meed-logo

line1 line2 line3
SIGN IN / REGISTER

Saudi Arabia showcases tourism plans

22 May 2023

 

Saudi Arabia has emerged as the world’s biggest investor in tourism, with $550bn dedicated to developing new destinations by 2030. 

Initially aiming to attract 100 million visitors a year, as outlined in Vision 2030, the Saudi Tourism Authority (STA) has now set its sights on surpassing this goal. 

By 2030, tourism is projected to contribute more than 10 per cent of Saudi Arabia’s GDP, generating an additional one million jobs.

“The world in the 1920s came to Saudi for oil. Now the world will come in the 2020s for tourism,” said the STA’s CEO Fahd Hamidaddin at the Arabian Travel Market 2023 event recently held in Dubai. “Tourism is the new oil.”

During the exhibition, Saudi Arabia made its grandest appearance to date, showcasing its premier destinations and offering an array of 500 bookable experiences and packages through 67 partners on the stand.

The world in the 1920s came to Saudi for oil. Now the world will come in the 2020s for tourism
Fahd Hamidaddin, Saudi Tourism Authority

Robust growth

Last year, the kingdom recorded a 121 per cent surge in visitor numbers, compared with pre-Covid levels. There were 93.5 million visits in 2022, made up of 77 million domestic travellers and 16.5 million international tourists.

On the back of these figures, the volume of projects associated with hospitality and entertainment is soaring.

The Saudi General Entertainment Authority has granted operating licences to 24 theme parks in the country and issued over 4,000 permits for events and a further 3,370 licences for live performances during 2022, reports UK-based property consultancy Knight Frank.

The kingdom also aims to add 315,000 new hotel rooms by 2030, at an estimated cost of $37.8bn. If all these keys become available, it will mean the country’s hotel room inventory will surpass the UAE’s 200,000 rooms.

At least 225,000 of the rooms are being developed by Saudi Arabia’s gigaprojects. Neom plans to develop about 200 hotels, with international chains competing to operate the properties.

The heritage destination Al-Ula aims to have 5,000 hotel rooms by 2030, while The Red Sea Project has plans for 8,000 rooms across 22 resorts within a decade. The cost of delivering all these hotel rooms is estimated at $110bn, according to Knight Frank and STR Global.

Domestic tourism 

While Saudi Arabia aspires to become one of the world’s top five tourist destinations, it is domestic tourism that currently plays a pivotal role in unlocking the country’s potential.

Out of a population of 36 million, approximately 65 per cent of Saudi nationals make between one and three trips within the kingdom each month, according to Knight Frank.

To further bolster domestic tourism, experts stress the need to expand Saudi Arabia’s transport infrastructure to enhance internal mobility. 

“Supporting hospitality infrastructure, such as new airports and national airlines, combined with a legislative framework that eases access to the sector for international investors will be critical,” said Knight Frank’s head of hospitality in Saudi Arabia, Turab Saleem.

The masterplan for King Salman International airport in Riyadh envisages the facility becoming the world’s largest airport by passenger capacity, with the ability to welcome 185 million passengers by 2050. The airport will house a new national flag carrier, Riyadh Air, which is expected to start operations in 2024.

Riyadh is also working on other airport projects, and in March France’s Egis Group landed a contract for 26 airports in Saudi Arabia. 

MEED's latest special report on Saudi Arabia includes:

> GIGAPROJECTS: Saudi Arabia under project pressure
> ECONOMY: Riyadh steps up the Vision 2030 tempo
> CONSTRUCTION: Saudi construction project ramp-up accelerates
> UPSTREAM: Aramco slated to escalate upstream spending
> DOWNSTREAM: Petchems ambitions define Saudi downstream
> POWER: Saudi Arabia reinvigorates power sector
> WATER: Saudi water begins next growth phase
> BANKING: Saudi banks bid to keep ahead of the pack
> DATABANK: Riyadh holds its buoyant economic heading

https://image.digitalinsightresearch.in/uploads/NewsArticle/10855371/main.gif
Eva Levesque

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Egypt strengthens its economic position

    4 March 2026

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15858071/main.gif
    MEED Editorial
  • Power and water assets face strategic risk amid Iran attacks

    4 March 2026

     

    Recent attacks on energy infrastructure across the GCC have drawn renewed attention to the strategic importance of the region’s power and water sector.

