicted by constant strife and politicians appealing to religious prejudice cannot agree to coexist peacefully. It is our belief that the opportunity to attract people from all over the world is so large that resolving these disputes could stimulate a tremendous increase in tourism and help to support local economic growth in many countries. Religious leaders could take the opportunity to emphasize common origins of the three religions and teachings of tolerance by their founders. Development of sites visited by Moses, Abraham, Jesus and Mohammed, with the guidance of religious scholars, might promote tolerance rather than strife. Visits to site facilities operated by members of religious institutions would earn resources to support continuing religious studies on world issues.

 

By providing such an economic benefit for the peace process, motivation to proceed with the Oslo accords is supported. By linking restoration of historic religious sites to religious scholars, rather than politicians, longer term goals may also be accomplished.

 

In the following paper, we will begin by highlighting the important historical events of the Middle East and illustrate not only how and why the region spawned three major religions of the world, but we will also attempt to lay the foundations behind the history of strife in the region. Next, we will outline the major tourist attraction of the Middle East in order to demonstrate that the multitude of essential sites could conceivably help to spur a burgeoning tourist industry throughout the region. With that in mind. we will turn to an important element of a tourist-driven economy, infrastructure. Clearly, for the countries of the Middle East to prosper from the tourist industry, they will need to prioritize infrastructure development. This development creates an exciting opportunity for investors of any nationality to create tremendous value. Finally, we will conclude with a case study of an economy driven by the tourist industry, Orlando, Florida. Therefore, we believe that one possible solution for the strife in the Middle East is simply money; the all-powerful greenback could conceivably attract important foreign investment, attract important infrastructure projects, create a multi-billion dollar tourist industry and best of all, help make the religious differences and political disputes a thing of the past.

 

HISTORY OF THE REGION

Although three major religions of the world, Judaism, Christianity and Islam, all share similar roots, the history of their peoples is filled with hatred, war and strife. In order to understand how and why the Middle Eastern region has become the strife-filled region of today, a brief look at the evolution of these major religions is important.

 

The history of any land and people is also influenced to a considerable degree by the surrounding geographical environment. This environment not only includes the natural features such as climate, soil, topography, etc., but more importantly, the geopolitical relationships with neighboring areas. Palestine, a small and relatively poor country, derives its historical importance from its unique centralized location at the crossroads of nations and continents.

 

Part of the reason that Palestine has become such a controversial property is because its history has been largely determined by its' place in the geopolitical and political framework of the ancient Near East. As a geographical unit, about 350 miles in length, Palestine extends from Sinai in the south to the Amanus and Taurus mountains in the north, while its width from the Mediterranean shore to the fringes of the inland desert averages only 60 miles. This long, narrow strip beside the Mediterranean Sea has the most exceptional climate and topographical structure in the entire region. In contrast to the barren desert that borders it on the east, the Levant comprises an important segment of that inhabitable region happily defined as the "Fertile Crescent. Palestine comprises the southwestern arm of the Fertile Crescent and is the poorest and smallest of all its countries. Its main geopolitical importance lies in its role as a passageway to the second great center of ancient civilization, Egypt, the land of the Nile. It constitutes the only land bridge between the two continents of Asia and Africa.

 

Towards the end of the fourth and the beginning of the third millennia BCE (Before the Common Era), the foundations of human civilization were laid in the two lands surrounding the Tigres and Euphretes Rivers, Mesopotamia and Egypt. These two regions saw the rise of the first mighty kingdoms that succeeded in imposing an organized and unified government over their respective populations, and in various periods even spread their authority to regions beyond their natural borders. The birth of these two civilizations was aided by similar economic and geographical factors in their respective regions. Each contained broad expanses, the fruitfulness of which depended upon the great rivers passing through them. The river is the main force for integration and unification in these lands; it is a convenient and inexpensive artery for transportation and irrigation, which stimulated the local populations to take advantage of these natural surroundings.

 

Features such as these do not exist in Palestine and Syria where the geographical features tend to separate the land into smaller districts and serve as serious tumbling blocks to unification. Not one but three rivers flow across it lengthwise. Of course these rivers are conducive to the development of urban settlements. The excavations in Jericho, in fact, demonstrated that one of the most ancient urban settlements in the Middle East was founded there, dating back to the Neolithic period (8th millennium BCE).

 

Thus Palestine and Syria became a middle ground between Mesopotamia and Egypt from both the economic and the political point of view. The mighty kingdoms on both sides of the Fertile Crescent considered this strip of land a thoroughfare; and both of them labored to impose their authority over it, mainly in an effort to control the trade routes passing through and to use it as a bridgehead during warfare. Therefore, many different rulers presided over the small territory over the years, with ownership changing hands not infrequently.

 

As a natural outflow from the region's geopolitical importance, Palestine also is full of religious significance. The events that occurred in Palestine in ancient times and the stories and legends that arose are firmly planted in the minds of over a billion people throughout the world, as the area contains sites of major historical significance for three major religions.

 

Although human history in Palestine extends over a half a million years, the following outlines the major periods of time in Palestine. Important historical events are highlighted in order to demonstrate the religious, cultural and political changes that occurred over time. (While history is truly a subjective account of the occurrences of the past, we have attempted to present an unbiased and commonly accepted version of the major events of the region):

 

1) 2000 332 BCE Biblical Period

Recorded Jewish history dates back to the time of Abraham, approximately 2000 BCE. Abraham led his people through the Palestine region, eventually settling in Egypt, where Jews remained until Moses led the Exodus to the land of Israel around 1250 BCE. As a result of pressure from the surrounding peoples, the Jews first formally organized themselves under the tutelage of King Saul and King David (approximately 1000 BCE). The First Temple was built in 961 BCE, cementing Jerusalem as the political and religious center of the Jewish people. Jerusalem and the First Temple fell in 586 BCE to the Babylonian empire and the Jews were expelled from the land. The Jews were subsequently allowed back by King Cyrus in 538 BCE, but at that point, Palestine was simply one of the many territories in the vast Persian empire. However, the Jews were able to build the Second Temple during Persian rule.

2) 332-63BCE Hellenistic Period (Greeks)

Alexander the Great ended Persian dominance, but his empire was divided between Ptolemy (Palestine and Egypt) and Seleucus (Syria and Babylon) upon his death. As a result of its geographical location, Palestine became the battleground between the two empires. This period in Palestine was marked by material wealth among many of the inhabitants. In fact, there are many Hellenistic archeological sites in Israel today where the wealth of the rich Hellenists at the time is still imminent. Later in this time period, the Maccabean revolt evolved into the Hasmonian dynasty, reasserting Jewish dominance in the region.

3) 63 BCE 324 CE Roman Period

Palestine served as a Roman state under Jewish authority until Rome decided to take control in 63 BCE. The ministry of Jesus of Nazareth (28-30 CE), destined to bring about tremendous change in world religion, was at the time simply one of many factions in the religious and political battlefield that existed in Palestine. Mismanagement of this battlefield on the part of the Romans led to the revolt in 66 CE and the subsequent reprisal by the Romans, including the destruction of the Second Temple.

4) 324-634 CE Byzantine Period

Emperor Constantine legalized Christianity in 313 CE, leading to its adoption by many Romans. His consecration of the sites associated with Christ's birth, death-resurrection, and ascension, by the erection of the great churches awakened and deepened interest in the Holy Places. Pilgrims flocked to the Holy Land, stimulating development in all spheres; churches sprang up everywhere and monasteries made the desert into a city. Jerusalem prospered once again.

