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Tourism businesses on the up in Medina

The Holy Mosque in Medina, Saudi Arabia. Pilgrims flock to the city as part of Hajj Bert de Ruiter/Alamy via Reuters
The Holy Mosque in Medina, Saudi Arabia. Pilgrims flock to the city as part of Hajj
  • Report on Saudi holy city
  • Tourism to contribute 10% of GDP
  • Part of Vision 2030

The number of tourism businesses in Medina was 15 percent higher in the first quarter of 2024 than the same time last year, a boon for Saudi Arabia as it aims to increase the industry’s contribution to the national economy.

Madinah Chamber did not supply a breakdown of the figures, but the state-owned Saudi Press Agency (SPA) said the increase included more accommodation, travel agencies and trip organisers.

Tourism accounts for 2.6 percent of all economic activity in Medina, SPA reported. Saudi Arabia has set a target for tourism to represent 10 percent of total GDP by 2030.

More than 106 million tourists visited Saudi Arabia in 2023, surpassing the kingdom’s 2030 target and prompting it to set a new goal of welcoming 150 million annual visitors by the end of the decade, according to the Ministry of Tourism.

AGBI reported last week that the costs of Hajj are getting ever higher for pilgrims coming from around the world to perform the annual rites, which are a duty for every able-bodied Muslim to perform once in a lifetime. 

Saudi Arabia has revamped its pilgrimage regulations in recent years as part of its tourism strategy.

“The two holy cities of Mecca and Medina are set to be a prolific centre for more investments in the years to come,” business consultancy Astrolabs said in a recent report, citing huge spending on infrastructure to accommodate more pilgrims. 

Before the Covid-19 pandemic in 2020, the government said Hajj alone accounted for $12 billion annually, while tourism expenditure for religious purposes as a whole was over $18 billion. As the economy recovered in 2022 the figure was closer to $10 billion. 

“There is certainly scope for the revenues and numbers continuing to rise,” said James Swanston of Capital Economics in London. 

“The kingdom is leaning quite heavily on tourism to drive non-oil growth, and religious tourism will be key to that.” 

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