Saudi Arabia seeks tourism boost by paying airlines to fly: report

The Saudi government is seeking to boost its tourism industry by offering to subsidize airlines that fly unprofitable routes linking the Gulf kingdom with major cities around the world.

What happened: According to a Bloomberg report, Saudi Arabia entered the global tourism scene very late – it only started issuing tourist visas in 2019, and the Ministry of Tourism aims to attract 12 million foreign visitors this year, which will account for approximately 4% of the Saudi tourism market. economic exit. However, the minister of tourism Ahmed Al Khatib wants to raise this share to 10% by 2030.

“The main goal is to create direct flights to our main target markets,” Al-Khatib said. “The program compensates airlines for losses from flying direct flights to these very important hubs for us.”

See also: Spirit Airlines delays border merger vote after new JetBlue takeover bid

What happens next: The new subsidy is part of the state air service program. The first agreement has already been signed to provide flights of the national carrier Saudia to Barcelona and Zurich.

Al-Khatib did not disclose the amount of subsidies paid to airlines, only acknowledging that the government “will negotiate with each carrier to determine their amount.”

The Saudi government also intends to allocate $147 billion to expand its transportation capabilities, including building a new airport in the capital Riyadh, a new airline owned by the State Investment Fund, and expanding direct destinations served from the country from 100 to 250.

Photo: Paul Davey/Wikimedia Commons

About the author


Leave a Comment