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GlobalData: Saudi Arabia Must Ensure Benefits of Change

Following the news September 27 that Saudi Arabia has introduced reforms to its visa regulations and dress-code restrictions for women to encourage foreign tourists, Richard Thompson, editorial director, GlobalData, a leading data and analytics company, offered his view on Saudi Arabia’s tourism market.

According to Thompson, the opening up of Saudi Arabia’s tourism market to international visitors is a significant reform for the Kingdom and is very important to the Kingdom’s Vision 2030 reform agenda led by Crown Prince Mohammed bin Salman.

Diversification of the Saudi economy away from oil is one of the core objectives of the Vision 2030 reforms and tourism is right at the front of the diversification agenda.

Saudi Arabia is already the biggest tourist market in the region in terms of visitors. However, the vast majority of visitors are pilgrims visiting the holy sites at Mecca and Medina. Many other visitors are on business trips.

Saudi Arabia is set to see a long-term surge in visitor numbers which will drive significant new non-oil revenues for the country and attract investment. Most important of all, it will create new jobs and career opportunities for young Saudis.

The past 12 months have seen significant progress in Saudi Arabia’s reform programme. However, real change always takes time to take hold in Saudi Arabia and many reforms that have been announced in the past have been bogged down by bureaucratic inertia or political resistance. This can create confusion and frustration for investors.

To overcome this resistance, Saudi Arabia’s reforms must continue to build internal capacity to ensure that institutional and bureaucratic barriers are removed. They must ensure that the benefits of the reforms reach everybody in the kingdom and are not felt only by the rich, urban elite.

In particular, Riyadh must ensure that the Kingdom’s rural youth population does not miss out on the benefits of the reform agenda. 

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