Saudi Arabia Has Exceeded Vision 2030 Tourism Target 7 Years Ahead, Says IMF Report
The International Monetary Fund (IMF) has recognised Saudi Arabia's tourism sector as a key player in the nation's economic diversification, according to its 2024 Article IV Consultation report.
Saudi Arabia has surpassed its Vision 2030 goal of attracting 100 million visitors annually by 2023, achieving this milestone seven years early. Tourism revenues hit $36 billion in 2023, with net tourism income rising by 38 percent. The sector contributed 11.5 percent to GDP in 2023 and is expected to reach 16 percent by 2034.
This growth is driven by strong domestic demand and an increase in international arrivals. Non-religious tourism has seen a significant rise, with more leisure travel and visits to friends and relatives. Major events like Formula One, the 2027 Asian Cup, and the 2030 World Expo have further boosted this trend.
The IMF highlights that tourism has shifted Saudi Arabia's service balance to a surplus. By earning more from international visitors than it spends on outbound tourism, the Kingdom achieved a positive balance by 2022. In 2023, additional gains came from increased revenue in transportation and service exports.
The report also mentions that while spending on outbound tourism by Saudi nationals decreased, expatriates in the Kingdom significantly increased their leisure spending post-COVID. The diverse connections created across industries like food, beverage, travel, cultural industries, and accommodation are crucial to this transformation. These linkages are reducing the Kingdom's dependence on oil-intensive sectors.
Major projects such as Red Sea Global and Diriyah Gate are central to this shift. These initiatives focus on luxury tourism, cultural preservation, and infrastructure improvements. Vision 2030 remains Saudi Arabia's comprehensive economic reform plan with tourism at its core.
The IMF's recognition of Saudi Arabia's progress underscores the vast potential of its tourism sector. This sector is poised to drive sustainable economic growth in the coming years. "The Kingdom's achievements reflect its commitment to diversifying its economy," the report noted.
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