Saudi Arabia Targets 150 Million Visitors With Affordable Pivot

Riyadh (TRI) — Saudi Arabia, long synonymous with ultra-luxury giga-projects like NEOM and Red Sea Global, is quietly executing a strategic pivot toward mass tourism, aiming to democratize access and swell visitor numbers to 150 million annually by 2030 under Vision 2030. The shift, confirmed by Tourism Minister Ahmed Al-Khateeb in November, marks a departure from years of exclusive high-end focus — where room rates often topped $2,000 a night — to mid- and upper-mid-range offerings that could unlock billions in broader economic gains.

This recalibration comes as the kingdom’s tourism sector posts record highs: 30 million international arrivals in 2024, up 8% from 2023, with inbound spending hitting SR168.5 billion ($45 billion), a 19% surge. Total visitors — including domestic — reached 116 million last year, pushing combined spending to SR284 billion ($75.7 billion), an 11% increase. Through the first half of 2025, arrivals climbed to 60.9 million (+1.5% YoY), with projections for 120-127 million by year-end, generating SR275 billion ($73.3 billion) and eyeing a 10% GDP contribution.

Al-Khateeb, speaking on the sidelines of the U.N. Tourism General Assembly in Riyadh, emphasized inclusivity:

“We started with building luxury destinations for luxury travelers. And we have already started building destinations for the middle class and upper middle class. We will not ignore this segment.”

This comes amid critiques that early Vision 2030 investments — nearly $1 trillion earmarked for tourism — skewed too heavily upscale, potentially alienating volume-driven markets and straining affordability for Saudis themselves.

The Luxury Legacy: High Stakes, High Returns

Saudi Arabia’s tourism renaissance began with a luxury-first blueprint, leveraging oil wealth to craft aspirational gateways. Mega-developments like the $500 billion NEOM (a futuristic linear city with The Line), Red Sea Global’s 50-island archipelago of eco-luxury resorts, and AlUla’s $15 billion “Journey Through Time” heritage masterplan targeted affluent Western and regional elites, blending adventure, culture, and sustainability.

Hospitality pipelines reflect this: Of 320,000 new rooms slated by 2030, 78% fall into luxury, upper-upscale, or upscale categories, with current inventory at 61% high-end and 167,500 keys as of Q1 2025. Projects like Diriyah Gate (a UNESCO-adjacent cultural hub) and Qiddiya (an entertainment mega-city) promise $32 billion in GDP uplift by 2035, while religious tourism — core to the model — saw 18.5 million pilgrims in 2024, up from prior years.

The payoff? International revenue soared 148% vs. 2019 in 2024, leading G20 nations, with leisure now at 23% of visits (up from negligible pre-2019). Top markets: Bahrain (3.4 million), Egypt (2.6 million), Pakistan (2.5 million), Kuwait (2.3 million), and Indonesia (1.8 million), blending regional ties with growing Asian interest. Yet, with 66% of rooms upscale, average stays hit 6.7 nights for internationals, but spending per visitor ($1,304 in 2022 data) lags global peers, hinting at untapped volume.

The Mass Pivot: Volume Over Exclusivity

Enter the 2025 course correction: a deliberate broadening to mid-tier infrastructure, visa easements, and pilgrimage scaling to capture the “missing middle.” Al-Khateeb announced 10 new Shebara Island resorts with “more affordable pricing,” alongside doubled pilgrim capacity to 30 million by 2030 via expanded mid-range hotels near Mecca and Medina.

This aligns with Vision 2030’s non-oil pivot — tourism now 4.5% of GDP (7% non-oil) — targeting 70 million internationals and 80 million domestics by decade’s end. Domestic tourism, at 86.2 million in 2024 (+5.2% YoY), spent SR114 billion, driven by locals shunning abroad amid rising costs. Q1 2025 saw arrivals 102% above 2019, per UN Tourism, with revenue growth topping global charts.

Key enablers:

• Hospitality Diversification: Mid-range chains like Hampton by Hilton (201 keys in NEOM, opening 2025) and Marriott expansions signal affordability creeping in.
• Connectivity Surge: Riyadh Air launches in 2025 with 100+ routes; GCC “Grand Tours” visa eases regional hops.
• Events and Culture: Hosting UN Tourism Assembly; mega-events like 2026 FIFA qualifiers; VAT refunds starting 2025 to boost spending.
• Sustainability Tilt: Eco-focus in AlUla and Red Sea, appealing to mid-market millennials; 112,000 women in tourism jobs (+67%).

Statista forecasts $4.13 billion Travel & Tourism revenue in 2025 (+6.77% CAGR to $5.74 billion by 2030), with hotels at $2.61 billion and online sales at 87%. Knight Frank eyes $100.23 billion market by 2030.

Challenges: Balancing Act Amid Scrutiny

The pivot isn’t seamless. Critics, including citizens in private forums, decry luxury bias as elitist, with projects like Red Sea seen as “not for us” — favoring high-income expats over middle-class Saudis. Workforce gaps persist: Luxury ops struggle with multilingual staff; Saudization quotas (up to 40% in hospitality) hike costs.

Geopolitics looms: Regional tensions could deter mass influxes, while a strong riyal pressures affordability. Overtourism risks in holy sites demand smart capacity management, and $1 trillion investments face ROI scrutiny as oil wanes.

Vision 2030’s Endgame: Inclusive Powerhouse?

This shift reframes Saudi tourism as a volume engine, not just a prestige play. As Al-Khateeb put it:

“Hospitality is in our DNA — something we’ve been doing for thousands of years.”

With leisure at 35% of domestic visits and 20% international spend, the kingdom eyes $85 billion revenue in 2024 alone.

Analysts like those at Oxford Business Group see “forward focus” in this evolution, with 1.6 million jobs projected by 2030. Yet success hinges on execution: blending mass access with luxury allure to avoid diluting the brand.