Sustainability takes center stage in Saudi Arabia’s hospitality landscape

This picture shows a partial view of the Regis resort in Tabuk province on the western coast of Saudi Arabia on February 9, 2024, which is part of the Red Sea tourism megaproject. (AFP)
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Updated 22 September 2024
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Sustainability takes center stage in Saudi Arabia’s hospitality landscape

RIYADH: In the competitive world of hospitality, sustainability is no longer a niche trend but a crucial business strategy. So, is your next hotel stay contributing to a greener planet and supporting local communities?

Green hotels are becoming more and more popular among Saudi Arabia’s hospitality and tourism industry, which is wonderful news for the Kingdom’s environmentalists.

To draw in clients and increase profits, a number of investors are now focusing on initiatives that advance sustainability.

The push for sustainable tourism has gained remarkable momentum in recent years, with the hotel industry at the forefront of this transformation.

Current trends

Nicolas Mayer, a partner of global industry leader tourism at PwC Middle East told Arab News that a focus on environmental and social sustainability are driving change in the Kingdom.

He explained that environmental sustainability is important when it comes to energy efficiency and sustainable building practices.

Mayer noted that the integration of Internet of Things technologies and advanced building management systems are revolutionizing energy efficiency in hotels.

“Preventive maintenance sensors and advanced energy analytics contribute significantly to CO2 reductions, though these improvements are often invisible to consumers,” Mayer said.

The construction and renovation of hotels increasingly focus on sustainability, which means that when building or updating premises, developers are using practices that reduce environmental impact, such as using eco-friendly materials and energy-efficient technologies.

“Saudi Arabia, for example, is ensuring new tourism developments do not harm ecosystems, particularly around the Red Sea and inland destinations,” Mayer said.




Nicolas Mayer, a partner of global industry leader tourism at PwC Middle East

He added: “The proactive environmental master planning by Saudi tourism authorities is expected to result in more sustainable destination development compared to more established destinations.”

The social aspect of sustainability in tourism, which includes local workforce development and community engagement, emphasizes the importance of collaborating with communities and stakeholders.

Increasingly, there is an acknowledgment that tourism should take place in well-preserved ecosystems, and it is the duty of developers and operators to bolster and support these.

“The sustainable tourism landscape within the hotel industry is rapidly evolving. There’s a pronounced shift toward eco-friendly practices, with travelers increasingly prioritizing hotels that align with their environmental values,” Craig Hewett, co-founder and chief hotel officer at travel app Wego explained to Arab News.

He added: “This has led to a surge in demand for initiatives such as water conservation, energy efficiency, and waste reduction. This is exemplified by projects like the Red Sea Project, which showcases a holistic approach to sustainable development.”




Craig Hewett, co-founder and chief hotel officer at travel app Wego

 

A bright experience

If sustainability remains at the forefront of the hotel industry. Does that mean it will enhance guest experiences?

According to a study by the online travel agency Booking.com in April, 83 percent of travelers believe that sustainable travel is important, and 75 percent of global travelers say that they want to travel more sustainably over the next 12 months.

“The trend is not just about meeting consumer expectations but also about differentiating brands in a competitive market. Hotels are recognizing that sustainability is not a passing trend but a critical factor in attracting and retaining guests,” Jamie Charlesworth, managing director of Middle East and India at designer and manufacturer of water park products firm Whitewater, told Arab News.

He added: “However, there is a cautionary tale of greenwashing, where companies may exaggerate their sustainability claims without taking meaningful action. To avoid this, transparency and authenticity are key.”

Sustainable practices in hotels greatly improve the overall guest experience by providing genuine and engaging connections with the local culture, society, and environment.




Jamie Charlesworth, managing director of Middle East and India at designer and manufacturer of water park products firm Whitewater

Guests today are looking for more than just standard amenities — they want experiences that offer real insight into the local way of life and surroundings.

“For instance, hotels that incorporate local Saudi crafts and cuisine into their offerings or provide opportunities for guests to participate in traditional cultural activities or even everyday Saudi social life create a more engaging and memorable stay and provide additional spending opportunities which in turn contributes to hotel’s profitability,” Mayer said.

He continued: “Additionally, initiatives such as sourcing food from local farms or collaborating with local artisans for decor not only support the local economy but also enrich the guest experience — there are many such examples in recent hotel projects in AlUla, Al-Balad and elsewhere in the Kingdom.”

Mayer further explained that when hotels align their services with guests’ desires for sustainable and culturally authentic experiences, it not only makes customers happier but also benefits the resorts financially.

By meeting these preferences, hotels attract more guests and build loyalty, which leads to increased revenue.

