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Saudi Arabia’s $13 billion tourism investment aims for $85 billion revenue leap

In 2023, the Kingdom raised its 2030 original goal from 100 to 150 million visitors annually.

Saudi Arabia’s $13 billion tourism investment aims for $85 billion revenue leap
[Source photo: Krishna Prasad/Fast Company Middle East]

As part of its economic diversification plan, Saudi Arabia is significantly emphasizing tourism. The kingdom is allocating resources to this growing sector, attracting private investments, and initiating ambitious projects to bolster its tourism industry.

According to Princess Haifa Al-Saud, the kingdom’s vice minister for tourism, Saudi Arabia has secured $13 billion in private investments to fuel its transformation into a major travel destination.

This influx of capital aims to significantly expand accommodation options, with projections indicating an increase of 150,000 to 200,000 hotel rooms within the next two years. Princess Haifa revealed in a Bloomberg interview that the ultimate goal is a dramatic rise in tourism revenue, with a target of $85 billion this year compared to $66 billion in 2023.

This ambitious strategy aligns with Crown Prince Mohammed bin Salman’s vision for economic diversification, aiming to lessen reliance on oil revenue and cultivate new income streams through tourism, sports, and technology. Saudi Arabia is actively courting international visitors, setting a lofty target of 150 million annual tourists by 2030, forming part of the broader economic diversification plan.

Mega-projects like Qiddiya and investments in industries like football are designed to entice foreign travelers, showcasing Saudi Arabia’s commitment to becoming a global tourism hub. Moreover, being the sole bidder for the 2034 World Cup further underlines the kingdom’s ambitious goals in the tourism sector.

Domestic tourism dominates the sector, with 2023 seeing 100 million visitors, primarily Saudi residents. International arrivals, mainly for religious or business purposes, reached around 27 million. Leisure travel currently holds a smaller share due to ongoing infrastructure development projects.

The government’s commitment to the tourism industry is unwavering. It aims to attract $80 billion in private investment by 2030 and has allocated a substantial $800 billion to the sector over the next decade. The revised target of 150 million visitors by 2030, announced in October 2023, further underscores the government’s growing optimism and confidence in these ambitious plans.

Minister of Tourism Ahmed Al-Khateeb attributed this adjustment to exceeding initial projections, “I think we will close this year with about 100 million (visitors) and almost 6% of contribution to gross domestic product, that’s why … (Crown Prince Mohammed bin Salman) instructed us to revise our targets to 150 (million visitors),” Al-Khateeb said at the time.

The minister elaborated that the new target anticipates a balanced split of 50/50 between domestic and international tourists, projecting 75 million visitors from each category by 2030.

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