Saudi Arabia’s entertainment plans signal new socio-economic reality
By Theodore Karasik and Madison Taylor
As part of an effort for social and economic reforms by the Crown Prince of Saudi Arabia, Mohammed bin Salman (MBS), the Kingdom has announced a plan to invest $64 billion in their entertainment sector. The investment serves as a piece of the Kingdom’s path to Vision 2030 with goals of creating a vibrant society, a thriving economy, and an ambitious nation.
As part of a goal for a vibrant society, Vision 2030 sees entertainment as “indispensable to our quality of life“. The funding will help modernize the state, balance citizens’ fulfillment with the thriving economy, champion tourism, and retain money that would have gone to other states for entertainment purposes.
The General Entertainment Authority (GEA) announced its “Don’t Even Think of Traveling” Campaign, encouraging residents to seek entertainment opportunities within the Kingdom, rather than traveling to Dubai or Bahrain. Residents of Saudi Arabia have spent billions of their disposable income on venues or parks outside of the Kingdom.
To counter these losses, the GEA has invested in a wide variety of entertainment projects to appeal to many different audiences. The GEA has already lined up 45 events and in 18 cities for a calendar of international and local performances, festivals, and carnivals. With this assortment of entertainment options, the GEA hopes bolster both domestic and international support and tourism.
This move by MBS is a big signal for modernization in Saudi Arabia. MBS has been very in tune with the need for modern laws and industries in the face of high millennial populations and shifting political opinions.
Bolstering entertainment also serves as a deterrent of youth joining certain social groups and Islamist networks as well as an alternative to possible discontent related to quick and dramatic shifts in Saudi Arabia’s social structures and family life. Mixed gender concerts and festivals will serve as an alternative to reformist groups for youths.
In a related move, KSA lifted a ban on movie cinemas and over 300 theaters will be operating in Saudi Arabia 2030.
The plan will bring Western acts such as Maroon 5 and Cirque du Soleil and popular children’s shows as the Care Bears and the Teenage Mutant Ninja Turtles to the Kingdom. The Kingdom hopes not only to improve the lives of its citizens but also to become an entertainment hub for the rest of the world.
Such opportunities have lured international investors into this emerging market. MBS focused on these prospects on his recent tour to the United States.
He met with top Apple, Microsoft Google, and Amazon executives as well as Hollywood executives to discuss the upcoming opportunities for entertainment and technology investment in the KSA. MBS and Google arranged a cloud-computing contract as well as meeting with Disney on enhanced entertainment concepts.
Deals were also made for entertainment centers with National Geographic, AMC, and Feld Entertainment. In addition, the Saudi Arabian Public Investment Fund and Six Flags agreed to build a new theme park in hopeful entertainment hub Qiddiya.
Construction for the new destination will start this year. Once built, the entertainment city will focus on six key areas: Theme Parks, Wheels and Wings, Scenic and Animal Encounters, Water and Snow, Sports, and Events, Culture, and Education.
An important cornerstone of Vision 2030 and another hopeful entertainment and technology hub will be NEOM, a city focused on technological innovation within the arena of the fourth industrial revolution focusing on Artificial Intelligence (AI).
The city’s ambitions include being the future hub of entertainment, technology, and media production. Falling under all three of these categories, virtual reality will be a great prospect for investment in NEOM. KSA has already invested $400 million in VR, backing Magic Leap, a company focused on VR goggles.
With mutual interests in VR technology, tech giants such as Microsoft might find their new hub for innovation incubation and growth within NEOM concept. Of course, NEOM is not just about VR googles but building an entire new concept of entertainment within the larger requirement for advanced technologies including AI and robotics. Ingenuity is a key word.
This investment in entertainment could certainly be a viable option for the diversification of Saudi Arabia’s economy. If the Kingdom is successful in becoming an entertainment hub, the tourism and domestic patronage could prove to be a very lucrative source of revenue when paired with the implemented Value-Added Tax. NEOM alone is expected to contribute $100 billion to the economy by 2030.
Furthermore, the tourists attracted by big names in the industry would further contribute to the Kingdom’s hospitality and travel sectors. If the Saudi state can provide cutting-edge venues and other advantages to their industry, they will emerge as a strong competitor in the region. The investment will also create around 224,000 jobs focused on hiring younger generations.
Overall, combined with other efforts such as the privatization of state-owned resources and investment in other sectors, the Kingdom seems to be on track towards Vision 2030 in its early years in the entertainment sector.
The precedent set this year by the GEA could prove to be a historic act in both economic diversification and modernization and illustrates the critical role that the Authorities as opposed to Ministries play in Saudi Arabia’s rapidly transforming style of governance related to implementing a broad-based entertainment policy in times of dramatic social change.
The net impact is to produce dividends for Saudi Arabia’s economy while opening Saudi society to entertainment and ultimately sparking critical thinking about the Kingdom’s future as well as epic social changes in how the Kingdom adjusts social norms in MBS’s Saudi Arabia.