The Tourism Development Fund will launch equity and debt investment vehicles to develop the tourism sector in collaboration with private and investment banks.

Ahmed Al Khateeb, Chairman of the Saudi commission for tourism and national heritage gestures during an interview with Reuters in Riyadh, Saudi Arabia on September 25, 2019.
Ahmed Al Khateeb, Chairman of the Saudi commission for tourism and national heritage gestures during an interview with Reuters in Riyadh, Saudi Arabia on September 25, 2019. (Reuters)

Saudi Arabia plans to start a tourism development fund with an initial capital investment of $4 billion.

The Tourism Development Fund will launch equity and debt investment vehicles to develop the tourism sector in collaboration with private and investment banks, the ministry of tourism said on Sunday.

“The launch of the fund at this time, as the tourism sector faces unprecedented global challenges, is testament to investor and private-sector confidence in the long-term outlook for tourism in Saudi Arabia,” Minister of Tourism Ahmed Al-Khateeb said in a statement.

Visitors take a selfie in the National Museum in Riyadh, Saudi Arabia, November 29, 2017.
Visitors take a selfie in the National Museum in Riyadh, Saudi Arabia, November 29, 2017. (Reuters)

New visa regime

Tourism is one of the main pillars of Saudi economic reforms aimed at weaning the country off its dependence on oil revenue.

Saudi Arabia last year opened up to international tourists, launching a new visa regime while appealing to foreign companies to invest in the sector, which it hopes will contribute more than 10% of gross domestic product by 2030, up from 3% currently.

Analysts predict a severe economic contraction in Saudi Arabia this year, hit by the economic impact of measures to contain the Covid-19 pandemic and by a sharp drop in oil revenue because of low crude prices.

Source: Reuters