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Luxury brands book sales drop as Mideast war takes toll on airport shopping

The disruption now in its sixth week exposes a vulnerability for luxury and beauty groups that have relied on airport shopping and Gulf hubs among their highest-margin channels

Reuters
Reuters

15 April, 2026

Luxury brands book sales drop as Mideast war takes toll on airport shopping

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Article Summary
The Middle East conflict is impacting luxury retailers like DFS and Avolta, as airport closures and reduced travel curb sales of premium goods. This hits high-margin travel retail, offsetting weakened demand elsewhere. LVMH and Kering report sales declines. The industry is shifting inventory, but recovery may be slow, impacting firms like Estee Lauder and Puig particularly.

From DFS to Avolta, duty-free stores selling premium perfumes and spirits to big spenders are feeling the pinch as conflict in the Middle East shuts airports and curbs travel to the region, a setback likely to become more acute as the war drags on.

The disruption now in its sixth week exposes a vulnerability for luxury and beauty groups that have relied on airport shopping and Gulf hubs among their highest-margin channels – to offset weaker demand in China and Europe, making even short-term airport closure a potential drag on quarterly profit.

Read more-Flexible payments, AI now shape how Gulf shoppers buy, finds Tabby survey

Analysts have said a prolonged slump in Middle East air traffic could compound pressure on a travel-retail industry still recovering from the COVID-19 pandemic, squeezing underperforming businesses such as LVMH’s DFS and weighing on prestige beauty and luxury firms including Estee Lauder, Puig and L’Oreal.

International flights to and from the Middle East plummeted in the first half of March. While some airlines in the UAE are slowly restarting, flights remain well below normal levels.

Flight cancellations from the Middle East, excluding Turkey, decreased from their peak of 65 per cent on March 3 to 13 per cent on March 27, showed data from Cirium, but the number of flights scheduled has also fallen.

DFS “is costing two (percentage) points of growth” for its selective retailing division, which includes beauty brand Sephora, LVMH CFO Cecile Cabanis told analysts this week.

The conflict shaved at least 1 per cent off group ​sales in the latest quarter due to lower spending in the Gulf region, LVMH said.

“What we see today is still that demand is very much down,” Cabanis said.

Drone strikes shutter gulf hubs

Companies that operate in the $74bn travel-retail industry have been shifting inventories and temporarily closing airport stores in the region. Normalcy for luxury airport shops may take time, analysts said.

Dubai International Airport, whose retail outlets include L’Oreal’s Aesop, Kering’s Gucci and Estee’s Jo Malone, is operating a reduced number of terminals after a drone attack forced the hub to temporarily close. Kuwait International Airport has been shut due to repeated drone strikes, halting sales for airport outlets owned by Avolta and Boots.

Avolta, which earns 3 per cent of revenue from the Middle East, is moving inventory from locations with slower sales to those with more foot traffic, CFO Yves Gerster told Reuters. Still, partly shuttered airports in some instances were leading to strong sales of food and other items for stranded travelers, for instance at Dubai airport, Gerster said.

Kering CFO Armelle Poulou told Reuters after the company’s first-quarter earnings report that travel retail was slightly down compared with last year, and that “performance with local customers has been more resilient than tourism-related demand.”

The conflict shaved 3 per cent off overall Kering sales in March, or 1 per cent for the quarter, with a similar effect at Gucci in particular, Poulou said.

Investors will keenly watch out for Estee’s quarterly results on May 1, as the firm explores a $40bn acquisition of Spanish competitor Puig, which derives a tenth of sales from travel retail. That makes it one of the more exposed beauty companies to swings in airport shopping and international travel, analysts said.

L’Oreal, whose travel-retail business in Asia accounted for less than 4 per cent of the company’s $44bn in 2025 sales, is scheduled to report quarterly results on April 22. The company does not provide total travel-retail sales, although analysts said Asia accounts for the largest share.

Estee Lauder and L’Oreal declined to comment. Puig was not immediately available for comment.

Qatar Airways extends complimentary date changes until October 2026

The airline has introduced complimentary changes until October 31, 2026, offering customers more destinations and more flexibility across its network

Nida Sohail
Nida Sohail

14 April, 2026

Qatar Airways extends complimentary date changes until October 2026

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Article Summary
Qatar Airways offers complimentary flight changes until October 2026 for bookings until June 2026. Saudia and Saudi Arabia Railways are integrating ticketing for air and rail travel, simplifying passenger journeys. Oman Air flights operate normally, but some routes to Dubai, Bahrain, Doha, Kuwait, Copenhagen, Baghdad and Khasab are cancelled until April 2026 due to regional airspace disruptions.

