Saudi Arabia’s $800 billion tourism plan starts to take shape

With a target of 200 hotels at its mega-project Neom and a new hospitality school, the kingdom is charting its path to 70 million visitors a year


Cyclists on Saudi Tour pass Al-Hijr archaeological site

RIYADH, Saudi Arabia — Four years after opening up to international tourists for the first time, Saudi Arabia marked progress on its massive $800 billion investment drive to lure travelers as it played host to the United Nations’ World Tourism Day. 

Riyadh welcomed over 500 government officials, investors, international press and U.N. delegates from 120 countries last week to underscore the importance of the global tourism industry. The occasion was also an opportunity for Saudi Arabia to set out more bold plans for its young tourism sector as it seeks to diversify its economy beyond oil revenues.

“If you want to introduce your country to the world, then tourism is the best way to do it,” Zurab Pololikashvili, secretary-general of the U.N. World Tourism Organization, said during a  roundtable discussion. 

Neom has signed around 18 hotel deals – including with luxury brands like JW Marriott, The W and German boutique concept 25Hours – and has a target of 200 total, most of them to be built on The Line, a spokesperson for Neom Hotel Development told The Circuit

First unveiled by Crown Prince Mohammed bin Salman in 2017, Neom is a $500 billion mega-project in the northwest of the country along the Red Sea coast, with construction underway on a variety of zones such as a mountain ski resort, an island getaway, a major port and a city-of-the-future concept known as The Line, where the majority of the hotels will be built. 

The flurry of deals in Neom marks a shift for the kingdom, which has always catered to  Muslim pilgrimage tourists. The majority of hotels currently open in Saudi Arabia are centralized in Medina adjacent to the holy site of Mecca. 

Saudi Arabia’s Minister of Tourism Ahmed Al-Khateeb announced the creation of the Riyadh School for Tourism and Hospitality to build a pipeline of talent to staff the fast-growing industry. Set to open in 2027, it will cost more than $1 billion to build and be located in the capital’s entertainment and tourism project known as Qiddiyah.

Pololikashvili also announced the creation of a center for the study of sustainability — of which the UNWTO was working closely with officials in the kingdom to accomplish. The program is due to be launched in September and will offer a bachelor’s degree program with students spending time pursuing studies in Madrid, Spain and the Swiss city of Lucerne. 

Al-Khateeb said the kingdom will invest $800 billion to develop tourism over the next decade as the contribution of travel and tourism to the nation’s economy begins to pick up pace. The goal is for the sector to contribute up to 10% of gross domestic product  by 2030, up from a current 4.5%.

The kingdom has also raised  its tourism targets, setting a goal of attracting 70 million international visitors annually by 2030, up from 50 million, Bloomberg reported.  

Among the various delegates in attendance at World Tourism Day was Israel’s Tourism Minister Haim Katz, who arrived in the kingdom on Tuesday, becoming the first Israeli minister to lead a delegation to Saudi Arabia. The visit comes at a time when Israel and the kingdom are moving closer towards a U.S.-brokered normalization deal.

Pololikashvili said Saudi Arabia was obliged to admit the Israeli minister for the U.N. event even though the two countries don’t have diplomatic relations. “All our member states are invited to take part in our events – independently of where they are held,” Pololikashvili told The Circuit.

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