THE IMPORTANCE OF AIR TRANSPORT TO SAUDI ARABIA
The air transport sector makes a major contribution to Saudi Arabia’s economy There are different ways of measuring air transport’s impact on an economy. We look at three: the jobs and spending generated by airlines and their supply chain, the flows of trade, tourism and investment resulting from users of all airlines serving the country, and the city pair connections that make these flows possible. All provide a different but illuminating perspective on the importance of air transport.
DIRECT SUPPLY EMPLOYEE TOURISM CHAIN SPENDING 594,000 SUPPORTED BY THE JOAIR TRANSPORTBS SECTOR
138,000 114,000 47,000 295,000 JOBS JOBS JOBS JOBS 5.6% SUPPORTED BY AIR TRANSPORTGDP & FOREIGN TOURISTS ARRIVING $36.5 BY AIR GROSS VALUE ADDED BILCONTRIBUTIONLION TO GDP US $11.5 US $6.2 US $2.5 US $16.2 Source: Oxford Economics 1 BILLION GROSS VALUE ADDED
The air transport sector all of which are subsequently US $20.2 billion of GDP in Saudi supports jobs... spent on consumer goods and Arabia. Spending by foreign services. Foreign tourists arriving tourists supports a further Airlines, airport operators, airport by air to Saudi Arabia, who spend US $16.2 billion of the country’s on-site enterprises (restaurants their money in the local economy, GDP, totaling to US $36.5 billion. and retail), aircraft manufacturers, are estimated to support an In total, 5.6 percent of the and air navigation service additional 295,000 jobs. In total country’s GDP is supported by providers employ 138,000 people 594,000 jobs are supported by inputs to the air transport sector in Saudi Arabia. In addition, by air transport and tourists arriving and foreign tourists arriving by air. buying goods and services by air. from local suppliers the sector supported another 114,000 ...and spending jobs. On top of this, the sector is estimated to support a further The air transport industry, For forecasts of the industry’s 47,000 jobs through the wages including airlines and its supply GDP and jobs contribution over it pays its employees, some or chain, are estimated to support the next 20 years see page 4 The importance of air transport to Saudi Arabia | 2
Air transport facilitates flows of goods, investment and people
US 2. bn US 229 bn R IGN T URIST US 232 bn P NDITUR DI P RTS
Note: Data relate to all modes of transport / Source: UNWTO, UNCTAD and World Bank 2
The most important benefits from and the economy can be seen economic flow, stimulated by air transport go to passengers from the spending of foreign good air transport connections, is and shippers and the spillover tourists and the value of exports foreign direct investment, creating impacts on their businesses. The (though note these figures include productive assets that will value to passengers, shippers all modes of transport). A key generate a long-term flow of GDP.
Top five international tourist Top five busiest direct flights Top five busiest air cargo arrivals (all modes of transport) arrivals routes by country of residence 3 1. Pakistan 1. United Arab Emirates 1. United Arab Emirates 2. Kuwait 2. Egypt 2. India 3. India 3. Pakistan 3. Egypt 4. Indonesia 4. Turkey 4. Pakistan 5. Egypt 5. India 5. Bangladesh
Source: UNWTO and IATA 2
Annual passenger flows by region (origin-destination, ‘000s)
2 335 9 8 8 433 Middle East is the largest market for passenger flows to and from Saudi Arabia, followed by Asia-Pacific and Africa. 26.7 million passengers arrived to 26 728 Saudi Arabia from the Middle 6 East (60.3 percent of total), 4 996 9.8 million passengers arrived from Asia-Pacific (22.2 percent of the total) and 5 million passengers arrived from Africa (11.3 percent).
Source: IATA Direct Data Solutions
3 Arrivals of non-resident tourists at national borders or in all types of accommodation establishments, by country of residence. Some of these are key source markets for religious tourism. 3 | The importance of air transport to Saudi Arabia
Air transport connects Saudi Arabia to cities around the world Air transport generates benefits to consumers and the wider economy by providing speedy connections between cities. These virtual bridges in the air enable the economic flows of goods, investments, people and ideas that are the fundamental drivers of economic growth.
Map of Saudi Arabia’s air connectivity, by its largest markets (segment basis) 4