This positive outcome reinforces the business’s commitment to sustainability, creating a cycle where both guest satisfaction and economic success are continuously enhanced.

“Moreover, sustainable environmental practices, while often less directly visible to guests, contribute to an improved experience by ensuring a responsible and pristine environment,” Mayer said.

He added: “Advanced technologies in energy efficiency, intelligent building management, and sustainable construction practices reduce the ecological footprint of hospitality assets.”

Role of technology

Technology plays a pivotal role in advancing sustainable practices within the hospitality industry. Innovations such as smart thermostats, energy-efficient lighting, and waste management systems are transforming hotel operations.

“Saudi Arabia’s focus on digital transformation aligns perfectly with the need for technological solutions in the hospitality sector. Technology is a powerful tool in driving sustainable practices within the hotel industry,” Hewett said.

He added: “From energy management systems to digital guest tools, innovation is transforming how hotels operate.”

Another significant aspect is advanced technologies that are transforming how hotels manage their energy usage, leading to significant reductions in CO2 emissions.

“Technology facilitates the integration of sustainable practices in daily operations, such as water conservation measures and waste management systems, thereby promoting overall sustainability in hotel operations,” Mayer said.

He continued: “On the social side, technology enables better community engagement and workforce development through platforms that facilitate local hiring, training, and procurement.”

However, Mayer explained that hotels face several challenges when implementing sustainable practices, including high initial costs, resistance to change, and the complexity of integrating new technologies.

“The significant upfront investment required for energy-efficient systems, sustainable construction, and local procurement can be a deterrent, particularly for smaller operators,” he said.

The PwC Middle East official added: “Here the Saudi Arabian tourism ecosystem actually has a global advantage, as many of the hotels are only just being built now, which is more cost efficient than retrofitting older buildings. Integrating advanced technologies like IoT and intelligent building management systems also requires specialized knowledge and training, adding to the complexity.”

Mayer went on to say that there may be a requirement for additional training and awareness campaigns from staff and management who are accustomed to traditional practices and may not see the immediate benefits of sustainability efforts.

“To overcome these challenges, hotels can seek out government incentives and grants aimed at promoting sustainability, engage in partnerships with local communities and suppliers to share costs and benefits, and invest in comprehensive training programs to build internal support and expertise,” he said.

He added that the Saudi government, through the Ministry of Tourism, the Tourism Development Fund and other programs, also provides a wide array of support and programs aimed at facilitating local initiatives.

Evolution to come

Mayer outlined the expected evolution of sustainable tourism in the hotel industry, highlighting several key trends and changes.

“Over the next five years, sustainable tourism in the hotel industry is poised to become a cornerstone of hospitality management. Hotels will increasingly adopt integrated sustainability frameworks that balance environmental, social, and economic goals,” he underlined.

He further elaborated that the adoption of smart technologies, such as IoT and AI-driven energy management systems, will become widespread, enhancing resource efficiency and reducing operation costs.

“Moreover, there will be a stronger emphasis on social sustainability, with hotels investing in local communities through workforce development programs, local sourcing, and community engagement initiatives,” Mayer said.

Wego also expects to see a continued and accelerated growth in sustainable tourism within the hotel industry.

“As consumer demand for eco-friendly options increases, hotels will need to adapt and innovate to remain competitive,” Hewett said.

He added: “We foresee a greater emphasis on data-driven decision-making, with hotels utilizing advanced analytics to optimize their sustainability performance. Additionally, there will be a growing focus on circular economy principles, with hotels implementing strategies to reduce waste and conserve resources.”


Egypt’s exports to Lebanon up 43.8% across 2024: CAPMAS

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Egypt’s exports to Lebanon up 43.8% across 2024: CAPMAS

RIYADH: The value of Egyptian exports to Lebanon saw a 43.8 percent year-on-year surge in 2024 to reach $762.8 million, according to new figures.

Data from Egypt’s Central Agency for Public Mobilization and Statistics also showed that imports from the Middle Eastern country declined by 2.3 percent, totaling $237.7 million during the same period.

These shifts in trade come amid broader economic trends. The region’s gross domestic product grew by 1.8 percent in 2024, reaching $3.6 trillion despite ongoing challenges, according to a March report by the Arab Investment and Export Credit Guarantee Corporation, or Dhaman.

Looking ahead, this economic momentum appears set to continue. Moody’s projects 2.9 percent growth for the region in 2025, up from 2.1 percent in 2024, while maintaining a stable outlook for the region’s sovereign credit fundamentals over the next 12 months.

