Everything You Need to Know About Saudi Tourism & Hospitality Sector

Tourism and hospitality are pivotal sectors under Saudi Arabia's Vision 2030 initiative, aimed at driving economic diversification and sustainable development. These industries are central to transforming the Kingdom into a global investment powerhouse and an open society. As integral components of Saudi Arabia's diversification strategy, tourism and hospitality are essential for building a resilient economy capable of withstanding global economic fluctuations. The prioritization of these sectors stems from several key reasons that underscore their importance to the Kingdom's future.

Why Saudi Arabia is Betting Big on Tourism

• Reducing Oil Dependence: Oil revenues have traditionally been the primary source of income for KSA's economy. The aim of Saudi Arabia is to develop and foster a robust hospitality and tourism sector to create a more balanced and resilient economy and reduce its dependence on oil.
• New Revenue Streams: Tourism and hospitality offer alternative sources of income, which are crucial for long-term economic stability and growth. These sectors can generate significant revenue through spending on accommodations, dining, entertainment, and transportation.

FDI and Public-Private Partnerships Drive Tourism Growth

Saudi Arabia is strategically attracting significant foreign direct investment (FDI) to propel its tourism and hospitality sector. By positioning itself as a premier tourist destination with world-class infrastructure, captivating hospitality projects, and thrilling entertainment facilities, the Kingdom presents a lucrative opportunity for investors. This approach is further strengthened by the government's strong backing for public-private partnerships (PPPs). These collaborations unlock the expertise and resources of both sectors, accelerating the development of large-scale tourism projects and fostering sustainable economic growth.

Local Hiring Boom

Saudi Arabia is aiming to make tourism the second-largest employer by 2030. Saudization, also known as Nitaqat, is a cornerstone of Saudi Arabia's Vision 2030 initiative, aimed at increasing the employment of Saudi nationals in the private sector.

If you wants to know more about Nitaqat program, you can read our blog Everything You Need To Know About Nitaqat in Saudi Arabia. The development of tourism and hospitality can create a vast number of job opportunities for Saudi nationals.  This is particularly important given the country's young and growing population. Saudization mandates higher employment of Saudi nationals, leading to a rise in local hiring within hotels, restaurants, travel agencies, and other tourism-related businesses. In 2023, around 1 million job opportunities were created in the tourism sector. Localizing the workforce has Economic Impact:

• Increased Disposable Income: With more Saudi nationals employed, there is a rise in disposable income, which can be reinvested in the local economy, including tourism and leisure activities.
• Sustainable Growth: A localized workforce contributes to the sustainable growth of the industry, reducing economic volatility associated with expatriate labor markets.

Infrastructure Development

• Modernization Projects: Vision 2030 includes several mega-projects, such as NEOM, the Red Sea Project, Qiddiya, and Al-Ula. The aim of mega-projects is developing the country's infrastructure to support tourism. These projects are set to create world-class tourism and hospitality facilities.
• Transport and Connectivity: Improvements in transport infrastructure are important for supporting an influx of tourists and enhancing travel experience. These improvements include airports, roads, and public transportation.

Promoting the culture and heritage

 Saudi Arabia is known for its rich cultural and historical heritage, including UNESCO World Heritage sites. Promoting these sites can attract cultural tourists and highlight the Kingdom's historical significance. Also, Saudi Arabia can enhance its cultural diplomacy by opening up to tourists. Fostering a better understanding and appreciation of its culture and traditions on the global stage.

Global Competitiveness

Tourism is one of the largest and fastest-growing economic sectors globally. Saudi Arabia aims to become a competitive player in the global tourism market, by investing in tourism and hospitality. In addition, attracting international tourists can boost the Kingdome's global image and contribute to its economic goals by bringing in foreign currency and fostering international business relationships.

The prioritization of tourism and hospitality in Saudi Arabia is a testament to the Kingdom's strategic vision for a diversified and resilient economy. By focusing on these sectors, Saudi Arabia aims to reduce its dependence on oil, create vast employment opportunities for its young population, and attract substantial foreign investment. Through massive infrastructure projects and the promotion of its rich cultural heritage, the Kingdom is set to become a premier global tourist destination. As these industries flourish, they will play a crucial role in achieving the ambitious goals of Vision 2030, paving the way for a prosperous and sustainable future for Saudi Arabia.

Are You Aiming to Invest in KSA's Tourism and Hospitality Sector?

If you are aiming to operate or hire best talent in Saudi Arabia's tourism and hospitality sectors, TASC will be your perfect partner. TASC has over 16 years of extensive experience in business services, include: contract staffing, permanent recruitment, HR management, payroll outsourcing, and offshoring.

Get in touch with our expert team to discover how TASC's specialized recruitment solutions and market expertise can help you hire or investing in Saudi Arabia's burgeoning tourism and hospitality industries. Let us work together to achieve your business goals and contribute to the Kingdom's Vision 2030.