5) 634 - 1099 CE Moslem Period

The Prophet Mohammed created a religion- Islam; a unique book, the Quran; and a state with a powerful army. In 622 CE (often the date recognized as the start of the Muslim religion), Mohammad and his followers left their native city of Mecca for the oasis of Medina, whose inhabitants had become receptive to monotheism by the presence in their midst of a several flourishing Jewish communities. Islam recognized Jerusalem as a Holy City as a result of its origins as an outgrowth of Judaism and Christianity. Therefore, Jerusalem became center of Muslim pilgrimage.

6) 1099 - 1187 CE Crusader Period

After securing Jerusalem and slaughtering Jews and Muslims alike, the Crusaders eventually overtook all of Palestine.

7) 1187 - 1517 CE Mameluke Period

The struggle for power during this period did not revolve around Palestine, although the area continued to attract scholars and pilgrims from all three religions.

8) 1517 - 1917 CE Ottoman Period

Ruled by the Ottomans without much concern save taxes, Palestine's Jewish community grew as Jews from Europe and Russia began seeking safe havens from the anti-semitic ways and the pogroms within their native lands.

9) 1917 - 1948 CE British Mandate

Britain received the mandate to govern Palestine as a consequence of WWI. This period is characterized by a three-way political battle between the British, Arab and Jewish factions of Palestine.

10) 1948 - present State of Israel

Following British withdrawal in 1948, war broke out between the Jews and Arabs, with the Jews successful in establishing the State of Israel. In 1967, Israel was victorious again in war and from this time forward, has controlled the entire city of Jerusalem and all of the territory between the Jordan River and the Mediterranean Sea.

 

As evidenced by the many occurrences briefly touched upon above, the three religions, Judaism, Christianity and Islam are forever deeply intertwined: religiously, politically and geographically. Christianity built upon many of the monotheistic tenets of Judaism and over time, evolved into the many different factions of Christianity that exist today. At the onset of Christianity, there were very few differences between the two religions. Christianity was viewed initially as another sect of the Jewish tradition, accepting most of the Biblical customs and laws, but differentiating themselves in their belief that Jesus Christ was a prophet or later, God's son. The major break between the two religions came during the reign of Hadrian (117-138 CE), as the Jewish nation within Palestine was crushed and Jerusalem was renamed Aelia Capitolina by the Romans. Jews were forbidden to enter the city for one hundred years. As these dramatic events unfolded, many of the Hebrew Christians fled to the mountains of Pella, located in present-day Jordan, in obedience to Christ's instruction found in Matthew 24:16. This left only Gentile believers in control of the Church for the first time, and they quickly appointed Mark as Jerusalem's first non-Jewish pastor. Over time, Christianity distanced itself further and further from its Jewish heritage, often labeling the Jews as evil and the cause for Christ's insurrection.

 

Similarly, Islam absorbed elements of the Jewish and Christian heritage. The character of the Muslim religion expressed itself in the language of its holy scripture, in the adoption of Mecca and the holy sites around, as its central sanctuary and in numerous Arab social notions and laws incorporated in its system. From beginning to end, the Quran is replete with biblical ideas, stories and phraseology. Telling references to post-biblical, specifically Jewish teachings, are included. The belief in the redeeming power of the book and in Moses as his predecessor in transmitting a heavenly scripture dominated the Arab Prophet in his initial, formative period. He remained "Judaic" throughout his life. Islam shares with Judaism its stern monotheism, which abhors the association of God with any other supernatural being. The word Islam means exclusive and complete dedication and originated with the story of Abraham, who is described in the Jewish tradition as a completely devoted servant of God. As in Judaism, the service of God consists of the fulfillment of his commandments, moral and, specifically, ritual, which have to be carries out in a precise manner. The study of these commandments, as laid down by holy law, is worship. Islam, like Judaism, is a religion of deeds and study. During the centuries preceding the advent of Islam, there were many Jews in Arabia, and their influence was felt. Medina (where, according to his Muslim biographies, the Prophet passed his childhood), was replete with Jews and one theory holds that the Jews refusal to believe in Mohammed as a prophet led him to splinter off and form the Islam tradition. Mohammed's original approach was indeed universalistic; that is, he believed that God had only one book to give; the different religions were versions of the same book, and he, as a language-minded Arab, saw himself called upon to bring a version in pure, easily understandable Arabic. After struggling with the notion that God had chosen many people, Mohammed reconciled the dilemma by realizing that Islam was indeed superior to both Christianity and Judaism and although the other two religions held many similar customs and beliefs, the people of those religions would eventually become subject to Islamic rule.

 

Because the origins of each religion occurred in and around Palestine, there has been never ending strife in the region over who is to control the Holy Sites and which religion is superior. Even though all three religions are indeed based upon the notion of one God, (and presumably that God is one and the same since all three religions do believe in the Bible) nevertheless, there continues to be tremendous strife and warfare amongst the religions. Upon reading the outlined history above, is it any wonder that the Middle East today is an area of bloodshed and war?

 

 

MAJOR TOURIST ATTRACTIONS OF THE MIDDLE EAST

The City of Jerusalem and its surrounding areas contain the most important religious sites in the world for Jews, Christians and Muslims. For followers of Judaism, what remains standing of the Wailing Wall represents the City of David and the Temple that his son Solomon constructed to house the Ark of the Covenant. The temple was a symbol of religious ideal that transcended the bickering of the twelve tribes of Israel. In subsequent years the city went through times of expansion and contraction. The As syrian invasion in latter part of C8 BC sent people flocking to Jerusalem and forced the City to expand its walls. The city was then devastated by the Babylonians in 586 BC. Only after the Maccabean revolt in the first half of the second century BC had restored Jewish rule did

the city begin to grow again. Under Hasmonean Kings, the City spread to the west and east but the lines of the original walls and Temple remain intact.

 

Around 70 ~Z, Titus of Roman descent had captured the Middle East and established Roman control over the region with the backup from the army legions. John the Baptist, Jesus, James, and thousands of other Jews were killed to suppress uprisings. A full scale uprising in 70 CE resulted in Titus razing the city, cornering and slaughtering Jews holding out in Masada and scattering others throughout the Roman empire. Different sects including Eastern Orthodox, today's Jewish sects as well as Christians evolved from the Jewish refugees. A component of rebels who opposed Roman Rule for over two centuries was adopted as a state religion in 313 CE in the Nice a conference. Collapse of the Holy Roman Empire in 324 CE ended that state religion until the Renaissance, resurgence of Roman Catholicism, breaking off of protestant sects (including Mormons). In the early 600s CE, Mohammed founded Islam based on the original teachings of Moses and Abraham, attracting followers now throughout the world. The Orthodox branches of Christianity throughout Greece, Central Europe and Russia trace their origin to the same original events in Jerusalem but evolving on the fringes of the empire beyond Rome's influence.

 

The City, now deadened by the absence of the Jews, received renewed prosperity when Christianity received the public backing of the Emperor in 313. The places made holy by contact with Jesus drew pilgrims from all over the world. The city grew rapidly. Thus the city acquired the dimensions it has today and is filled with hundred of historic sites which have the potential to attract millions of tourists.

 

Haram ash-Sharif (Temple Mount). One of the most prominent architectural sites in Jerusalem, Muslims refers to it as "The Noble Sanctuary" In order to erect a more appropriate shrine for the Ark of the Covenant, Solomon ordered the Temple constructed in 960 BC. After the first Maccabean victories, it was extensively rebuilt. Amid the ruins of CE 70, the emperor Antoninus Pius erected two statues on the platform. Jews were restricted from entering except for one day a year. The el-aska mosque is believed to be the Temple of Solomon and served as the residence for the King of Jerusalem until 1131 when he handed it over to a group of monks.

