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�������� is ramping up the adoption of smart technologies such as artificial intelligence, augmented reality, and virtual reality across its tourism sector, aiming to redefine the visitor experience and support its broader economic diversification agenda.

Experts say the integration of these technologies across flagship projects like Neom and the Red Sea Project is positioning the Kingdom as a global tourism hub at a time when the industry is recovering from the pandemic and projected to reach $11.7 trillion in economic contribution by 2025.

As part of Vision 2030, the Kingdom is positioning tourism as a key non-oil growth engine. Its National Tourism Strategy targets 150 million annual visitors by 2030 and aims to raise the sector’s contribution to gross domestic product from 3 percent to 10 percent.

Speaking to Arab News, Nicholas Nahas, partner and tourism & hospitality global competence center lead at Arthur D. Little, said �������� is intelligently integrating smart technologies into its tourist destinations, helping the Kingdom emerge as one of the most sought-after tourism hubs.

“In ��������, smart tourism, while not always explicitly referenced or promoted as such across its portfolio of tourism developments, is subtly being integrated as a strategic enabler of the country’s broader economic shift to diversifying its economy,” said Nahas.

He added: “It includes artificial intelligence for personalized trip planning, biometric systems to streamline travel and immigration, IoT-enabled controls in accommodations, and AR/VR to create immersive storytelling at cultural and entertainment sites.”

Nahas further said that smart technologies are being planned as enablers to manage growth, enhance quality, and differentiate the visitor experience.

Smart tourism refers to the use of advanced digital technologies across the tourism value chain to enhance visitor experiences, improve operations, and support sustainable destination management.

The concept also aligns with the idea of a Smart Destination — a location that leverages technology and innovation to create more immersive and sustainable experiences.

Julio De Salvo, Globant’s chief solution officer for the Middle East and North Africa and the Asia Pacific region, echoed similar views. He said �������� is well-positioned to become a global tourism hub, and this journey could be further accelerated by adopting smart technologies across the sector.

Salvo added that some of the key drivers of smart tourism in the Kingdom include massive investments in smart infrastructure — such as AI-enhanced airports and digital visa platforms — a young, tech-savvy population, and a strong commitment to sustainability through regenerative models that prioritize environmental and cultural preservation.

The Globant executive also commented on the global post-pandemic recovery of the tourism sector and said the industry is accelerating toward a projected $11.7 trillion in economic contribution by the end of 2025.

“�������� isn’t riding the wave of global tourism recovery; it’s creating its own momentum, using smart tourism as a catalyst for economic diversification, innovation leadership, and long-term global relevance,” said Salvo.

Creating personalized experience

Salvo told Arab News that the tourism industry is witnessing a rapid shift, where digital tourism is slowly giving way to cognitive tourism — with advanced technologies used to deliver personalized services to travelers.

“In ��������, it’s no longer just about online bookings or mobile apps — it’s about intelligent systems that understand, anticipate, and adapt to travelers’ behavior in real-time,” said Salvo.

A recent study by global consumer insights provider Toluna echoed this trend, noting that Saudi travelers are increasingly relying on smart technologies, with 87 percent using generative artificial intelligence tools like ChatGPT and Gemini to plan and manage their vacations.

As part of Vision 2030, the Kingdom is positioning tourism as a key non-oil growth engine. Its National Tourism Strategy targets 150 million annual visitors by 2030 and aims to raise the sector’s contribution to gross domestic product from 3 percent to 10 percent.

The report further found that 46 percent of Saudi travelers use AI assistants to discover activities, while 31 percent rely on these tools to optimize their itineraries.

Nahas said destinations powered by smart technologies are delivering more personalized, seamless, and immersive experiences — supporting higher satisfaction levels and encouraging repeat visitation.

The Arthur D. Little official added that these technologies will also enable more sustainable operations, from energy use in hotels to mobility and waste systems in major destinations.

“Importantly, the Kingdom’s flagship tourism projects — such as Neom, the Red Sea Project, Diriyah, Qiddiya, and New Murabba — are integrating smart systems as a core component of how tourism experiences are crafted, delivered, and continuously improved,” said Nahas.

Neom aims to elevate the visitor experience through AI-led personalization and immersive digital engagement.

The Red Sea Project similarly integrates smart infrastructure to enable seamless and sustainable guest experiences. The destination is deploying IoT sensors to monitor environmental indicators, utilities, and operational systems across its resorts and natural assets.

Diriyah, while rooted in heritage, is incorporating digital heritage documentation and exploring interactive technologies to enhance cultural storytelling — aligning with broader trends in cultural tourism that use immersive tools to enrich historical engagement and visitor education.

