Saudis en­vi­sion fu­ture be­yond oil with 50-is­land Red Sea tourism plan

Northwest Arkansas Democrat-Gazette - - BUSINESS & FARM - ALAA SHAHINE AND VI­VIAN NEREIM

Saudi Ara­bia wants to turn hun­dreds of miles of its Red Sea coast­line into a global tourism des­ti­na­tion gov­erned by laws “on par with in­ter­na­tional stan­dards” as part of its plan to trans­form the econ­omy and re­duce its re­liance on oil.

The project will cover 50 is­lands and 16,600 square miles — an area big­ger than Bel­gium — be­tween the cities of Um­luj and Al Wajh to at­tract “lux­ury trav­el­ers from around the globe,” ac­cord­ing to an of­fi­cial state­ment sent to Bloomberg last week. It will be de­vel­oped by the king­dom’s sov­er­eign wealth fund, with the first work ex­pected in two years.

Bring­ing sun-seek­ers to Saudi beaches could trans­form a tourism in­dus­try that re­lies al­most solely on Mus­lim pil­grims vis­it­ing holy shrines in Mecca and Me­d­ina. But while the an­nounce­ment em­pha­sized the eco­nomic ben­e­fits, past mega-projects to di­ver­sify the econ­omy have strug­gled to get off the ground, and ques­tions are likely to be raised over how ac­cept­able the plan is to the king­dom’s in­flu­en­tial re­li­gious es­tab­lish­ment.

“If you can’t change re­stric­tions on al­co­hol and dress, that mar­ket dis­ap­pears,” said Crispin Hawes, Lon­don-based manag­ing direc­tor at Te­neo In­tel­li­gence, re­fer­ring to for­eign tourists.

Tourists will ei­ther not re­quire a visa or will be able to ob­tain one on­line. One of the doc­u­ments re­ferred to the project as a “semi­au­tonomous” area gov­erned “by in­de­pen­dent laws and a reg­u­la­tory frame­work de­vel­oped and man­aged by a pri­vate com­mit­tee,” a sign that it could ease strict rules ap­plied else­where in Saudi Ara­bia. The king­dom’s aus­tere in­ter­pre­ta­tion of Sunni Is­lam bans al­co­hol, im­poses a dress code, lim­its gen­der mix­ing and pre­vents women from driv­ing cars.

The pro­posal is part of Crown Prince Mo­hammed bin Salman’s blue­print to pre­pare the big­gest Arab econ­omy for the post-oil era. Au­thor­i­ties are al­ready re­lax­ing rules on en­ter­tain­ment, and by 2030, they aim to dou­ble house­hold spend­ing on re­cre­ation to 6 per­cent. Con­certs, dance shows and even film screen­ings have drawn thou­sands of peo­ple over the past year.

The idea of cre­at­ing sep­a­rate ar­eas for for­eign­ers with looser rules also isn’t en­tirely new to Saudi Ara­bia. The most fa­mous, the Saudi Aramco com­pound in Dhahran, is de­signed like an Amer­i­can sub­urb. On the gen­der-mixed cam­pus of King Ab­dul­lah Univer­sity of Science and Tech­nol­ogy, at­tended by Saudis, women can drive and wear what they want.

And while al­co­hol is il­le­gal, with au­thor­i­ties of­ten bust­ing home­made dis­til­leries and dis­trib­u­tors, it’s qui­etly con­sumed in many pri­vate homes and com­pounds dom­i­nated by wealthy ex­pa­tri­ates.

Saeed Al Wah­habi, a Saudi po­lit­i­cal com­men­ta­tor based in Abu Dhabi, said the long lead time be­tween the date of the an­nounce­ment and the ini­tial ground­break­ing could be de­signed to test how the pub­lic re­acts to the plan.

“We are wait­ing for so­cial change within the up­com­ing two years be­fore we start the project. Let the peo­ple talk about it, dis­cuss it,” he said by phone.

Con­cerns about Western in­flu­ences seep­ing into Saudi so­ci­ety might be as­suaged by the prom­ise to de­velop a ru­ral area far from ma­jor cities. The project will cre­ate as many as 35,000 jobs “once it’s up and run­ning” and con­trib­ute $4 bil­lion to Saudi Ara­bia’s gross do­mes­tic prod­uct, ac­cord­ing to the state­ment.

The Pub­lic In­vest­ment Fund, headed by Prince Mo­hammed, will in­ject ini­tial in­vest­ments into the project and start part­ner­ships with in­ter­na­tional com­pa­nies.

The ini­tial ground­break­ing is ex­pected in the third quar­ter of 2019. The first phase will be com­pleted by the fourth quar­ter of 2022, in­clud­ing “the devel­op­ment of ho­tels and lux­ury res­i­den­tial units, as well as all lo­gis­ti­cal in­fra­struc­ture — in­clud­ing

air, land, and sea trans­port hubs,” ac­cord­ing to the state­ment.

Vis­i­tors will have ac­cess to the an­cient ru­ins at Mada’in Saleh, a relic of the same an­cient civ­i­liza­tion that built the bet­ter-known city of Pe­tra in Jor­dan and a UNESCO world her­itage site. A pro­mo­tional video for the project with dra­matic mu­sic show­cases white sand beaches and flocks of

birds soar­ing over turquoise waves.

“It’s unique,” Al Wah­habi said. “He picked the most pure area in the coun­try,” he added, re­fer­ring to the crown prince. “It’s kind of far away from ev­ery­thing.”

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