AlUla’s rise drives economic growth and job creation

AlUla’s emergence as an expansive archaeological, cultural, and tourism hub is a significant milestone in Saudi Arabia’s economic diversification efforts. (SPA)
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Updated 12 May 2024

AlUla’s rise drives economic growth and job creation

  • AlUla on track to achieve 2 million visitors annually by 2035

RIYADH: Increasing visitor numbers to the cultural and tourism hub of AlUla is already delivering a boost to Saudi Arabia’s economy in line with Vision 2030 ambitions, experts have told Arab News.

Situated in the northwest of Saudi Arabia and covering around 22,000 sq. km, the Kingdom’s historic city also boasts a thriving agricultural sector that plays a pivotal role in its economic development.  

Built upon social, economic, and ecological principles, the Royal Commission for AlUla has outlined a strategic roadmap for the comprehensive development of the area, with the primary objective of assisting the Kingdom in diversifying beyond oil and contributing to the national gross domestic product. 

This strategy encompasses three main pillars: tourism, heritage, and nature; local community; and economic diversification. 

Phillip Jones, chief tourism officer at RCU, told Arab News: “AlUla is an integral part of the tourism objectives driven by Saudi Vision 2030. With AlUla’s regional economy primarily driven by tourism, by 2035, AlUla will contribute a cumulative SR120 billion ($31 billion) to the Kingdom’s GDP.” 

He said the RCU is following a “light-touch” tourism model to ensure the continued conservation of AlUla’s natural and cultural heritage.  

Jones also highlighted that AlUla hosted over 260,000 visitors last year, marking a 43 percent increase from the previous year, and projected that it would welcome more than 290,000 visitors in 2024. 

“We are also on track to achieve 2 million visitors annually by 2035.” 

Tourism infrastructure 

Across the Kingdom, the transformative economic impact of tourism is in full swing. 

In 2024, AlUla is poised to welcome two new hotels: Dar Tantora in the second quarter of the year and Hegra Boutique Hotel in the final quarter.  

These new additions will join Habitas and Banyan Tree, core hotels that opened in 2021 and 2022 respectively.  

Additionally, in the coming years, AlUla will also welcome AZULIK AlUla Resort, Sharaan Resort, and the International Summit Centre, among others. 

“AlUla’s emergence as an expansive archeological, cultural, and tourism hub, equivalent in size to Belgium, is a significant milestone in Saudi Arabia’s economic diversification and global outreach enhancement efforts,” Ali Haider, regional director for Middle East and Africa at Nomadic, a subsidiary of Fragomen, told Arab News. 

With AlUla’s regional economy primarily driven by tourism, by 2035, AlUla will contribute a cumulative SR120 billion ($31 billion) to the Kingdom’s GDP.

Phillip Jones, chief tourism officer at RCU

“As AlUla continues to develop, it is poised to attract a diverse range of visitors, both locally and internationally, in line with Saudi Arabia’s aim of attracting 150 million visitors by 2030 and having the tourism sector contribute $200 billion to the economy,” Haider added. 

This development comes as RCU recently launched its first global brand campaign – “Forever Revitalising” – which Jones described as the embodiment of their vision for AlUla. 

This showcases the commission’s commitment to not just preserving AlUla’s historical essence but also enhancing the region’s eternal appeal, according to the executive. 

“We will continue to see the economic benefits of smart, sustainable development as we welcome more international visitors with new international flights, new luxury accommodations, and our year-round activities and attractions,” RCU’s Jones reiterated. 

Haider emphasized how a surge in tourism will also lead to increased demand for ancillary services such as accommodation, transportation, tour guides, and dining establishments. 

“By investing in destinations such as AlUla, the Kingdom aims to reduce its dependency on oil revenue and create new, sustainable sources of economic growth as well as preserve and promote its cultural heritage,” the Nomadic executive highlighted. 

Workforce and talent acquisition

As the region undergoes development, there will likely be tangible improvements to the Kingdom’s broader talent acquisition and retention metrics across various sectors. 

“While increasing demand for tourism to destinations like AlUla will create jobs locally within the tourism sector and other supporting sectors, visitors to AlUla may also leverage their stay to visit other parts of the Kingdom, or even the broader region, and thereby broaden the economic impact of their visit,” Haider explained. 

He continued by stating that this could foster the development of lesser-known tourism destinations. Additionally, he mentioned that the global uptake of “bleisure travel” might result in visitors staying in the Kingdom for longer periods and potentially exploring the local business landscape.  

