Middle East leads recovery rates for international tourist arrivals

In the Middle East, Saudi Arabia showed the most improvement in its ranking score between 2019 and 2024 rising from 50th place in 2019 to 41st this year. (AFP / The Royal Commission for AlUla)
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Updated 22 May 2024

Middle East leads recovery rates for international tourist arrivals

  • WEF report finds Saudi Arabia showed the most improvement in its ranking score between 2019 and 2024 in the region
  • The UAE, ranking No. 18 globally, is the top performer in the MENA region

DUBAI: International tourist arrivals and the travel and tourism sector’s contribution to global GDP are expected to return to pre-pandemic levels this year, according to the latest World Economic Forum travel and tourism study.

The WEF’s Travel & Tourism Development Index 2024, published once every two years in collaboration with the University of Surrey, analyzes the travel and tourism sectors of 119 countries. TTDI scores and rankings are based on a variety of factors and policies that contribute to the development of a country’s travel and tourism sector, such as sustainability, infrastructure and resources.

The global tourism industry is expected to recover from the COVID-19 pandemic and even exceed the levels seen before the outbreak. This growth is driven by a marked increase in the demand for travel, which coincides with countries investing in tourism and cultural attractions as well as better flight availability. 

“This year marks a turning point for the travel and tourism sector, which we know has the capacity to unlock growth and serve communities through economic and social transformation,” said Francisco Betti, head of the Global Industries team at the WEF. 

However, not all countries will recover equally. Although 71 of the 119 ranked economies increased their scores since 2019, the average index score rose just 0.7 percent above pre-pandemic levels.

Despite a promising future, the travel and tourism sector is reeling from the after effects of the pandemic. Labor shortages continue, while other factors like air route capacity and capital investment struggle to keep up with demand. Combined with growing macroeconomic, geopolitical and environmental risks, and worsened by global inflation, these factors drive up prices, making recovery an uphill climb.

The top 10 countries in the TTDI’s 2024 edition are the US, Spain, Japan, France, Australia, Germany, the UK, China, Italy and Switzerland.

The Middle East leads in recovery rates for international tourist arrivals, exceeding 2019 levels by 20 percent, while Europe, Africa and the Americas all showed a strong recovery of around 90 percent in 2023.

In the Middle East, Saudi Arabia showed the most improvement in its ranking score between 2019 and 2024 rising from 50th place in 2019 to 41st this year.

The report shows “just how much progress Saudi Arabia has made in its travel and tourism sector,” with “significant investment in infrastructure, cultural and natural attractions, and a noticeable increase in welcoming visitors,” Betti told Arab News. 

The UAE, ranking No. 18 globally, is the top performer across the Middle East and North Africa region, climbing seven spots from 25th in 2019, while Egypt (61st) is the top standalone nation in North Africa.

Home to high-income economies, including all the members of the Gulf Cooperation Council, the Middle East is performing better than North Africa due to improved tourist and transport infrastructure, an advanced aviation sector, the presence of large corporations, and high levels of safety and security. 

The North African economies, on the other hand, are still developing and tend to be more price competitive. The report found that economies such as Egypt, Morocco, Tunisia and Algeria are often challenged due to issues such as gaps in transport and tourism infrastructure, safety and security concerns, and a less-than-ideal business environment. 

The MENA region saw the second-greatest increase in Air Transport Infrastructure scores, up 8.4 percent, with average air route capacity and airport connectivity being among the greatest regional indicator improvements since the 2021 TTDI edition.

As the region looks to diversify beyond oil and gas, many of its economies have pumped substantial investment and resources into developing the travel and tourism sector. This is evident in the development of cultural and tourist attractions, visa policies, and increased government spending on the sector.

Saudi Arabia, for example, plans to spend around $800 billion on tourism over the next decade with the goal of attracting 150 million tourists a year by 2030, with about 70 million coming from abroad.

Moreover, the Kingdom has attracted $13 billion in private sector investments into the tourism industry and is targeting $85 billion in tourism revenue this year compared to $66 billion in 2023, Bloomberg reported. 

Betti said that in order for Saudi Arabia “to further harness the sector for economic growth, it will need to continue improving its positioning as global tourism destination, and focus on building a sustainable, inclusive, and resilient tourism ecosystem,” which means “multiplying the number of visitors while protecting the environment, supporting both small and large businesses, and training its workforce.”

The effect of these efforts is reflected in the greatest regional average increase in travel and tourism socioeconomic impact scores, which have increased by 13.8 percent from 2019 to 2024. 

Still, the region scores the lowest for socioeconomic impact.

