TheChek News Flow

Garment factories in Bangladesh, one of the world’s biggest clothing production hubs, are struggling to complete orders on time as flooding disrupts their cotton supplies — exacerbating a backlog caused by recent political turmoil.

Bangladesh is a leading global cotton importer due to the size of its textile and garment industry, but the devastating floods mean few trucks and trains have been able to bring supplies to factories from Chittagong port over the last week, industry officials and analysts said.

The disruption, on top of the unrest and protests that led to factory closures earlier this month, have caused garment production to fall by 50 percent, said Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association.

“The industry is now under immense pressure to meet deadlines, and without a swift resolution, the supply chain could deteriorate even further,” Hatem said.

Bangladesh was ranked as the third-largest exporter of clothing in the world last year, after China and the European Union, according to the World Trade Organization, exporting $38.4 billion worth of clothes in 2023.

At the clothing factory she runs in the capital, Dhaka, Rubana Huq is counting the cost of lost production.

“Even for a moderate-sized company like ours, which makes 50,000 shirts a day and if the price of one single shirt is $5, there was $250,000 of production loss,” said Huq, a former president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

She said some garment plants were slowing resuming production, but estimated that complete recovery “would be at least six months away”, warning that Bangladeshi manufacturers could lose 10 percent-15 percent of business to other countries.

Bangladesh’s readymade garments industry, which supplies many of the world’s best-known fashion brands, accounts for more than 80 percent of the country’s total export earnings.

Buyers are adopting a cautious approach and could potentially delay new orders, said Shahidullah Azim, a director of the BGMEA industry group.

“The longer this uncertainty persists, the more challenging it becomes for us to maintain the momentum we have built,” he told Reuters.

The Bangladesh Meteorological Department said flood conditions could persist if the monsoon rains continued, as water levels were receding very slowly.

Some cotton shipments could get diverted to India, Pakistan and Vietnam, commodity analysts said.

“We are already hearing and seeing some cotton for prompt delivery wanted by Pakistan and Vietnam,” said Louis Barbera, partner and analyst at VLM Commodities based in New Jersey.

New orders shifted from Bangladesh could also be accommodated in southern India, said Atul Ganatra, president of the Cotton Association of India.

Even before the floods and political unrest, the Bangladeshi garment industry was grappling with power shortages that remain a problem, said Fazlee Shamim Ehsan, vice president at the country’s knitwear manufacturers and exporters association.

“Energy shortages continue to hamper our operations,” he said.

France’s Top Design Fair Maison&Objet Gets a Makeover

The fair's managing director Mélanie Leroy told WWD that major changes, including a more consumer-driven format, will be visible as the upcoming edition opens its doors Sept. 5.

MILAN — Maison&Objet, which just celebrated its 30th birthday, is gearing up to reshape the fair for both its September and January editions.

The fair’s managing director Mélanie Leroy told WWD that the fall edition will see a more consumer-driven format dedicated to unearthing under the radar talent and putting forth cutting-edge trends, as soon as it opens Sept. 5. The January edition is being groomed to meet the needs of the premium brands that traditionally show during the winter season.

“Our community relies on us and Paris has been a major marketplace for the design business. Thanks to Maison&Objet and since the pandemic, we have created formats such as Maison&Objet in the City engineered for brands that still want to be part of our community but would rather stay in their showroom instead of building a booth. Once again, we have adapted,” Leroy said.

The September edition, which will close Sept. 9, will see a section dedicated to the new and avant-garde with emerging talents from Scandinavia via its historic international “rising talents award” program, and an exhibition of young designers from Hong Kong as part of a yearly partnership with Hong Kong design week will also be on display.

The Maison&Objet Factory curated by Paris Design Week will also put forth fresh names like Paris-based furniture designer Senimo; design and architecture firm Corpus Studio and Raphael Pontais, as well as Netherlands-based lighting designers Rollo Studio and Hyères-based designer James Haywood. Main highlights in September include talks with Maison creative director Cordelia de Castellane and ready-to-wear designer Yves Salomon, who made his foray into the furniture arena with Chapo Creation in April. Belgian interior architect, decorator and artist Lionel Jadot, Maison&Objet Designer of the Year and his team of designers and visionaries involved in his Zaventem Ateliers collective are gearing up to create a space around the zero-waste potential of the hospitality sector.

