Sweeping regulatory reforms in recent years have led to the emergence of a flourishing entertainment scene in Saudi Arabia. The entertainment sector is considered a high priority in the government’s economic diversification drive and related efforts to cultivate a broad local talent pool and enhance the quality of life in the Kingdom.
A dedicated entertainment regulatory body, the General Entertainment Authority (GEA), has been established to regulate and drive sector growth, and a growing range of training, business support and financing schemes are in operation under its banner. Many of these focus on supporting entertainment-related start-ups, with expanding the Kingdom’s network of small and medium-sized enterprises (SMEs) a core component of Vision 2030, the government’s overarching socio-economic development blueprint (see Economy chapter).
Entertainment sector growth has been rapid, mirroring the rate of development in other areas of the economy since the Kingdom’s diversification agenda began. Multiple government authorities are instrumental in bolstering the Kingdom’s entertainment, culture and sport offerings. Saudi Arabia’s success in securing the rights to stage a raft of high-profile international entertainment and sporting events is buttressed by an expanding portfolio of homegrown shows, festivals and events, all of which are contributing to increased domestic and international awareness of the country’s culture and investment opportunities (see analysis).
Structure & Oversight
The foundation for reform was laid in 2016, when the government launched Vision 2030, its plan to diversify the economy, boost job creation, raise the capacity and capabilities of domestic human capital, and enhance the quality of life in the Kingdom. The Quality of Life Programme, which prioritises development of the entertainment, cultural and sport sectors, is one key Vision Realisation Programme established to facilitate progress towards opening new opportunities to local and international investors and entities to contribute and reap the benefits of the Kingdom’s flourishing economy. With socio-economic reforms opening long-restricted areas of the economy, multiple new government ministries and authorities have been established since the rollout of Vision 2030. The GEA was launched in 2016 and has since assumed a leading role in expanding the entertainment sector and improving business conditions for existing entertainment players, as well as new and potential market entrants.
In light of the fact that the government aims to position the country as a global entertainment and tourism destination, a new licensing framework – Entertainment Portal – was launched in 2019. More than 13,000 licences had been issued for entertainment and supporting activities as of July 2023.
The GEA periodically monitors its licensing criteria to facilitate the process for companies operating in the sector while also protecting Saudi culture and interests. The latest round of regulatory amendments came in August 2021, outlining the criteria applicants must meet and the documents they must provide in order to obtain an entertainment licence.
The GEA’s bid to boost employment in the entertainment sector – while also raising the capacity of human capital contained therein – has seen a continuation of its Happiness Creators Initiative, through which it runs a range of training and education initiatives. Those initiatives are designed to provide employment opportunities in the entertainment sector and an upskilling programme for employees and executive-level staff already working in the sector. The Happiness Creators Initiative had trained a total of 403 candidates as of July 2023. In addition, the GEA also offers digital courses through which it aims to train up to 100,000 entertainment sector employees, with 44,000 individuals enrolled on the platform as of the second half of 2023.
Intergovernmental Partnerships
Indicative of the drive to enhance intergovernmental cooperation as a means to achieve the goals of Vision 2030. In February 2022 the GEA signed a mutual agreement with the Ministry of Culture (MoC) to boost synergies between the two entities in the development of the entertainment and cultural sectors.
The GEA also signed an agreement with the Tourism Development Fund – the catalyst and enabler – to develop regulatory frameworks related to areas of mutual interest, with the aim of supporting growth in the number of private entities operating in the entertainment sector, and the leisure- and tourism-related segments in particular, while also improving synergies between public and private bodies.
Other Players
The MoC was established in 2018 to facilitate development across multiple areas of the cultural economy. It oversees commissions related to the following activities: heritage; architecture and design; culinary arts; literature, publishing and translation; theatre and the performing arts; fashion; libraries; museums; music; visual arts; and film. The film segment, in particular, has been identified as offering high-value growth potential, with rapid expansion taking place across the Kingdom’s film production and distribution spaces.
The Ministry of Sports (MoS), formerly the General Sports Authority, oversees the development of sporting participation and infrastructure within the Kingdom. The ministry has been influential in the development of football’s Saudi Pro League, which has seen several high-profile transfers of top international footballers in recent years.