The newly released CAPMAS report revealed there was “an increase in the value of trade exchange between Egypt and Lebanon, reaching $1 billion in 2024, compared to $774 million in 2023, an increase of 29.3 percent.”

The main export groups of goods to Lebanon during 2024 included fuels, mineral oils, and distillation products worth $215 million, iron and iron products worth $65 million, and cement worth $55 million.

The value of fruits and vegetable exports stood at $48 million, while sugar and sugar products were worth $41 million. 

As for the main import groups of goods from Lebanon during the same year, they entailed iron and iron products worth $118 million, fruits and vegetables worth $72 million, and electrical appliances and equipment worth $22 million.

The value of plastics imports stood at $4 million, while dyeing and coating extracts were also worth $4 million.

The CAPMAS data also shed light on how the value of Lebanese investments in Egypt amounted to $51.2 million during the fiscal year 2023/2024, compared to $51.4 million during the fiscal year 2022/2023.

Egyptian investments in Lebanon amounted to $9.7 million during the fiscal year 2023/2024, compared to $7.9 million during the fiscal year 2022/2023.

“The value of remittances from Egyptians working in Lebanon amounted to $42.9 million during the fiscal year 2023/2024, compared to $38.1 million during the fiscal year 2022/2023, while the value of remittances from Lebanese working in Egypt amounted to $3.5 million during the fiscal year 2022/2023, compared to $3.7 million during the fiscal year 2022/2023,” the CAPMAS report added.

According to estimates, the number of Egyptians residing in Lebanon reached 11,300 by the end of 2023, the report concluded.


Invest Qatar launches $1bn incentive program to accelerate investment

Updated 25 min 42 sec ago
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Invest Qatar launches $1bn incentive program to accelerate investment

  • Move was announced during the 5th Qatar Economic Forum
  • Program offers financial packages for local and international investors covering up to 40% of expenses

DUBAI: Investment promotion agency Invest Qatar has launched a $1 billion program aimed at accelerating investment inflows and boosting diversification of the Qatari economy, it said on Wednesday.
Announced during the 5th Qatar Economic Forum, the program offers financial packages for local and international investors covering up to 40 percent of expenses such as setup costs, construction, leases and staff for a five-year period.
It said the first phase of the program will offer four off-the-shelf packages designed to stimulate fresh investment, support the expansion and digitization of existing facilities, create high-skilled employment, and promote knowledge transfer.
The Advanced Industries Package targets high-value, technology-intensive sectors such as pharmaceuticals, chemicals, automotive, and electronics.
The Logistics Package encourages investments in infrastructure, automation and advanced logistics services, while the Technology Package seeks to develop the digital economy through support for cybersecurity, cloud computing, artificial intelligence and data-driven innovation.
The Lusail financial services package aims to advance fintech, insurance, asset and wealth management, while incentivising firms to establish offices in Lusail, the country’s main financial district.


Kuwait sovereign wealth fund head says investors reduce US exposure at their ‘own risk’

Updated 39 min 11 sec ago
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Kuwait sovereign wealth fund head says investors reduce US exposure at their ‘own risk’

DOHA: The head of the Kuwait Investment Authority, which manages almost $1 trillion in assets, said the sovereign wealth fund is committed to investing in the US and that investors cut allocations to US assets at their own risk.
Some global investors have ditched US assets in recent weeks on fears that US President Donald Trump’s overhaul of global trade may hurt the US economy, and could cause deeper long-term damage.
The trend looks set to continue, given that a record number of managers have said they plan to keep cutting their exposure to US assets, according to BofA research.

Kuwait has been investing in the US market for a “long time” and that “won’t change,” KIA Managing Director Sheikh Saoud Salem Abdulaziz Al-Sabah said at an investment conference in the Qatari capital on Wednesday.
“I would say it very bluntly, underweight America at your own risk,” he said.
Last week, Moody’s downgraded the US sovereign credit rating by one notch, citing concerns about the nation’s growing $36 trillion debt pile, which could make investors more cautious and drive up borrowing costs across the economy.
“They (investors) are merely looking at equity markets, but they’re not taking into fact the US has the largest fixed income market, the US has the largest private equity market, the real estate market, infrastructure and credit,” Al-Sabah said.
“I think the US has the breadth and depth to sustain its exceptionalism and it has the rule of law as well,” he said.


Jewelry spending up 13% in Saudi Arabia as weekly POS stays above $3.2bn: SAMA

Updated 21 May 2025
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Jewelry spending up 13% in Saudi Arabia as weekly POS stays above $3.2bn: SAMA

RIYADH: Jewelry spending in Saudi Arabia rose by 13.2 percent between May 11 and 17 compared to the previous week, adding SR330.4 million ($88 million) to point-of-sale transactions during this period. 