Currently, the MENA region is grappling with issues such as lower female participation in the workforce and the resulting gender gap in the industry; below-average workers’ rights and social protections, which limits the talent pool from joining and flourishing in the industry.

The report suggests that, going forward, regional economies should focus on reducing the concentration of tourism at the most visited destinations and creating a competitive workforce in order to prosper.

Further easing travel and trade restrictions, and investing in environmental sustainability, would also help propel the sector in the region.

In the coming years, the industry will be challenged by “the impact of climate change, geopolitical tensions, macroeconomic uncertainty and the application of new digital technologies such as artificial intelligence (AI),” WEF’s Betti and Iis Tussyadiah, professor and head of the school of hospitality and tourism management at the University of Surrey, said in the report. 

“Within this context, it has become critical for T&T (travel and tourism) decision-makers and stakeholders not just to focus on improving sector readiness for future risks and opportunities, but also to ensure that the sector accounts for its economic, social and environmental impact and is a driver of global prosperity,” they added.


Informatica spearheads Saudi digital transformation with cloud-powered solutions

Updated 02 June 2024

Informatica spearheads Saudi digital transformation with cloud-powered solutions

RIYADH: Saudi Arabia is set to elevate its tourism and services to a “world-class experience” through cloud-powered digital solutions by partnering with enterprise software developer Informatica Inc., said a senior executive.  

In an interview with Arab News, the company’s CEO, Amit Walia, expressed admiration for the rapid growth of tourism and the significant attention the Kingdom has given to enhancing the journey for visitors.  

Walia said: “I was very impressed and amazed by the amount of focus on the end customer, the tourist, and how to make that experience the best in the world. Making sure that the information is readily available so that the experience is great.”

He emphasized that the company wants to assist in achieving this goal and can contribute to developing tourism and infrastructure in Saudi Arabia.

Walia highlighted the potential to enhance visitor experiences, both religious and non-religious, by leveraging data and technology in areas such as transportation, accommodation, and leisure facilities.

Informatica enables businesses to utilize their information and AI by connecting and managing data across any multi-cloud or hybrid system, facilitating modern business strategies.

The CEO spoke to Arab News on the sidelines of the first major data innovation summit, Informatica Summit Saudi Arabia 2024, in Riyadh.

The gathering was organized to outline a roadmap for how the nation can fast-track its vision of becoming a cloud-first, data-driven state ahead of the World Expo 2030.

He stressed the company’s ability to manage supply chains and ensure data security and governance, suggesting that these capabilities can enhance the Kingdom’s operational efficiency as a digital enterprise.

Walia also highlighted Informatica’s belief that its investment in Saudi Arabia will accelerate the nation’s AI and cloud-focused digital transformation, ultimately benefiting its advancement.

“All the big partners you have standardized on Informatica. We believe we can help the Kingdom not just meet its 2030 goal, but I think they can do it sooner, and we want to be a part of that story,” he said.

Emphasizing the critical role of cloud technology in driving digital transformation, particularly in the context of AI, Walia asserted that cloud infrastructure is essential for enabling these technological developments.

He highlighted the importance of data management, stating that high-quality data is crucial for achieving accurate results in AI applications.  

The company is set to open its first-ever office in the Kingdom in the coming months, reinforcing its presence in the region.

The CEO expressed confidence that Informatica’s development in Saudi Arabia would surpass its growth in any other region, particularly compared to its European expansion.

“My belief is that our growth in the Kingdom will be far, far faster than in any other region on the European continent that we’ve had. My firm belief is that, and we’re investing accordingly,” Walia said.   

During the interview, Walia noted that the company collaborated with Google Cloud to establish a regional data delivery infrastructure, ensuring security.  

He further explained that partnerships with global system integrators and local agencies aim to standardize governance and privacy practices across the country.

“It’s a very deep partnership. We’ve been working with Google Cloud from its very early days. And our goal here in the Kingdom is to make sure that all of our cloud platforms for data management are available locally,” Walia said.  

He continued: “Expect us to be talking about that a lot more in the coming months and weeks, to be the backbone of all things related to good and secure data management for the Kingdom.”   

He concluded the interview by underscoring the importance of data management in the era of AI-driven advancements. Walia emphasized that while AI is powerful, it only generates value when paired with high-quality data.

“The AI does not deliver any value. AI only delivers value if it has good data paired with it. And data can only become good; data by itself is not good. It’s of poor quality and fragmented. Data becomes good when you manage it. That’s data management. That’s what we do,” he said.

Walia added, “Informatica has been doing data management for 30 years. We’ve been the number one company that does that at scale. Our platform runs 92 trillion transactions a month and grows 100 percent every year.”