 

Dome of the Rock. The first major sanctuary built by Muslims and the only one to survive virtually intact. According to Arab beliefs, the purpose of Umayyad caliph Abd al-Malik in building the Dome of the Rock was to commemorate Mohammed's ascension into heaven after his night journey to Jerusalem. By constructing a beautiful structure, Abd al-Malik' 5 goal was to instill a sense of pride in Muslims over-awed by the majestic churches of Christendom. In addition, Abd al-Malik intended to make a symbolic gesture to both Jews and Christians, two religions that Islam considered imperfect. In addition to its proximity/association with the Temple, Jewish scripture has endowed the Rock with a complex mythology centering on Abraham and Isaac. By building the Rock above the Temple, the message from Abd al-Malik was that Islam had superseded their faith.

 

Golden Gate. The focus of many religions. Used for the ceremony of the red heifer. The crusaders opened the gates twice a year, on Palm Sunday and on the Feast of the Exalation of the Cross.

 

The Western Wall. The Wailing Wall where Jews from the adjoining Jewish Quarter came to pray and to lament the destruction of the Temple. The enormous stones of the lower wall display characteristics of Herodian style. The Wailing Wall attracts Jews from around the world.

 

The Tomb of David. Legend is that David and James, the Jewish and Christian founders of Jerusalem, are buried on Mount Zion. Beneath the present floor of the Tomb of David are Crusader, Roman and Byzantine floors, so the base of the building goes back to at least C2 CE.

 

Saint Peter in Gallicantu. The house of the high priest Caiaohas at which Jesus was taken after his arrest. Also where Peter went after his betrayal.

 

Tombs of the Valley. The tombs are the burial sites of prominent Muslims, Jews and Christians. Those buried there hoped to be the first in line to benefit by the charity of an unjaded messiah.

 

Bethpage. The starting-place of Jesus' triumphant entrance into Jerusalem.

 

Jaffa Gate. Arabs refer to this as "the gate of the friend", the reference to Hebron which takes its Arabic name from Abraham, "the friend of God." The wall between the Lshaped gate and the Citadel was destroyed and the Ottoman sultan Abdul Hamid II filled the moat in 1898 to allow Kaiser Wilhelm II to travel to the city along a road. Legend is that the two graves behind the iron fence are those of the architects executed by Suliman the Magnificent for leaving Mount Sion. The two mounted figures outside the gates represent the equipment of Crusader and Muslim cavalry during the period of the Latin Kingdom.

 

Sion Gate and Dung Gate. In Arabic, this gate is known as "the Gate of the prophet Davis" because his tomb is located, according to legend, on Mount Sion. Its worn outerface gives testimony to the war of independence in 1948.

 

St. Stephen's Gate. The current Hebrew name for this gate. "The Lion's Gate" is derived from the heraldic emblems of the Mameluk Sultan Baybars and the Lion's he placed to guard the gate. According to legend, the lion's were being prepared to eat Suliman's father, the first Ottoman sultan if he tried to destroy Jerusalem.

 

The Citadel. The West Side of the Old city is dominated by the citadel complex, which has been around since the period of Herod the Great (36-4 BC). The Hasmonean Wall is mentioned by Josephus in his writings of the three towers Herod erected in memory of his friend Hippicus, his brother Phasael, and his wife Mariamne. It was in this palace that Pontius Pilate judged Jesus. A similar murderous farce was played out on the same spot under Florus. The Byzantines considered the western part of the palace to be part of Mount Sion and it came to be known as David's Tower. In the Crusades, this tower served as the home for the Crusader Kings of Jerusalem.

 

Herod's Gate. The official name is Bab ez-Zahr or "the flowered gate" obtaining its name because pilgrims believed a Mameluk house inside to be the palace of Herod Antipas. This is also the gate where the crusaders established a bridgehead on July 15, 1099.

 

Damascus Gate. The most elaborate of the city gates, and the only gate of Ottoman motif to be excavated. This gate leads down to the crusader chapel of St. Abraham.

 

New Gate. Opened in 1887 by Ottoman sultan Abdul Hamid II to ease access to the Old City from the suburbs developing outside the wall. Adjacent to the gate is "Goliath's Castle", so named by the Arabs because of the legend that David killed the Philistine a bow shot away.

 

THE CHRISTIAN OUARTER

The Holy Sepulchre. The site where Christ died. Among the holiest shrine to Latin Catholics, Greek Orthodox, Armenians, Syrians, Copts and Ethiopians. Millions have thought it a worthwhile risk to risk death or slavery in order to pray here. The site was buried in 135 when Hadrian filled in the quarry to provide a level base for his Capitoline temple. The site was resurrected in early C4 when the emperor Constantine decided to uncover the church to commemorate the Resurrection. Additional buildings and improvements were also made at this time and the Church was dedicated in 335. The church was refurbished again in 614 following the fire set-off by the Persians. The church then underwent years of hardship and poverty where it was allowed to deteriorate until the crusaders arrived in 15 July 1099. The crusaders modified the church erecting the monastery of the canons where the Constantine basilica used to be. In 1119 they replaced the replica of Christ's tomb.

 

Two Mosques. North of the Holy Sepulchre is the Khanqah Salahiyya, a convent of Sufi mystics founded by Saladin between 1187 and 1189 on the site of the palace of the Crusader patriarch of Jerusalem. The base of the structure contains much crusader masonry.

 

The Mauristan. This square is the home of the newest church in the city, The Lutheran Church of the Redeemer and the oldest church in the city, the Church of St. John. Legend is that Bernard the Monk visited the Mauristan in 870 and felt that "we stayed in the hospice of the most glorious emperor Charles. All who come to Jerusalem for reasons of devotion and speak the Roman language are given hospitality there." Nearly destroyed by the caliph in Hakim in 1009, these edifices were restored some 50 years later by a group who had a particular interest in this part of the citv the merchants of Amalfi.

 

Roman Column. Column in the middle of the Christian quarter which honors Marcus lunius Maximus, Legate of the Augusts, which implies that he was the governor of the province of Judea. It was built in CE 200 by one of his aides.

 

The Armenian Quarter. This area gets its name from its most famous structure, the compound of the Armenian Monastery. The Monastery is a city unto itself with schools, libraries, living quarters and a seminary all surrounding the Cathedral of St. James.

 

Cathedral of St. James. This church signifies the life and energy of a unified people. Magnificent carpets and lamps are ubiquitous. Fact and legend are intertwined as our different designs from different religious periods.

 

Convent of the Olive Tree. The site where Jesus was tied during the scourging. Legend has it that the indented stone in the Northeast corner was caused by Jesus' elbow as his body jerked at the pain of the first lash. Also served as the house of the high priest Ann as, the father-in-law of Caiaphas, and this was the starting point of the other pious legends.

 

 

The Muslim Ouarter

St. Anne's. Considered the most beautiful church in the city, according to legend the crypt enshrines the home of the Virgin Mary and her parents Joachim and Anne. Next to the church are the remains from the miraculous medical baths where clients of the Gods Serapis gathered in hopes of healing. Legend has it that Jesus cured a man there who was ill for 38 years.

 

Antonia Fortress. The great fortress built by Herod the Great and named in honor of Mark Anthony. Attacked by Titus' troops in CE 66, it became the final battleground for the war of Antonia. After two tough months of fighting, the fortress finally fell and was ordered razed to the ground; all that remains is the south wall.

