Travel in Saudi Arabia

Softening of visa fees and extensions for post Umrah visas revive growth in tourist arrivals

A softening of visa fees during the year led to growth in inbound arrivals to Saudi Arabia in 2018. This represented a turnaround from 2017, when visa fees were put up in order to boost non-oil revenues, and which subsequently had a negative impact on pilgrim arrivals.

Growing internet penetration, a tech-savvy population and digital payment strategy support robust online travel sales

The rapid evolution of smartphones and increased internet penetration has led to significant growth in tech-savvy consumers in the Kingdom, most of whom belong to “generation Z”. With high levels of social media usage and comfort on online platforms, these consumer groups prefer the convenience of using online booking platforms.

National carriers remain competitive both domestically and internationally

The national flag carrier, Saudi Arabian Airlines leads the airlines category in the country, having a strong operational presence in charter and scheduled airlines. The airline also expanded its business model into low cost carriers given the surge in demand for low cost and economy travel in recent years as both domestic travellers and those from regional countries readily opt for low cost options.

Online travel sales and intermediaries attract investor interest

With changing market dynamics in terms of ICT infrastructure and consumer behaviour translating into robust online travel sales, the category is gaining noticeable investor interest from both outside and within the country. Although several online travel platforms are currently active in the country, many of which are regional platforms, there is still room for new entrants.

National Transformation plan to diversify travel market over the forecast period

Changing lifestyles and less conservatism in the Kingdom as well as major reforms across most industries designed to diversify the economy and reduce the Kingdom’s dependence on the oil sector, mean travel and tourism is one of the key pillars of the Vision 2030 plan. Major reforms and infrastructure developments, a strengthening of the aviation industry and public transport to support the country’s wider economic goals, and the inclusion of the travel market in the overall transformation plan, will support higher numbers of religious tourists over the forecast period.

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