Saudi tourism investments seen to hit US$ 8.9b by 2020
The Kingdom of Saudi Arabia will see a steady growth in its travel and tourism industry with almost SR33.5 billion to be invested in the sector until 2020, this was according to experts who attended the recently concluded Saudi Arabia Briefing of the Arabian Hotel Investment Conference (AHIC) in Riyadh.
Hosted by Marriott International, the event in Saudi followed similar briefings in key tourism markets across the region, such as Oman and Qatar. In Riyadh, experts gathered to discuss the prospects of? Saudi Arabia?s travel and tourism sector as well as analyze the trends that will have an impact on its ability to attract more tourists.
Data from the World Trade and Tourism Council show travel and tourism investments in Saudi Arabia have grown at a CAGR of 5.8 percent since 2001 and are estimated to have reached SR20.55 billion at year-end 2012. It is expected to increase at an annual rate of 6.7 percent to reach SR33.5 billion of total investments in 2020.
The investments reflect a strong commitment to Saudi?s tourism and travel industry, which has been contributing significantly to the country?s GDP, accounting for as much as 6.1 percent of overall GDP by 2017.
Philip Wooller, Area Director ? Middle East & Africa, STR Global, says there are about 66,438 rooms that are in constriction in the Middle East and Africa region. Majority of these are classified as Upscale (32 percent) and Upper Midscale (22 percent).
?Among the region?s key markets, Dubai reported the largest number of rooms under construction (10,970 rooms). Five other markets reported more than 2,000 rooms under construction: Makkah, Saudi Arabia (6,927 rooms); Riyadh, Saudi Arabia (5,804 rooms); Doha, Qatar (4,944 rooms); Abu Dhabi, United Arab Emirates (3,036 rooms); and Jeddah, Saudi Arabia (2,569 rooms),? he added.
Looking ahead, Filippo Sona, Director, Head of Hotels MENA, Colliers International reviewed what has changed in Saudi Arabia?s hospitality sector and gave some significant insights into where it is headed.
In conversation with Saad Al Qahtni, Section Head Accommodation, SCTA; and Otto Goessnitzer, Licensing & Quality Consultant, SCTA, Sona noted the potential for growth using the Serviced Apartment Business Model whose key strength is being able to change the target market profile between long and short stay to suit market conditions in order to achieve revenue maximization.
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