Saudi Arabia’s tourism sector is experiencing substantial growth, with domestic spending reaching SR105 billion (approximately $28 billion) through the third quarter of 2025. This represents an 18% increase year-over-year, according to Princess Haifa bint Mohammed, Deputy Minister of Tourism. The figures were announced at the Budget Forum 2026 in Riyadh, highlighting tourism’s role in the Kingdom’s economic diversification efforts.
The sustained expansion in both domestic and international travel is bolstering Saudi Arabia’s economy. The country recorded nearly 30 million inbound tourists in 2024, an 8% increase from the previous year, with associated spending totaling SR168.5 billion. This growth underscores the success of Saudi Arabia’s Vision 2030 plan, which prioritizes developing the travel industry.
The Rise of Saudi Arabia’s Tourism Sector
The Saudi government views tourism as a key pillar of its economic transformation, aiming to reduce reliance on oil revenues. Investments in infrastructure, cultural attractions, and marketing campaigns are driving this growth. The ministry said that the sector welcomed over 100 million visitors overall, generating SR275 billion in total spending.
Domestic Tourism Remains Crucial
While international visitor numbers are climbing, domestic tourism continues to be a vital component of the sector’s success. Princess Haifa emphasized the importance of local travelers in sustaining long-term growth. The ministry is actively working to cater to the preferences of Saudi residents, offering a diverse range of experiences.
Growth in Alternative Accommodations
A particularly notable trend is the rapid expansion of private accommodation options. The number of licenses issued for rural lodges and private hospitality homes has increased by an astounding 1,250% compared to the previous year. More than 31,000 such licenses have been granted, reflecting both strong consumer demand and significant investor interest in this segment of the market.
This surge in alternative accommodations provides travelers with more choices and contributes to a more decentralized tourism ecosystem. It also offers opportunities for local entrepreneurs to participate in the industry. The growth in this area is a key component of the Kingdom’s broader strategy to diversify its hospitality offerings.
Supporting Investment and Innovation
The Ministry of Tourism is actively working to empower the private sector and attract further investment. Over 5,700 tourism licenses have been issued, representing a 40% increase, demonstrating the sector’s appeal and potential for strong returns. This growth is fueled by initiatives designed to streamline the investment process.
One key initiative is the launch of a unified data platform. This platform provides investors with transparent, real-time insights into market performance, spending patterns, and visitor demographics. Additionally, digital service platforms have been implemented to expedite procedures and improve the ease of doing business. These improvements aim to reduce bureaucratic hurdles and encourage greater foreign direct investment.
European visitor numbers have risen by 14% this year, while travelers from East Asia and the Pacific have increased by 15%. These figures indicate a broadening of the source markets for Saudi tourism, reducing reliance on any single region. The ministry is actively targeting new markets and tailoring its marketing efforts to appeal to diverse audiences.
However, challenges remain. Maintaining sustainable growth requires careful management of resources and infrastructure. The Kingdom is investing heavily in projects like the Red Sea Project and NEOM, ambitious developments designed to attract high-end tourists and establish Saudi Arabia as a premier global destination. These projects are expected to significantly contribute to the country’s luxury travel market.
Princess Haifa stated that the recent achievements are not a final destination, but rather stepping stones towards further growth. The ministry continues to set new targets and refine its strategies to maximize the sector’s potential.
Looking ahead, the Ministry of Tourism is expected to release a comprehensive report detailing the full-year performance for 2025 in early 2026. Analysts will be closely watching for further details on the impact of Vision 2030 initiatives and the sustainability of the current growth trajectory. The ongoing geopolitical landscape and global economic conditions will also be key factors influencing the future of Saudi Arabia’s tourism sector.