 

Monastery of the Flagellation. The residence of Pontius Pilate which lends itself to memories of the passion of Christ.

 

Ecce Homo. In conquering the Antonia fortress in CE 70, the Romans built a ramp across a rock-cut pool called Struthion. The central bay is now the Ecce Homo arch. After the Roman victory, the walls were torn down, but the lower part of the gate remains. When Hadrian re-planned Jerusalem in CE 135 he built a forum here. The three pronged gate is now a symbol of Roman triumph.

 

Mameluk Buildings. The religious colleges and pilgrim hospices for the Mameluks, a people who were forced to convert to Islam. The Mameluks were conscious of the importance of badges of distinction. Therefore, the buildings are inscribed with blazons symbolizing their office at court. The emblem for the cup (representing highest level of society) is found on buildings erected by Tankiz, the great Viceroy of Syria.

 

 

The Jewish Quarter.

The Jewish quarter was badly damaged in the siege laid by the Arabs in 1947. However, the restoration was began in 1967 after the retaking of the city.

 

Israelite and Hasmonean Walls. The walls protecting the Jewish quarter can be seen as a passage through time with the new walls being built as old ones were destroyed in wars. The walls are of different thickness and designs and it is often difficult to figure out the precise layout of a period.

 

Crusader Market. The crusaders transformed the Byzantine Cardo Maximus into a long covered shopping area.

 

The Burnt House. A month after the destruction of the Temple and the Lower City, the Romans attacked the Upper City. The Romans burnt every house they found and this is one of which there are some visible remains.

 

The Four Synagogues. These synagogues were the spiritual center for the Sephardic Jews, refugees expelled from Spain and Portugal and migrated to Palestine when it came under Ottoman control. The prophet Elijah Synagogue was started as a study hall and derives its name from the legend that appeared on Yom Kippur.

 

Hurva and Ramban Synagogues. Enshrining the name of Rabbi Moshe Ben Nachman, a prominent scholar of the middle ages who settled in Jerusalem in 1267. There were only two Je~ 5 in the City when he arrived and he dedicated his life to the establishment of a Jewish Community. The synagogue was destroyed and rebuilt and in 1523 it was the only place of Jewish worship in all of Jerusalem. Between 1599 and 1967, Jews were restricted access to the synagogue.

 

MECCA1

The hajj, or pilgrimage to Mecca, a central duty of Islam whose origins date back to the Prophet Abraham, brings together Muslims of all races and tongues for one of a Muslim persons life's most moving spiritual experiences. For 14 centuries, countless millions of Muslims, men and women from the four corners of the earth, have made the pilgrimage to Mecca, the birthplace of Islam. In carrying out this obligation, they fulfill one of the five "pillars" of Islam, or central religious duties of the believer.

Muslims trace the recorded origins of the divinely prescribed pilgrimage to the Prophet Abraham, or Thrahim, as he is called in Arabic. According to the Qur'an, it was Abraham who, together with Ishmael (Isma'il), built the Kabah, "the House of God," the focal point toward which Muslims turn in their worship five times each day. It was Abraham, too - known as Khalil Allah, "the friend of God" - who established the rituals of the hajj, which recall events or practices in his life and that of Hagar (Hajar) and their son Ishmael.

 

In the chapter entitled "The Pilgrimage,' the Qur'an speaks of the divine command to perform the hajj and prophesies the permanence of this institution:

"And when We assigned for Abraham the place of the House, saying "Do not associate Anything with Me, and purify My House for those who go around it and for those who stand and bow and prostrate themselves in worship. And proclaim the Pilgrimage among humankind: They will come to you on foot and on every camel made lean By traveling deep, distant ravines."

By the time the Prophet Mohammed received the divine call, however, pagan practices had come to muddy some of the original observances of the hajj. The Prophet, as ordained by God, continued the Abrahamic hajj after restoring its rituals to their original purity.

 

Furthermore, Mohammed himself instructed the believers in the rituals of the hajj. He did this in two ways: by his own practice, or by approving the practices of his Companions. This added some complexity to the rituals, but also provided increased flexibility in carrying them out, much to the benefit of pilgrims ever since. It is lawful, for instance, to have some variation in the order in which the several rites are carried out, because the Prophet himself is recorded as having approved such actions. Thus, the rites of the hajj are elaborate, numerous and varied; aspects of some of them are highlighted below.

The hajj to Mecca is a once-in-a-lifetime obligation upon male and female adults whose health and means permit it, or, in the words of the Qur'an, upon "those who can make their way there." It is not an obligation on children, though some children do accompany their parents on this journey.

 

Before setting out, a pilgrim should redress all wrongs, pay all debts, plan to have enough funds for his own journey and for the maintenance of his family while he is away, and prepare himself for good conduct throughout the hajj.

When pilgrims undertake the hajj journey, they follow in the footsteps of millions before them. Nowadays hundreds of thousands of believers from over 70 nations arrive in the Kingdom of Saudi Arabia by road, sea and air every year, completing ajourney now much shorter and in some ways less arduous than it often was in the past.

 

Till the 19th century, traveling the long distance to Mecca usually meant being part of a caravan. There were three main caravans: the Egyptian one, which formed in Cairo; the kaqi one, which set out from Baghdad; and the Syrian, which, after 1453, started at Istanbul, gathered pilgrims along the way, and proceeded to Mecca from Damascus.

 

As the hajj journey took months if all went well, pilgrims carried with them the provisions they needed to sustain them on their trip. The caravans were elaborately supplied with amenities and security if the persons traveling were rich, but the poor often ran out of provisions and had to interrupt their journey in order to work, save up their earnings, and then go on their way. This resulted in long journeys which, in some cases, spanned ten years or more. Travel in earlier days was filled with adventure. The roads were often unsafe due to bandit raids. The terrain the pilgrims passed through was also dangerous, and natural hazards and diseases often claimed many lives along the way. Thus, the successful return of pilgrims to their families was the occasion ofjoyous celebration and thanksgiving for their safe arrival.

The pilgrimage takes place each year between the eighth and the 13th days of Dhu alHijjah, the 12th month of the Muslim lunar calendar. Its first rite is the donning of the ihram.

 

MEDINA2

After Mohammed had preached publicly for more than a decade, the opposition to him reached such a high pitch that, fearful for their safety, he sent some of his adherents to Ethiopia, where the Christian ruler extended protection to them, the memory of which has been cherished by Muslims ever since. But in Mecca the persecution worsened. Mohammed's followers were harassed, abused, and even tortured. At last, therefore, Mohammed sent seventy of his followers off to the northern town of Yathrib, which was later to be renamed Medina ("The City"). Later, in the early fall of 622, he learned of a plot to murder him and, with his closest friend, Abu Bakr al-S iddiq, set off to join the emigrants.

 

In Mecca the plotters arrived at Mohammed's home to find that his cousin, 'Ah, had taken his place in bed. Enraged, the Meccans set a price on Mohammed's head and set off in pursuit. Mohammed and Abu Bakr, however, had taken refuge in a cave where, as they hid from their pursuers, a spider spun its web across the cave's mouth. When they saw that the web was unbroken, the Meccans passed by and Mohammed and Abu Bakr went on to Medina, where they were joyously welcomed by a throng of Medinans as well as the Meccans who had gone ahead to prepare the way.