    On 2 March, Qatar’s Ministry of Defence announced that the country had come under two drone attacks launched from Iran.

    One drone targeted a water tank owned by Mesaieed Power Plant, while another targeted a power facility in Ras Laffan Industrial City.

    Elsewhere in the region, Saudi Aramco shut down its Ras Tanura refinery following a drone strike, while US cloud provider Amazon Web Services reported service outages after incidents at two data centres in the UAE.

    Desalination reliance

    Across the GCC, desalination now provides the majority of drinking water. In Kuwait, about 90% of potable water comes from desalination plants, while the figure is about 70% in Saudi Arabia. In the UAE and Oman, the figures are 42% and 86%, respectively. While the geopolitical narrative tends to be dominated by oil, it is power and water infrastructure that is perhaps most critical to everyday life.

    For instance, the Ras Al-Khair desalination plant in Saudi Arabia is among the largest operational facilities of its kind. According to MEED Projects, the plant produces about 1.1 million cubic metres a day (cm/d) of desalinated water.

    Using a typical domestic water consumption benchmark of roughly 250 litres per person per day, that output is sufficient to supply potable water for around four million people.

    Other large projects operate on a similar scale. The Yanbu phase 3 desalination plant produces roughly 550,000 cm/d, while the Shuaibah 3 independent water project (IWP), commissioned near Jeddah last year, has a capacity of 600,000 cm/d. Facilities of this scale can supply drinking water to populations of between two million and four million people.

    The region’s reliance on large coastal desalination facilities also creates structural vulnerabilities, as most plants are located along the Gulf coastline to allow seawater intake.

    Many are also integrated with thermal power plants, producing electricity and desalinated water at the same site. This configuration offers operational efficiencies, but concentrates critical infrastructure in a limited number of locations.

    In February, Kuwait signed a 25-year energy conversion and water purchase agreement for the Al-Zour North independent water and power plant (IWPP) phases two and three. Once completed, the facility will add 2,700MW of power and 545,000 cm/d of desalinated water to Kuwait’s supply network

    Separately, Kuwait’s Council of Ministers recently approved plans for the Kuwait Authority for Partnership Projects (Kapp) to tender the first phase of the Nuwaiseeb power and water desalination plant as an IWPP project. The first phase of the scheme will have an estimated power generation capacity of 3,600MW and a desalination capacity of 341,000 cm/d.

    While several GCC states maintain strategic water storage reserves, these typically cover only a limited number of days of consumption in major cities. This makes water infrastructure one of the most sensitive categories of critical assets in the region.

    Electricity infrastructure

    Standalone electricity infrastructure is equally central to the functioning of GCC economies. Power generation supports residential demand, large industrial complexes, transport networks and digital infrastructure.

    One example is the UAE’s Barakah nuclear power plant in Abu Dhabi, which has a total capacity of 5.6GW across four reactors. According to Emirates Nuclear Energy Corporation (Enec), the plant’s four APR1400 reactors produce 40TWh annually, which is equivalent to around 25% of the UAE’s electricity needs.

    At the same time, Gulf electricity systems are becoming increasingly interconnected. The GCC Interconnection Authority grid links the national networks of member states and enables countries to exchange electricity during periods of peak demand or supply disruption.

    According to WorldBank studies, desalination plants typically operate continuously because water storage capacity is limited relative to demand. Similarly, power grids must balance supply and demand in real time.