Focus on Cuisine

The fair has revamped its Cook&Share section, reducing its presence to an annual one rather than a biannual one. Cook&Share will showcase in September and feature a dedicated restaurant in the heart of the hall to attract visitors. The section will be a recurring fall event focused on cooking, tableware, culinary accessories and gourmet food. Shops and department stores, purchasing groups, decorators, hotels and restaurants will find industry innovations each fall.

Collectible Design and Hospitality

The January edition will showcase three distinct facets: a focus on collectible design, what’s new in hospitality and a fashion component dedicated to unveiling opportunities for retail where accessories and men’s and home fashion are on show.

The fair named Belgian hospitality designer Lionel Jadot as Designer of the Year — Hospitality. This title recognizes an eminent personality whose career, vision, signature and uniqueness set the standard for the profession. A member of the Vanhamme family of furniture-makers, he is also well-known for his work with repurposed materials and reinvention of spaces. The prize will be awarded to him at Maison&Objet exhibition in September. To mark the occasion, he will have carte blanche for his pavilion, thus allowing him to showcase his interior design philosophy.

Power in Numbers

Overall, Paris Design Week, which is also coordinated by SAFI, the same team behind Maison&Objet, will feature more than 400 spots throughout the city of Paris and put forth 127 young talents, compared to 80 last year.

The Paris Design Week Factory will unfold Sept. 5 to 14, and is one of the city’s key events, taking place at four venues in the same district: it reveals the best in young and emerging talents on an international scale, after a call for entries.

Overall, Maison&Objet aims to have 25 percent of exhibitors at each edition be new brands, with 30 percent represented by first time visitors. In September, the fair will welcome 600 new brands and a total of 2,200.

The fair said that its marketplace MOM is thriving with an 11 percent rise in visitors since its launch a year ago. MOM is the only marketplace online that allows direct to consumer and B2B brands alike to make direct buy/sell transactions. Trade professionals make up 60 percent of its total audience. The other 40 percent are retailers. The site has welcomed three million visits in one year and 20,000 stoppable products.

Propelling Women in Design

In July, Maison&Objet unveiled the first creative and business network of the design industry dedicated to fostering relationships between women. Leroy said Woman&Design by Maison&Objet is a business and creative collective that aims to identify, connect and promote women who are pushing the boundaries of product design, interior decoration, craft and lifestyle.

Outside of the fair, Leroy joined Leia Capital in 2022, an angel investor group dedicated to investing in innovative projects led by women. Leroy now wants to leverage the fair’s strengths as a business partner and its community to better serve the women in the industry.

Forging Ties in the U.S.

In June, the organization revealed that it appointed Nina Magon its official U.S. ambassador. Magon is the founder of Nina Magon studio, which is active in the luxury residential, commercial and hospitality worlds. The fair said Magon is a woman whose path has transformed the industry and her task will be to create a network with the fair rather than attempting to export Maison&Objet to the U.S. in the near term.

“Exporting a show for the sake of its image will not make sense if we were not able to deliver connections, business and growth to our community. And this is what we are all about. That’s how we have grown our presence in the U.S. and how we hope to grow through ambassadors like Nina,” Leroy said.

Seven & i shareholders set deadline for status briefing on takeover bid

Artisan Partners want an update on negotiations after Couche-Tard’s unsolicited approach

A prominent shareholder in Seven & i Holdings has set a deadline for the Japanese convenience store giant to update investors on the takeover bid by Canada’s Couche-Tard, warning that management will be “held accountable” if it did not immediately open negotiations with the buyer. 

The investors also warned that government intervention in the takeover attempt would signal that Japan was not serious about a series of recent reforms aimed at stimulating mergers and acquisition activity and pushing companies to improve asset efficiency.

The deadline set by two portfolio managers at US-based Artisan Partners was sent in a letter to the board of Seven & i on Friday night, 11 days after the company that controls the 85,000-strong global network of 7-Eleven stores revealed that it had received the unsolicited approach from Couche-Tard.

Although Seven & i said at the time that it had established a special committee to examine the bid, no other details — such as the offered price range, the terms or when the bid was first tabled — have been shared. 

Seven & i has not named the members of the special committee, provided evidence that the committee is fully independent or said when it will reach its conclusion. Multiple investors have privately described the level of secrecy to the Financial Times as frustrating.

In the letter, Artisan’s David Samra and Ben Herrick asked for Seven & i to brief shareholders on the status of takeover negotiations by September 19, citing the “historic implications” of a process that has captivated the Tokyo market and could represent the biggest takeover of a Japanese company by a foreigner. 