 

This was the Hijrah - anglicized as Hegira - usually, but inaccurately, translated as "Flight" - from which the Muslim era is dated. In fact, the Hijrah was not a flight but a carefully planned migration which marks not only a break in history - the beginning of the Islamic era- but also, for Mohammed and the Muslims, a new way of life. Henceforth, the organizational principle of the community was not to be mere blood kinship, but the greater brotherhood of all Muslims. The men who accompanied Mohammed on the

 

Hijrah were called the Muhajirun - "those that made the Hijrah" or the "Emigrants" -while those in Medina who became Muslims were called the Ansar or "Helpers."

 

Mohammed was well acquainted with the situation in Medina. Earlier, before the Hijrah, the city had sent envoys to Mecca asking Mohammed to mediate a dispute between two powerful tribes. What the envoys saw and heard had impressed them and they had invited Mohammed to settle in Medina. After the Hijrah, Mohammed's exceptional qualities so impressed the Medinans that the rival tribes and their allies temporarily closed ranks as, on March 15, 624, Mohammed and his supporters moved against the pagans of Mecca.

 

The Constitution of Medina - under which the clans accepting Mohammed as the Prophet of God formed an alliance, or federation - dates from this period. It showed that the political consciousness of the Muslim community had reached an important point; its members defined themselves as a community separate from all others. The Constitution also defined the role of non-Muslims in the community. Jews, for example, were part of the community; they were dhimmis, that is, protected people, as long as they conformed to its laws. This established a precedent for the treatment of subject peoples during the later conquests. Christians and Jews, upon payment of a yearly tax, were allowed religious freedom and, while maintaining their status as non-Muslims, were associate members of the Muslim state. This status did not apply to polytheists, who could not be tolerated within a community that worshipped the One God.

 

Ibn Ishaq, one of the earliest biographers of the Prophet, says it was at about this time that Mohammed sent letters to the rulers of the earth - the King of Persia, the Emperor of Byzantium, the Ne gus of Abyssinia, and the Governor of Egypt among others -inviting them to submit to Islam. Nothing more fully illustrates the confidence of the small community, as its military power, despite the battle of the Trench, was still negligible. But its confidence was not misplaced. Mohammed so effectively built up a series of alliances among the tribes his early years with the Bedoums must have stood him in good stead here- that by 628 he and fifteen hundred followers were able to demand access to the Kabah during negotiations with the Meccans. This was a milestone in the history of the Muslims. Just a short time before, Mohammed had to leave the city of his birth in fear of his life. Now he was being treated by his former enemies as a leader in his own right. A year later, in 629, he reentered and, in effect, conquered Mecca without bloodshed and in a spirit of tolerance which established an ideal for future conquests. He also destroyed the idols in the Ka'bah, to put an end forever to pagan practices there. At the same time Mohammed won the allegiance of 'Amr ibn al-'As, the future conqueror of Egypt, and Khalid ibn al-Walid, the future "Sword of God," both of whom embraced Islam and joined Mohammed. Their conversion was especially noteworthy because these men had been among Mohammed's bitterest opponents only a short time before.

 

In one sense Mohammed's return to Mecca was the climax of his mission. In 632, just three years later, he was suddenly taken ill and on June 8 of that year, with his third wife 'Aishah in attendance, the Messenger of God "died with the heat of noon."

 

 

IMPORTANCE OF INFRASTRUCTURE

One of the most important components of economic development for emerging markets is infrastructure. Throughout the world, governments are focusing on infrastructure projects in order to meet the demands of local economies as well as to facilitate commerce and projected growth. The number of airports, water, toll-road, port, and telecommunications projects planned or under way has increased significantly over the past few years. Clearly, for the countries in the Middle East to prosper and to enable them to facilitate increased tourist demands, they will need to prioritize infrastructure development. The following section will look at various infrastructure initiatives of a few emerging markets to get a sense for how these projects are undertaken. Analyzing these countries highlights some of the many issues that need to be addressed and gives a sense for the magnitude of these undertakings. Lastly, this section will close with some of the initiatives contemplated and underway in the Middle East.

 

One issue that deserves mention up front is that while governments are focusing on infrastructure projects they are simultaneously working to divest themselves of many of the nationally owned infrastructure enterprises. Governments, particularly those in emerging markets, are under pressure to reduce public spending. In addition, these large infrastructure needs forces governments to be "selective" in their choices of projects to support. As such, there is a greater need for the private sector to finance an increasing portion of infrastructure projects (a concept known as "project finance" or "privatization"). In these situations, governments are using multi-year concession3 as a means to entice private investors. The process of privatization also promotes competition as well as innovation within an industry. The shift to private control of these entities creates a substantial opportunity for corporations and individuals to get involved in projects with attractive potential returns and future ancillarv business opportunities.

 

Greece3

Up until the late 1980s, all substantial infrastructure projects were entirely government financed. In recent years, though, due to large public debt, budget constraints, and the need for infrastructure improvements, project finance became important to Greece. As government funding was no longer the only source of financing, a new source emerged. Greece adopted a "build operate transfer" concept, which involves combining investment financing from the European Union (EU) and the Greek government. This was a direct result of the need for Greece's economy to meet the standards for inclusion in the EU. As a result of this process, Greece has Dr4.8 trillion (approximately US$20 billion) in infrastructure projects underway (Greece also has an additional Dri trillion (approximately US$4.2 billion) of projects unconnected with the EU support program).

 

The major sources of financing for Greek infrastructure projects include: EU support frame funds, Greek state investment funds, European Investment Bank, commercial banks, export agencies and private funds.

 

The major projects include:

 

The Spata Airport. The estimated cost for the new airport in Athens is Ecu2. 15 billion (approximately US$1.7 billion). The Greek state has a 55% stake in the new airport while ajoint venture made up of a number of corporations owns the remaining 45%. The joint-venture company is undertaking the construction, operation, development, and utilization of the airport for 30 years.

The Elefsis, Stavros, Spata ring road. The road will be built at an estimated cost of Dr456 billion (approximately US$1.9 billion). Three companies have been established to oversee the project including:

1. A concession company which is undertaking the financing of the project

2. A construction joint venture made up of the same companies as for the Spata airport.

3 An operating and maintenance company.

Rio-Antirrio Bridge. The bridge connects Patras and Igoumentisa, the two major ports of western Greece, and is budgeted at Dr2lO billion (approximately US$875 million). The concession company, which will construct the bridge, is a group of eight companies.

 

Since the Greek government used to fund all major infrastructure enterprises, they had little experience in project finance. There was little legislation in place, as well as little experience in these dealings. The Greek government has had to overcome these difficulties by doing things such as, adopting new legislation and bringing in outside consultants to help oversee the construction projects. In addition, the construction companies have had to adapt to running and creating projects. This included bringing in technical and financial experts and to work more closely with the commercial banks and other financing sources.

 

South Korea4

In 1994-1996, prior to the current economic problems facing some Southeast Asia countries, South Korea planned a number of infrastructure projects to help position itself for the next economic boom. In the past, the unbalanced nature of infrastructure projects caused economic development in regions to differ significantly. Going forward, Korea wanted a transformation in policy to promote balanced growth in all sectors and regions. Korea embarked on a comprehensive program to intertwine the new projects to maximize infrastructure synergies. Simultaneously, Korea focused on giving more autonomy to regional authorities. Emphasis was to focus on visionary and futuristic planning to ensure that infrastructure projects, such as roads, airports, and railroads were inter-linked. To attract capital, the government resorted to a variety of tactics, including appealing to people and private businesses within the regions involved. They searched out participants with the skills and technical know-how specific to each project, as well as capital and profitability goals consistent with each project. By getting involved in regional infrastructure development, participants are able to gain advantages in local economies.

