Saudi Arabia is pushing ahead with its ambition to become a global hub for transport, splashing billions of dollars on new aviation and tourism infrastructure.
The kingdom believes it can compete with its neighbours by investing in a new airline to draw traffic to capital Riyadh and away from Dubai and Doha, respectively the home bases for Emirates and Qatar airlines.
Saudi Arabia is timing its US$147 billion investment into transport and tourism at a time when the Covid-19 pandemic has put pressure on international airlines in the region, notably Emirates and Etihad.
Saudi transport minister Saleh Al Jasser expects about 35% of spending will come from the government and the rest from the private sector.
Along with the new airline, the kingdom will expand the country’s rail network and promote itself as a cruise destination, headquartered in the city of Jeddah on the Red Sea coast. A new airport is also on the drawing board.
Saudi Arabia’s Vision 2030, a strategic framework to diversify its economy, has a strong emphasis on tourism. Several mega attractions are planned, including Qiddiya, the world’s largest entertainment city – surpassing Walt Disney World in Florida.
Saudi officials have not given a name to the new carrier, which will focus on extensive international hub operations, leaving the kingdom’s state-owned Saudia to concentrate on regional routes.
Saudi Arabia said last week that global airlines industry body IATA had agreed to open a regional headquarters in Riyadh although the industry's trade association denied it would be a regional base.