A spokesman for Seven & i declined to comment.

Analysts have speculated that a successful bid for Seven & i could cost a buyer between $40-50bn. The company’s market capitalisation before the bid was made public stood at roughly $31bn.

Artisan is not generally considered an activist shareholder, but has become the first big investor in Seven & i to go public with criticism of the company’s behaviour and express concern that management might snub an opportunity to enhance shareholder value.

Artisan’s letter argued that negotiating with Couche-Tard represented Seven & i’s best tactic to secure “positive stakeholder outcomes in Japan” and called on the company to solicit offers for the retail conglomerate’s many subsidiaries as soon as possible. 

“Failure to engage with ACT [Couche-Tard] and other potential partners could result in a less favourable outcome with less flexibility,” warned the letter.

Artisan blamed Seven & i’s management for deferring “opportunities to enhance corporate value on several occasions”. The portfolio managers argued that the undisturbed share price o f the Japanese group — meaning before the impact of the offer from Couche-Tard — “was nearly at the same level as it was in 2016 when many of the current executive directors were in place”. 

“In US dollar terms, the currency in which the lion’s share of the company’s capital has been deployed, the results are worse. Since 26 May 2022, the day on which most of the current independent directors were elected, the company’s share price has underperformed the Nikkei 225 and TOPIX by more than 40 per cent,” they added.

Artisan meanwhile recommended Couche-Tard, which controls the Circle K convenience store chain in North America, as “uniquely positioned to enhance [Seven & i] corporate value” by taking advantage of the Japanese group’s “tremendous brand power”.

Plug and play nuclear reactors remain a shot in the dark

A new UK state body might ease investor fears but any renaissance is likely to be slow

Funding new nuclear plants has always been a hard pitch to investors. Huge cost overruns for large plants such as EDF’s Hinkley Point C in Somerset have only added to the perception that nuclear is risky and technologically challenging.

Still, there is a clear desire for more nuclear generation capacity from western governments. Belatedly, policymakers have realised they are unlikely to achieve their aims without some state involvement to entice private investment. In Britain, a new state-owned nuclear body should help reassure potential investors that taxpayers will shoulder at least some of the risk. Even then, any nuclear renaissance will be a slow burn.

Greater government intervention should work to the advantage of Rolls-Royce. The UK engineering group is the majority owner of a joint venture that is developing small modular reactor technology — plants built in factories and assembled on site to reduce cost and risk. It is looking at potentially selling down its 70 per cent stake further.

At its last fundraising in 2021, the unit secured £490mn — £210mn of which was UK government grant funding. But this is expected to run out in the first quarter next year. The JV is currently midway through a lengthy and costly regulatory design process which won’t conclude before 2026.

Any new fundraising deal could reportedly value this venture at a similar level to New York-listed SMR developer NuScale, which has a $2bn market capitalisation. That would be a big step up for a lossmaking business with little revenue to speak of: in 2021 the Qatar Investment Authority put in £85mn and took a 10 per cent equity stake.

Its success still depends on a UK government-led SMR design competition. By the end of the year, the UK’s new state-owned nuclear body Great British Nuclear is expected to select two SMR designs out of five in the running.

Each winning design would be assigned a site in Britain before GBN sets up development companies, initially 100 per cent state-owned, to work with the technology providers to progress the projects. A tender document published in 2023 suggested government match-funding would be available, should developers require it, to ensure their technology is ready for final investment decisions to be taken in 2029.

Meanwhile, SMR developers must prove their technologies can provide value for money. One easier way would be to measure build costs against the £13bn-£14bn cost per gigawatt of Hinkley Point C at today’s prices. Harder to argue will be whether SMRs can generate electricity at comparable prices to other low carbon technologies such as onshore wind.

These remain unknowns. Investing in SMR technology still relies on a — sometimes disputed — conviction that nuclear will be indispensable to low carbon energy systems.

Dubai’s ‘co-pilot’ princes step up as emirate prepares for next generation

Sheikhs Hamdan and Maktoum take on greater responsibility as their father Sheikh Mohammed gradually steps back

Dubai crown prince Sheikh Hamdan bin Mohammed al-Maktoum has won popularity at home for his thrill-seeking pursuits, from leading mass-participation runs and cycle events to scaling the city’s Burj Khalifa tower.

His younger brother Sheikh Maktoum keeps a lower profile, preferring to eschew the limelight as he cultivates the image of an astute technocrat.

