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Religious tourism a major economic force: 1.8 million pilgrims arrive in Saudi for Hajj

With Hajj taking place from August 9th to August 14th starting this week, we look at some financials and consider the future of religious tourism in the Kingdom.

Hajj and Umrah alone are estimated to produce for the Kingdom $12 billion in revenue yearly They contribute 20% of non-oil GDP and 7% of total GDP Cumulative pilgrims of both Hajj and Umrah are expected to reach 30 million by 2030

Religious tourism continues to be a major driving force of the economy for Saudi Arabia, with Hajj and Umrah pilgrimages front and center of this booming industry. Hajj, which is required of Muslims to be performed at least once during their lifetime, unless they are unable financially or physically, will begin tomorrow, August 9th. Umrah, on the other hand, is similar to Hajj, but can be undertaken at whichever point during the year. 

Hajj and Umrah alone are estimated to produce for the Kingdom $12 billion in revenue yearly, contributing 20% of non-oil GDP, and 7% of total GDP. Given that almost 2.37 million pilgrims travelled to Mecca for Hajj that year, this should come as no surprise. After all, Hajj is the largest annual gathering of people from all around the world. This year, and as of this writing, 1.84 million pilgrims have arrived so far. Hajj will conclude on Wednesday, August 14th

The future holds nothing but growth for these pilgrimages: “Economic experts have said Hajj and Umrah revenues are poised to exceed $150 billion by 2022 in light of the expected mergers of economic blocs and groupings to meet the growing demand on Hajj and Umrah economics in terms of transport, commercial stores and expansion in small, medium enterprises (SMEs),” Arab News reported in 2017. 

As for numbers, cumulative pilgrims of both Hajj and Umrah are expected to reach 30 million by 2030, according to an official statement. 

Overcoming challenges of scale

Unlike Umrah, which doesn’t have a set date, Hajj leads to an over concentration of visitors to the Kingdom, and particularly Mecca. This high density of pilgrims leads to an extreme strain on infrastructure. 

“Even as the Saudi government invests heavily in infrastructure to support the influx of religious pilgrims, the physical capacity of the holy sites in Mecca can “only” accommodate approximately 2.5 million pilgrims,” writes ICF, a global consulting services firm. 

“The Hajj dictates that the pilgrims need to be in Mecca by the time the holy week begins. As a result, we see a surge in pilgrim travel during the 30 days before the Hajj. When the rituals conclude, the flow reverses. This “to-and-fro” motion exerts an extreme load on airport infrastructure and airline capacity, sparking very peaked and imbalanced traffic flows over a relatively short period of the year.”

As a result, ICF’s data suggests that development will continue to focus on expansion to be able to withstand the growing numbers. However, the next step will entail improving the experience of Hajj instead, focusing on better organization and efficiency, such as streamlining border control and improving transport. Some private, third-party firms like ride-hailing firm Careem are already playing their role in this. Two months ago, they launched a bus service, dubbed Careem Bus, along the Jeddah-Mecca route, costing travelers $6.70 each way.