The answer to this question can, in part, be found in the institutionalized nature of the Islamic Republic as well as the regime’s externalization of the crisis, ruthlessness, and pragmatism.
Saudi Arabia has come out from under coronavirus-imposed travel restrictions to relaunch an ambitious calendar of tourism events over recent months. Sports, arts, and entertainment gatherings have engaged Saudis and attracted global attention and foreign visitors. Racing fans watched the Formula One Grand Prix from the Corniche Circuit in Jeddah in December 2021 and the Dakar Rally’s circuitous desert route across the kingdom in January. Also in January, the high-profile Spanish Super Cup tournament was broadcast to international audiences from Riyadh. For art and design mavens, there was the inaugural Diriyah Contemporary Art Biennale followed by the Saudi Design Festival held in the new JAX warehouse district of the heritage city. The first Red Sea International Film Festival was held in Jeddah in December, attended by a host of Saudi and international glitterati. Meanwhile, the monthslong Riyadh Season has provided restaurant dining experiences and family fun alongside an eye-raising electronic dance music festival; more than 180,000 men and women attend the opening night – once unimaginable in the austere kingdom. It’s hardly the Saudi Arabia of a decade ago, when a community-organized TED talk drew crowds of Saudi youth starved for any form of public engagement.
These events form the programmatic side of an extensive portfolio of tourism investments targeting vast territories of the kingdom. If fully realized, this new tourism infrastructure will form an alternate economic platform that greatly expands Saudi Arabia’s traditional focus on religious tourism and has the potential to reshape the social and political contours of the long-predominant oil economy.
Saudi Tourism Plans are Ambitious
The Saudi leadership has audacious aspirations for the tourism sector, striving to make it the number two industry behind hydrocarbons. In a country, which apart from the critical religious tourism sector, had no tourism visa before 2019 and whose Tourism Ministry was established only in 2020, there is certainly room for growth. Still, Saudi Vision 2030 set a seemingly fanciful target of 100 million domestic and international visits a year. For comparison, the number one country for tourism, France, received 90 million international visitors in 2019. According to the United Nations World Tourism Organization and Saudi General Authority for Statistics, in that last full year before the coronavirus pandemic, Saudi Arabia had 17.5 million visitors, including 9.5 million religious pilgrims for both hajj and umrah, a number the Saudis would like to see increase to 30 million by 2025.
Competition both internationally and regionally will challenge the Saudi aim of explosive growth for the industry. And the new headwinds for tourism in the context of the pandemic and increasing green consciousness may perpetuate the country’s reliance on its domestic market long starved of entertainment and destinations. Still, the Saudi government is putting money behind this realization. Half of the giga-projects spearheaded by the Public Investment Fund are in tourism, and the futuristic technology city of Neom also has tourist elements. In addition, a sizeable number of the companies created under the Public Investment Fund are active in the tourism and entertainment industries. At the 2021 Future Investment Initiative the Saudi tourism minister stated that Saudi investment in the industry would surpass 1 trillion dollars over the next 10 years.
The pandemic postponed the kingdom’s global opening, but the associated fiscal constraints did not appear to curb the commitment of the leadership to forward its tourism agenda. Contracts for roads, bridges, and airports for the entertainment city south of Riyadh, Qiddiya, and the high-end Red Sea coastal development proceeded in 2020 despite austerity measures. And the budget for the Diriyah Gate Development Authority heading the expansion of this heritage and arts site north of Riyadh was doubled from $20 billion to $40 billion.
Saudi Tourism is About More Than Just Tourists
The tourism and entertainment sectors represent an engine for economic diversification and job creation for the kingdom’s youth population. But they go well beyond that. The blueprints for the new tourist sites reveal multifaceted plans for land development. Much as Dubai fronted infrastructure and turned its territory into foreign investment opportunities, the Saudi leadership is looking to open up vast expanses of land, some of it remote and relatively unpopulated, for development. Most of these new tourist sites – on the Red Sea coast or in Riyadh’s northern and southern areas – are akin to new cities, with multiuse development plans incorporating hotels, restaurants, arts and entertainment venues, and housing.
One prime example is the Diriyah Gate Development Authority. This historic location of the Al Saud dynasty and first Saudi state is centered on a UNESCO heritage site. But around this historic core are plans for numerous art and history museums, more than 20 hotels, varied retail spaces, over 100 restaurants, offices, and residential housing for a permanent population of 100,000. This will include arts and educational districts hosting the kingdom’s modern art museum, a new university focused on tourism and hospitality, and numerous facilities for hosting international sporting events, such as the Formula E race. The property development extends into the surrounding regions with plans to plant a million date trees in the Wadi Hanifa and transform the nearby Safar Valley into “Riyadh’s own Beverly Hills,” complete with a golf course designed by Greg Norman.
