The Emerging Impacts of Tourism on the Economy of The Kingdom of Saudi Arabia: A Comparative Study of Oil and Tourism.

Abstract

Saudi Arabia was heavily dependent on oil, which caused an economic crisis due to the collapse of global oil prices. In 2016, the Saudi government launched Vision 2030 to diversify the Saudi economy and avoid dependence on oil revenues. One aim of Vision 2030 is to initiate numerous tourism initiatives to boost the tourism industry's economic impact, elevating its contribution from 3% of GDP to 10% by 2030. This paper provides the necessary assessment to understand tourism's role and contribution to the Saudi economy and to determine whether the industry's growth is on the right track. Also, this paper also evaluates tourism growth trends and revenue generation compared to oil and determines whether tourism revenues can sustainably replace or supplement oil revenues in Saudi Arabia's economy. Mixed methods, including time series analysis and a systematic qualitative literature review, were used to provide a more comprehensive understanding of the case study and its evaluation. Five main tourism variables are examined, including Pilgrims (Hajj), Business, Leisure, Food and beverage, and Traditional and Cultural sites. One of the most important conclusions is that tourism revenues can complement the significance of oil in the Saudi economy and enhance it sustainably, making it more resilient in the future. Many of the goals of Vision 2030 for tourism were achieved before 2030, which prompted the government to set higher goals. It was also evident from the data analysis that dependence on oil has decreased, and the rate of economic diversification and the contribution of tourism to the Saudi GDP has increased.