In April, Informatica launched its AI-powered Intelligent Data Management Cloud platform in Saudi Arabia, representing a groundbreaking move for the Kingdom.

This initiative involved setting up a new point of delivery in Riyadh on Google Cloud, allowing the company to enhance support for local partners and organizations with its cloud data management platform in accordance with local regulations.

Saudi Manpower Solutions Co. eyes expansion following its public listing

Updated 02 June 2024

Saudi Manpower Solutions Co. eyes expansion following its public listing

RIYADH: Various sectors across different parts of Saudi Arabia will soon have greater and easy access to manpower as the country’s first service provider eyes expansion with its initial public offering.

Speaking to Arab News, Abdullah Al-Timyat, CEO of Saudi Manpower Solutions Co., known as SMASCO, said the IPO will help propel SMASCO within the Saudi market, drive growth initiatives, and fortify its presence and stakeholders’ trust.

Al-Timyat said the IPO proceeds will not be utilized for internal operations but will be earmarked for strategic growth initiatives to expand the company’s footprint across the Kingdom’s diverse market. 

He added the company’s capital-light model, fortified by no debt and robust cash management, positions it for agile expansion. “We have zero debt and funding. We have strong cash management, and we have enough internal funds for our operations. So, the IPO will enable SMASCO in its future steps and strategic direction in expanding within the Saudi market, reaching new geographic cities and regions within Saudi Arabia.”

With an eye on deepening market penetration, Al-Timyat outlined SMASCO’s strategic direction, leveraging the IPO’s support to enhance brand awareness and stakeholders’ trust.

“We will even go deeper … within specific sectors, in business industry and professional manpower, depending on a more trusted bond that we have available because of the IPO and the support that we will have.”

The executive outlined the company’s current focus on the Kingdom’s market, emphasizing its vast potential and opportunities for manpower companies, including SMASCO.

He also underscored the entity’s mature model and expertise in technologies, which position it to potentially expand into new markets in the future. While there are no immediate plans to venture beyond Saudi Arabia, SMASCO remains prepared to seize opportunities should they arise, he said.

Looking ahead, the CEO highlighted artificial intelligence’s transformative potential emphasizing its role in enhancing efficiency and service delivery. 

He said: “AI and advanced technology is an opportunity for manpower companies. This is how we see it in SMASCO, this will provide us more opportunities, a faster a road to (achieve) our objectives operationally, financially and even for our customers.”

Al-Timyat highlighted the pivotal role of Vision 2030 benchmarks in providing clarity and direction to SMASCO’s future endeavors.

“Since the government launched Vision 2030, we have a clarity where we are going and this makes it easier for any industry, for any investor. We see a persistence of execution by the government, which we have never witnessed before and this is actually aligned with what we are seeing.”

This synergy between technological innovation and national objectives supports industry advancement. The executive noted that it is set to drive economic growth and societal development in alignment with the Kingdom’s ambitious vision.

Al-Timyat also outlined the global demand for various industries, including medical, logistics, tourism, and entertainment, which are also prevalent in Saudi Arabia.

Each of these industries requires specific qualities for talents and specialized manpower services to address their unique needs, he noted.

The executive said SMASCO, specialized in manpower solutions, has created subsectors within its team to cater to diverse industries.

This focus on specialization enables SMASCO to provide high-quality services that align with the economy, market trends, and specific requirements of each industry.

‘Global fracture due to lack of trust between superpowers’: WEF panel discusses investing amid geopolitical shifts 

Updated 29 April 2024

‘Global fracture due to lack of trust between superpowers’: WEF panel discusses investing amid geopolitical shifts 

  • Participants emphasized the need for structural reforms to address socioeconomic disparities, and foster trust in global relations

RIYADH: Amid shifting geopolitics and declining foreign direct investment in emerging markets, Saudi businesswoman Lubna Olayan emphasized on Monday the crucial role of trust and transparency for investors, highlighting the need for robust foundations in a deeply interlinked global landscape. 

During a panel discussion on “Investing amid Global Fracture” at the special two-day World Economic Forum meeting in Riyadh, Olayan highlighted the pivotal role of trust in the reshaping of foreign investment strategies due to the emergence of new global players and escalating security concerns. 

“The global fracture stems from a lack of trust between superpowers, which is now escalating to a lack of trust between everyone,” Olayan told the panel.  

The prevailing trend evident in this global fracture, primarily seen in the rivalry between the US and China, is countries prioritizing their own interests without feeling obligated to align with any specific side, she said.  

