Saudi tourism investment “still an...

Ministry official outlines new incentives in the kingdom at IHIF EMEA 2025

Despite US$160 billion already committed to transforming Saudi Arabia’s tourism sector, there remains an US$80 opportunity for investors.

That’s according to Saudi Arabia’s Ministry of Tourism General Manager of Investment Planning & Attraction Tareq Al-Shaghrood speaking at the International Hospitality Investment Forum (IHIF) EMEA 2025 in Berlin, Germany (pictured).

Al-Shaghrood said developing the kingdom’s tourism sector, as part of Vision 2030, had already seen US$160 billion of funding from the public and private sectors.

“Ultimately, what we are trying to do with the tourism sector is to create an investable and sustainable sector for both domestic and international investors, operators and key stakeholders,” said Al-Shaghrood.

“We still have an US$80 billion opportunity for investors to come in and develop across hospitality and retail.”

The gathering of leading industry executives and investors heard Al-Shaghrood highlight the Red Sea project where ambitious plans have become reality, with six hotels now open and a further 11 due this year.

Al-Shaghrood added that development has been largely driven by the sovereign wealth fund PIF, which is why the government is introducing new measures to entice international and domestic investors.

They include underwriting an incentives programme which can subsidise up to 25% of total capital expenditure in priority destinations. Hotel owners will also receive a 75% reduction in fees paid to the government, and new regulations mean international investors will be treated the same as domestic investors.

Shebara, a Red Sea Global resort now open

Saudi breaking tourism records
Al-Shaghrood told attendees that the national tourism strategy has made Saudi the G20’s fastest-growing destination, welcoming 109 million visitors in 2023, and that 2024’s data, due to be released soon, would set new records.

In the first nine months of 2024, Saudi ranked third globally for growth rate of international arrivals, up 25% compared to the previous year, according to UN Tourism.

Saudi’s tourism sector saw hotel rooms more than double in Q3 2024, soaring from 214,600 to 443,200.

The kingdom has plans for an additional 320,000 hotel rooms, with an estimated 221,000 of those located in the Holy Cities.

According to the Q4 2024 Hotel Construction Pipeline Trend Report for the Middle East from Lodging Econometrics (LE), Saudi Arabia has a current pipeline of 316 hotels, accounting for 83,275 rooms.

For more information, visit www.ihif.com

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