Massive investment in mega tourism projects to the tune of $810bn (Dh2.97tn) is expected to transform Saudi Arabia as one of the largest leisure tourism industries in the world between now and 2030, according to research conducted by the Middle East and North Africa Leisure Attractions Council (MENALAC), the leisure and entertainment industry council representing the Middle East’s dynamic leisure attractions sector.
“Mega tourism projects being developed by Public Investment Fund will be spread over an area of more than 64,634 square kilometers, with a value exceeding $810bn (Dh2.97tn),” according to the Ministry of Tourism, the country’s tourism regulator.
The third project is Amaala, or the Saudi Riviera, located in the northern region with an area of 3,800 square kilometers, and developing islands in the Red Sea with a total area of 34,000 square kilometers.
Mishal Al Hokair, Board member of MENALAC, said, “Saudi Arabia has an array of dynamic plans and attractions planned over the next few years, each of which will add to the fast growing Leisure and Entertainment sector. Its Vision 2030 will change the entire economic and tourism landscape of not only Saudi Arabia, but the entire Middle East region, that will have a massive positive knock-on effect on the leisure tourism industry.
“Once the current COVID-19 situation improves, the investment and development in the Saudi Arabia’s tourism sector will bring massive opportunities for the industry. It is time for everyone to prepare for the next big growth.”
In addition, the tourism ministry will be developing museums in various Saudi regions, and preserving Saudi heritage with a cost of more than $1.3bn.
“Saudi Arabia foresees that the national tourism will significantly contribute to the gross domestic product as the most growing non-oil economic sector. The tourism revenues increased to more than SR193bn ($51bn) in 2017; and to more than SR211bn ($56bn) in 2018,” the ministry said in a report.
The total number of inbound and outbound tourist trips in Saudi Arabia is expected to reach 62mn trips; where tourism revenues are to exceed SR142bn ($37bn) by the end of 2020.
International openness of tourism
“Therefore, it is to rank as the 24th on the scale of tourist business environment, and 124th in the international openness of tourism, and the 60th in the travel and tourism competitiveness indicator,” the report also said.
Also, tourist facilities licensed by the ministry, have achieved a big growth over the past 10 years; especially in tourist accommodation. In 2008, the number of tourist accommodation did not exceed 800 hotels, and hotel apartments. In 2018 the number increased to 7,388. The number of travel and tourism agencies went up from 589 to 2,414; with the presence of 633 tourist trips organizers.
Changes and growth in Saudi Arabia’s tourism landscape will also help leisure attractions operators in the Middle East and North African countries. The recent reopening of the land borders by Saudi Authorities will help boost regional tourism in the GCC region.
The tourism ministry plans to facilitate investment SR171.05bn that will boost the tourism industry capacity and the number of hotel rooms to 621, 600 rooms. Besides, boosting the tourism sector’s contribution to the GDP by 3.1 percent, and increase direct employment to 1.2mn jobs.
Prakash Vivekanand, Board member of MENALAC, said, “The latest news from Saudi Arabia is very encouraging. The government wants to push ahead with the mega projects that will boost not only the country’s gross domestic product (GDP); but also the tourism sector. It create massive opportunities for all the players in the leisure attractions business. We could count on an exciting future for the industry in the MENA region.”
According to the Ministry of Investments; the country wants to increase investment in recreational facilities to 6% from the current 2.9% per annum; more than double the current level, as part of Saudi Vision 2030.
“In 2017, the Saudi Arabian tourism sector attracted investment of SR172bn ($28.6bn); six times the world average in tourism capital investments,” according to a report by the ministry. “Investments are to rise 5.5 percent per annum over the next ten years to SR200bn ($54bn) per annum.”
Despite the current situation with regards to COVID-19; Saudi Arabia is pushing ahead; with construction of some of these massive projects. A number of construction contracts have recently been awarded following the partial re-opening of the economy after the lockdown.
Red Sea Development Company has recently awarded construction contracts worth $1 bn. While NEROM awarded Bechtel and AECOM program management contract.
Rosa Tahmaseb, secretary general of Menalac, said, “The leisure attractions industry; in the MENA region is upbeat with the new opportunities that are arising in Saudi Arabia. We see massive opportunities for our industry created by more than a $1tn investment in the Saudi economy; between now and 2030.
“I urge the leisure industry stakeholders, both our suppliers and operators to explore these opportunities and ascertain how they can take a leading role in helping Saudi Arabia develop its leisure facilities in the coming decade.
“Despite the short-term setback created by the COVID-19 pandemic, the long-term prospects for our industry remain bright. One example of this is in the dynamic projects planned for Saudi Arabia.”
Tourism and entertainment are an essential part of the Saudi Vision 2030; also aimed at diversifying the Saudi economy by reducing its dependence on oil. The Kingdom also intends to develop versatile tourism destinations; which include several coastal sites, marvelous islands, and distinguished heritage areas. All of which will require a high level of expertise; support and the most innovative attractions; technology and experiences. This is to ensure the Kingdom becomes one of the top tourist and entertainment destinations in the Middle East; within the next few years.