ATM 2020: Saudi Arabia’s tourism industry rapidly evolving

ATM 2020

Research commissioned by the Arabian Travel Market (ATM), conducted by Colliers International, has revealed that visitors to the KSA are expected to rise 38 per cent from 15.5 million in 2019 to 21.3 million by 2024.

This significant rise will be a result of the growing number of GCC residents wishing to visit the Saudi Arabia on short city or mini breaks, as well as business travellers extending their work trips to explore the Kingdom’s expanding tourism offerings.

Colliers’ data also revealed that more than 21.3 million visitors are expected to visit the country by 2024.

Travel Forward 20

Exhibition director – Middle East, Arabian Travel Market, Danielle Curits declared: “As Saudi Arabia continues to reduce its reliance on oil, increasing tourism arrivals is becoming instrumental in the country’s economic diversification, and at ATM, we are witnessing this growth firsthand, with the total number of exhibitors from the Kingdom increasing 45 per cent year-on-year between 2018 and 2019.”

Curtis continued: “With an ambition to increase inbound tourism to 100 million by 2030, Saudi Arabia no longer wants to be viewed as solely a religious destination for the world’s Muslim community, or a corporate destination as one of the richest countries in the world. It has an incredible landscape, with diverse regions and an array of tourism offerings for leisure travellers.”

Due to these positive forecasts, the global hotel industry has gained a renewed interest in Saudi Arabia with international and regional brands looking to expand their presence in the country.

According to data from STR, 79,864 hotel rooms are expected to be added to the KSA’s existing inventory by 2025, with the majority of rooms (34,270) in Makkah, followed by Jeddah and Riyadh – 14,525 and 11,632 new rooms, respectively.

Last year was a strong year for hotels in Riyadh, with RevPAR growing 5.2 per cent following a 9.2 per cent increase in occupancy and -3.6 per cent decline in ADR. In Q4, Riyadh’s RevPAR reached $141.15 – the highest it has been since 2014.

Curtis said: “While, this new supply may place additional competitive pressure on hotels’ performance across the country, the projected growth in visitor numbers over the next four years is expected to continue to boost occupancy levels throughout 2020 and well beyond.”

Hot on the heels of the new tourist visa, Saudi Arabia has developed a two-phase tourism strategy in line with Vision 2030. Phase one (2019-2022) will focus on attracting first-time visitors to discover Saudi Arabia, and phase two (2022 onwards) will focus on the full development of giga projects such as NEOM and the Red Sea Project.

Meanwhile, Saudi Arabia’s outbound tourism market is expected to reach over $43 billion by 2025, according to the latest data from Renub Research. Family holidays are currently dominating the market, but a rising generation Z population is expected to change this trend.

At this year’s Arabian Travel Market in April, Saudi exhibitors will include the Saudi Commission for Tourism and National Heritage, SAUDIA and flynas, among others, with NEOM making its debut. The Saudi pavilion will occupy almost 2,300m2 of stand space, representing a 20 per cent jump on last year.

Curtis concluded: “As GCC travel and tourism companies and destinations look to attract a larger share of the KSA market, ATM 2020 will introduce the Saudi Arabia Tourism Summit as part of the show’s new forum & networking series. The session will outline what destinations are doing to attract visitors from this key market while also providing an informal networking event for buyers from Saudi Arabia and exhibitors.”