 

During 1994, the Korean government felt that traffic congestion had forced increased social expenditures, This, in turn, weakened the international competitiveness of companies and created problems for the overall economy. The government, along with potential project participants, set out to design the basics for infrastructure plans. The feeling was that the projected profitability of many of these plans would make it possible to attract a number of participants. In total, the government outlined the possibility of long-term projects, including roads, ports, dams, railroads, subways, telecommunications, costing over 1,000 trillion won (approximately US$1.3 trillion) through the year 2020.

 

Selected private companies were involved in seven of the 10 projects initiated in 1995 by the Korean government. The major projects include:

New Seoul International Airport expressway. Intended to transport passengers to the new airport, which is expected to be a major hub in Asia in the future. The 747 billion won (approximately US$960 million) project was started in November 1995 with a target completion of November 2000. Individual companies were designated for the construction, and an 11-company consortium takes control of the expressway for 30 years.

Integrated passenger's convenience facilities at Inchon Port. Designed as a convenience to tourists of Inchon, it will include a passenger terminal and a department store. The cost is estimated at 200 billion won (approximately US$257 million) and is being carried out by a consortium of companies.

Chonan-Nonsan Expressway project. Designed to ease traffic jams between Chonan and Daejon on the Seoul-Pusan Expressway and to promote the development of nearby surrounding regions. The construction costs are estimated at 479 billion won (approximately US$617 million). In addition, there are opportunities for profitable ancillary businesses, such as gas stations and restaurants for the participating construction companies.

Subway projects for Seoul-Hanam and Pusan-Kimhae routes. Lightweight trains will be used for both projects and the layout is designed to promote development of other businesses, such as shopping centers, recreational facilities, and housing. The SeoulHanan line is designed to have 11 new stations over 10.5 km. and is expected to cost 223 billion won (approximately US$287 million).

 

Companies with large local presence, such as Samsung Engineering & Construction, Daewoo, and Dong Ah Construction Industries are actively involved in a number of the projects. These companies are working with the government to help create, design and implement infrastructure projects.

 

Australia5

In an effort to promote competition, reduce debt, and improve infrastructure, the government in the Australian state of Victoria has been promoting private sector involvement in new and existing infrastructure enterprises. For new projects, the government has instituted two types of programs, "build, own, operate, transfer" (BOOT) and "build, own, operate" (Boo) to invite participation. Already, projects involving hospitals, prisons, emergency services and toll roads have been initiated under these programs.

 

In addition to new projects, the Victorian government has raised substantial money for the state by privatizing certain elements of the energy industry. Privatization in the electricity industry has raised approximately A$13 billion (approximately US$10 billion), and the planned privatization of the gas industry could raise an additional A$5 billion (approximately US$4 billion). These asset sales have helped to improve the economy of Victoria and to attract capital from foreign investors.

 

Some of the major new and existing privatization projects in Victoria include:

Melbourne City Link toll road. The Melbourne City Link project is a A$1.75 billion (approximately US$1.37 billion) BOOT project that will extend for 22 km and will be Victoria's first toll road. The project involves upgrading existing freeways, linking them with new sections, and constructing two tunnels. The goal of the project is to provide and improve freeway access surrounding downtown Melbourne. The concession to collect tolls is for 34 years and involves the use of identification tags for electronic toll collection. Local construction companies and financiers formed consortiums to bid for the concession.

Electricity industry. In an effort to promote competition in privatizing the electricity industry, the Victorian government separated the industry into five separate generation companies, five distribution businesses and a transmission company. The majority of these assets have been sold to private enterprises and have generated in excess of A$13 billion (approximately US$10 billion). Energy companies from both Europe and the United States bid for, and successfully acquired, electricity assets. As such, Victoria's government was successful in attracting foreign capital and promoting competition. In addition, government felt that privatization and competition would lead to innovation within the electricity industry.

 

Lastly, while the Victorian government was not only able to raise money and promote competition, it was also able to allocate "risks" to those best positioned to manage them. In particular, privatization shifts the risk of a project away from the government. Energy companies are better equipped to understand and deal with the risks associated with energy projects.

 

The Middle East

 

There is limited information about infrastructure development projects in the Middle East, but as the peace in the region progresses, more projects are expected.

 

 

Islamic Regionv6

Recently, the Islamic Development Bank (1DB) started planning a US$1.5 billion fund to back independent infrastructure projects in the IBD's 52 member countries. IBD plans on raising US$1 billion in equity capital and an additional US$500 million in debt. IBD, itself, has pledged up to $250 million and a Geneva-based lead sponsor Dar Al-Maal Al Islami Trust has committed an additional $200 million. The rest of the funds will be raised from institutional and private investors, with a minimum investment of $10 million. The fund will have a ten-year life and a five-year commitment period, and the tar~et return for the fund is 18% to 20% annually.

 

Gaza Strip and West Bank7

Since Yasser Arafat and the Palestinian Authority took control of the Gaza Strip and the West Bank about five years ago, a number of large infrastructure projects have been started. Violence in the region and control by Israel has caused major problems for the Palestinian economy in terms of GDP and unemployment has gone way up. Investment in infrastructure could be the catalyst that gets the Palestinian economy going and helps them to distance themselves from Israel. Since the Oslo agreement was signed five years ago, close to 30 "donor" countries and organizations have pledged about US$1 billion in funds to the Palestinian Authority. It is estimated that a significant portion (close to half) of these funds could be used for infrastructure projects. So far the largest portion of funds has been targeted towards water-related projects since the quality of water in the region is very poor.

 

Some of the current and planned projects in the region include:

The US Agency for International Development, in conjunction with two United States contractors, is proceeding with a US$50 million project to tap into deep aquifers and deliver potable water more reliably to Palestinian towns.

In the transportation sector, a US$165 million road development and improvement project in the Gaza Strip is under way (funded partially by Saudi Arabia and the Arab Fund), while a US$25 million road project is under way in the West Bank (funding mostly by Denmark).

During 1996, the Palestinian Energy Ministry awarded a US$160 million contract to consortium led by France's utility Electricite de France to build a 160-megawatt power plant. The private facility will provide power to the Gaza Strip and will significantly reduce Gaza's current need to get power from Israel.

Palestinian and Egyptian contractors have been working on the first Airport in the Gaza Strip. The project was delayed by political disagreements with Israel over control of the airport, but the first flight was completed this year.

 

Political issues and the violence in the region continue to make investment a nsk proposition. And, while infrastructure will not necessarily solve the economic problems of the region, the development of roads, water and power will attract more investment in the region. Further investment could lead to more opportunities for private investors and could pave the way for more revenue from the tourist industry.

 

In an environment where banks and private investors are looking to get involved in infrastructure projects; construction companies are willing to use their balance sheets to fund projects; and there is a trend towards competition in what used to be government operated sectors, it is no surprise that governments are looking to out source the "risk" of infrastructure projects. As governments focus on tourism as a source of revenue, they will need to focus on infrastructure to make it a viable enterprise. This is where private investors could see the greatest opportunity for investment returns. Getting involved in infrastructure development will also open the door to more ancillary opportunities for investment in areas such as restaurants and hotels. But, first the infrastnlctl]re needs to be there.

 

CASE STUDY: ORLANDO

The greater metropolitan Orlando/Orange County area of Florida provides a useful case study of the potential economic impact of the tourism industry. Orlando's economy is fundamentally centered on servicing the millions of people who visit the area every year with either business or leisure in mind. Analyzing the various trends and composition of visitor traffic and the cumulative impact on the Orlando economy can provide insight on the potential for tourism in the Middle East.