Dubai’s ruling family is counting on the brothers’ different qualities to maintain the development of an emirate that has evolved over the decades from an entrepôt port to a global trade, tourism and financial centre.

Their abilities are moving more into focus as their father, Dubai ruler and United Arab Emirates prime minister Sheikh Mohammed bin Rashid al-Maktoum, gradually steps back from frontline decision-making. The 75-year-old is now regularly photographed walking with a cane, as the ground is prepared for the eventual succession of Hamdan.

“Sheikh Mohammed’s still in the driver’s seat,” said Abdulkhaleq Abdulla, a Dubai-based political scientist. “But the co-pilots have taken more responsibility.”

Hamdan, 41, and Maktoum, 40, were in their 20s when they were appointed heir apparent and deputy ruler respectively, with a view to eventually taking over the day-to-day running of Dubai from their father.

“Hamdan is seen as the chief marketing officer [in charge of] new investments, tourism and promoting Dubai,” said one emirate-based chief executive. “Maktoum is the money man, he’s more serious.”

The succession planning moved up a gear in July as Hamdan joined the federal government as deputy prime minister. He also stepped into the largely ceremonial role of defence minister held by his father since 1971. Maktoum has been UAE finance minister and a deputy prime minister since 2021.

The brothers’ partnership is part of a new generation of leaders emerging in the Gulf. After Abu Dhabi’s Sheikh Mohamed bin Zayed al-Nahyan became UAE president last year he appointed his eldest son Sheikh Khaled as crown prince and promoted his own brothers.

Managing the power balance between Abu Dhabi, the cash-rich Emirati capital, and the more entrepreneurial Dubai is a task that will increasingly rest on the shoulders of the younger cohort.

Dubai’s latest revival started amid the coronavirus pandemic after it reopened its tourism and services-based economy faster than other cities.

The highest profile of the seven emirates that make up the UAE, the city became a magnet for wealthy tech and crypto investors, social media influencers and remote workers fleeing lockdowns elsewhere. Moscow’s invasion of Ukraine in 2022 sparked a further influx of Russians relocated by multinational companies, seeking to avoid the impact of western sanctions, or avoid the draft.

Dubai’s total population grew 9 per cent between 2019 and 2023, according to government estimates, hitting 3.7mn. The expanding ranks of expatriates helped generated Dubai’s third property surge this century, following the growth of the early 2000s.

That earlier boom ended nine years later amid the global financial crisis, when Dubai used more than $20bn in bailout loans from Abu Dhabi to avoid default. During the Arab uprisings of 2011, Dubai was seen as a safe haven for regional wealth, sparking a growth spurt that lasted until oil prices collapsed in 2014.

Maktoum, the “money man”, has been quietly using the proceeds from privatisations and growing tax revenues to pay down Dubai’s estimated $100bn-plus in bonds and loans — built up during the debt-fulled boom of the 2000s — and put the emirate’s finances on a more sustainable footing.

Some of this has come from Dubai’s capital markets strategy, through which it is listing state-related entities to boost liquidity and compete more effectively with larger bourses in Saudi Arabia and Abu Dhabi.

When he took effective power in 1995, Sheikh Mohammed turned Dubai into a global metropolis by boosting trade, developing infrastructure to attract investment and opening up new sectors in real estate, media and finance.

Sheikh Mohammed’s advisers continue to wield influence, but they are gradually being eclipsed by Hamdan and Maktoum aides such as Mohammed al-Hussaini, minister of state for financial affairs, and Helal al-Marri, who heads Dubai’s economic and tourist departments.

“Hussaini reflects prudence, financial management and discipline,” said Nasser al-Shaikh, former director-general of Dubai’s department of finance. “Marri reflects the growth agenda.”

Hussaini is a board member at Dubai’s national bank Emirates NBD and the $320bn Investment Corporation of Dubai that oversees state holdings in the city’s leading companies.

At the finance ministry, he is overseeing the UAE’s introduction of a 9 per cent corporate tax rate, which along with the sales tax of 5 per cent introduced in 2018 is expected to bring the government substantial revenues. However, analysts have warned that the levies will need careful management to avoid deterring investors previously attracted by the country’s tax-free status.

Marri, who is also on the ICD board, chairs the domestic stock market and is leading Dubai’s drive to become a cryptocurrency hub and to double the economy’s size by 2033.

