Inside the Saudi Arabia Tourism Bet: $1 Trillion in Investment, Zero Track Record, and Infinite Ambition

The pitch slides for Saudi Arabia’s tourism campaign most likely look amazing in a conference room somewhere in Riyadh. At Al-Ula, ancient sandstone tombs rise from the quiet of the desert. coral reefs on a Red Sea coast that has hardly seen any development. Like an architectural thought experiment, NEOM’s geometric aspirations stretch across the country’s northwest. $1 trillion has been invested. a target of 100 million tourists annually by 2030—a figure that, for comparison, is typically higher than the number of tourists that visit a nation like France or the United States each year. The slides make some sort of sense when you’re seated in that conference room. The story becomes much more complex when we are in the real country.

Dora Jane Flesher, a retired accountant from Arkansas who traveled to Saudi Arabia soon after it opened to leisure travel, described to the Wall Street Journal what the early experience looked like on the ground: genuinely amazing ancient tombs carved into sandstone next to a museum with a collection of vintage televisions, touch-tone phones, and rocks from every state in the United States. “We saw a lot of random things,” she stated, “that will not be popular tourist destinations.” Her account dates back to 2022. How much has changed is unclear. The question of whether a nation can successfully manufacture a tourism industry in less than ten years is still genuinely open, but it is evident that Saudi Arabia has been developing at an exceptional scale and speed in the years since.

The ambition’s foundations are not ridiculous. Most visitors have never seen Saudi Arabia’s actual assets, in part because the nation hardly acknowledged them until 2019. Prior to that year, only business travelers, foreign workers, and religious pilgrims performing the Hajj in Mecca were granted visas; these visitors had particular spiritual goals rather than just being curious tourists. The official start of something unprecedented in the kingdom’s modern history came in 2019 with the switch to electronic tourist visas, which were available to citizens of 49 countries for about $142. The timing was purposeful: Vision 2030, which Crown Prince Mohammed bin Salman had been promoting since 2016, identified tourism as one of the “promising sectors” through which the nation would diversify away from oil revenues, which currently account for the vast majority of government revenue.

A series of agreements, announcements, and ongoing construction followed. Accor, Hilton, and Hyatt agreed to become hotel partners. A new national airline, Riyadh Air, was founded. With promises of solar power, no marine discharge, and zero ecological impact, the Red Sea Project, a luxury resort development spanning an essentially unexplored coastline, started construction. One of the biggest structures ever created by humans is the Mukaab, a massive entertainment complex that is slated to be built outside of Riyadh. The most talked-about architectural project on the planet is NEOM, which includes a city called The Line that would house nine million people in a 170-kilometer linear structure. It has drawn both intense curiosity and intense skepticism. According to CoStar, more than $1 trillion had already been committed or spent on infrastructure related to tourism and hospitality by the beginning of 2024. Investment is happening at a real pace. The estimated 100 million visitors per year have not yet shown up.

There are significant obstacles in the way of achieving the 2030 goal. The most tangible issue is probably water scarcity: the majority of Saudi Arabia is desert, the nation uses a lot of energy to produce fresh water through desalination operations, and groundwater supplies are running low. The natural environment of the area just cannot supply the amount of water needed for hotel swimming pools, golf courses, and the kind of resort infrastructure being constructed along the Red Sea. Marketing materials showcase the Red Sea Project’s impressive environmental commitments. Plastic-wrapped tea bags and single-use coffee pods were discovered in the rooms of visitors to the nearby Habitas AlUla resort, an environmentally conscious operator that has made a special commitment to solar power and no single-use plastics. Although there isn’t much of a difference between the operational reality and the promotional language, anyone who is paying attention can see it.

And then there is the question that never completely disappears. For a sizable portion of the global travel market, Saudi Arabia’s human rights record—which includes the 2018 murder of journalist Jamal Khashoggi in the Saudi consulate in Istanbul, the detention of women’s rights activists, and the criminalization of same-sex relationships—is not a minor concern. Saudi Arabia’s tourism ambassador, Lionel Messi, received an open letter from the families of imprisoned dissidents pleading with him to change his mind. “The Saudi regime wants to use you to launder its reputation,” they said. LGBTQ tourists are now welcome, according to the Saudi Tourism Authority’s website. Despite years of conjecture that this might change, alcohol is still illegal throughout the nation, with no verified exceptions, not even in private resorts.

Observing all of this from a distance gives the impression that Saudi Arabia is genuinely attempting something unprecedented in the history of tourism—not just constructing hotels and airports, but attempting to build an entire cultural identity as a leisure destination for a global audience, essentially starting from zero, in about ten years. It’s still unclear if that can be accomplished at the scale required by the Vision 2030 targets. Markus Pillmayer, a professor of tourism at the University of Applied Sciences in Munich, carefully put it this way: “Seeing what’s going on there is really thrilling. However, I believe it is still too early to determine with certainty whether or not it will be successful.” That might be the most truthful statement regarding the entire business.