Emphasizing the critical significance of transparency in global relations, Olayan highlighted the need for the rule of law and the equitable application of laws as fundamental prerequisites for investors.  

Salman Rahman, private industry and investment adviser to the prime minister of Bangladesh, discussed the urgent need for restructuring the global socioeconomic order.  

He pointed to inequalities such as the lack of electricity for 50 per cent of Africa’s population and vaccine disparities exposed during the pandemic.

Rahman’s remarks highlighted the need to address socioeconomic disparities and foster a more equitable global landscape. 

Laurence Fink, chairman and CEO at BlackRock Inc., stressed the importance of cooperation between governments and stakeholders to navigate the deepening divides between major powers.  

He emphasized the critical role of collaborative efforts in addressing the multifaceted challenges of the modern world. 

Standard Chartered Bank aims to boost Saudi-China economic ties with strategic expansion 

Updated 19 March 2024

Standard Chartered Bank aims to boost Saudi-China economic ties with strategic expansion 

RIYADH: Saudi Arabia offers significant growth potential for foreign banks operating in the Kingdom to meet the increasing demand from Chinese clients, according to a senior banker. 

Speaking to Arab News, Jerry Zhang, CEO of Standard Chartered Bank China, noted that the company is strengthening its infrastructure and services to better support Chinese clientele in Saudi Arabia, indicating confidence in the market’s potential. 

Zhang said: “We are actually hiring a corridor banker. Corridor banker, meaning that a Chinese-speaking local relationship manager is servicing the underlying clients. So, we are hiring additional resources to be stationed in Saudi to serve the Chinese clients here. This is absolutely driven by the demand.”  

She added: “We are also beefing up supporting systems and services capabilities to serve Chinese clients here onshore. That’s a straightforward proof of how we see the potential of this market.” 

Standard Chartered’s banking presence in the region is relatively new, as it commenced operations in Saudi Arabia in 2022. 

However, the corridor between the Middle East and China already contributes 10 percent to the bank’s income and is experiencing rapid growth. 

“Hopefully, in 12-24 months’ time, we will see the share of the Middle East corridor within the entire China origination income grow faster, particularly in Saudi Arabia, and I can claim a large share of that and report it to you,” Zhang said. 

Additionally, the CEO underlined that Saudi Arabia and China align strategically. The Kingdom is actively seeking diversification in its economy, particularly in sectors like infrastructure, new energy, technology, logistics, and e-commerce. These sectors are recognized as key areas where North Asian companies excel. 

“Therefore, I think Chinese companies do have an edge and also an urge to come across to Saudi Arabia to provide their products and services, expanding into this part of the world very fast. In our Standard Chartered’s position, we’ve been consistently transitioning to support the so-called emerging new economy in China for the past eight to 10 years,” Zhang continued. 

The CEO underscored that new economy sectors, such as technology and innovation, have experienced significant growth and now contribute nearly 50 percent of the firm’s corporate income.  

This transition aligns strategically with both countries’ goals and supports Saudi Arabia’s Vision 2030 by providing services in sectors relevant to its objectives. 

Zhang further elaborated on the development of the Chinese economy, highlighting its 5.2 percent growth rate last year, which is considered strong compared to other major economies.  

She anticipates a 4.8 percent growth rate for 2024, primarily driven by consumption and growth in these rising industries. 

“More than 30 million cars have been produced and sold. For the first time in history, China has exceeded Japan to become the No. 1 exporter of cars worldwide, and for EV (electric vehicle) cars in particular, last year, I think China has produced close to 10 million EVs and more than 30 percent in the penetration ratio,” Zhang said. 

Commenting on the relationship between the North Asian country and Saudi Arabia, Zhang said that Standard Chartered China has engaged with the Kingdom’s leadership team and women entrepreneurs in technology, whom they have sponsored and supported through programming. 

“First, we saw the bilateral relationship really accelerate after President Xi’s visit. By the end of 2022 and during the investment conference, both sides had signed more than 60 agreements worth more than $25 billion in contracts, which is extremely exciting, and things have been moving even faster from there,” Zhang commented. 

She added, “The two central banks have signed a currency swap program worth 50 billion RMB, which will pave a very strong foundation for financial collaboration between the two nations as well... We are seeing this extremely friendly government-to-government relationship that further nurtures the economic ties between the two sides.” 

The bank is enhancing its presence by adding more personnel, introducing new products and solutions, and implementing best practices from its global operations in the Kingdom. 

Mazen Bunyan, CEO of Standard Chartered Saudi Arabia, emphasized that the Kingdom and China share a historic and long-standing relationship. Additionally, both nations have very similar strategies for achieving their economic growth, diversification, and objectives. 