Qatar Airways has announced a new travel flexibility initiative aimed at giving passengers greater convenience and reassurance when planning their journeys.

The airline has introduced complimentary changes until October 31, 2026, offering customers more destinations and more flexibility across its network.

Customers with a confirmed booking on Qatar Airways operated flights for travel until June 15, 2026 are eligible for complimentary date changes up to October 31, 2026, an Instagram story on the entity’s Instagram story. The policy is designed to support travellers whose plans may shift due to changing circumstances or disruptions.

Read more-Etihad announces fee waiver: Here’s what travellers need to know

Importantly, if a rebooked flight is impacted again, passengers will remain eligible for further fee-free changes until October 31, 2026. (*subject to availability and fare seasonality).

The update forms part of the airline’s broader effort to provide more adaptable booking conditions and improve customer confidence in travel planning.

Saudia and Saudi Arabia Railways launch integrated air-rail ticketing

Saudia, the national flag carrier of Saudi Arabia, has signed a major agreement with Saudi Arabia Railways (SAR) to integrate their digital systems, allowing passengers to issue boarding passes for both air and rail journeys in a single transaction. The agreement was formalised during the Umrah and Ziyarah Forum 2026 in Madinah.

The agreement was signed by Essam Akhonbay, Vice President of Marketing at Saudia, and Engr. Ibrahim AlNoaman, Commercial Director of the Haramain High-Speed Railway (HHR) and Masar Makkah Master Plan (MMMP). The collaboration is aimed at strengthening connectivity between air and rail services and simplifying travel procedures for guests.

Through this integration, both organisations will deliver enhanced digital services designed to reduce travel time and effort while improving the overall passenger experience. The initiative also builds on previous joint efforts, including special fares for train travel to Makkah and Madinah as part of an expanding transport ecosystem.

Akhonbay said: “This agreement reflects Saudia’s commitment to advancing a more seamless and integrated travel experience through digital innovation. Our digital infrastructure is designed to support the continuous introduction of new services with high efficiency and reliability.”

Saudia continues to invest in improving the passenger journey through advanced digital platforms powered by artificial intelligence, enabling more personalised travel experiences. These developments extend to ground and inflight services, including upgraded entertainment systems and high-speed connectivity to ensure a smoother journey.

The Haramain High-Speed Railway, one of the fastest rail systems in the world, operates at speeds of up to 300 km/h and connects Makkah and Madinah via five main stations, including King Abdulaziz International Airport station, one of the largest airport-linked railway stations globally. The integration is expected to further strengthen mobility and streamline multi-modal transport across the Kingdom.

Oman Air operations continue amid regional airspace disruptions

Oman Air has confirmed that its flights are continuing to operate as normal, with additional services being deployed across its network. However, the airline noted that ongoing regional airspace closures have led to temporary disruptions on selected routes.

As a result, flights to and from Dubai (DXB), Bahrain (BAH), Doha (DOH), Kuwait (KWI), Copenhagen (CPH), Baghdad (BGW), and Khasab (KHS) are cancelled until 30 April 2026.

Guests affected by the changes are advised to manage their bookings via the airline’s website or mobile application.

The airline added: “We sincerely apologise for any inconvenience and thank you for your understanding,” a notice on the airline’s website said.

China, UAE agree to deepen strategic partnership during Abu Dhabi Crown Prince’s visit

Discussions covered cooperation in energy, petrochemicals, investment flows, battery technology, energy storage systems, electric mobility, electronics and digital transformation

Neesha Salian
Neesha Salian

14 April, 2026

China, UAE agree to deepen strategic partnership during Abu Dhabi Crown Prince’s visit
Image: Abu Dhabi Media Office

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Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan met China’s President Xi Jinping and Premier Li Qiang in Beijing, where both sides discussed expanding a comprehensive strategic partnership spanning energy, investment, technology and industrial cooperation.

The meetings took place during the Crown Prince’s official visit to China which began on Sunday.

Sheikh Khaled conveyed the greetings of UAE President Sheikh Mohamed bin Zayed Al Nahyan and expressed appreciation for the hospitality extended by Chinese leadership during his official visit.

During his meeting with President Xi, both sides reviewed bilateral relations and reaffirmed their commitment to advancing cooperation in line with the comprehensive strategic partnership between the two countries.

In a separate meeting with Premier Li Qiang, discussions focused on expanding economic and investment ties and deepening cooperation in future-oriented sectors, alongside an emphasis on adapting to global economic shifts and strengthening supply chain resilience.

