A popular destination for lovers of sun, sport and safari, South Africa has much to offer the international tourist. And the country?s airport retail market is showing promise despite the global travel downturn. John Rimmer talks to Rory Mackey, general manager retail at Airports Company South Africa.

Few of the world?s leading duty-free markets were hit as hard as Israel in the aftermath of the September attacks on the US. Operators are clamouring for rent relief to offset their losses, but the airport authority remains hopeful that travelling Israelis will keep penetration rates and spend high.

September 11 turned a year of growth into a year-end of uncertainty for Middle East duty-free operators. But despite the tensions in some parts of the region, there is much to look forward to. The biggest players continue to invest heavily in infrastructure development, the recent drop in European business traffic is offset by strong intra-Gulf travel, and the Christmas travel rush to the sub-continent is yet to come. DFNI presents a round-up of key developments affecting the industry across the region.

At the Global Travel Retail Summit in June I suggested that the Middle East was now the world?s leading region in duty-free retailing standards, writes Martin Moodie. Recent developments have only reinforced that opinion, as a number of retailers continue to stretch the boundaries of excellence and innovation.

BAA, recent winner of the Oman airports management contract, has announced plans to contribute to the development of the Gulf state as a leading tourist destination.

Faced with the aftermath of the savage attacks on the US on September 11, organisations such as TFWA and IAADFS have responded to help the victims, raising more than $60,000 to date. And an initiative in Canada is building on this wealth of goodwill with a special duty-free promotional drive.

Faced with increases in the export tax on tobacco, the long government regulatory review and the September 11 effect, Canadian duty-free could be regarded as symptomatic of the challenges facing the global industry today. But it?s not all bad news. Dermot Davitt reports from the Frontier Duty Free Association?s (FDFA) annual Maple Leaf Gold Standards Awards.

The tobacco issue continues to dominate the agenda among operators in Canada, as they struggle to offset volume losses from successive rises in the export tax on cigarettes. The latest levy, adding C$1.50 ($0.95) to a 200-stick carton, puts further pressure on profitability and for some, brings into question their ability to survive.

The government?s regulatory review of duty-free, which had dogged the industry for almost four years, turned out well for the region?s operators, with few changes to the programme. Fears that foreign ownership or licence competition could be introduced were quashed in the Summer, although there have been changes.

Across the spectrum, from machine-made cigarillos to hand-made premium cigars, the customer profile of the category is changing. DFNI examines the profile, motivations and opinions of a sample of travellers buying premium cigars, surveyed last week at World Duty Free?s The Cigar House store at London Heathrow airport terminal three.

The cigar sector has undergone a revolution since the boom in the US market. Developing technology and a new professionalism among suppliers have broadened product possibilities, attracting a different customer profile. Gavin Lipsith reports.

Dutch manufacturer Henri Wintermans would be the first to acknowledge the rise in demand for small cigars over recent years, having doubled its sales volumes in the past six years.

At the premium end of the market, Cuban cigar manufacturer Habanos has been quick to respond to the popularity of smaller and cheaper cigars with the launch of their Mini ranges.

Since the abolition of intra-EU duty-free more than two years ago, duty-free cigar sales have fallen noticeably.

Falling sales are plaguing all product categories in travel-retail since September 11. But the sunglasses sector is showing resilience, as Kevin Rozario reports.

The Cigar House concept has transformed the way cigars are sold at London Heathrow. Walk-in humidors ensure products are kept in good condition, staff are well trained and single cigars are offered, widening customer choice. And many of the changes can be put down to the vision of tobacco specialist Sergio Morera. Gavin Lipsith reports.

Travel industry analysts believe that the all-important Japanese traveller?having cut back on travel with devastating results in places such as Hawaii and Guam?will head instead to intra-Asian destinations such as Taiwan, Singapore, Hong Kong and South Korea over the next year.

Birgit Meiser is one of duty-free?s most experienced and committed servants. After many years in the trade, she has successfully developed Meiser Consult, her own agency business, and sunglasses are playing a key role in that success. She discusses her progress with Martin Moodie.

A stand-alone sunglasses and watches concept, divided 75:25 respectively, that opened in August is giving both sectors a lift for operator Waked Internacional.