    Amid ongoing missile and drone attacks on GCC states, Iran said on Monday that it was closing off the Strait of Hormuz, a critical maritime route. GCC countries import roughly 85% of their food, much of it transported by sea, while the strait handles about a fifth of global oil supply. Disruptions to power and water infrastructure across the region could have even more immediate consequences.

    READ THE MARCH 2026 MEED BUSINESS REVIEW – click here to view PDF

    Riyadh urges private sector to take greater role; Chemical players look to spend rationally; Economic uptick lends confidence to Cairo’s reforms.

    Distributed to senior decision-makers in the region and around the world, the March 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/15856956/main.jpg
    Mark Dowdall
  • Algeria tenders multiple railway consultancy contracts

    4 March 2026

    Algeria’s state railway company, Agence Nationale d’Etudes et de Suivi de la Realisation des Investissements Ferroviaires (Anesrif), has tendered several consultancy tenders for various railway schemes in the country.

    The first tender was issued for the study of the new Bouinane/Meftah/Khemis El-Khechna railway line.

    The tender was issued on 3 March, with a bid submission deadline of 12 April.

    The second tender covers the detailed study of the Sidi Arcine railway station.

    The tender for the project was floated on 1 March. The bid submission deadline is 30 March.

    The other tender covers the completion of the study of the Zeralda/Gouraya railway line.

    The notice was floated in late February, with a bid submission deadline of the end of March.

    The latest consultancy tenders follow Anesrif’s formal start of the procurement process for its multibillion-dollar Laghouat-Ghardaia-El-Meniaa railway project, as MEED reported earlier this week.

    International and local firms have been given until 8 March to submit expressions of interest for the overall client’s engineer role on the 495-kilometre-long railway development.

    Consultancies have also been given until 12 March for two separate contracts covering the project supervision and control of the first 265km-long element between Laghouat and Ghardaia, and the 230km-long line between Ghardaia and El-Meniaa.

    This Laghouat-Ghardaia section, which is estimated to cost about $1.4bn, will comprise 21 viaducts, one tunnel, 55 pipe crossings and five stations.

    The 230km-long Ghardaia to El-Meniaa second section will start at Metlili station and extend south to El-Meniaa. It will comprise six viaducts, 35 railway structures and three stations, and have an estimated total construction cost of about $1.2bn.

    The speed of passenger trains on the railway will be 220 kilometres an hour (km/h) and 100km/h for freight trains.

    The solicitations of interest for the construction of the two sections were originally scheduled for February, but to date have not been released.

    READ THE MARCH 2026 MEED BUSINESS REVIEW – click here to view PDF

    Riyadh urges private sector to take greater role; Chemical players look to spend rationally; Economic uptick lends confidence to Cairo’s reforms.

    Distributed to senior decision-makers in the region and around the world, the March 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/15855965/main.jpg
    Yasir Iqbal
  • Conflict has limited impact on GCC projects

    4 March 2026

     

    Register for MEED’s 14-day trial access 

    The conflict in the Gulf has so far had a limited impact on projects in the GCC, with most sites operating normally since hostilities began on 28 February. In total, there are 6,738 projects under execution across the GCC, with a combined value of $951bn, according to regional projects tracker MEED Projects.

    Contracting companies in the region say that the majority of their projects have not been affected by the conflict, and work has continued onsite without disruption. However, a few sites have temporarily halted operations, either at the request of the authorities or because they were considered at risk due to their strategic locations.

    “Work has continued on our projects in Dubai. We have only one site where we were asked to stop work,” says a contractor overseeing projects across Dubai.

    Another contractor operating across the UAE has also continued work but halted operations at one site following a nearby security incident. “We have one site that was close to a facility that was struck by debris, so we stopped work,” the contractor says.

    Work has also continued on projects outside of the UAE. In Saudi Arabia and Qatar, contractors continue to work on projects, including strategically sensitive oil and gas projects. “We have continued work on most of our projects. There are a few sites where we have been asked to stop work, but this is the minority, and at most sites we are still working,” says an international contractor.