He emphasized that due to several recent enhancements, this was more attractive than ever. 

Bleisure travel refers to the blending of business and leisure activities within a single trip. 

“Furthermore, AlUla’s potential to attract international talent will facilitate knowledge exchange and collaboration, leading to the transfer of skills and expertise to the local workforce,” Haider underlined. 

He pointed out that the Kingdom’s ambitious target of creating over 1 million jobs within the tourism industry by 2030 reflects its commitment to leveraging both local and global talent to drive economic growth in multiple ways. 

Additionally, he explained that creating those jobs “hinges on effective implementation strategies and sustained investment in infrastructure and human capital development.”  

Saudi Arabia also has one of the youngest populations globally, with 63 percent of Saudis under the age of 30. 

“The youth represent a significant advantage for the country’s diversification ambitions, offering a skilled, innovative, and cost-effective workforce. Additionally, it fosters entrepreneurship and accelerates technology adoption over the long term,” he emphasized. 

Haider also highlighted how the fresh perspectives and digital proficiency of this demographic have the potential to propel the growth and competitiveness of Saudi Arabia’s economy on a global scale. 

“Considering the Kingdom’s proactive approach to tapping into international talent pools – as evidenced by the recently enhanced Premium Residency Permit scheme – as well as its broader commitment to economic diversification coupled with AlUla’s strategic significance as a tourism destination, there is optimism that this initiative will contribute significantly to job creation,” he explained.  

From RCU’s perspective, the people of AlUla are at the center of their strategy, and they are among the primary beneficiaries of the diversified economy. 

“In the process, we expect to create around 40,000 new jobs by 2035, which will be filled mainly by talent from AlUla and across Saudi Arabia,” Chief Strategy and Digital Officer at RCU, Waleed Al-Dayel, told Arab News. 

He added that RCU has already created “thousands of new jobs, trained thousands of Saudis in critical job skills to match the requirements of the new positions, provided language training and scholarships, and reduced the local jobless rate by more than half.”

Sustainable destination  

There is no doubt that AlUla also plays a vital role in sustainability. 

Al-Dayel explained that RCU’s development of the city into a world-class sustainable destination for tourism and investment was guided by the 12 principles of the AlUla Sustainability Charter, aligning with the goals of Saudi Vision 2030 and the Saudi Green Initiative. 

The executive further elaborated on the increasing number of initiatives registered with the Saudi Ministry of Energy and Ministry of Environment, Water, and Agriculture. These are specifically focused on key sustainable growth initiative objectives. 

“RCU’s comprehensive vision is transforming AlUla into a global sustainable destination where our community of residents, tourists, and future generations can thrive,” Al-Dayel highlighted. 

In terms of transport strategy, the governorate’s residents and visitors prioritize eco-friendly options in line with the AlUla Sustainability Charter, as well as the national transport strategy’s aim to enhance the quality of life through improved transport services. 

Al-Dayel also shed light on how RCU is developing a future transport model for AlUla, with a low-carbon tram line at its core, surrounded by pedestrian, equestrian, and biking trails. This model also supports the needs for individual vehicles and freight. 

“When combined with the increase in open green spaces and revitalized urban design, the future of transport in AlUla will greatly contribute to the improved quality of life,” he concluded.

Xi calls for more jobs for youth, migrant workers

Updated 28 May 2024

Xi calls for more jobs for youth, migrant workers

  • (We should) insist that employment of young people including college graduates is a top priority: Chinese president

BEIJING: China’s President Xi Jinping called on Monday for efforts to promote high-quality and sufficient jobs for college graduates and migrant workers, while presiding over a Politburo group study session, state media Xinhua reported on Tuesday.

“(We should) insist that employment of young people including college graduates is a top priority,” the Xinhua report quoted Xi as saying at a group study session of the Politburo, a top decision-making body of the ruling Communist Party.

The Xinhua report did not give details on job promotion support measures or plans.

The survey-based jobless rate for 16-24 year-olds, excluding college students, was 14.7 percent in April, down from 15.3 percent in March, official data showed last week.

China’s statistics bureau revised its methodology by removing college students from the survey pool after youth jobless rate surged to around 20 percent last year.

Xi also said the government should take steps to promote the employment of migrant workers, guide them to return to their hometowns and for people to start businesses in the countryside.