Nahas added: “These systems could be equally used to monitor visitor needs, respond to requests, and elevate the visitor experience.”

“Plans also include autonomous electric vehicles, smart utility management, and a centralized digital platform that will allow guests to access accommodation, transportation, and experience bookings.”

Salvo also emphasized the transformative role of data and AI. “By integrating real-time data — from IoT sensors to traveler preferences and even biometric signals — we can deliver experiences that are not just personalized, but truly responsive,” said the Globant official.

He added: “This is how data becomes experience — and how destinations become intelligent, dynamic environments that adapt in real time. It’s a win-win: travelers feel seen, and operators gain the insight and agility to manage resources, reduce friction, and elevate every journey.”

Nahas said AI is also becoming increasingly prominent in trip planning and customer service, with chatbots offering timely support and tools generating personalized itineraries.

According to the Arthur D. Little executive, service robots using AI could be deployed in budget accommodations to handle routine tasks such as cleaning and food delivery, boosting both efficiency and consistency.

“On the infrastructure side, IoT, cloud, and AI systems are being integrated into facilities to monitor and control environmental conditions in real time. This supports sustainability goals by optimizing resource use and maintaining comfort standards, particularly in large-scale developments,” said Nahas.

Potential challenges

Amid these promising developments, experts also highlighted challenges facing �������� in implementing advanced technologies in its tourism sector — including localization gaps.

“Many of the most advanced solutions in areas such as AI, AR/VR, and IoT are currently developed outside the Kingdom. As �������� integrates these tools into its tourism offering, collaboration with international partners will be important, alongside efforts to build local capabilities over time,” said Nahas.

Highlighting the importance of regulation, the Arthur D. Little executive added that clear guidelines around data governance, cybersecurity, and system standards will be essential to support consistent implementation and long-term alignment with national priorities.

Salvo shared similar concerns, emphasizing the need for talent development to support the growing smart tourism ecosystem. He said this requires upskilling programs and international partnerships to close expertise gaps.

“Major tech infrastructure, including nationwide 5G networks, smart airports, and cloud systems, is still rolling out, with delays in full deployment potentially hindering real-time applications like personalized AI tours and immersive experiences in mega-projects like The Red Sea and Neom,” added the Globant official.

Despite these challenges, experts told Arab News that smart tourism can grow into a well-integrated part of ��������’s tourism strategy — provided there is the right coordination and policy framework.

“The pieces are steadily coming into place — with emerging tech adoption readiness jumping to nearly 75 percent in 2025 — and paint a bright future where smart tourism not only overcomes these obstacles but propels �������� to lead in innovative, regenerative travel,” concluded Salvo.

RIYADH: �������� is advancing an ambitious strategy to position itself as a global hub for technology startups, striking a balance between regulatory reform and an unprecedented wave of innovation.   

As the Kingdom races to diversify its economy and reduce dependence on oil, entrepreneurs and legal experts say the country is reaching a pivotal moment in its efforts to create a business environment that is both competitive and predictable. 

Feras Mousilli, managing partner at Lloyd & Mousilli, described the pace of change as remarkable.   

“The regulatory landscape in �������� is evolving at an impressive pace and the government’s proposed regulations show a clear intent to support its Vision 2030 goals: reduce barriers, increase clarity, and compete globally for tech innovation,” he told Arab News in an interview.   

Yet as new frameworks take hold, founders continue to grapple with the friction that arises when rapid innovation meets complex compliance requirements. 

In recent years, the Saudi Central Bank and the Capital Market Authority have emerged as key architects of this transformation.

Through sandbox environments and tiered licensing, regulators have created mechanisms for startups to test their ideas with fewer constraints.   

Among the most consequential reforms is the introduction of open banking frameworks, which mandate financial institutions to share Application Programming Interfaces with third-party fintech firms, opening the door to greater competition and inclusion. 

APIs are a set of rules and protocols that allow different software systems to communicate and exchange data. 

For founders such as Hisham Al-Falih, the shift has been both sweeping and hard-won.   

“I’d say that the things that have kind of maybe changed the most this year are the introduction of new regulations,” said Al-Falih, founder of Lean Technologies, in an interview with Arab News. 

“In ��������, the central bank has been continuing its mission and its plan of rolling out open banking,” he added. 

“This is obviously a multiyear effort, and it’s culminating now with the introduction of the PIS, the Payments Initiation Service, which is expected to go live soon,” Al-Falih said. 

He recalled that when Lean Technologies launched in 2019, few policymakers had a roadmap for modern fintech.   

“None of these regulatory kind of bodies really adopted open banking and had plans for it,” he said.   

“And so there’ve been years of discussions and conversations and back and forth with a variety of industry bodies to get to where we’re getting to today.” He added that Lean has worked closely with regulators to help shape the emerging framework. 

