Saudi Arabia Moves to Open Borders in Bid to Diversify Economy

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By: Gerelyn Terzo of Sharemoney 

Saudi Arabia, which boasts a population of 30 million people, has opened up its borders to travelers entering and leaving the Middle Eastern nation. The kingdom’s Ministry of Interior will once again issue tourist visas to travelers from nearly a dozen countries that have curbed the spread of coronavirus, according to a report by Saudi Arabia’s Public Health Authority.  The Saudi kingdom is eager to revive travel to the country as it seeks to diversify its petroleum-based economy.

Additionally, Saudia Arabia’s vaccinated citizens are now free to travel outside of the country, marking the end of more than a one-year international ban that was implemented to quash the pandemic. Saudi Arabia is being touted as having more relaxed travel rules than Australia, where citizens and dual-citizens alike looking to leave the country must obtain a government exemption. Meanwhile, non-citizens living in Australia must jump through additional hoops to board international flights.

Travelers into Saudi Arabia must provide proof of a PCR test within 72 hours of entering the country. While Saudi Arabia has made inbound travel easier, it has yet to lift its quarantine requirements for non-vaccinated travelers. As a result, non-vaccinated travelers from the countries on the approved inbound flight list must still quarantine for one week on their own dime and take a PCR test, the results of which must be negative, before leaving the country.

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The  countries from which travelers are now free to arrive in Saudi Arabia include:  

  • United Arab Emirates
  • Germany
  • The U.S.
  • Ireland
  • Italy
  • Portugal
  • The U.K.
  • Sweden
  • Switzerland
  • France
  • Japan

Travel Headaches

Saudi Arabia began restricting travel from other countries in February 2020. This made it challenging for people who were planning to travel to the kingdom to complete their trips, many of whom found themselves stuck in the UAE, which is a popular hub for international flights.  

Arabnews.com featured Nagham Hassan, a Saudi expatriate from Syria who has been living in France since January 2020. Hassan has been unable to travel to Jeddah, Saudi Arabia due to travel bans in both places. She explained how her parents came to Saudi Arabia some 40 years ago, and Hassan and her new husband were looking to return to celebrate their wedding with family. She plans to return home soon now that Saudi Arabia added France to its list of acceptable countries.

Meanwhile, the countries that remain on what’s known as a “red list” and therefore cannot travel to Saudi Arabia include:

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  • Libya
  • Syria
  • Lebanon
  • Yemen
  • Iran
  • Turkey
  • Armenia
  • Somalia
  • The Democratic Republic of Congo
  • Afghanistan
  • Venezuela
  • Belarus
  • India
  • Pakistan 

The response on social media was mixed. Pakistanis want to know when Saudia Arabia will lift the travel ban from the South Asian nation.

Saudi Economy & Travel

Saudi Arabia’s economy is largely fueled by the oil industry, which comprises 42% of its USD 678 billion economy. In an attempt to diversify its revenue streams, however, the Middle Eastern nation has its sights set on the travel and tourism sector, from which it is targeting a contribution of 10% to GDP by the end of the decade. Key to this plan is greater participation from the private sector. It has established what it dubs a Public Investment Fund (PIF) to direct USD 3 billion toward projects building out the kingdom’s travel and infrastructure.

Saudi Arabia tourism industry has come a long way. Prior to 2019, gaining entry into the Middle Eastern nation as a tourist was near impossible unless you traveled on a “pilgrimage.” Since then, the country has opened up its borders and added travel and tourism as another rung in its economic ladder. Those plans were slowed with the emergence of COVID-19, which triggered a suspension on international travel into and out of the country, a setback that the Crown Prince has since set his sights on reversing.

Crown Prince Mohammed bin Salman recently introduced the  Soudah Development Company (SDC), which is controlled by the PIF and is tasked with developing the mountainous region of Soudah into a tourist destination, offering:

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  • 2,700 hotel rooms
  • 1,300 housing units
  • 30 commercial and entertainment centers 

Saudi Arabia is involving the private sector and local communities to build this destination hotspot, with expectations for 8,000 jobs to be added to the economy in the next nine years. The kingdom is expecting that it will attract some 2 million thrill-seeking travelers to the destination each year.   

In addition, Saudi Arabia has partnered with the Mediterranean country of Greece to strengthen travel between the two nations.  Officials from both countries reportedly signed a “joint action plan” to encourage travel for the following reasons:

  • Medicine
  • Shopping
  • Luxury
  • Sports
  • Adventure
  • Food

Saudi Arabia and Greece plan to create mutually acceptable vaccination certificates to support safe and efficient travel between the two countries.

Saudi Arabia’s decision to open its borders comes at a time when the country suffers from sky-high joblessness, with the unemployment rate hovering at 12.6% as of Q4 2020. Unemployment came dangerously close to 15% in Q3 2020. Prior to the pandemic, the Saudi government was targeting an unemployment rate of 7% by 2030.

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According to a poll by the General Authority for Statistics cited by Reuters, more than 90% of Saudi Arabia’s unemployed are willing to work in the private sector but not if they require lengthy commutes. In Q1 2021, Saudi’s GDP shrunk by 3.3% due to declines in crude oil output amid a one-two punch of OPEC+’s decision to cut production coupled with weaker demand due to COVID-19. On the bright side, the non-oil economy grew by 3.3% as recovery from the pandemic began to unfold. This was the first time the kingdom experienced growth in non-oil-related sectors since Q1 2020. Projections are for the country’s economy to expand by 2.1% this year on the heels of a 4.1% contraction in 2020.


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