Saudi Launches Own Duty-Free Company to Boost Tourist Spending
Skift Take
Key Points
- Saudi Arabia's Public Investment Fund has launched Al Waha, a new duty-free retailer aimed at boosting tourist spending.
- The initiative is part of Saudi Arabia's broader efforts to enhance its travel and aviation competitiveness, including major expansions at King Salman International Airport.
- Al Waha will explore travel retail opportunities across various locations, with a focus on sustainable revenue generation.
Summary
Saudi Arabia's Public Investment Fund has launched Al Waha, the country's first duty-free company, to enhance tourist spending and support the kingdom's travel and aviation sector. This initiative aligns with Saudi's broader efforts to become more globally competitive, including significant expansions at King Salman International Airport and the launch of Riyadh Air. Al Waha will operate at airports, land border crossings, and seaports, focusing on sustainable travel retail revenue opportunities.
Saudi Arabia’s sovereign wealth fund on Monday announced the formation of a new company dedicated to duty-free retail, the latest initiative in the kingdom’s efforts to attract global travelers.
The company, Al Waha, was established by the Public Investment Fund (PIF).
Majed Al-Assaf, Head of Consumer Goods and Retail in MENA Investments at PIF stated: “There is considerable potential for Saudi Arabia to gain a larger share of travel retail spending in the future, and the continued increase in visitors – as well as global events being hosted locally – offer new opportunities to generate sustainable travel retail revenues.”
Al Waha’s launch is the latest effort by Saudi to make its travel and aviation sector more globally competitive.
In November 2022, PIF announced an expansion to the existing King Salman International Airport to make it one of the biggest in the world. The plans state that the airport aims to accommodate up to 120 million travelers by 2030 and 185 million travelers, with the capacity to process 3.5 million tons of cargo, by 2050.
In terms of retail space, there will be 12 square kilometers dedicated to support facilities, residential and recreational facilities, retail outlets, and other logistics. That's around the size of three Central Parks.
In March 2023, PIF launched Riyadh Air, its new national carrier, which plans to begin commercial operations this summer. Riyadh Air has previously announced it aims to serve over 100 destinations by the end of the decade, potentially contributing up to $20 billion to the Saudi economy.
The idea of a duty free venture was first mentioned in February 2024 by the Moodie Davitt Report, which referred to it as "Project Travel Retail." PIF has confirmed to Skift that Al Waha and "Project Travel Retail" are the same initiative.
Al Waha will operate its airport outlets on a duty-free basis and explore additional travel retail opportunities at land border crossings, seaports, and inflight shopping.
In January 2023, Saudi officials denied claims in media reports that it was considering selling alcohol in airport duty-free stores.
Photo Credit: The Riyadh Skyline Wikimedia Commons / B.alotaby
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