Sidestepping the difficulties

Saudi Arabia aims to turn tourism into one of its major industries creating millions of jobs in the process.

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By  John Irish Published  June 1, 2003

|~||~||~|Leading Saudi Arabia’s tourism plans, the first Arab in space is convinced that the Kingdom’s hospitality sector can succeed, but how realistic are these plans? Just a month ago, at the Arabian Travel Market (ATM), Saudi Arabia heralded its move into a new open era by unveiling a comprehensive master plan aimed at creating a viable tourism infrastructure.

For many, the words Saudi Arabia and tourism in the same sentence sounded a little odd. Yet, with a highly organised and motivated delegation under the leadership of HH Prince Sultan bin Salman bin Abdulaziz Al Saud, the Saudi Arabian Supreme Commission for Tourism (SCT) began to persuade trade visitors and the media that tourism in the cradle of Islam could be a reality.

Following the recent bombings in Riyadh, those ambitious plans are now being put back into question. But whereas the attacks that occurred the same week in Casablanca will inevitably harm Morocco’s thriving tourism economy, for Saudi Arabia the tourism roadmap does not necessarily need to be put aside.

Currently, the Kingdom welcomes around 20 million visitors yearly, which the World Tourism Organisation defines as a person spending a single night away from home. Of that number, an estimated 6.3 million are in Saudi for the Hajj and Umrah religious pilgrimages.

Tourism contributes 5.4% of the national gross domestic product (GDP), but, unlike the industrial and oil sectors, it offers the potential to create new job opportunities for the present and future Saudi generations, particularly at a time when experts estimate unemployment could be as high as 31%. The SCT is predicting that the travel industry could generate up to 2.3 million jobs over the next 20 years, something that the government can ill afford to ignore.

However, in a society where dependency on oil prevails and the image of working in such an industry is negative, the national psyche must change first. Prince Sultan considers tourism as a possible catalyst to turn the local society at an early age into better hosts but also to make them aware of their own heritage. In schools, the Society and Tourism project was launched with the objective of outlining the benefits of Saudi tourism. Regionally, the SCT aims to establish 50 tourism development authorities, which graduates will fill every year, while it is encouraging the older generation to travel internally through the National Tourism Media Strategy. “We are really trying to change perceptions and culture, it’s a big challenge,” says Prince Sultan.

The target is to raise the number of visitors beyond 44 million, with revenues increasing from the current $9.64 billion a year to $22 billion by 2018. “Our budget at the SCT is the fastest growing budget in the Saudi government; it has risen by 50% per year since we were established, while other ministries have had 4-7% increases,” explains Prince Sultan. The five year plan, which is to be completed by 2008, has a budget of SR1.3 billion (US $400 million), but could increase to over SR11 billion once all the costs that come with tourism development are accounted for.
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If that wasn’t sufficient to highlight the government’s position, Prince Sultan points to the participation on the tourism board of senior ministers from all the major industries as proof of the seriousness of the project. The idea is that much like the rest of the world’s tourism authorities, all sectors will need to co-operate, be it the media, commerce, immigration or trade. “Don’t think of us as a government agency that sits around and shuffles papers all day, we see our job as temporary. We think of our job as running initiatives and hopefully they will then just support themselves,” says Prince Sultan.

The project aims to iron out many of the obstacles that Saudi tourism faces. “The next years are what we call the intensive care period. There are a lot of obstacles, there is a very challenging mission, and we have a lot of mixed up laws, because tourism grew without a central agency,” he says. “What we have begun to do is to clean up the system. Give us a year and this system will be completely streamlined,” he continues.

The SCT has made it clear from the outset that its main target will be the Saudi market. Traditionally, the Saudis are one of the highest spending groups globally. As intra-Arab tourism has increased and global trends have indicated that visitors are travelling closer to home, the SCT’s plan to stop the 4-5 million exodus of Saudis every summer makes sense.

Second to the Saudi market, but equally significant, will be the Arab and Muslim nations. At present, there are over six million religious visitors each year, who hardly leave the holy cities of Mecca and Medina.

Consequently, the Saudi authorities are paving the way for enhanced religious tourism, the Umrah Plus, which will enable pilgrims to extend their Umrah visits by facilitating trips throughout the country.

While the Saudi, regional and Arab market appears a logical step forward, non-Muslim tourism may prove a little more complicated. Many Muslims worldwide have raised doubts about having a sustained tourism market in the land of the Haramayn, the two holiest sites in Islam. As Prince Sultan explains: “We are making decisions on tourism in Saudi Arabia, not only for us but on behalf of the Islamic world as a whole. Many people will accept things happening in their country that they will not accept in Saudi Arabia. I don’t see this is an obstacle, but more as an asset.”

However, Prince Sultan is quick to point out that the Kingdom currently hosts over six million expatriate workers, a fact that he believes will eventually help promote the country, as former residents begin to speak of their experiences in Saudi. Prince Sultan argues that western tourists will come to Saudi for two reasons. Firstly, global tourism is developing in such a way that people are looking for more variety.
In the case of Saudi Arabia, the restrictions that apply and the curiosity of discovering the cradle of Islam will be part of the total experience. Secondly, unlike Dubai, which has gradually set itself up as a winter resort for the European market, Saudi Arabia will remain conservative in its approach, but develop a more focused, cultural and specific niche tourism, offering attractions such as trekking and scuba diving.
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Nevertheless, while current perceptions prevail, it’s unrealistic for the Saudi authorities to consider the Western tourism market as a big earner. As Dr Salman A Al Sudairy, an advisor to the Prince, comments: “I think, as tourism goes, that we have to address the issue of what target market we’re after, what are the attributes, the requirements and whether it is consistent with the profile we’re after.”

To swing the pendulum, the necessary infrastructure will need to be in place. Saudi Arabia already has 95,000 hotel rooms, which should gradually grow as the 10,000 tourism attractions that have been identified by the SCT are made accessible and available to the travelling public.

The tourism commission envisages that approximately 50,000 hotel rooms and 74,000 more apartments will be built to meet projected demand. Additionally, the Council of Ministers is considering proposals to create trade associations that will bring hotels and other forms of accommodation under the supervision of the tourism authorities. This, it is hoped, will lead to the creation of a hotel system similar to international standards, enabling greater co-operation with regional and global tour operators.

But where will this investment come from, particularly in the current uncertain climate? In such difficult times, Prince Sultan is adamant that the number one investors will be the Saudis themselves.

“If we bring him back to Saudi, everybody else will follow. Tourism is known as a major player in the investment field. It could really draw money like a black hawk, it’s a big country, it’s a desert that will swallow it up,” he argues. The question has to be whether the Saudi government will manage to create an environment that attracts these investors.
Prince Sultan’s vision depends on it. “It will be the number one priority; no more waiting for me in the lobby for hours to get appointments; we will work with the private sector hand in hand, serving them, helping them and making things easier, it’s a new perspective.”

Inevitably, since the Riyadh bombings, investors will think twice before building hotel complexes, expatriates will consider vacating the Kingdom for safer lands and the press will portray Saudi Arabia as a breeding ground for extremists. It could be asked whether anything has really changed, however? Even prior to these events, Saudi suffered from a fairly large image problem.

Ultimately, building up an industry such as this depends on security and governmental reforms. While the spectre of Al Qaeda may haunt Saudi Arabia, the tourism drive will focus primarily on Saudi nationals and Umrah visitors. For the rest, a great deal will depend on the geopolitical situation and how the Saudi government reacts to it. As a leading travel operator based in Saudi Arabia explained, the government is keen for change, but whether “it comes in two months, two years or five years, I honestly don’t know.”
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