RIYADH: As the travel and tourism industry has a critical role to play in the global economy’s recovery from the pandemic, Saudi Arabia is leading the way through collaboration and investment in the sector, a leading minister has confirmed.
As the global leaders gathered at the World Travel and Tourism Council summit in Riyadh, Saudi Minister of Investment Khalid Al-Falih said his ministry and the Public Investment Fund are supporting the tourism sector as it is part of the Kingdom’s diversification strategy.
“We are investing in it for the greater good. Obviously, the impact it has on the standing of the country is very high,” he said during an appearance on a discussion panel.
He said that the industry is a double-digit proportion of the global gross domestic product and this sector impacts all aspects of the economy.
“We saw during the pandemic if the sector loses, everyone loses — society loses, the macro economy loses, and the spillover effect is quite incredible,” he said, adding that one shouldn’t measure the sector purely by macro numbers of 10, 12, or 15 percent of GDP.
Despite a perception that travel and tourism is a difficult industry and was among the last to recover from the pandemic, the minister contested that it is a sector where one can make money, no matter where in the value chain someone is positioned.
Speaking at the same panel, Princess Haifa Al Saud, the Kingdom’s vice minister of tourism, emphasized the need for collaboration as the tourism industry recovers from the pandemic.
“It means we all have to have one vision, set clear targets, and work together to deliver — which we are doing today in Saudi Arabia,” she said, adding that is why the Kingdom is the fastest growing economy within the G20 countries for tourism, with a 121 percent increase according to the UN World Tourism Organization.
She revealed that during the G20 presidency, Saudi Arabia was the first country to bring the public and private sectors to the table to deal with the post-pandemic issues.
The vice minister said the government is amending its regulations and policies as per the need of the industry after having feedback from the private sector.
“For example, the criteria for hotel classifications which we launched three years ago are being amended based on the feedback we received from the private sector as we understand one size doesn’t fit all,” she said.
The Princess also revealed that through the ease of doing business, the government is going to launch 28 initiatives this year in order to facilitate the investor’s journey.
The UN World Tourism Organization Secretary General Zurab Pololikashvili, who was also part of the panel discussion, said that two years ago no one knew when the world would recover from the pandemic.
“People were saying we will recover in 2027; some of them were saying 2023. But the first nine months of this year showed that 700 million travelers are back. This is 65 percent of the best year we had in 2018-19,” he said.
Marriott International CEO Anthony Capuano agreed that anyone that had any questions about the resilience of travel has had those questions answered. “The speed with which travel has recovered has been remarkable,” he said.
He pointed out that the recovery has been uneven, however, adding: “In many markets around the world, we have seen extraordinarily strong recovery. Opening of borders has been the catalyst to that recovery. But we look at Greater China, the zero-Covid policy has continued to dampen the recovery in a meaningful way.”
Many countries, when working on their post-recovery plan, chose to spend on other sectors first than tourism, a trend which Saudi Arabia bucked.
According to Greg O’Hara, founder and senior managing director of Certares, the Kingdom has been absolutely committed to investing in its own tourism infrastructure, and argued the world is going to change as all the developing nations are becoming more wealthy.
“Where they are going to travel and how they are going to travel, are going to be completely different. Saudi Arabia is making a bet on itself and the rest of the world has to deliver to the travelers,” said O’Hara.