The world?s biggest prescription frames and sunglasses manufacturer is undaunted by the slowdown in travel-retail. Kevin Rozario talks to duty-free manager Martha Rosas about the Luxottica brand?s momentum in the channel.

The Swatch Group and China Power Duty Free Group have forged a strategic alliance to enable the Swiss watchmaker to target the Chinese duty-free market. In a worldwide exclusive, DFNI publisher Martin Moodie was on hand at the Swatch headquarters in Biel as board delegate Nick Hayek Jr met China Power Duty Free Group?s two top executives, Gai Zhixin and Antares Cheng, to cement an historic deal.

Following its trial of the shelving for GuinnessUDV?s new gift range The Johnnie Walker Collection, World Duty Free (WDF) has installed a ?liquor gifting bar? in the newly-refurbished World Shopping store at London Heathrow terminal three.

LVMH chairman Bernard Arnault said last week that retailing was a ?non-core? activity for the company, but denied that DFS Group or Sephora were for sale. LVMH?s retail businesses have been hit hard by the global economic slowdown and in particular the downturn in Asian travel.

Bahrain Duty Free is set to complete its most ambitious renovation and expansion programme yet, with the relocation and doubling in space of its duty-free complex at Bahrain International airport.

One of the region?s leading travel retailers Abu Dhabi Duty Free (ADDF) was set for an exciting expansion into Egypt in October.

A consortium involving Irish airports operator Aer Rianta is among those that has been shortlisted to bid for the $300m contract to develop and operate Larnaca and Paphos airports in Cyprus.

Sharjah is just a stopover for many tourists. But, says Weitnauer Tuxedo deputy general manager Daniel Garcia, in the present climate this may not be a bad thing. Jane Labous investigates how Sharjah airport is faring in a world increasingly worried about flying.

The ninth annual Dubai Duty Free Golf World Cup was played out in the most difficult circumstances. Yet it turned into a resounding success, as Martin Moodie reports.

Doha airport on the first day of Ramadan and the gateway to the Qatari capital is buzzing with passengers visiting the Middle East?s newest duty-free complex, writes Martin Moodie.

His Majesty King Abdullah II of Jordan will officially open the eighth annual Middle East and Africa Duty Free Symposium, to be held in the Jordanian capital Amman in January 2002.

DFNI is pleased to present an exclusive report on UK travel-retail research specialist JRA?s eagerly awaited annual polls of international travel retailers. The reports, available by subscription only, assess the service retailers receive from suppliers in a number of product groups. The categories examined in the 2001 third annual report are liquor, beauty products and confectionery.

EU. In a landmark case for the luxury goods industry, the European Court of Justice has ruled that retailers must seek the permission of trademark holders before sourcing goods from outside the European Economic Area (EEA)?the 15 EU states plus Norway, Iceland and Liechtenstein. The move is a boost for fashion, fragrance and other luxury goods suppliers trying to stamp out grey-market imports and prevent discount retailing in Europe.

Preparations are well under way for next year?s Raven Fox Enchantment Ball, to be held in London on International Women?s Day, March 8 2002. The event will be in aid of the charity Cosmetic Executive Women (CEW) France.

INTERNATIONAL. P&O Princess Cruises and Royal Caribbean Cruises have announced a merger worth $6bn that will create the world?s largest cruise operator. The deal could be concluded by the second quarter of 2002, if approved by anti-trust authorities and the shareholders of the two groups.

CANADA. Retailers at terminal three at Toronto Lester B Pearson International airport have been hit hard after carrier Canada 3000 was declared bankrupt last month.

SWEDEN. The Nuance Group will introduce its Travel Shopping concept at Sweden?s airports when it begins its five-year duty-free contract at 15 of the country?s airports on January 1.

SOUTH AFRICA. State-owned airport authority Airports Company South Africa (ACSA) is stepping up plans to create a wholesale duty-free service for bulk-buying market traders.

UK. BAA has completed the 50,000sq ft (4,650sq m) extension of its London Gatwick North terminal. At its heart is a new World Duty Free (WDF) store as well as several specialist branded outlets on two levels.

