Saudi Arabia takes the center stage at World Economic Forum (Davos)

As the world leaders convened in Davos, amid a global economic, social, and political uncertainty, the Kingdom of Saudi took the center stage.

During the World Economic Forum gathering of the world’s financial and economic elite in the Swiss resort of Davos, special attention has focused on the importance of Saudi Arabia’s growing role on the global stage.

This year, the World Economic Forum returned to its in-person annual meetings for the first time, since the outbreak of the coronavirus pandemic, as the forum has not been held for two years. Before the pandemic, the World Economic Forum was held at the beginning of the year, when cold and snow covered the city of Davos, and this time it was held at the end of spring when the weather and the general atmosphere were also different.

A report by Reuters news agency shed the light on the difference between the Davos Forum this year from its meetings in the pre-pandemic. This is due to the challenges facing the world due to the continuing consequences of the epidemic crisis, the war in Ukraine, sanctions against Russia and the rise in prices and inflation rates around the world amid declining expectations for global economic growth.

But amid all this, Saudi presence was shining, not only through the several Saudi coffee outlets in the corridors of the conference, one of which bears the name of Crown Prince Mohammed bin Salman but also to the participant’s interest in the Kingdom’s unprecedented transformation.

The “Reuters” report indicated that “the war in Ukraine has increased the importance of Saudi Arabia internationally, providing it with an opportunity to reposition politically.”

Saudi Economic Miracle

At a time when the Western world is facing a severe slowdown in economic growth, and the economy of some countries is expected to enter a recession, the Saudi gross domestic product is expected to grow by 8% this year, according to the International Monetary Fund estimates.

This may be due to the significant growth in the Saudi energy sector in the first quarter of more than 20%, according to data from Focus Economics. The Reuters report also cited statements by the head of the Saudi energy giant, Aramco, Amin Nasser, who said that the company plans to invest up to $50 billion in long-term energy projects.

“This is at a time when oil and gas producers in the United States are facing restrictions from an American administration that does not help facilitate their business,” according to the report. It is not only the actions of the US government but also the huge difference in the cost of oil and gas production in the United States and Saudi Arabia.

In his speech to the Davos Forum last Tuesday, US Presidential Representative for Climate Affairs John Kerry acknowledged the need for oil and gas but warned against focusing on investing in them only.

Saudi Arabia is the leader of the Organization of Petroleum Exporting Countries (OPEC) and has the largest untapped production capacity, is the most capable of controlling the global supply of a commodity that the world desperately needs to mitigate the impact of the war in Ukraine.

Reuters and other international media reviewed the transformations that are taking place in Saudi Arabia towards reform and change, from changing and modernizing laws, including laws related to women’s rights, as well as developing the tourism sector, in a short period of time.

In a related context, the American billionaire George Soros indicated, in his event at the World Economic Forum, that what he called “closed societies” are on the rise, while what he described as “open societies” are declining.

The media mogul added that “China and Russia represent the biggest threat to open societies today,” and that “several years ago it was possible to add Saudi Arabia to that group as well.”

The Reuters report concludes by noting that as the world tends to become more divided, pressure is increasing on Saudi Arabia to abandon neutrality and take a position with this or that side, “and the stability of the world depends in part on the side that Saudi Arabia will tend to change.”

Moreover, during a session on the future outlook for the Saudi economy, the Saudi Minister of Economy and Planning Faisal Al-Ibrahim affirmed that the Kingdom’s efforts are continuing strongly to diversify its economy and that oil revenues will help achieve these goals.

The Saudi minister recalled that Saudi Arabia had achieved the highest quarterly growth in GDP since 2011, during the first quarter, at a rate of 9.6%.

Al-Ibrahim said that the energy demand will continue, as confirmed by all experts. He noted that Saudi Arabia will raise production capacities to 13.4 million barrels of oil per day as a maximum capacity, stressing that this does not contradict work on climate change issues and mitigating harmful emissions.

“The last thing we want is to focus on climate change without jeopardizing energy security,” he added.

He also said, “The Green Saudi Initiative, the Green Middle East Initiative, and the Kingdom’s ambitions to reach 50% of the needs of its public utilities from renewable energies by 2030… all are going according to plan, and we can share more details.”

The Saudi Minister of Economy and Planning also stressed that we will continue to work closely to diversify the Kingdom’s economy, and that “the increase in oil revenues and activity will help to reach the goals faster and more effectively.”

“The Saudi economy will grow by 7.4% this year, and during the past year the non-oil economy has grown by 6.1%, and we want this approach to continue,” he said.

