Selling Saudi Arabia as a holiday destination

Saudi Arabia has idyllic islands, spectacular terrain and ancient landmarks. It also has a plan to get more people to see them. Arabian Business looks at the opportunities and the challenges of making that happen
Selling Saudi Arabia as a holiday destination
Saudi Arabia’s tourism sector currently contributes five percent to the national economy, compared to the 80 percent that is powered by oil.
By Shoshana Kedem
Sat 09 Sep 2017 06:25 PM

A recent promotional travel video for Saudi Arabia showcased the desert kingdom’s pristine white sands, untouched coral reefs and sapphire seas - but little in terms of facilities.

The footage was released by the country’s tourism authorities on the heels of a mega-project that would see 50 Red Sea islands and a 180-kilometre stretch of coastline turned into a world-class resort.

The move is the latest initiative in a series of efforts announced last year to reform the oil-rich country’s economy and wean it off petrodollars. Saudi Arabia’s tourism sector currently contributes five percent to the national economy, compared to the 80 percent that is powered by oil.

That five percent does add up to a significant $22.93bn into the national coffers, with the number of inbound tourist trips estimated at 14 million in 2015, according to the Saudi government’s Tourism Research and Information Centre.

The so-called Red Sea Islands Development Plan will be implemented with a $20m cash injection from the kingdom’s Public Investment Fund starting from autumn 2019.

Up to 35,000 jobs will be created by the project, which is hoped will generate $4bn a year in revenues. The government promises it will be finished by the end of 2022, and, according to the Saudi Press Agency, will be a“private area with systems in accordance with international best practices and expertise”.

What this means is that the enclave will be a semi-autonomous economic zone, more tolerant of international customs, and open to outsiders with tourist visas on arrival for visitors from select countries, according to Otto Goessnitzer, a consultant at nfrastructure developer Equinox International.

Nearly 2.4 million pilgrims visited Saudi Arabia this year

Currently, tourist visas to Saudi Arabia are granted only to select groups on a limited basis. Citizens of all countries require a visa before arrival, with the exception of GCC members. Goessnitzer explains how, much like Dubai, the Saudi government might one day relax the entry rules for selected states.

“When the Red Sea tourism development is finalised, [bearing in mind] it will take another five to ten years for stage one, they will have visas upon arrival,” he speculates.

“The Saudi government will select some countries from Europe and maybe the US and Canada to start a gradual tourist influx, by granting visa on arrival like the model in Dubai. This will go on for three to five years and then they will add more countries.”

The acceptance of international customs will only go so far, of course. It is likely that this will stretch as far as family-friendly coastlines, where men and women can lounge together, unlike the nation’s customary gender segregated beaches. But the opening up of the tourist industry will be a very gradual evolution, says Goessnitzer.

Beyond religious tourism

As the cradle of Islam, housing the two holiest Muslim sites in Mecca and Madinah, Saudi Arabia’s tourism industry and infrastructure currently evolves around the Haj pilgrimage and its sites. Pilgrims dominate among Saudi Arabia’s 20 million annual foreign visitors, and their numbers are growing.

Almost 2.4 million arrived this year, up from 1.9 million in 2016, with authorities planning to draw 15 million by 2030.

The Prophet Mohammed [PBUH] Mosque in Madinah is among the holiest sites in the Islamic world

A staggering 162 projects for new hotels and resorts are currently in the pipeline or under construction, which is ambitious for a country with few general tourists, says Caroline List, an analyst at hotel research consultants Top Hotel Projects.

“Most of the construction is in the parts of the country where the pilgrims come for religious purposes. They definitely do need these rooms, it’s not as if they’ve built these hotels and they are empty,” List tells Arabian Business from Rotenberg, Germany.

Pilgrimage visas currently only allow visitors to travel around the holy sites, however, so the fate of equally ambitious projects like the Red Sea development project would largely depend on a visa scheme that welcomes tourists, List says.