FRANCE. French airport authority Aéroports de Paris (AdP) has released details of the 3,320sq m (35,740sq ft) of retail space in Paris Charles de Gaulle airport?s new terminal 2E. It is due to open in Spring 2003, and the authority will invite bids for the space next year.

The nightmare of a duty-free tobacco ban could become a reality in some regions if the industry fails to step up lobbying efforts.

UAE. Retail operations at Dubai Duty Free will double in space to about 11,000sq m (118,400sq ft) when the new Emirates concourse opens in four years? time.

SINGAPORE. The Civil Aviation Authority of Singapore released tender documents for the long-awaited fragrances and cosmetics concession in Changi terminal one on November 30. The tender had been postponed because of the uncertainty after September 11, but the CAAS eventually decided that traffic and spend had stabilised enough to proceed. Weitnauer currently operates the contract.

HONG KONG. Hong Kong Airport Authority is to tender new spaces for retail as it expands its commercial activities. The Hong Kong SkyMart project involves reconfiguring and redesigning existing areas on departures and arrivals levels.

INTERNATIONAL. Inflight Sales Group (ISG) has agreed lucrative concession contracts with leading international carriers Varig and Air Canada

FRANCE. LVMH chairman Bernard Arnault said last week that retailing was a ?non-core? activity for the company, but denied that DFS Group or Sephora were for sale. LVMH?s retail businesses have been hit hard by the global economic slowdown and in particular the downturn in Asian travel.

HONG KONG. Retailers and suppliers have come together to call on airports to address the issue of high rents and low investment. Speaking at the recent ACI Airport Business conference in Hong Kong, Nestlé International Travel Retail general manager Dan Cappell was among those who delivered a wake-up call to the airport community.

US. Airport authorities have unveiled further relief measures for their retail concessionaires to help them overcome the worst effects of the post-September 11 downturn.

New products and line extensions are helping drive volume growth for Canadian distributor Peter Mielzynski Agencies, particularly in the fast-growing vodka sector.

Agency Chase International is launching Ketel One Citroen vodka in Canada duty-free to build on the success of the brand in North American markets.

Tobacco manufacturer Agio has maintained its duty-free sales despite the global slowdown in travel.

Dutch tobacco supplier Henri Wintermans has revealed the new design for its well-known Café Crème brand.

The International Travel Retail Confederation (ITRC) has reported an excellent response to the fundraising appeal made at a duty-free tobacco seminar in Cannes last month.

Cigarette suppliers to Canadian duty-free continue to feel the heavy impact of a succession of measures designed to curb smoking and curtail their businesses.

Japanese beauty house Kanebo has acquired the licence to produce a fragrance for Costume National, a Milan-based fashion brand with seven boutiques around the world.

Jewellery and fragrances house Bvlgari suffered a slowdown in sales in the third quarter of 2001.

Clarins? new daytime moisturising cream is to be launched in duty-free outlets over the coming months.

SAS Trading is to open a dedicated cosmetics and fragrances store in Gdansk airport, Poland on December 14.

Clinique claims its two new foundation and powder products demonstrate a breakthrough in optical science.

Chocolaterie Duc d?O and Stollwerck?s Sarotti division have appointed Singapore distributor Distriworld as duty-free consultant on a global basis.

Bonardo Travel Retail (BTR) has been employing hostesses to stage sampling promotions at Zürich and Milan Malpensa airports for Swiss Delice?s Chocobloc.

German distributor Pasco, which handles Bose and Bang & Olufsen in duty-free, has declared its recent four-month home delivery initiative with KLM Airlines a success?and is hoping to capitalise on other opportunities in this area.

The Pen Shop, Europe?s largest chain of writing instrument shops, has opened a permanent outlet in London Heathrow airport terminal one.

UK ferry operator P&O Stena has reported a 20% increase in watch sales onboard this year, to £2m ($2.86m). More than 100,000 units have been sold so far.

Swiss supplier Hanowa Watch unveiled its latest collections at the TFWA World Exhibition in Cannes last month.

Latin American travel retailer Waked Internacional is to introduce more expensive branded sunglasses into its newly opened stand-alone sunglasses and watches store SunTime.