Tourism predicted to significantly reduce KSA’s oil dependence

Arabian Travel Market

According to the panel discussion ‘Why Tourism is Saudi’s New White Oil’, held at the Arabian Travel Market (ATM) 2019, tourism will play a major role in reducing Saudi Arabia’s dependence on oil revenues.

Experts gathered at the event’s Global Stage, including representatives from Saudia Private Aviation (SPA), Dur Hospitality, Colliers International MENA, Marriott International, Jabal Omar Development Company and Saudi General Investment Authority, to discuss opportunities related to upcoming tourist-focused developments and visa reforms.

Kingdom-based industries in direct contact with tourists are expected to generate more than $25 billion this year – approximately 3.3 per cent of Saudi Arabia’s GDP – according to figures released by the World Travel and Tourism Council (WTTC).

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Head of destination marketing, Jabal Omar Development Company, Reema Al Mokhtar said: “Our country has beautiful geographic diversity and a host of cultural attractions so, once visitors come into the kingdom and see the different projects lined up for them, I think it will market itself.”

Saudi Arabia’s domestic tourist trips are projected to rise by eight per cent in 2019, while inbound visits from international markets are expected to grow by 5.6 per cent per year, according to research conducted by Colliers Internatoional, on behalf of ATM 2019.

With the creation of new local attractions thanks to the Quality of Life Vision Realization Program and the General Entertainment Authority (GEA), Saudi Arabia’s overall number of tourist trips is on course to hit 93.8 million by 2023, up from 64.7 million in 2018.

Commenting on Saudi residents’ historic tendency to travel out of the country for entertainment and leisure, CEO, Colliers International MENA, John Davis commented: “I think some airlines could probably double their number of [weekend] flights and still fill the seats. So, when the country opens [new local attractions], people will utilise them.”

By helping Saudi Arabia to further boost its domestic and inbound tourist numbers, panellists agreed that ‘giga’ developments will prove crucial in helping to meet the economic diversification targets set out in Saudi Arabia’s Vision 2030.

Despite the more than 9,000 keys of three- to five-star international supply due to enter the market this year, the panel agreed that the Kingdom is well placed to sustain and even increase occupancy levels over the coming years, thanks to a combination of giga-projects, high-profile events, entertainment and religious tourism.

Visa-related improvements are also expected to drive growth in Saudi Arabia’s tourism sector. With the roll-out of 30-day Umrah Plus Visas, eVisas for tourists and specialist visas for events, such as the Formula E Championship’s E-Prix, the Kingdom looks set to attract more international visitors than ever before.

Director of Tourism, Saudi General Investment Authority, Majid M AlGhanim stated: “Many of the reforms that are happening right now, such as 100 per cent ownership and easier registration for foreign companies, involve regulation. Hopefully, we will see lots of international investment in Saudi destinations very soon.”