Sport has undergone major development in recent years. In June 2023 it was announced that an initiative led by the Public Investment Fund (PIF), the country’s sovereign wealth fund, and supported by some of the Kingdom’s largest private entities would see Saudi football teams privatised to drive investment and growth to the local league to compete internationally (see analysis). Furthermore, the MoS announced in 2022 that it had entered into an agreement with 11 other Arab countries to promote yoga participation as part of youth development schemes, in an effort to encourage healthy lifestyles for its citizens from an early age (see Health & Life Sciences chapter).
Size & Performance
The rate of growth experienced across the economy since the diversification drive began – combined with the raft of giga-projects in the pipeline (see analysis) and ongoing restructuring and privatisation efforts – is set to fuel broadbased expansion across the entertainment and tourism industries in the coming years.
Recent sector growth can be attributed to the organisational capacities of the relevant government and public sector entities, as well as the Kingdom’s substantial financial resources, which have allowed it to direct funding into targeted industries. In the entertainment sector, these resources have enabled the Kingdom to attract some of global culture and sport’s top attractions to the country in recent years. Between 2019 and the first quarter of 2023 more than 120m visitors took part in the Kingdom’s entertainment, sport and cultural offerings. Football, boxing and other sporting events, music concerts, cultural attractions and restaurant openings have helped to drive attendance.
Funding & Development Initiatives
The entertainment sector has been identified as a fertile base to expand the start-up and SME ecosystem. To foster sector growth, the GEA acts as facilitator between several local banks, financial services providers and entertainment-related SMEs. Participating financial institutions offer a range of support services that cater to specific company requirements.
The GEA’s Entertainment Accelerator Programme was outlined to key stakeholders in October 2022. The initiative comprised a boot camp, during which selected start-ups were helped to develop their ideas under guidance from the GEA and other stakeholders. Standout enterprises were selected to participate in the accelerator, which is running in two consecutive periods, with a total of 28 start-ups. The first accelerator ran during the period from March to June 2023, and the second will run between August and November 2023.
Through workshops, mentorship programmes and financing facilities, the accelerator is designed to ensure that start-ups have access to the financial backing and human resources required to develop their ideas into marketable products capable of driving entertainment sector growth in the following areas: support services, entertainment destinations, amusement parks, tech solutions, ticketing services, event organisation and crowd management, facility operation, and talent management and development.
Prior to that, in 2021 the GEA launched its Entertainment Offerings Support Programme, through which it provides support to companies to elevate the quality and maximise the reach and impact of their entertainment-related concepts and ideas. The programme took the form of a competition – structured similarly to a hackathon – where ideas were pitched and developed, and those deemed best were selected for further development. Enterprises operating in spaces such as entertainment and arts exhibitions, children’s entertainment, entertainment centres, and e-sports and e-gaming, among others, took part. The initiative was designed to provide companies with a platform to contribute to the government’s drive to boost local content creation and develop local talent. Entrepreneurship within the sector is being encouraged through the programme, and the GEA is working with the private sector to enhance investment models and frameworks.
Cinemas
The Saudi cinema industry presents solid growth potential for international investors. The Film Commission’s development strategy was launched in 2021 and has a strong focus on the cinema and film distribution segment. By mid-2021 – around three years after the sector’s April 2018 re-opening – 34 cinemas, comprising a total of 342 screens, had opened across the country, with multinational brands displaying significant appetite to capitalise on pent-up demand and facilitate investment legislation.
In January 2022 the country had 52 cinemas and 473 screens; by December of that year the number of screens had risen to more than 580, and by 2030 it is forecast to reach 2500. Furthermore, the Kingdom’s box office receipts have doubled since the post-pandemic re-opening of theatres. While several international cinema brands are planning to expand their presence in the country in 2023 and 2024, Muvi remains the current market leader. The Kingdom’s first homegrown cinema chain, Muvi was established in 2019. As of December 2022 it accounted for 21 of the country’s film theatres and 205 of its screens, distributed across 10 cities.