The UK-trained chartered accountant, who has worked at KPMG and McKinsey, is seen as a bridge into the international business community. “When you have an issue, you go to Helal,” said a senior banker.

Yet although many Emiratis acknowledge the new leadership’s effectiveness and commitment to fiscal prudence, the new era has ushered in an air of uncertainty.

“This feels like limbo,” said an Emirati businessman. “There’s a lot of confidence in them, but the new crew are also somewhat unknown.”

And despite the brothers’ growing influence, many businesspeople still believe it is their father who calls the shots. As one Dubai magnate said: “Sheikh Mohammed’s still in charge”.

EU set to clash with member states over ‘defining’ budget overhaul

Commission says era of ‘funding with no conditions’ is gone

Brussels is set to push EU member states towards a radical overhaul of its €1.2tn common budget, tying payments to economic reforms instead of automatically compensating poorer countries.

Talks on the next long-term budget round will start in the autumn, kicking off one of the EU’s most complex and fraught policy negotiations.

One of the most contentious changes sought by the European Commission will be to revamp rules governing so-called cohesion funds, which distribute tens of billions of euros a year to close the economic gap between richer and poorer parts of the union.

Advocates of the changes argue attaching reforms — such as changes to pensions, tax or labour laws — to payouts will make spending more effective and impactful.

One EU official briefed on initial work for the 2028-34 budget said so-called net recipient countries — member states that receive more from the budget than they put into it — “need to understand that the world where they get an envelope of cohesion funding with no conditions . . . is gone”.

A second EU official acknowledged the shift would be “a pretty defining moment”.

But such a change is likely to provoke intense disagreement among the EU’s 27 member states, who must now spend years attempting to reach unanimous agreement on the size of the common budget and what it should be spent on.

Beset with challenges ranging from the war in Ukraine to retooling its economy to compete with China and the US, Brussels is already struggling to stretch its current budget, which runs until 2028.

Under the existing budget, about a third goes towards closing gaps between poorer and richer regions and another third is paid out in agricultural subsidies. The rest is divided between research funding, development aid and the cost of running the EU’s machinery.

The proposed conditionality clauses would mimic those attached to the EU’s pandemic-era €800bn fund, which disbursed money based on countries implementing pre-agreed reforms and investments. Those included a labour market reform in Spain, changes to Italy’s justice system and adapting Belgium’s pensions system.

But access to cohesion funds is seen as sacrosanct by many states in central and eastern Europe that joined the EU in the early 2000s with the promise of payouts in exchange for opening up their economies to western European investors.

Hungary, Slovakia and the Baltic states are the top five net recipients of cohesion funds as a percentage of national income, according to a study by the German Economic Institute.

Governments in these countries are likely to oppose any moves that they see as potentially limiting their payouts. Countries that pay in more to the EU budget than they get back are more supportive, however.

“Pretty much the only way you can convince net payers to contribute more is to put more strings attached on recipients,” said a senior EU diplomat.

Talks over the common budget begin in the autumn, with a formal proposal expected in 2025.

The European Commission could also impose big changes to the way funding streams are bundled, switching from a multitude of programs into a single country “plan”. It is considering other changes, including whether to shorten the duration of the common budget from seven years to five.

Proponents in the commission said the sweeping reforms would make the budget more efficient at meeting priorities such as climate change, boosting homegrown industry and reacting to unexpected crises.

“The way we agree on the EU budget has way too much inertia built in,” said a third EU official. “We need to be closer to reality,”

However, several special interest groups and regional authorities believe the changes constitute a mission creep by the commission.

“There are widespread concerns among many of the EU’s regions about what this kind of shift could mean for their critical funding,” said Ľubica Karvašová, vice-chair of the European parliament’s Committee on Regional Development, in response to plans for changes to funding streams.

“No local mayor wants their EU financial flows to rely completely on their central government enacting a reform plan, especially given how that leaves it open to domestic political leverage.”

At the moment, the EU budget is largely financed by countries according to their economic weight, split between net payers and net beneficiaries. Historically it is worth about 1 per cent of EU GDP.

Some EU officials argue the budget is not sufficient to deal with the bloc’s myriad challenges and requires more money from capitals.

“There is nothing, legally speaking, preventing the EU budget to be bigger than 1 per cent [of EU GDP],” commission executive vice-president Valdis Dombrovskis told the Financial Times.

Several countries have expressed interest in their commissioner heading the budget department of the commission.