Abu Dhabi Crown Prince highlighted UAE’s focus on strengthening relations

Abu Dhabi’s Crown Prince highlighted the UAE’s commitment to further developing relations with China, particularly in areas of economic cooperation, development initiatives and long-term strategic investment.

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Importance of UAE–China Business Promotion Conference discussed

Both sides also underscored the importance of the UAE–China Business Promotion Conference held during the visit, which brought together investors and business leaders to explore opportunities in trade, infrastructure, technology and industrial development.

According to official figures, non-oil trade between the two countries reached approximately $111bn in 2025.

As part of the visit, Sheikh Khaled also held meetings with chairmen of leading Chinese companies, including China National Petroleum Corporation (CNPC), Wanhua Chemical Group, China Investment Corporation, Contemporary Amperex Technology Company Limited (CATL), and Xiaomi Corporation.

Discussions covered cooperation in energy, petrochemicals, investment flows, battery technology, energy storage systems, electric mobility, electronics and digital transformation.

Both sides also exchanged views on regional and international developments, emphasising the importance of stability, multilateral coordination and peaceful resolution of conflicts.

The visit also saw the signing of multiple memoranda of understanding covering areas including clean energy, investment, sustainable agriculture, environmental protection, health sciences and advanced technology, alongside joint research and knowledge exchange initiatives.

The engagements reflect ongoing efforts by the UAE and China to deepen their comprehensive strategic partnership and expand cooperation across emerging sectors, as both economies continue to pursue diversification and long-term economic resilience.

ClearTax approved as UAE e-invoicing provider ahead of July deadline

ClearTax said it is already working with enterprises in sectors including real estate, manufacturing, banking, financial services and insurance, as well as retail and consumer goods

Neesha Salian
Neesha Salian

14 April, 2026

ClearTax approved as UAE e-invoicing provider ahead of July deadline
Image: Getty Images/ For illustrative purposes

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ClearTax said on Tuesday it had been approved as an ‘Accredited Service Provider’ under the UAE’s e-invoicing framework, as companies step up preparations ahead of a July deadline to appoint certified providers.

The accreditation, granted under the UAE Ministry of Finance and Federal Tax Authority framework, comes as businesses move to comply with new requirements that will standardise digital invoicing and reporting.

The shift is expected to push companies to upgrade tax and finance systems, with governments globally increasingly using e-invoicing data and analytics to monitor transactions and automate compliance processes.

ClearTax has supported e-invoicing, tax compliance mandates across multiple markets

ClearTax said its offering draws on experience supporting e-invoicing and tax compliance mandates across multiple markets, including India, Saudi Arabia, Malaysia and Europe.

The company has previously worked on India’s 2020 e-invoicing rollout, advised on Saudi Arabia’s ZATCA Phase I and II implementation, and operates within Malaysia’s framework as an accredited provider, as well as Europe’s Peppol-based network.

“Most enterprises today are still trying to solve tax operations through ERP connectors, manual efforts and spreadsheets,” said Archit Gupta. “As governments move toward real-time visibility and AI-driven scrutiny, that approach starts to break down.”

He added that companies need to shift from reactive compliance to what he described as continuous, data-driven tax processes.

The company said it has committed $50m to expand its operations in the UAE, including building local teams and infrastructure to meet data residency requirements.

ClearTax said it is already working with enterprises in sectors including real estate, manufacturing, banking, financial services and insurance, as well as retail and consumer goods.

The UAE’s e-invoicing rollout is part of broader efforts to modernise tax administration and improve transparency, with companies expected to integrate accredited providers into their systems ahead of the July deadline.

Read: Beyond compliance: How e-invoicing can power the UAE’s next phase of growth

How UAE’s R&D tax credits could unlock significant value for the construction sector

The framework, introduced under Ministerial Decision No 24 of 2026 and effective from January 1, offers tax credits of between 15 per cent and 50 per cent on eligible R&D spending

Neesha Salian
Neesha Salian

14 April, 2026

How UAE’s R&D tax credits could unlock significant value for the construction sector
Image: Supplied

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Article Summary
UAE construction firms risk missing out on significant R&D tax credits (15-50%) if they don't promptly identify qualifying activities and establish necessary structures. The incentive, outlined in Ministerial Decision No 24, rewards innovation like sustainable materials and AI adoption. Dhruva advises proactive documentation and pre-approval, as retrospective claims are unlikely to succeed. Workforce planning is vital to maximise credit levels.

Construction companies in the UAE risk missing out on substantial tax savings under the country’s new research and development (R&D) incentive regime unless they move quickly to identify qualifying activities and put the required structures in place, according to tax advisory Dhruva, a Ryan Affiliate.