Beyond fintech, the Kingdom has implemented comprehensive reforms to the legal framework governing all businesses.   

In February, the government passed a new Investment Law establishing a unified framework for foreign and domestic investors, with enhanced protections and simplified procedures.   

At the same time, a revised Companies Law introduced the Simple Joint Stock Co., designed to make it easier to incorporate and operate a startup. 

Companies were required to update their Articles of Association by Jan. 18, marking a nationwide effort to align corporate governance with international norms. 

These changes coincide with record-breaking momentum in the broader startup ecosystem. 

In 2025, �������� was recognized as the fastest-growing startup environment in the world, according to the Global Startup Ecosystem Index, which reported Riyadh had climbed 60 places to rank 23rd globally.   

Venture funding has accelerated sharply, achieving a 49 percent compound annual growth rate from 2020 through 2024, with artificial intelligence startups emerging as a priority.   

Riyadh’s growth was catalyzed by a policy-driven approach that prioritized both scale and specialization.   

According to the 2025 Global Startup Ecosystem Report by Startup Genome, more than 200 fintech companies now operate in the Kingdom, supported by the Saudi Central Bank’s regulatory sandbox and Fintech Saudi’s market-building efforts.   

The report highlighted startups such as Lean Technologies, Rasan, and Tamara as examples of companies attracting substantial regional and international capital, with major financial institutions serving as early adopters and anchor clients. 

In addition to fintech, the report praised the Kingdom’s progress in cybersecurity, noting that Riyadh-based firms like Mozn and sirar by stc are developing artificial intelligence-powered solutions for identity verification, fraud detection, and compliance. 

�������� has emerged as the leading hub for venture capital activity in the Middle East and North Africa, raising $860 million in the first half of the year — a 116 percent year-on-year increase — supported by sovereign initiatives and rising foreign investor interest.  

According to regional venture platform MAGNiTT, the Kingdom recorded 114 VC deals during the period, representing a 31 percent increase from the same time in 2024, and continuing its momentum from the previous year, when it secured the largest volume of funding in the region for the second consecutive year.  

This surge in venture activity is further underpinned by structural reforms and policy incentives.  

As of mid-2025, ��������’s Ministry of Investment had issued 550 Startup Investment Registrations, known as Riyadi licenses, reflecting a 118 percent annual growth.   

While ��������’s ambition to become a digital-first economy is undisputed, Mousilli cautioned that rapid change can overwhelm young companies.   

“The challenge comes when compliance is so burdensome or complex that it diverts resources away from core growth,” he said.   

“For example, in fintech, a startup may spend months navigating licensing or anti-money laundering requirements — before they’ve even validated their product-market fit.”   

As a result, he noted, some founders default to “we’ll deal with it later,” exposing themselves to legal risk. 

The Kingdom has signaled that it wants to avoid this trap. Regulators are increasingly adopting risk-based supervision models that calibrate oversight according to the size and systemic impact of each company.   

“The most effective regulators understand that a small startup doesn’t need the same oversight as a multinational bank,” Mousilli said. “�������� is beginning to adopt this risk-based approach, which is a positive sign.” 

To complement the regulatory overhaul, the government has introduced new compliance mandates around ultimate beneficial ownership disclosures, enhanced anti-money laundering protocols, and environmental, social, and governance reporting, reinforcing transparency and investor confidence.   

The Digital Government Authority reported that digital transformation readiness exceeded 74 percent in 2025, underscoring a push to digitize public services and reduce administrative delays. 

For founders, this shift is not merely regulatory — it is cultural. Al-Falih said that collaborative policymaking has become a defining characteristic of the Saudi tech sector.   

“We’ve been working closely with the Central Bank and the associated parties in the ecosystem to provide our feedback, our notes on how their framework is being written, and to obviously engage with them in a productive way,” he said. 

In the view of many entrepreneurs, these conditions are creating fertile ground for growth. “I would argue that the region has some of the best regulations and infrastructure set up,” Al-Falih said. “And so we will be one of the more successful parts of the world to introduce these technologies.” 

Still, legal experts caution that unresolved issues — such as the enforcement of intellectual property rights, clarity in employment law, and the efficiency of dispute resolution — remain on investors’ radar.   

Mousilli observed that, despite the progress, �������� will need to maintain its momentum to consolidate its gains. “The frameworks are improving, but clarity and consistency, especially in implementation, remain key areas to watch and develop,” he said. 

Yet for those building the next generation of technology companies, the convergence of regulatory ambition and economic transformation is unmistakable.   

As Al-Falih put it: “This is one of the best times to be alive and one of the best times to be a member of the tech community in the GCC.”