 

Overview of Visitor Origination

Approximately 37.2 million people visited the Orlando/Orange County area in 1997. Of these visitors, 33.7 million (91%) came from within the United States and the remaining 3.5 million (9%) came from foreign countries. These levels represent a 7.5% compound annual growth rate in domestic visitors and a (3.1%) annual decline in international visitors since 1992 for a net compound annual growth rate of 6.2%.

 

Within the United States, nearly half of the visitors to the Orlando area (16.1 million or 48%) came from within the state of Florida. The Tampa/St. Petersburg/Sarasota area generated 6.1 million visitors (18% of total domestic visitors, 38% of Florida visitors) followed by the Orlando/Daytona BeacIi/Melbourne area which generated 3.0 million (9% of total, 19% of Florida). The Miami/Ft. Lauderdale, Ft. Myers/Naples, West Palm Beach and Jacksonville areas combined accounted for 35% (5.6 million) of Florida visitors bringing the combined visitor contribution of these six metropolitan areas to 92% of total Florida resident visitor traffic to Orlando.

 

The remaining 17.6 million (52%) of the domestic visitors in 1997 came from a much wider range of cities from across the United States. The largest non-Florida origination point was the New York metropolitan area which generated only 2.3 million visitors (7% of total domestic visitors, 13% of non-Florida visitors). The remaining metropolitan areas in the top ten (in order, Charlotte, Atlanta, Philadelphia, Chicago, Boston, Detroit, Cleveland, Baltimore and Washington D.C.) contributed only 6.0 million visitors (18% of total, 34% of non-Florida) bringing the total top ten concentration to 8.3 million (25% of total, 47% of non-Florida). The remaining 9.3 million visitors to the Orlando area in 1997 came from a broad mix of rural and urban areas across the country.

 

The 3.5 million international visitors also came from numerous points near and far. A large proportion of this group came from the United Kingdom (0.9 million, 27% of total) and Canada (0.6 million, 17% of total) but the balance of the traffic came from nearly every corner of the earth. For example, Orlando attracted 759 thousand people from South America, 217 thousand from the Far East, 46 thousand from Australia/New Zealand and 42 thousand from Africa.

 

Orlando is a major tourist center relative to other destinations for international travelers coming to the United States. The Orlando/Orange County area attracted approximately 8.5% of all international visitors in 1997. This volume was driven by the fact that Orlando was a scheduled stop for 25% of the 3.7 million visitors from the United Kingdom (part of Orlando's 15% share of the 10.4 million who came from the whole of Europe) as well as almost 27% of the 2.8 million visitors from South America. Approximately 32% of overseas visitors (excluding Canada & Mexico) to Orlando in 1997 were making their first trip to the United States. Mickey Mouse does seem to have the whole world in his hands.

 

Overview of Visitor Activities

Visitors to the Orlando area come for a variety of purposes and engage in numerous activities that impact the economy. In aggregate, 79% (29.3 million) of visitors in 1997 came to Orlando for leisure purposes. The remaining 21% (7.9 million) were travelling on business. This proportion is roughly the same for both domestic visitors (78% leisure, 22% business) and international visitors (85% leisure, 15% business). Not surprisingly, proportionally fewer international travelers came to Orlando for business purposes. The growth in domestic visitors since 1992 has been equally split between leisure (7.2% compound annual growth rate) and business (8.6% compound annual growth rate).

In 1997, domestic leisure visitors accounted for 26.3 million (approximately 90%) of total leisure travelers. These visitors came with a range of motivations including general vacation (44%), getaway weekends (19%), special events (15%), visit friends/relatives (14%) and other personal (8%). No matter how it is characterized, all of these people came to have fun and an examination of the activities that these visitors engaged in demonstrates that indeed fun was almost surely had by all. A large portion of domestic leisure visitors enjoyed four major activities including the theme/amusement parks (73%), general entertainment (53%), dining (47%) and shopping (44%). Visitors also engaged in beach fun (11%), touring (9%), cultural events (7%), and night life (7%). Not surprisingly, non-Florida visitors were more "active" vacationers than Florida visitors has demonstrated by the higher proportion who enjoyed the theme/amusement parks (80% vs. 65%), general entertainment (55% vs. 51%), shopping (46% vs. 41%), beach/waterfront (a whopping 19% vs. 1%), and touring (12% vs. 5%) during their stay. The only activity that Florida visitors enjoyed in greater proportion was dining (51% vs. 44%). These results are primarily driven by the difference in the average length of stay among overnight visitors. Non-Florida residents averaged a lengthy 5.7 nights while Florida residents averaged a much shorter 2.2 nights per visit. The differences between the two groups (and the resulting impact on the economy) are even more dramatic when including those visitors who made day trips to the Orlando area. The majority of Florida leisure visitors (58%) did not spend the night in Orlando compared with only 18% of non-Florida leisure visitors (still a surprisingly high number). On the other end of the spectrum, 61% of non-Florida leisure visitors stayed more than 4 nights while only 5% of Florida leisure visitors did so.

 

In 1997, domestic business visitors accounted for 7.4 million (approximately 94%) of total business travelers. This group consisted of 4.2 million travelers attending group meetings and 3.2 million transient business travelers. Of those attending group meetings, approximat~y 3.0 million (70%) stayed overnight in the Orlando area. (This analysis will focus on the overnight group business travelers for which data collection is most reliably available.) Domestic business visitors generally engaged in fewer activities per person with a slightly different mix. Once again, the four major categories were dining (44%), the theme/amusement parks (33%), shopping (25%) and general entertainment (25%). This group also enjoyed touring (8%), shows (5%), beach/waterfront (5%) and, not surprisin~y, golf (5%). The majority of overnight domestic business travelers stayed from one to three nights (55%) but the average length of stay reached 3.9 nights in 1997.

 

Overseas travelers to Orlando (excluding Canada & Mexico) in 1997 were very active visitors who were most likely to enjoy the shopping (92%), theme/amusement parks (82%), and dining (82%). As one would expect, these visitors had a visited the area longer than domestic visitors. In 1997, the average length on stay in Orlando was 8.6 days and the average length of stay in the entire U.S. was 17.1 days. The overseas traveler to Orlando visited an average of 1.6 states and 2.7 separate destinations during their trip.

 

Overview of Key Attractions

The growth of Orlando's tourism industry has been driven by the omnipresent Walt Disney. Orlando is the king of theme and amusement parks. Of the top eight theme parks in the United States, five are located in the Orlando/Orange County area with a sixth (Busch Gardens) not far away in Tampa. Together, The Magic Kingdom (#1 theme park in the United States, 17.0 million visitors in 1997), Epcot (#3, 11.8 million) Disney MGM-Studios (#4, 10.5 million), Universal Studios Florida (#5, 8.9 million) and Sea World of Florida (#7, 4.9 million) accounted for approximately 53.1 million visitors in 1997. Busch Gardens (Tampa) brought in another 4.2 million. Driven by 10% compound annual growth at The Magic Kingdom, total visitors to these parks has grown 5% annually from 46.1 million in 1995 to 1997.