Saudi Tourism Sector on the Rise

Haifa bint Mohammed Al Saud, Assistant Minister for Strategy and Executive Affairs, Ministry of Tourism of Saudi Arabia, revealed that Saudi Arabia recorded 63 million visits during the year 2021.

She pointed out that Saudi Arabia ranked second in the World Economic Forum Tourism Index, as the Kingdom advanced 10 places to 33rd place among more than 100 countries in the Tourism and Travel Development Index for the year 2021.

She said, “In 2019, when we launched the national tourism strategy, we started with 41 million visits in 2018, including religious visits as basic visits, and we ended in 2021 with 63 million visits. We have not only recovered but also achieved an increase, most of which were driven by local tourism.”

The Assistant Minister of Tourism in Saudi Arabia enumerated the main areas in which the Kingdom achieved a distinguished performance: “We were able to amend decisions and policies, and we are now among the top 10 countries in the business, travel and tourism environment.”

She gave an example of this, saying: “It used to take two weeks to obtain a license to engage in any tourist activity in Saudi Arabia. Now it takes only 120 seconds online, in addition to the electronic visa that requires 5 minutes to obtain it, in addition to the visa on arrival.”

In an interview with “Al Arabiya” on the sidelines of the Davos Forum, Haifa bint Mohammed Al Saud indicated that the domestic tourism sector in Saudi Arabia reached the numbers achieved in 2019 and exceeded them by 34%, and the increase came in the number of visitors and spending, while the world did not reach For 2019 numbers yet.

She added, “We have not modified our ambitious targets for the tourism sector in Vision 2030 after the coronavirus pandemic, and all data indicate an improvement in the situation, and we are sure that we will reach these goals.”

On the other hand, the Assistant Minister of Tourism indicated that 42% of small and medium-sized companies in the Kingdom are owned by women.

In the WEF Tourism Index 2021, Saudi Arabia ranked second in the Arab world, seventh in Asia and 33 globally, as the Kingdom scored 4.3 points on the general index.

The report ranks 117 economies according to a set of factors critical to the development, sustainability and resilience of the travel and tourism sector, which in turn contributes to economic and social development.

The index consists of five sub-indicators: the enabling environment in terms of the work environment, security, safety, health and the labor market, and travel and tourism policies in terms of the extent of the country’s openness and price competitiveness in hotels and tourist places, airports and transportation infrastructure, and infrastructure for tourism services, in addition to drivers demand travel and tourism and the sustainability of the travel and tourism sectors in a country.

The report revealed that the global tourism sector is showing signs of recovery in many parts of the world after it was severely affected by the Covid-19 pandemic. Japan topped the world’s rankings, followed by the United States in second place, then Spain third, and France In fourth place, Germany in fifth place.

The Kingdom advanced three places compared to 36th globally in the 2019 version of the report, which ranked 140 countries. In this year’s version, the report was modified to become the Travel and Tourism Development Report as an upgraded version of a series of travel and tourism competitiveness reports issued 15 years ago.

The report monitors countries’ rankings in 5 sub-indicators, 17 axes and 112 indicators.

The sub-indicators in the report include the possible environment, the possible policies and conditions for tourism and travel, infrastructure, demand enhancers for tourism and travel, and the sustainability of the tourism and travel sector. The most important sectors concerned in the report are the economy, infrastructure, environment, security, financial security and taxes Governance, Culture, and Digital Economy.

The Travel and Tourism Development Report is issued every two years by the World Economic Forum based in Geneva, Switzerland. The report was first issued in 2007 under the name the Travel and Tourism Competitiveness Report. It measures a set of factors and policies that enable the sustainable development of the travel and tourism sector. The report also highlights the Factors and policies that contribute to a sustainable environment for the travel and tourism sector, which in turn contributes to the competitiveness of countries.

The report’s methodology relies on statistical data by 59%, while opinion polls constitute 30% of the indicators sourced from the opinion poll and 11% are composite indicators.

The increase in percentage points achieved by the Kingdom is the highest in percentage points among the first 45 countries that appeared on the index and the second-highest increase among the total of the 117 countries included in the index.

In this rank, Saudi Arabia is ahead of 84 countries, including Lithuania, Thailand, Latvia, the Czech Republic, Russia, Mexico, Bulgaria, Indonesia, Romania, Uruguay, South Africa, Turkey, Croatia, India, Brazil, Serbia, Montenegro, Georgia, Argentina, Ukraine, and the Maldives.