The framework, introduced under Ministerial Decision No 24 of 2026 and effective from January 1, offers tax credits of between 15 per cent and 50 per cent on eligible R&D spending.

Despite the potential upside, many firms in the construction sector — one of the UAE’s largest contributors to economic activity — have yet to classify or document innovation work in a way that would allow them to claim the benefit, Dhruva said.

“The construction sector innovates constantly, but much of this activity has never been labelled R&D,” said Nimish Goel, leader Middle East, Dhruva. “That is precisely where value is being left on the table.”

The advisory said the window to act is narrowing, as the regime requires upfront approval and detailed, contemporaneous documentation of qualifying work.

How the construction sector can leverage R&D tax credits

Under rules aligned with OECD standards, eligible R&D must involve technical uncertainty and systematic experimentation. In construction, this can include developing low-carbon materials, testing modular building techniques, or creating proprietary software for building information modelling, digital twins and AI-driven project management.

Sustainability-focused innovation, such as net-zero building systems and climate-adapted cooling technologies, as well as the use of robotics and drones in construction and inspection, may also qualify.

A key feature of the regime is its dual-threshold structure, which ties the level of tax credit not only to R&D spending but also to workforce size.

The first Dhs1m ($272,000) of qualifying expenditure attracts a 15 per cent credit with a minimum of two R&D staff, rising to 35 per cent for up to Dhs2m with six staff, and 50 per cent for up to Dhs5m with at least 14 staff. Companies that fail to meet headcount thresholds receive lower rates.

This structure effectively links tax benefits to hiring, making workforce planning a critical lever for maximising returns.

Specialist roles such as engineers, materials scientists and software developers can determine access to higher credit tiers, while staff costs receive a 30 per cent uplift in qualifying expenditure.

“This is not just a tax incentive; it represents a structural shift in how innovation is recognised within the construction sector,” Goel said.

The regime also requires companies to secure pre-approval and maintain detailed records of R&D objectives, methodologies and outcomes for seven years, raising the compliance bar for an industry not traditionally structured around formal R&D processes.

Advisers warn that companies attempting to retrospectively classify projects are unlikely to meet the standard, making early integration of R&D tracking into project workflows essential.

For large construction groups operating centralised engineering or shared technology platforms, structuring will also be critical, as intra-group transactions are excluded from qualifying expenditure.

With the UAE pushing to position itself as a knowledge-driven economy, the incentive brings the construction sector into line with technology and manufacturing in accessing R&D support.

“The question is not whether to engage,” Goel said. “It is how quickly companies can build the processes to do so effectively.”

Read: Abu Dhabi, Dubai top Multipolitan’s tax-friendly cities index

Dubai’s RTA services disrupted: Here’s what users need to know

The disruption, which has persisted for approximately two days, has rendered several core digital services unavailable, including the vehicle registration renewals

Nida Sohail
Nida Sohail

14 April, 2026

Dubai’s RTA services disrupted: Here’s what users need to know

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The Roads and Transport Authority (RTA) in Dubai is currently managing a temporary technical disruption that has affected multiple service channels, limiting access to essential transport-related services across the emirate.

The disruption, which has persisted for approximately two days, has rendered several core digital services unavailable, including vehicle registration renewals, ownership transfers, and transaction processing related to buying and selling vehicles. Users attempting to access the RTA mobile application are met with a system notification stating that technical issues are ongoing and under resolution.

Customer feedback

Customer responses on social media indicate operational challenges resulting from the outage.

One user reported an inability to renew a vehicle registration due to the application not functioning. Another highlighted broader implications, stating that ongoing issues have prevented the completion of vehicle purchases, sales, and associated processes over a two-day period.

These interactions reflect a wider service interruption affecting both individual users and transactional workflows that depend on uninterrupted platform availability.

RTA response and current status

The RTA has issued a standardised response across its digital communication channels, confirming the disruption and ongoing remediation efforts. In its public replies, the authority stated that a “temporary technical disruption” is affecting services across various channels and that technical teams are actively working to restore full functionality.

No specific timeline for resolution has been communicated at this stage. The authority has requested customer understanding and cooperation while resolution efforts continue.

The disruption underscores the critical role of RTA’s digital infrastructure in supporting daily transport-related transactions in Dubai. The temporary unavailability of these services has led to delays in compliance-related processes and transactional activities, with potential downstream implications for customers managing time-sensitive requirements.

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Luxury brands book sales drop as Mideast war takes toll on airport shopping