The Saudi government has also been keen to stress the difference between tourism and pilgrimage. At a recent press conference, the Governor of Mecca, Prince Khalid Al Faisal, stressed that authorities did not seek to exploit the sacred ritual by giving out tourist visas to pilgrims travelling for Haj.

“There’s no religious tourism. Haj is religious rite. Mecca is for worship, the holy places are for worship and not for tourism. As for tourism, that’s outside the holy places and outside Mecca,” said Al Faisal.

They do, however, plan to extend the Umrah visa, says Goessnitzer, who previously worked with the Saudi Commission for Tourism for nine years.

“The Saudi government is not extending the Haj visa. Haj is a very limited and precious period, so it’s not going to happen there. But what they will do is to increase the Umrah visa with maybe a combined visa for tourism. That means you come from any country, Malaysia, Sudan, then you make your Umrah. After Umrah you have one or two weeks on a tourist visa.”

That would provide a solid base for growth, given the number of visitors. Authorities issued 7.5 million Umrah visas in 2016, and aim to increase the number to 15 million by 2020, and 30 million by 2030.

Satellite view of the Farasan Islands along the Red Sea coast

‘Discover Saudi Arabia!’

Saudi Arabia’s tourism body launched a tourist visa scheme ‘Discover Saudi Arabia!’ in previous years, but suspended it in 2014 to allow the government to develop tourist infrastructure. Goessnitzer says he expects the authorities will wait until major projects are ready before re-tweaking visa laws.

The new airport in Jeddah, pledged to start operating early next year, and the high-speed Haramain railway, connecting Mecca and Madinah via Jeddah, are still works in progress.

“When all these infrastructure projects are finished then the Saudi government will gradually increase the Umrah visas to 50 or 60 million a year,” says Goessnitzer.

Whatever happens, the Saudi tourism strategy will not be aimed at the thrill-seeking millennials and backpackers driving the global tourism industry today, List says. So what will be on offer to tourists who visit Saudi Arabia?”

In answer to this question, Justin Wateridge, managing director of Steppes Travel, lists a number of compelling reasons to do just that. Centuries-old Ottoman castles, sandstone cliffs and over 1,000 islands speckled across deep blue lagoons are just some of the sites Saudi Arabia has to recommend it.

“You have no doubt heard of Monument Valley in the USA and Wadi Rum in Jordan, or the Siwa Oasis in Egypt and possibly Ennedi in Chad,” he says. “I am not sure you will have heard of Al Ula in Saudi Arabia, but you need to take note of this name and travel to one of the world’s most spectacular desert landscapes. As a topographical feature it stands tall, timeless, captivating and enthralling.”

Wateridge organised an escorted tour to Saudi Arabia earlier this year and is familiar with the destination and its key sites. The obscure 2,000-year-old mud-and-sandstone ghost town has ruins from the 6th century BC baked into the north-eastern Saudi desert.

“The jewel in Al Ula’s crown is Mada’in Saleh, which holds 94 tombs with decorated facades, 35 plain funerary chambers and more than 1,000 non-monumental graves and other stone-lined tombs,” Wateridge says.

A five-star desert camp with air-conditioned tents and roaming peacocks opened here in August, just one of the new haunts hoping to draw upmarket travellers to the region. A further boon will be the launch of Flyadeal flights this month. The budget carrier, part of the national airline Saudia, plans to expand throughout the region, which could further help.

“This will boost tourism full stop,” Mark Breen, head of transformation at Saudia Holding Company said at the Arabian Travel Market last year.

But will it work? Wateridge thinks so. “It is only just opening up to tourism.

As to why it has not done so before, the overriding reasons are perception and access.”

He also thinks the Saudis themselves are “most definitely” ready for outsiders, even if certain delicate cultural obstacles remain. “As with anywhere else in the world, the visitors [should be] respectful of local mores and customs.”

List agrees that such cultural anomalies in dress and gender might even work in the kingdom’s favour in drawing curious travellers. “It is the local experience that they are seeking, and to get more in touch with the culture and the locals and the people themselves,” she says.

For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.