He called for stabilizing the income of people who had been lifted out of poverty and preventing large-scale return to poverty due to unemployment, Xinhua said.

Companies and industries with strong job creation capabilities will be supported, the report said.

China created 4.36 million new urban jobs in the first four months, Human Resources Ministry data showed, 36 percent of its annual job creation target.

Saudis spent more money on electronic devices during the 4th week of May: SAMA data

Updated 28 May 2024

Saudis spent more money on electronic devices during the 4th week of May: SAMA data

RIYADH: Saudi Arabia’s point-of-sale spending reached SR11.2 billion ($2.98 billion) in the fourth week of May, official figures showed.

The latest data from the Saudi Central Bank, also known as SAMA, revealed that spending on electronic and electric devices surged by 9.5 percent to reach SR240.4 million.

Beverages and food, which accounts for the largest share at 14.9 percent, saw a 5.9 percent decline, reaching SR1.66 billion, during the week from May 19 to 25.

Meanwhile, transactions at restaurants and cafes, holding a 14.6 percent share, recorded a slower decline of 4.8 percent, amounting to SR1.64 billion. 

Saudi spending on miscellaneous goods and services, including personal care items, supplies, maintenance, and cleaning, constituted the third-highest share and witnessed a 5.1 percent decline that week, reaching SR1.36 billion. 

Despite composing only 1 percent of the week’s overall POS value, spending on education recorded a minimal increase of 0.1 percent to SR152.48 million.

In the past few years, this sector has been allocated the largest share of government expenditure in comparison to other divisions of the economy. 

Efforts are underway to revamp the education system, aiming to equip the national workforce with the necessary skills to thrive in a technological and information-centric global economy.

The hotel sector experienced the largest decline in POS transaction value, dropping 10.9 percent to SR227.13 million.

According to data from SAMA, 35.44 percent of POS spending occurred in Riyadh, with the total transaction value reaching SR3.97 billion. However, this represents a 1.6 percent decrease from the previous week.  

Riyadh has undergone considerable expansion, evolving into a pivotal center for growth and progress. The city is witnessing a surge in new businesses setting up operations, drawn by its vibrant economic landscape and strategic prospects for investment and innovation.

Spending in Jeddah followed closely, accounting for 14.3 percent of the total and reaching SR1.60 billion; however, it marked a 3.1 percent weekly drop. 

The two cities that registered the highest declines in POS spending were Makkah and Madinah, with decreases of 11 percent and 6.8 percent, respectively. The value of transactions in Makkah reached SR380.98 million, while in Madinah, it was SR393.26 million.

Saudi healthcare to advance with major digital tech partnership

Updated 28 May 2024

Saudi healthcare to advance with major digital tech partnership

RIYADH: The Saudi healthcare system is set to advance as two of the country’s major companies partner to leverage digital technologies to enhance the Kingdom’s capabilities.

SAMI Advanced Electronics Co., a wholly owned subsidiary of SAMI, the nation’s defense and digital solutions provider, has signed a cooperation agreement with the National Unified Procurement Co., a Public Investment Fund company.

The agreement, signed on May 27, will provide solutions for medication tracking and IT infrastructure and increase local content through medical devices manufacturing and maintenance.

This partnership demonstrates SAMI-AEC’s unremitting efforts to build a harmonious and applicable healthcare system in Saudi Arabia based on digital technologies.

Ziad Al-Musallam, CEO of SAMI-AEC, commented on the agreement, saying that they are honored to collaborate with NUPCO, as this deal underscores the unwavering commitment of both entities to bolstering efforts aimed at enhancing the healthcare ecosystem in Saudi Arabia.

“At SAMI-AEC, we firmly believe in the significance of augmenting public health services through digital solutions and delivering e-health services. This involves integrating effective, fast technologies to empower the healthcare sector, aligning with the objectives of Saudi Vision 2030,” he said.

Fahad Al-Shebel, CEO of NUPCO, highlighted the agreement’s importance and its role in fortifying the healthcare infrastructure and facilitating access to the integrated technology offered by SAMI-Advanced Electronics Co.

Aiming to upgrade the healthcare sector by improving its facilities in all public hospitals and medical centers in the Kingdom, NUPCO is the country’s largest central company providing medical purchasing, storage, and distribution services for medicines, devices, and supplies.

With a workforce of over 3,320 individuals, 85 percent of whom are Saudi nationals, SAMI-AEC has positioned itself as a leader in electronics, technology, engineering, and manufacturing. Its services span sectors such as defense and aerospace, digital, energy, and security.