 

The depth of attractions in Orlando is impressive. The area boasts a very wide range of operations that had attendance in excess of 100,000 in 1997 including the Kennedy Space Center Visitor Complex (2.7 million), Wet'N Wild (1.3 million), Blizzard Beach (1.3 million), Typhoon Lagoon (1.3 million), Daytona USA (500 thousand), Godwin's Gatorland, Inc. (500 thousand), Water Mania (500 thousand), Ripley's Believe It or Not! (380 thousand), Terror on Church Street (250 thousand), Paintball World, Inc. (200 thousand), U.S. Astronaut Hall of Fame (200 thousand), Central Florida Zoological Park (200 thousand) and Harry P. Leu Gardens (115 thousand). Orlando is also home to numerous professional sports franchises including Major League baseball (minor league and spring training for the Braves & Astros), NBA basketball (Magic), IHL hockey (Solar Bears), ASL soccer (Lions), Arena football (Predators), and RHI roller hockey (Jackals). Additionally, more than 125 golf courses are located within a 45-minute drive of downtown Orlando which host two PGA and one LPGA tournaments during the year. These endless points of interest are the backbone of Orlando's tourism industry.

 

Orlando's business amenities boost the area's attractiveness to companies from around the world. The Orange County Convention Center is ranked 3rd in the United States is terms of prime exhibit space behind McCormick Place in Chicago and the Las Vegas Convention Center. The Center is home to over 1.1 million square feet of exhibit space and over 250 thousand square feet of meeting space. A 1997 survey of 225 meeting planners rated Orlando as an excellent (66%) or good (29%) location for a meeting by the overwhelming majority of respondents.

 

Overview of Individual Visitor Expenditures

Tourism revolves around visitor expenditures which generate private profit and public tax revenue. The primary components of tourist spending are i) transportation, ii) entertainment, iii) accommodations, iv) food and v) shopping. Spending patterns of domestic leisure visitors to Orlando vary dramatically depending on the distance traveled (Florida resident vs. non-Florida resident) and, subsequently, the length of stay. In 1997, the average non-Florida visitor spent $812 per trip compared to $204 per trip for the Florida resident. This difference was reflected across the board in each spending category. Average expenditures per person per trip for each group were as follows:

transportation ($181 for non-Florida vs. $24 for Florida), entertainment ($161 vs. $50), accommodations ($153 vs. $31), food ($154 vs. $53), shopping ($120 vs. $37) and other ($42 vs. $8). The main driver of the differences in total spending is average length of stay. After normalizing the data to include day visitors, Florida resident visitors averaged 1.5 days per trip and non-Florida residents averaged 4.9 days per trip. The net result is that non-Florida visitors spent slightly more per day ($167 vs. $136) than Florida residents. It is logical to assume that this difference is the result of higher transportation costs offset by amortization of these costs over more days per trip.

 

Business travelers (again focusing on the 3.0 million overnight group meeting segment of the industry) spending patterns in 1997 were, in aggregate, similar to non-Florida leisure visitors although the mix was somewhat different. The average business traveler spent $799 per trip comprised of transportation ($211), accommodations ($273), food ($142), shopping ($79), entertainment ($74), and other ($23). The average length of stay for this group of business travelers was 3.9 nights producing an average spending per day total of $205. The higher proportion of spending on room accommodations by business travelers was driven by the fact that approximately 90% stay in hotels versus approximatelv 70% of leisure visitors who are more likely to stay in either a condo/timeshare or private home. Interestingly, business travelers did not spend significantly more on transportation than non-Florida leisure visitors ($211 vs. $181) as each demonstrated a roughly 50/50 split between air and auto travel.

 

Overview of Aggregate Economic Impact

Tourism is Orlando/Orange County's largest and most diverse industry. The growth in tourism between 1992 and 1997 has been dramatic and has been the driving force behind the area's strong economic growth. In 1997, the 37.2 million visitors that Orlando hosted spent over $15.9 billion. Domestic visitors generated $13.8 (87%) of this revenue while international visitors generated the remaining $2.1 billion. Revenue growth has average 7.6% per year since 1992 as total tourism revenue has risen from $11.0 billion to 1997's

$15.9 billion (a combination of 6.2% growth in visitors and 1.4% growth in spending per visitor). Industry growth also generates job growth for the private sector. Jobs generated by tourism account for 21.7% (154,200 jobs) of the total employment in the metropolitan Orlando area. This total consists of 15% (106,800 jobs) directly related and 6.7% (47,400 jobs) indirectly related to the industry. The directly related job segment of the economy generated wages of approximately $2.2 billion in 1997 which were ploughed back into the economy through increased consumer spending.

The public benefit of the tourism industry is also immense. The government takes in annual receipts of $356.9 million versus only $256.1 million in annual expenditures to support the industry. The net benefit of $100.8 million a year contributes approximately $419 each year to every household in Orange County. Additionally, $20.1 million of surplus ad valorem taxes were generated for area schools by the tourism industry in 1997.

 

In aggregate, the Orlando/Orange County area contains over 80 attractions, 89,500 hotel

 

rooms and 3,700 restaurants. The Orlando International Airport is the 23 rd largest airport

 

in the world and the 16 th largest in the United States with over 27.3 million passengers

during calendar year 1997. The airport was the 4th fastest growing major airport in the country during 1997 and is forecasted to serve 30 million passengers bv 2000 including more than four million international passengers. This infrastructure base has continually expanded to position Orlando for continued future growth.

 

Current projections look for continued strong growth in Orlando's tourism industry into the next century. Total visitors are expected to grow at a 5.5% compound annual rate through the year 2002 to eventually exceed 48.6 million. Tourism is expected to generate 24,000 new jobs (40% of total job growth) by the year 2000.60% of these 24,000 jobs are projected to be directly related to tourism with the remaining 40% indirectly related. Indeed, Orlando's future looks as bright as the central Florida sun on a clear July day.

 

 

CONCLUSI6N

"Greed is good. Greed works. Greed cuts through and captures the evolutionary spirit of

mankind." - Gordon Gecco, Wall Street

 

As Gordon Gecco so eloquently stated in Wall Street, man is motivated by money and it is our belief that wealth can be the primary cause of peace in the Middle East. The Middle East offers an enormous opportunity for investors to capitalize on the plethora of tourist attractions and on over a billion people's existing penchant to visit the area. Using Orlando as a model tourism-driven city, it is our belief that the tourist industry could be the peace offering that the region has long needed. The tremendous amount of wealth that can be created through the establishment of the infrastructure necessary to support a burgeoning tourist industry, not to mention the tourist industry itself, could go a long way in overcoming the strife that the poor region has experienced for countless centuries.

 

 

Bibliography

1 Information from article from ARAMCO World, July-August 1992. Author: Ism~l Nawwab.

2 Inforination from Islam and Islamic History in Arabia and The Middle East

3 Information from article titled "Project Finance" from Euromoney, September 1996. Author: Anonymous

4 Information from article titled "An industrial take-off begins from infrastructural development" from Business Korea, February 1996. Author: Kim, S.C.

5 Information from article titled "Whose risk in infrastructure ventures?" from Corporate Finance, September 1996. Authors: Cohen, Antony; Cunningham, Graham.

6 Information from article titled "Islamic institutions plan private infrastructure fund from International Trade Finance, October 1998

7 Information from article titled "Roads to development" from Infrastructure Finance, November 1998

Other sources:

The Jewish World: Ilistory and Culture of the Jewish People, 1992. Editor: Kedourie, Elie.

The Holy Land, 1998. Editor: Murphy-O'Connor, Jerome.

Orlando Area Market Summary, 1998. Orlando/Orange County Convention & Visitors Bureau, Inc.

Including:

a) D.K. Shifflet & Associates

b) U.S. Department of Commerce, Tourism Industries

c) Orlando CVB Research Department

d) Fishkind & Associates, Inc.

e) Smith Travel Research

f) Great~r Orlando Avi~ion Authonty

g) Amusement Business

h) Orlando Business Journal





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