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Expo 2030 to Diversify Saudi Economy

Expo 2030 is likely to have a significant positive impact on Saudi economy as the government will continue to drive higher spending and investment in infrastructure, local industry and services

Expo 2030 Riyadh will play a key role in diversifying Saudi economy from energy sector to non-oil sectors such as tourism, hospitality, real estate, construction, infrastructure development and technology by attracting millions of visitors during the six-month long exhibition period.

The mega event, which will coincide with the culmination of the kingdom’s Vision 2030, is schedule to take place from October 2030 to March 2031 in North Riyadh. The site will span over 600 hectares, with 3.38 million sqm dedicated to experiential space and 2.62 million sqm for supporting amenities and facilities.

The Expo 2030 will be held under the theme ‘The era of change: Together for a foresighted tomorrow’ and it has three sub-themes through which it aims to guide the global community towards a better future with the help of science and technology. The sub-themes include:

A Different Tomorrow: The advancement in science and technology should transform the world, create resilience, and serve humanity, however, responsibly, and ethically.

Climate Action: Mobilise the international community to encourage the development of sustainable solutions to protect the natural ecosystem.

Prosperity for All: An inclusive prosperous world with contributions from every nation to tackle inequalities and imbalances.

The Saudi Government, which has earmarked $7.8 billion to construct the most expensive venue in World Expos history, anticipated to attract 246 participants and 40 million visitors during the exhibition. Analysts and experts said the event will have the potential to promote several sectors in the pre-event phase as well as during the event and in the legacy phase.

In a comprehensive study, Al Rajhi Capital Research said total economic impact of Riyadh Expo is projected to be a $94.5 billion (SR335 billion), representing a 19 per cent addition to the estimated non-oil gross domestic product (GDP) for 2023 with an annualised impact of 0.75 per cent over the next 25 years.

“The impact of the Riyadh Expo is anticipated to extend beyond the event. Unlike Dubai, Riyad — which is not a tourist hub currently, needs to make significant investment for the six-month long exhibition, including building 100,000 hotel rooms, the economic impact over the years will be substantial, according to the report.

In another report, GIB Capital said Expo 2030 is likely to have a significant positive impact on Saudi economy as the government will continue to drive higher spending and investment in infrastructure, local industry and services.

Referring to the E&Y study, GIB Capital said Saudi economy may see SR175 billion-SR190 billion cumulative gross value added (GVA) boost from the government spending with the pre-expo stage likely witnessing a GVA impact of SR44 billion-SR47 billion and during the expo impact of SR23 billion-SR24 billion.

Beneficiary sectors

Non-oil sectors are expected to experience varying growth patterns with the building and construction, banks and insurance sectors likely witnessing expansion leading up to the expo as preparations for the global event gather pace. However, during the expo sectors such as hospitality and tourism, aviation and ancillary, car rentals, advertisement, and insurance are expected to be major beneficiaries, driven by increased visitor influx.

“Companies prominently engaged in these sectors, particularly in Riyadh, are expected to observe substantial growth in the coming years,” according to the research.

The research further highlights that the increase in construction activities will lead to higher demand for a diverse range of construction materials, including cement, steel, glass, tiles and ceramics, electrical wires and cables, plumbing pipes and fixtures, an paints and coatings. This surge in demand is expected to particularly benefit companies with a strong presence in Riyadh.

Analysts and experts said mega event will also help create jobs in Saudi Arabia and help reduce unemployment rate in the country. An EY report indicated that four million jobs will be created by the global event as the influx of visitors, participants and tourists requires related industries to scale up their workforce to meet the heightened demand.

GIB Capital research also pointed out that influx of tourists and visitors would increase the requirement of banking services such as payments, foreign exchange, credit facilities, and remittance services, to support and streamline operations throughout the expo duration, thereby benefiting the entire banking industry.

— muzaffarrizvi@khaleejtimes.com