    Supply chain concerns

    While operations largely continue as normal, there are concerns that projects could be impacted later due to supply chain disruption. Ports in the region have been targets, and with international shipping passing through the Strait of Hormuz effectively stopping, there is an expectation that international shipments will be delayed. A related concern is the sharp spike in oil prices that will be inflationary.

    How the disruption is handled will depend on the terms of specific contracts and on how companies choose to navigate the issue. The general consensus among contractors and lawyers is that it is not a force majeure event. Instead, it is general disruption that should be noted and documented, should there be cost or time implications later in the project.

    One Dubai-based contractor said the strategy for now is to support clients as best as possible amid this uncertainty, while noting that there may be cost implications later.

    The region has been considered a safe place for tourism, and also for the rich to live in a tax-free haven. The attacks on Dubai may change that perception, and that will impact the market in the future
    International contractor

    Future prospects

    There are also concerns about the market’s future. There have been record levels of contract awards in recent years, and the worry is that the pace of contract awards may slow as uncertainty grips the market.

    At the same time, some contract awards have been expedited. One Dubai-based contractor has signed two contracts since the conflict started. “We have signed deals that had been lingering for a while. I think the logic is that the client wants to lock in resources before prices or anything else changes,” says the contractor.

    Longer term, it is expected that priorities for construction could shift. Contractors say that defence will become more of a priority for governments in the future, and so will strategic infrastructure projects such as power and water.

    There might also be increased interest in making infrastructure more secure, which will add an additional layer of complexity for construction companies. “Facilities like data centres may be located underground in the future to protect them from attacks,” says a UAE-based contractor.

    The outlook for other sectors is more challenged, particularly real estate and tourism.

    “The region has been considered a safe place for tourism, and also for the rich to live in a tax-free haven,” says the international contractor. “The attacks on Dubai may change that perception, and that will impact the market in the future. Tourism is a key component of national visions across the GCC, so I think there will have to be a rethink of economic strategies for the future.”

    READ THE MARCH 2026 MEED BUSINESS REVIEW – click here to view PDF

    Riyadh urges private sector to take greater role; Chemical players look to spend rationally; Economic uptick lends confidence to Cairo’s reforms.

    Distributed to senior decision-makers in the region and around the world, the March 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/15855051/main.jpg
    Colin Foreman
  • Contractors begin Riyadh metro Line 2 extension works

    4 March 2026

    Contractors have started construction on two new metro stations within King Saud University, as part of the Riyadh Metro Line 2 extension.

    In a statement published on its website, the Royal Commission for Riyadh City (RCRC) said that the first station will serve the University Medical City and health colleges, and the second station will serve the university concourse.

    In July last year, MEED exclusively reported that RCRC had awarded an estimated $800m-$900m contract for the project.

    The contract was awarded to the Arriyadh New Mobility Consortium, led by Italy’s Webuild. 

    The group also includes India’s Larsen & Toubro, Saudi Arabia’s Nesma & Partners and France’s Alstom.

    The Line 2 extension is 8.4 kilometres (km) long, of which 1.3km is elevated and 7.1km is underground. It includes five stations – two elevated and three underground.

    It will run from where Line 2 currently ends at King Saud University, then travel to new stations at KSU Medical City, KSU West and Diriyah East, where it interchanges with the planned Line 7, and finally to Diriyah South.

    In 2013, the Arriyadh New Mobility Consortium secured Riyadh Metro’s Line 3 project for $5.21bn.

    Line 3, also known as the Orange Line, stretches from east to west, from Jeddah Road to the Second Eastern Ring Road, covering a total distance of 41km. 

    READ THE MARCH 2026 MEED BUSINESS REVIEW – click here to view PDF

    Riyadh urges private sector to take greater role; Chemical players look to spend rationally; Economic uptick lends confidence to Cairo’s reforms.

    Distributed to senior decision-makers in the region and around the world, the March 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/15855032/main.png
    Yasir Iqbal