Saudi Arabia’s Tourism Expansion Balances Modernization with Tradition
Riyadh, Saudi Arabia – The ambitious development of entertainment hubs such as Red Sea Global and the Qiddiya project near Riyadh may introduce more liberal amenities to cater to international tourists while maintaining religious sensitivities, according to Saudi political commentator Salman al-Ansari.
Speaking to This Week in Asia, al-Ansari emphasized that any changes would be carefully managed to ensure they align with Saudi societal values. "Any such changes will likely be carefully managed to ensure they align with Saudi societal values," he said.
Once a closed society that only welcomed foreign Muslim pilgrims visiting Mecca and Medina, Saudi Arabia began issuing tourist visas in 2019, now allowing citizens from 63 countries to visit for up to 90 days. The nation’s domestic tourism has surged following significant investments under the Vision 2030 plan initiated in 2016. According to a report from March by the Ministry of Economy and Planning, the value of arts and entertainment activities more than doubled between 2020 and 2022, while spending on food and accommodation increased by 77 percent.
This tourism boom is fueled in part by the influx of foreign firms and professionals to cities such as Riyadh and Jeddah, attracted by business opportunities generated by the estimated $870 billion worth of mega-projects scheduled for completion by 2030. Among the most notable developments is the futuristic city of Neom, planned on the Gulf of Aqaba coast, which Saudi Arabia shares with Egypt, Israel, and Jordan.
With the resumption of regular, full-scale pilgrimages to Mecca and Medina after the Covid-19 pandemic, Saudi Arabia surpassed its 100 million tourists target last year, prompting the government to aim for 150 million arrivals by 2030. Spending by inbound tourists soared by 319 percent between 2020 and 2022, according to the Ministry of Economy and Planning. As of last year, tourism accounted for six percent of Saudi Arabia’s economy, with a goal to increase this to ten percent by 2030.
Global property consultancy Knight Frank projects that Saudi Arabia will construct 320,000 new hotel rooms by 2030, two-thirds of which will be four- and five-star rated, necessitating accommodations for between 232,000 and 387,000 key tourism workers as the hospitality sector expands.
In further efforts to boost tourism, Saudi Arabia and its Gulf Cooperation Council partners approved plans in May to introduce a joint tourist visa scheme similar to Europe’s Schengen visa by the end of this year. Furthermore, Saudi Arabia gained approved-destination status from China last year, enhancing its objective to attract three million Chinese tourists by 2030.
While Saudi Arabia has made "significant strides towards social liberalization," al-Ansari noted it is unlikely to fully adopt the liberalization approach of neighboring United Arab Emirates, which decriminalized alcohol consumption in 2020. Firmly established as a premium global tourism destination, the UAE plans to open the Gulf’s first casino resort in 2027.
Nonetheless, al-Ansari pointed to gradual relaxations in certain areas, with the regulatory framework of the Neom city project hinting at “more liberal policies” to attract international tourists and businesses. A February report from The Economist Intelligence Unit described the opening of Riyadh’s first liquor store as "a very small step" towards making alcohol available to non-Muslim tourists and expatriates. The report anticipated further easing of social norms in pursuit of Vision 2030, likely including more relaxed alcohol laws.
Ultimately, Saudi Arabia may follow the UAE’s path in making alcohol available to non-Muslims in select venues, but the government is expected to proceed cautiously, with reforms implemented gradually and selectively.
Source: This Week in Asia, AFP, The Economist Intelligence Unit, and Knight Frank.
