By Fahd Al-Rasheed
The kingdom is already the 19th most visited country on the planet – but this is only the beginning.
You might not believe me when I tell you that Saudi Arabia will become a major tourism hub, competing with the likes of Dubai, Paris, and London. You will probably think, “How can the kingdom possibly compete for tourists with these hot spots?”
The answer is quite simple: the kingdom does not need to. Saudi Arabia is already the 19th most visited country in the world, as a result of Hajj and Umrah visitors. In 2014, the kingdom was visited by over 16 million tourists. The government plans to double this number by 2030 with major cpacity expansions in Makkah and Madinah, and at Jeddah airport, where the majority of pilgrims arrive, coupled with the introduction of a new high speed railway linking these cities, which should make this target easily achievable.
On top of this religious tourism advantage, Saudis are the world’s biggest spenders abroad, splashing out more than $21bn every year, according to government figures. Saudis make 10 million trips abroad each year, and they spend as much as four to six times their Western counterparts wherever they go. A global study found that holidaymakers from Saudi Arabia spend an average of nearly $7,000 per international trip - the most in the world. Yet, when in the kingdom, Saudis have few options in terms of tourism and leisure, making domestic tourism a major opportunity for economic development and diversification, as well as an opportunity for private sector participation.
In fact, the kingdom is so keen on developing this sector, that the Saudi Commission for Tourism and Antiquities, under the leadership of its energetic and visionary leader Prince Sultan Bin Salman, has introduced a new vehicle that provides private sector investors with soft loans of up to SAR100 million ($26.6m) per project. This should induce major investments in this sector.
My forecast for 2016 is that Saudi Arabia will enter the leisure and tourism sector in a significant way to capture its potential, and create much needed jobs for our youth. I know this because the project I am leading, King Abdullah Economic City (KAEC), will be a key anchor in the kingdom’s foray into this sector.
KAEC is a 181 million square metre privately developed city on the Red Sea, 90 kilometres north of Jeddah, with the goal of housing 2 million people when it is completed. KAEC is currently planning to attract more than 1 million tourists to the city by 2020 (3.5 million by 2025), by developing 36 new tourism and leisure projects, including world class water parks, zoos, amusement parks, exhibition centres, a world class golf course, equestrian trails, recreation clubs, and ten new hotels and resorts.
In addition, we have one of the most beautiful natural resources in the world: the majestic and serene Red Sea with an unparalleled marine environment. We will leverage this asset in a very ecofriendly manner to protect it for future generations and create many attractions that allow visitors to experience its many wonders.
The Haramain High Speed Rail station connecting Jeddah, KAEC, Madinah and Makkah will be operational in early 2017. The surrounding area to the Haramain Railway station in KAEC will leverage the fact that Saudi is a G20 economy, with significant demand for new MICE space, and will host a world class exhibition centre to cater to this unique market in the kingdom. It will also include souks and markets that celebrate the fact that Saudi Arabia has been hosting visitors from all over the world in the Hijaz region for over a millennia.
This shift to tourism will not be unique to KAEC, the kingdom’s other cities will also see major new projects introduced in 2016. The kingdom’s drive in the sector is not based on a “build it and they will come” proposition, but rather it is anchored on already existing demand that is growing by double digits every year. Thus, 2016 will be the year of tourism and leisure in Saudi Arabia.
Fahd Al-Rasheed, Group CEO of King Abdullah Economic City.
Saudi Arabia has more wealth above ground than under ground.. for sure !!