Saudi Arabia Risks $56B Tourism Hit After Successful 2025

The Middle East’s travel and tourism sector grew faster than the global average in 2025, helped by Saudi Arabia’s fast-growing business travel market.

The World Travel & Tourism Council said the region’s travel and tourism economy expanded 5.3 percent last year, compared with 4.1 percent globally.

The sector contributed $385.8 billion to GDP and supported 7.1 million jobs. International visitor spending also increased 5.2 percent, ahead of the global rate of 3.2 percent.

Saudi Arabia carried much of the growth

Saudi Arabia was the main driver of the regional result. Its travel and tourism sector grew 7.4 percent in 2025, almost twice the global average. The Kingdom generated $178 billion in travel and tourism GDP, equal to 46 percent of the Middle East’s total travel and tourism economy.

The country is investing in airports, hotels, entertainment, cultural attractions, and new destinations. It is also targeting 150 million visits a year by 2030.

Business travel became a key growth driver

Business travel was one of the strongest parts of Saudi Arabia’s tourism performance. Inbound business travel spending in Saudi Arabia reached $10.4 billion in 2025, up 65.6 percent year on year. Domestic business travel spending reached $1.5 billion, growing much more slowly.

The biggest boost came from international corporate visitors. These travelers often come for investment forums, conferences, government meetings, sports events, and large development projects.

The UAE, Jordan, and Oman also supported the region

The UAE remained a major travel economy in 2025. Its travel and tourism sector added $68.5 billion to GDP, while international visitor spending reached $56.9 billion. Dubai and Abu Dhabi continued to benefit from strong air connectivity, luxury hotels, events, shopping, and business travel.

Jordan and Oman also grew, though from smaller bases. Jordan’s travel and tourism sector expanded 5.5 percent, with international visitor spending of $8.5 billion. Oman posted the same 5.5 percent growth rate, with international visitor spending of $4 billion. Both markets are trying to build more focused travel demand instead of competing directly with Saudi Arabia or the UAE.

The war has made 2026 harder to predict

The strong 2025 performance now faces a much weaker outlook. Oxford Economics estimated that inbound arrivals to the Middle East could fall between 11 percent and 27 percent in 2026 because of the Iran war. In the worst scenario, the region could lose up to 38 million international visitors and $56 billion in spending.

Saudi Arabia may recover faster than its neighbors

The pressure is already visible in the region’s hotel market. UAE hotel demand has fallen faster, while Saudi Arabia has held up better because it relies more on domestic demand, has fewer hotel rooms relative to its population, and is less exposed in some cities. Saudi Arabia helped drive the Middle East’s 2025 tourism growth, but the region’s 2026 performance will depend on how well destinations can protect demand during conflict, weaker traveler confidence, and uneven air connectivity.

Photo by Piotr Chrobot on Unsplash