SG (JEDDAH)Religious tourism is a cornerstone of the tourism industry in the Saudi Arabia. The country hosts up to 8 million pilgrims annually, and is expected to host 30 million by 2030.
An increase rate of 275% coincides with the Kingdom’s intensified efforts in developing and restoring ancient national, Arab, and Islamic cultural sites. In addition, the Kingdom is seeking to double the number of Saudi heritage sites registered with UNESCO by 2030 as part of their efforts in developing the tourism sector. Furthermore, domestic tourism in Saudi Arabia is expected to grow at a rate of 40% by 2020.
According to a statement by the President of the Saudi Commission for Tourism and National Heritage (SCTH) Prince Sultan Bin Salman tourism revenues in the Kingdom of Saudi Arabia rose from SR57.3 billion ($15.2 billion) in 2004 to SR166.8 billion ($43.1 billion) by the end of 2016, an increase of 191%. On the other hand, the number of licensed accommodation facilities increased by 300% with the number of international hotel operators in Saudi Arabia increasing from 8 operators in 2002 to 25 operators in 2016.
The World Travel and Tourism Council predicted that the tourism and travel sector in Saudi Arabia would contribute by more than SR250 billion ($81 billion) to the country’s GDP by 2026. This is based on the Saudi government’s quest to nationalize and develop the tourism industry as part of their effort to diversify the economy. Consequently, the number of domestic trips related to tourism in the Kingdom reached more than 47.5 million in 2016 alone.
According to a survey by the Saudi Tourist Information and Research Center (MAS), there is more than 185,000 ready hotel rooms. Such rooms are classified by the standards of the SCTH and meet the highest globally recognized accommodation standards. This comes in addition to other types of housing accommodations that are prepared for the pilgrims visiting during the Haj season.
Elaf Group, a subsidiary of SEDCO Holding, specializes in tourism with services that range from hospitality management and travel, all the way to Haj and Umrah.
Commenting on the opportunities this vibrant industry sector offers, Anees Ahmed Moumina, CEO of SEDCO Holding Group highlighted that: “Hospitality companies succeeded in redeveloping and renovating their existing properties in line with the country’s plans to enhance the tourism sector. Such companies succeeded in diversifying their portfolio overtime, and today are fully ready to welcome visitors. Especially now, that the development and expansion project in the two holy cities have come a long way.”
Ziyad Bin Mahfouz, CEO of Elaf Group, said: “At Elaf Group, we would be working on taking advantage of these positive developments to strengthen our position in hospitality and tourism in the region. We have invested heavily to develop the infrastructure of our facilities and our services, which contributes to our ability in providing a range of unique tourism programs and luxury hotel rooms to all our customers; coupled with the support provided through the tourism, travel and transportation departments of our Group. Elaf is able to welcome visitors with the with top of the line hospitality”
As for this year, a report by Ernst & Young indicated that the hospitality sector in Makkah witnessed, in May, an increase in revenue by 90.5% per room when compared to the same period last year. Such an increase is due to the surge in the rate of return on deposits from SR222 in May 2016 to SR423 in May 2017. And thus, the hospitality sector in Makkah maintained hotel booking levels at 41% annually.
The index of average hotel room price in Makkah as well rose from SR534 per room in 2016 to SR1,033 in May 2017. This correlates with a slight rise in the index of average hotel room price in Madinah from SR672 per room in May 2016 to SR675 in May 2017. The report attributed such rise in room price in Makkah and Madinah to the increasing demand of Haj and Umrah pilgrims.