Skift Take
Increasing spending of domestic tourists is of paramount importance to the UAE and Saudi. Why? Because these residents are some of the highest spenders in travel.
Domestic tourism is relatively new amongst Gulf countries whereby they look to increase the spending of residents in a country by prompting them to visit facilities designed for tourism.
The UAE’s minister of economy this week said he wants the country to achieve a 50-50 split between international and domestic tourism, highlighting the deep pockets of UAE residents and locals.
“In the UAE today, 60% of its tourism is international and 40% is domestic. What is domestic tourism? Those are the nationals living here. We found that there are different products in the UAE for domestic tourists. Domestic tourists are important because they pay, they are high spenders”, said Abdullah bin Touq Al Marri, minister of economy at the Future Hospitality Summit in Dubai.
In December 2020, the UAE Government launched the “UAE Strategy for Domestic Tourism,” which revealed domestic tourism spending stood at 41 billion Emirati Dirhams (around $11.3 billion). Also in 2020, Dubai’s ruler, Sheikh Mohammed bin Rashid, said he wanted to double the amount of domestic tourism spending in the country.
He stressed that “working as one team in the tourism sector will bring long-term benefits to every part of the UAE and boost our status globally as a single destination that offers rich and diverse experiences.”
The tourism sector as a whole that year generated 71.6 billion Emirati Dirhams (around $19.4 billion).
According to WTTC data, local visitor spending in 2023 reached over 55.5 billion Emirati Dirhams (around $15.12 billion), marking a growth of nearly 40% compared to 2019. Meanwhile, international visitor spending increased by nearly 40% last year, surpassing 2019 levels by 12% to exceed 175 billion Emirati Dirhams (around $47.66 billion).
Al Marri added on stage: “You know UAE tourists are sought after by the West and East? I’ve had discussions with people wanting to bring in more tourists from UAE to Spain, Italy and London.”
“We want to reach 50% domestic tourism. I’m not looking elsewhere, I’m looking in, I’m looking at how to push domestic tourism to 50-50. With school holidays, with public holidays, there’s a lot of spending happening.”
Saudi Arabia’s Domestic Tourism Boost
Saudi Arabia too wants to achieve around a 50-50 split but is currently seeing a much larger domestic tourism market than international. The country is aiming for 150 million visits by 2030, with 70 million of them international and the rest domestic.
Domestic tourists accounted for 75% of visits last year, or 81.9 million people. International tourists spent 141.2 billion Saudi Riyals (about $37.6 billion) last year compared to 114.4 billion Saudi Riyals (about $30.5 billion) by domestic travelers.
Domestic tourism is important for Saudi Arabia as it allows the country to retain some of the industry’s highest spenders, who previously would’ve left the country to travel elsewhere.
In May, Saudi Minister of Tourism Ahmed bin Al-Khateeb stressed that the Kingdom is making major efforts to improve domestic tourism by cooperating with the Gulf countries on various initiatives, including the unified visa for the Gulf region, through which travelers are allowed to enjoy 30 continuous days in other Gulf countries.
Also in May, during a media roundtable, Saudi Tourism Authority CEO Fahd Hamidaddin told Skift: “Historically Saudis themselves did not go around Saudi itself. But then the pandemic hit, and there was a lockdown. Saudis were forced to go around [their own country]. Even internally, we were wondering if domestic travel would drop when the borders reopened, but it didn’t. When people visit Saudi, they actually come again, that even applies to domestic travelers.”
“After the borders reopened, we kept seeing domestic travel increase year on year. Why is that so critical? Because these Saudis were the highest spenders around the world [at that time].”