As these initiatives materialize, they are reshaping the kingdom in novel ways that reach beyond the narrow economic sphere to the geopolitical and sociocultural realms.
The New “Post-Oil” Geography and Geopolitics
Aside from the Riyadh region, most of the major new tourist sites sit alongside the western coast, from the Red Sea resorts and ultra-high-end development Amaala and inland to Hegra, the Nabataean archeological site, and natural desert formations of Al Ula. Adding in Neom, this marks a significant geographical shift – a Saudi Arabia that is more Westward facing as it departs from the historic development of the oil economy centered in the East. This, in part, contributes to Saudi Arabia taking a more active lead in Red Sea political governance. It has already colored Saudi relations with Red Sea neighbors Egypt and Jordan. Indeed in 2016, Egypt was thrown into a short political crisis as President Abel Fattah al-Sisi acceded to Saudi claims over the two Red Sea islands of Tiran and Sanafir, which now fall within Neom’s environs. Neom also features prominently in hints of a potential Saudi opening to Israel, with frequent reports of Saudi interest in capitalizing on Israeli investment and technical know-how to develop the futuristic city.
The tourism investments and new forays into arts and entertainment also form an important element of Saudi Arabia’s global repositioning, with its cultural orientation less narrowly focused on the Islamic world and more publicly engaged with urban development. This affords new means of cultural cooperation, such as the Saudi partnership with the French government to work with French cultural institutions in developing Al Ula. Such agreements, as well as more outward investments (such as the new focus on international sports epitomized by the purchase of the English football team Newcastle United), provide the means to project soft power through popular appeals and the alignment of financial and institutional interests.
Beyond a Religious Political Economy
The diversification of the economy into tourism and entertainment has had a profound impact on social life in the kingdom. The limitations once imposed by the Saudi religious establishment – the sanction against pre-Islamic sites and historical commemoration as well as the prohibitions against music, dance, and gender mixing – have dissipated in line with the broader opening. There are certain to be further liberalizations as beach-based tourism and cruises come online, with persistent rumors that even alcohol will be allowed in specified enclaves. This rapid social change is disorienting for many and unevenly applied, but there is little question of the direction as the kingdom seeks to create a more open environment to attract foreign investment and visitors. The changes also target the Saudi population itself, tapping into the energy, talents, and spending habits of the new generation.
Arts once disparaged or neglected are now being actively cultivated through the Ministry of Culture, which also holds the heritage portfolio. The Saudi leadership has also established 11 different commissions in film, fashion, theater, and the culinary arts, among others, in the service of the national cultural strategy to promote culture as a way of life, enable it to contribute to the economy, and create opportunities for international exchange. These commissions are cultivating a distinctive Saudi cultural output that contributes to a more localized tourist offering. The promotion of the palaces of Diriyah as a national icon similar to the Greek Acropolis and Roman Colosseum, the directive to the kingdom’s restaurants, cafes, and roasters to distinguish Saudi coffee from Arab coffee – both are indicative of this new more national approach.
Questions and Directions
In looking to the future of this industry, huge questions remain unanswered. Will the Saudi state continue to find and commit the capital to develop the sector, and will the private sector and foreign investors respond? Will the Saudi offerings be distinct and compelling enough to compete in the regional and global tourism market? How will the Saudi leadership manage the contradictions inherent in the rapid social change and integration of new tourist appeals with its base in religious tourism? Will the local and regional security environment cooperate? The latter is particularly noteworthy, given the Houthi drone strikes on Abha’s airport and the concerning, unexplained detonation of an explosive device injuring a member of a French team in the Dakar rally.
Still, while uncertainties remain, the promotion of tourism and entertainment as leading elements in the kingdom’s diversification strategy is already suggestive of profound changes within the kingdom. The Western tilt in geography and geopolitics, the global opening and national posturing, and the new embrace of arts and entertainment are indicative of broader trends as the kingdom navigates its “post-oil” future. All of this marks a step away from the distinctive religious-political economy and pan-Islamic global positioning previously pursued by the Saudi state.
This report is based on the presentations and discussions during the UAE Security Forum 2022, “Expanding Regional Partnerships for Security and Prosperity,” held on November 17, 2022 in Abu Dhabi, United Arab Emirates.
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