Saudi Arabia has attracted about $13 billion in private sector investment into its tourism industry as it aims to share the cost of spending associated with its plan to become a new travel hot spot.

The investments are poised to add another 150,000 to 200,000 hotel rooms within the next two years, according to Princess Haifa M. Al Saud, Saudi Arabia’s vice minister for tourism. The kingdom is also targeting raising tourism revenue to $85 billion this year from around $66 billion in 2023, she said.

“The current GDP contribution is 4.5% and we aim to get that to 10% by 2030,” she said in an interview. “We started from 3.2% when we opened up for tourism.” Saudi Arabia hopes to have 150 million tourists a year by 2030 as part of Crown Prince Mohammed bin Salman’s vision for the economy that includes diversifying revenue streams away from oil toward industries including sports and technology. The kingdom has been splashing out on mega project developments like the entertainment city of Qiddiya and embarked on a footballing spending spree last year in a bid to boost its appeal as a foreign travel destination. It’s also the sole bidder for the 2034 World Cup.

In 2023, Saudi Arabia recorded 100 million tourists, most of them locals. International visitors accounted for about 27 million, with a chunk of arrivals related to religious or business travel. Leisure trips are thought to have made up only a small percentage as projects meant to bring in travelers are still heavily under construction.

The government aims to attract as much as $80 billion in private investment into tourism by 2030 and is planning to spend some $800 billion of its own on the industry over the next decade.

Source: Bloomberg