The latest data from Saudi Arabia’s central bank, SAMA, revealed that it was one of only two sectors to record growth during the period, with education also posting an increase of 1.4 percent to SR164.6 million. 

The Kingdom’s overall POS transactions saw a 5.5 percent dip to SR12.3 billion in the seven-day period, driven by decreased spending across most of the sectors. 

Hotels spending saw the biggest drop, dipping by 18.1 percent to SR218.2 million. Clothing and footwear expenditure followed, falling by 10.4 percent to SR688.2 million, while recreation and culture saw a 9.3 percent decrease, totaling SR229.4 million. 

The smallest expenditure drop was in spending on construction and building material and gas stations, down by 1.7 percent each to SR330.1 million and SR929.7 million, respectively. 

The health sector declined by 4.8 percent to SR790.1 million, while public utilities dropped 4.3 percent to SR47 million. 

Electronics followed the trend, dropping 4.5 percent to SR1653.8 million, and furniture edging down by 3.7 percent to SR261.8 million. 

The telecommunication sector dropped by 5.5 percent in transaction value to SR98.3 million. Food and beverage spending decreased by 4.7 percent to SR1.8 billion, accounting for the largest share of the week’s POS. 

Restaurants and cafes accounted for the second-biggest share at SR1.7 billion, followed by miscellaneous goods and services at SR1.5 billion. 

The top three categories accounted for 41.1 percent of the week’s total spending, amounting to SR5 billion. 

Geographically, Riyadh dominated POS transactions, with expenditure in the capital reaching SR4.5 billion — a 3.4 percent decrease from the previous week. 

Jeddah followed with a 7 percent dip to SR1.7 billion, while Dammam ranked third, down 5.7 percent to SR640.5 million. 

Makkah saw the biggest decrease, inching down 20.6 percent to SR393.3 million, followed by Abha with a 9.7 percent downtick to SR153.5 million. 

In transaction volume, Hail recorded 3.7 million deals, down 2 percent, while Tabuk reached 4.7 million transactions, up by 0.2 percent. 


Oil Updates — crude gains as reports Israel may attack Iran raise supply worries

Updated 21 May 2025
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Oil Updates — crude gains as reports Israel may attack Iran raise supply worries

  • US intelligence suggests Israel plans to strike Iran, CNN says
  • US-Iran nuclear talks show little progress, impacting oil market

SINGAPORE: Oil prices gained more than 1 percent on Wednesday after reports of Israel preparing a strike on Iranian nuclear facilities raised fears that a conflict could upset supply availability in the key Middle East producing region.

Brent futures for July rose 68 cents, or 1.04 percent, to $66.06 a barrel, by 9:30 a.m. Saudi time. US West Texas Intermediate crude futures for July climbed 70 cents, or 1.1 percent, to $62.73.

New intelligence obtained by the US suggests that Israel is preparing to strike Iranian nuclear facilities, CNN reported on Tuesday, citing multiple US officials familiar with the matter.

It was not clear whether Israeli leaders have made a final decision, CNN added, citing the officials.

“Such an escalation would not only put Iranian supply at risk, but also in large parts of the broader region,” said ING commodities strategists on Wednesday.

Iran is the third-largest producer among the members of the Organization of the Petroleum Exporting Countries and an Israeli attack could upset flows from the country.

There are also concerns Iran could retaliate by blocking oil tanker flows through the Strait of Hormuz choke point in the Gulf, through which Saudi Arabia, Kuwait, Iraq and the UAE export crude oil and fuel.

The US and Iran have held several rounds of talks this year over Iran’s nuclear program, with US President Donald Trump reviving a campaign of stronger sanctions on Iranian crude exports to compel them to give up their nuclear aspirations.

Despite the discussions, US officials and the Iranian Supreme Leader Ayatollah Ali Khamenei made comments on Tuesday indicating both sides remain far from a resolution.

“There are indirect nuclear talks between the US and Iran, which, if successful, could give the market further upside. However, these talks appear to be running out of steam,” the ING analysts said.

Still, there were some signs of improving crude supply. US crude oil stocks rose last week while gasoline and distillate inventories fell, market sources said, citing American Petroleum Institute figures on Tuesday.

Crude stocks in the US, the world’s biggest oil consumer, rose by 2.5 million barrels in the week ended May 16, the sources said on condition of anonymity.

Investors are looking ahead to government US oil stock data from the Energy Information Administration later on Wednesday.

Also, Kazakhstan’s oil production has risen by 2 percent in May, an industry source said on Tuesday, an increase that defies pressure from OPEC+ on the country to reduce its output.