Over 800 of the company’s employees are engineers and certified experts, reaffirming the dedication of SAMI-AEC, which was established in 1988, to excellence and innovation.

On the other hand, NUPCO was established in 2009 with SR1.5 billion in capital. It is the leading company in Saudi Arabia in procurement, logistics, and supply chain management for pharmaceuticals, medical devices, and supplies for governmental hospitals.

Closing Bell: Saudi main index continues downward trend to close at 11,660

Updated 28 May 2024

Closing Bell: Saudi main index continues downward trend to close at 11,660

RIYADH: Saudi Arabia’s Tadawul All Share Index continued its downward movement for the third consecutive session this week, as it shed 171.28 points to close at 11,659.94 on Tuesday. 

The total trading turnover of the benchmark index was SR5.34 billion ($1.42 billion), with 23 stocks advancing and 202 declining. 

The Kingdom’s parallel market, Nomu, also slipped by 0.81 percent to 26,234.79, while the MSCI Tadawul Index shed 20.97 points to close at 1,449.44.

The best-performing stock on the main index was Sustained Infrastructure Holding Co. The firm’s share price soared by 6.2 percent to SR34.25.

Other top performers were the Mediterranean and Gulf Insurance and Reinsurance Co. and AYYAN Investment Co., whose share prices edged up by 3.98 percent and 3.63 percent respectively. 

The worst-performing stock on the benchmark index was Saudi utility giant ACWA Power, as its share price slid by 4.68 percent to SR456.60. 

On the announcements front, Etihad Atheeb Telecommunication Co. said that it was awarded two projects worth SR45.51 million by Technical and Vocational Training Corp. to provide dedicated Internet services in 77 locations. 

In a Tadawul statement, the telecommunication provider said that the first project has a value of SR23.64 million, while the second one amounts to SR21.87 million. 

Meanwhile, Mouwasat Medical Services Co. announced that its shareholders have approved the board’s recommendation to distribute a 17.5 percent cash dividend, or SR 1.75 per share for 2023. 

In March, Mouwasat Medical Services Co. had revealed that its net profit witnessed a growth of 10 percent in 2023 to SR657.7 million, compared to the previous year. 

Al Moammar Information Systems Co., on Tuesday, revealed that it received new orders to increase the capacity of data centers at a total value of SR 75.2 million. 

In a statement to Tadawul, the company added that further developments of the order will be unveiled in due course. 

PIF’s Halal Products Development Co. invests in Singapore-based cosmetics firm

Updated 28 May 2024

PIF’s Halal Products Development Co. invests in Singapore-based cosmetics firm

RIYADH: In a bid to localize the Kingdom’s cosmetics and personal care industry, the Halal Products Development Co. announced an investment in a Singapore-based fast-moving consumer goods conglomerate.

The Public Investment Fund-owned company signed a binding agreement with Believe — a company specializing in the halal cosmetics and personal care field.

As per the agreement, the company will relocate its headquarters from Singapore to Saudi Arabia and establish a factory to manufacture its products, the Saudi Press Agency reported.

The new headquarters will also serve as a major center for exporting the company’s products to various countries of the world.

This move is in line with the PIF-owned firm’s goal to strengthen the halal industries in Saudi Arabia and provide high-quality products compatible with Islamic standards.

Halal Products Development Co. CEO Fahad Al-Nuhait said that investing in this sector is a very important first step that serves as a major catalyst for developing and localizing the manufacturing of halal cosmetics and personal care.

In return, this is expected to raise the efficiency of the sector and support research as well as development efforts to improve the services provided locally and globally, Al-Nuhait added.

The CEO said it will also facilitate the transfer of the expertise and resources to the Kingdom.

Moreover, it will also contribute to achieving the goals of the Kingdom’s Vision 2030 by creating direct and indirect job opportunities.

Believe CEO Ankit Mahajan said this partnership represents a strategic opportunity to expand the scope of investment and boost manufacturing capabilities.  

The agreement will also provide contract manufacturing services for local brands in the initial stage and will expand to international brands in the future.

In August, Halal Products Development Co. signed a strategic cooperation agreement with the Saudi Exports Development Authority to launch the Halal Products Manufacturing Accelerator Program.

According to a statement, the new program came amid the Kingdom’s efforts to become a global hub for halal food products and accelerate the growth of the sector.