Poland’s Prime Minister Donald Tusk this month nominated Piotr Serafin, now Warsaw’s ambassador to the EU, as the country’s candidate for commissioner. Tusk said it was “very likely” that he would end up with the budget portfolio.

However, richer countries are skittish about handing oversight over the EU’s purse to a net beneficiary such as Poland.

“To be frank, the big contributors would be far more comfortable with one of their own managing the overhaul,” said a second senior EU diplomat.

Hoxton hotels owner is betting on Americas and Middle East as it plans to open 27,000 new rooms

Ennismore, the group behind the Hoxton hotel chain, is betting on the Middle East and the Americas for its growth after warning that Europe is becoming “challenging” for hotel development.

The company, which is backed by hotel group Accor, operates more than 37,000 hotel rooms in more than 170 hotels around the world and plans to add a further 27,000 in the next few years. It has 17 hotel and restaurant brands including Mondrian.

The Middle East, which accounts for 43 per cent of its rooms now will take the lion’s share of this growth — 70 per cent — while room numbers in the Americas, which currently account for less than a fifth of the total, will grow 61 per cent.

In Europe, whose 13,000 rooms account for about a third of the present total, the number of new rooms will grow by about 35 per cent.

“Europe generally is a lot more challenging than perhaps some of the other areas,” Sharan Pasricha, founder and co-chief executive of Ennismore, told the Financial Times.

The group, which already had offices in New York and Dubai, set up earlier this year new teams in Cancún and Riyadh to expand further in the regions.

In Europe, Ennismore has “smaller properties . . . sometimes they take a bit longer to develop than other regions and other jurisdictions, versus properties that we have in the Middle East and in the Americas that are considerably bigger, develop a lot faster and have some strong feeder markets attached”, added Pasricha, the son-in-law of Indian billionaire businessman Sunil Bharti Mittal.

Ennismore, which also runs Scotland’s Gleneagles resort, does not own any of its hotels but instead partners with “sovereign wealth funds, family offices, high net worth individuals [and] real estate developers to manage their real estate” using its brands, Pasricha said.

The company said in June that it would take over management of Our Habitas, a wellness and experience-driven hotel company which runs 10 resorts in places such as Mexico’s Tulum and Saudi Arabia’s AlUla oasis.

Co-chief executive Gaurav Bhushan said that under Ennismore’s operation, Our Habitas “should be able to add 20 to 30 new properties over the coming years” predominantly in these regions.

Ennismore merged with some Accor brands to form a joint venture in 2021, with the latter taking a majority stake. Ennismore is now also backed by a Qatari consortium which acquired a near-11 per cent stake from Accor the following year in a deal that valued the company at more than €2bn.

Accor does not disclose Ennismore’s financial performance. When asked if Ennismore needed more funding for the expansion, Pasricha said: “Our business is asset light, so it’s incredibly cash generative. We don’t need the capital for running the business as it’s more than profitable.”

Global hotel chains are seeking ways to expand to tap into booming tourist demand but room growth has been muted.

The number of rooms in construction has declined nearly 8.5 per cent from its 2019 peak driven by higher costs, ongoing supply chain disruption and lack of land, said Zach Demuth, property group JLL’s global head of hotels research. He added that Europe had also been affected by labour shortages and long planning permission times.

Global hotel supply is expected to grow an average of just 2.4 per cent over the next five years, significantly down from its long-term average of 4.2 per cent, according to JLL.

The Middle East is one of a few areas where hotel development is accelerating, thanks to its availability of capital and labour. The Saudi Arabian government, which has increased its target to lure 150mn visitors by the end of the decade, is using the kingdom’s more than $900bn Public Investment Fund to develop new tourist attractions such as AlUla and the futuristic city of Neom.

“The amount of money that’s been spent on how they create tourism demand is staggering,” said Demuth.

In the Americas, Bhushan said the company would particularly focus on Mexico and the Caribbean to “capture the American customer” including in all-inclusive luxury hotels. It will open the SLS Playa Mujeres Cancún in November as its first all-inclusive resort in the region.

The region is witnessing tourism growth helped by US visitors. Juan Pedro Sáenz-Diez, head of hotels for Mexico and the Caribbean at CBRE, said the company expected “strong consumer interest in the region”, with US visitors to Mexico and the Caribbean surpassing pre-pandemic levels.

A new airport in Tulum and the newly opened Maya Train are “poised to support incremental growth for years to come”, he added.