In Saudi Arabia, a landmark shift towards welcoming tourists from across the globe has driven major growth in international visitor numbers, spurring a booming industry ripe for global investors.
For years, tourists have flocked to visit the great wonders of the Middle East and North Africa. They have travelled in their millions to amble through ancient, atmospheric souks, explore Roman ruins and unwind on the vast unspoiled stretches of Gulf coastlines.
The region has long been an established tourism hotspot for those seeking both adventure and year-round sunshine. And now there’s a new focal point for international tourists on the look-out for new, authentic experiences.
According to recent data released by the UN’s World Tourism Organization, the sands of tourism in the Arab World are shifting. Saudi Arabia is the fastest-growing tourism destination in the G20, with visitor numbers up by 121 per cent compared with pre-pandemic levels.
Despite being a relatively new destination on the global tourism landscape, Saudi Arabia offers history, heritage, culture, sea, sunshine and more. When the kingdom opened its doors to international tourists in 2019, its tourism industry immediately began to thrive.
Visitors are quickly discovering that there is much more to Saudi Arabia than undulating dunes
Under the direction of Saudi’s national transformation program, Vision 2030, the kingdom aims to boost the tourism industry’s contribution to more than 10 per cent of GDP by 2030, with $1 trillion slated for investment into the sector over the next decade.
That means big business opportunities for international investors. To date, more than 3,500 tourism investment licences have been issued in Saudi Arabia in the past three years. And with the Saudi government moving quickly to increase the ease of doing business and travelling to the kingdom, the sector is set to go from strength to strength in the coming years.
Simplifying travel with the e-visa
In 2019, Saudi Arabia broke new digital ground by launching an e-visa system for international visitors. In the three years since, tourism numbers have surged as people from Auckland to Anderlecht have shown a clear appetite to see and experience the real Saudi Arabia.
Visitors are flocking to cultural landmarks, from the UNESCO World Heritage listed At-Turaif District in Ad-Diriyah to the Hegra archaeological site in AlUla, one of the oldest cities in the Arabian peninsula, deep in the northwestern desert. They are journeying to historic Jeddah in the west, discovering the ancient rock art inscriptions in Hail in the north. And they are exploring the world’s largest palm oasis, Al-Ahsa, in the east.
With this increased tourist footfall and groundswell of backpacker curiosity in Saudi’s ancient origins, businesses are identifying, creating and seizing new opportunities to expand their global footprint in the Middle East and beyond.
These opportunities include the world-leading giga-projects such as NEOM, Qiddiya, Diriyah Gate and King Salman Park, which, through a blend of innovative architecture and green technologies, are rewriting the rules of sustainable development and eco-friendly tourism.
Also featuring prominently in these investor-friendly projects is the Public Investment Fund-owned Soudah Development, with plans to invest $2.93 billion as it defines a new era of sustainable mountain tourism, as part of the kingdom’s ambitious environmental action plans.
Soudah Development plans to develop 2,700 hotel rooms, 1,300 residential units and 30 commercial and entertainment attractions to create a luxury mountain tourism destination high above the clouds. This planned infrastructure will play a key role in Saudi Arabia’s tourism push by attracting more than two million visitors a year, creating more than 8,000 jobs and contributing $7.72 billion to GDP by 2030.
In October 2022, Saudi Arabia’s flagship tourism project developer, rebranded as Red Sea Global, also owned by the PIF, said it would open three resorts in 2023 and 13 more in 2024.
Partner in success
Investors eyeing Saudi Arabia’s thriving tourism sector will have a partner in success – the Tourism Development Fund. Established in June 2020 to empower one of the kingdom’s most rapidly growing industries, TDF is tasked with helping Saudi and international investors access high-potential tourism investments across the country’s tourist destinations, with a capital of $4 billion allocated to make it happen.
Ahmed Al-Khateeb, Minister of Tourism for Saudi Arabia, has noted that the fund’s successful launch, even in the eye of the pandemic’s storm, was “testament to the investor and private-sector confidence in the long-term outlook for tourism in Saudi Arabia.”
In October 2022, TDF signed an agreement with Dana Bay Tourism Company to invest in a closed real estate fund worth $171.36 million, to develop a mixed-use beach resort project in Dana Bay in the Eastern Province – comprising luxury villas, retail stores, restaurants and entertainment venues, a museum, art galleries and artisanal workshops along a 14-kilometer beach.
Prior to that, in July 2022, TDF launched a digital platform to offer financing solutions for investors and entrepreneurs in the tourism sector to enable automated commercial registrations without having to fill in data. The new portal’s launch is part of the fund’s commitment to stimulate tourism investment. Earlier this year, TDF approved six strategic tourism projects worth $400 million.
The kingdom’s doors are open to all, for all to explore new high-potential opportunities and for all to discover the real Saudi Arabia.
For more information, visit: https://www.visitsaudi.com.