“We have a very unique opportunity and position as a global bank in both markets to leverage on that network, on connectivity. We’re expanding on the market. We’re expanding our operations, and adding people, products and services on the ground, and solutions,” Bunyan told Arab News. 

He added: “At the same time, we continue to engage with key stakeholders on each side, China and Saudi Arabia, to smooth the knowledge gap to help the engagement between the two counterparts or two countries.” 

Bunyan highlighted that the bank has around 50 employees working directly in the Kingdom, the majority of whom are Saudi nationals. Additionally, a significant number of women leaders are present within the organization’s regional workforce. 

“We have also a very huge portion of women leaders within both entities, and we continue to invest in talent in Saudi Arabia and develop them as well in line with the Vision 2030 Human Capital Development Program,” Bunyan said. 

Standard Chartered Bank in Saudi Arabia operates as a full-fledged wholesale organization, focusing on serving government and quasi-government financial institutions as well as large and global companies in the Kingdom. The bank’s objective is to deliver value to these clients and support them in achieving their respective objectives and strategic priorities. 

The financial institution plays a significant role in facilitating inward business into Saudi Arabia, leveraging its extensive global footprint, particularly in regions like China.  

Additionally, Standard Chartered assists international companies in establishing their presence and operations in the Kingdom, serving as a bridge between these companies and the Saudi market. 

Saudi Arabia named ‘most improved country overall’ in US Chamber of Commerce IP Index

Updated 06 March 2024

Saudi Arabia named ‘most improved country overall’ in US Chamber of Commerce IP Index

RIYADH: Saudi Arabia has received recognition as “the most improved country overall” in the 12th edition of the US Chamber of Commerce International Intellectual Property Index. 

Released on March 2, the report emphasizes the several achievements of the Kingdom, with Vice President of Middle East Affairs at the US Chamber of Commerce Steve Lutes telling Arab News that Saudi Arabia has made significant strides in the technology sector over the past year.

“Specifically, I think this year the Kingdom did sign on to some important international treaties and they’ve made some other progress on both the enforcement side and some other of the indicators,” Lutes said on the sidelines of the LEAP 2024 conference.

“The Kingdom moving up in ranking gives more confidence to investors,” he added. 

Lutes went on to say that the body aims to encourage partnerships with the business community, government, and academia in Saudi Arabia to drive the establishment of a diversified, knowledge-based economy aligned with Vision 2030.

The US Chamber of Commerce considers over 50 indices when ranking countries, Lutes added. 

“Some of this looks very marginal. But really, when you think about it from an economic perspective, these are very important drivers because these are the sorts of things that companies look at. Is my IP going to be safe? Is it going to be protected? Are rules going to be enforced? And that’s where you get the investment in value and innovation,” said the vice-president.

The Kingdom allocates a total of $2 million across all funding rounds dedicated to artificial intelligence companies and over $3 billion proportional to gross domestic product with a ranking position of 31 in the Global AI index.

“We’ve been looking at this as governments around the globe start to grapple with the regulatory frameworks for artificial intelligence. The Chamber commissioned a report that was largely targeted toward a domestic audience and had some policy recommendations in that,” said Lutes.

A report by the European Centre for International Political Economy and the US Chamber of Commerce, titled “The Opportunity of Artificial Intelligence: Boosting Productivity and Growth in Saudi Arabia,” will be released in March.

The study will include a breakdown covering the benefits of AI for the Kingdom, endowments and digital industry structures, and AI policies going forward. 

“It has some sector-by-sector analysis where we think it can be the most impactful. In my mind, though, the biggest message is for policymakers,” Lutes said, adding: “One of those is investing, for example, in human capital. You have to have the workforce that’s ready to take on these technologies and bring it to government processes, to business processes and see it diffuse. So, when it comes to the sectors, I think, you know, healthcare and education are two that are highlighted in particular as having the most upside.”

Lutes added this is his first time attending LEAP, which is now in its third edition, and the Chamber has been collaborating with the Ministry of Communications and the Saudi Authority for Data and Artificial Intelligence. 

“We are at the LEAP Conference and IP is so fundamental to that. So, kudos to the Kingdom this year. And I guess our message is let’s not rest on our laurels. Let’s continue to work together to see if we can continue to see the Kingdom climb in that index as well,” he concluded. 

LEAP, held in Riyadh from March 4-7, is an annual premier tech event founded in 2022 by the Ministry of Communication and Information Technology. It convenes leading professionals from the sector to deliberate on the industry’s future and the innovative opportunities ahead.