In addition to a number of Hollywood blockbusters enjoying success at the Saudi box office, Arabic films are proving popular with audiences. Egyptian productions accounted for 30% of box office revenue, even though they represent just 6.5% of the films released in the Kingdom. With this in mind, expanding and improving local content creation is a core focus of the aforementioned Film Commission strategy.
Industry Events
In March 2023 the GEA hosted the Middle East’s first International Entertainment Forum, in partnership with the International Association of Amusement Parks and Attractions. The event was designed to bring together global entertainment industry stakeholders, provide a platform for the Kingdom to highlight the rapid development of its entertainment sector, showcase its pipeline of mega-projects and allow local entertainment players to learn international best practices.
Broadening entertainment offerings are stimulating demand for audiovisual and professional lighting equipment. In May 2023 the Saudi Light and Sound Expo ran alongside the Saudi Entertainment and Amusement Expo – an annual event organised by private sector stakeholders – giving technology exhibitors a chance to strengthen connections with the international entertainment business community and potentially attract sizable long-term investment.
Investment & Partnerships
After a delegation of Saudi-French Business Council members met in May 2022, several major French companies involved in amusement park development, sport, e-games, entertainment cities, consulting and banking stated their intention to establish headquarters in Riyadh. This was followed up by visits from multiple other delegations of French entertainment industry stakeholders to explore the potential for long-term investment and involvement in the sector, which would allow them to capitalise on its growth potential.
Haichang Ocean Park, a major Chinese theme park operator, announced their plan to make a significant investment in the Saudi entertainment sector in April 2023, constructing an ocean theme park and developing other offerings such as water parks, wildlife parks, theme parks, entertainment centres and resorts in various locations throughout the country. Haichang stated that it planned to partner with Saudi sovereign entities to create a diverse portfolio of entertainment-related offerings, and that it was working with local stakeholders to identify suitable sites. In an indication of what Saudis and overseas tourists visiting the Kingdom might expect, Shanghai Haichang Ocean Park in China houses around 30,000 species of marine life and features shows, rides and other attractions on its 29.5-ha grounds.
Qiddiya, one of several giga-projects being developed under the banner of the PIF, which owns the full shareholding for the development, is the country’s largest dedicated entertainment development (see analysis). As one of its more than 300 attractions, Qiddiya will house a water park. In February 2022 Qiddiya Investment Company awarded an SR2.8bn ($746.5m) contract for construction of the water park to ALEC, a joint venture made up of two of the leading local engineering companies, Saudi Arabia Engineering & Contracting and El Seif Engineering Contracting. Meanwhile, Saudi engineering firm KEIR International was awarded an $18.3m contract to carry out engineering, design, electrical, communications, and civil and electromechanical works at Qiddiya. The focus on hiring local contractors aligns with the government’s goal of leveraging large developments to boost local content and fuel job creation.
Homegrown Offerings
Several cities, such as Jeddah and Riyadh, have launched a full-year calendar of events as part of the countrywide Saudi Seasons festival initiative. The programme was launched in 2019 by the then Saudi Commission for Tourism and National Heritage, along with various government authorities – including the GEA, the MoC and the MoS. Each festival is designed to celebrate and promote the distinct cultural heritage of the region it represents and feature high-profile attractions from the world of global entertainment.
The Saudi Seasons programme’s largest event, Riyadh Season, drew more than 13m visitors during its three-month schedule. The event saw 1.2m international attendees from 160 countries, and it featured 826 Saudi establishments alongside 174 international ones. The festival featured a range of international performers; major international branded events such as Cirque du Soleil, WWE, Disney on Ice and the Seasons Cup; and a showpiece football match between a Saudi all-star team and Paris Saint-Germain; among other attractions and events.
Riyadh Season 2022 saw the GEA open the Boulevard World entertainment zone in November, which was built in a record 82 days, while also achieving six Guinness World Records, including the largest manmade lagoon. A host of top international restaurants were also launched in Riyadh during the 2022 Season.
Jeddah Season 2022, which ran from May 2 to July 2, also demonstrated significant growth in attendance, attracting 6m visitors over that period. Some 80% of its workforce were Saudi nationals, another signal of how major national initiatives are being harnessed in order to drive progress on benchmark Vision 2030 objectives such as Saudiisation.
The Saudi Seasons programme provides perhaps the clearest indicator of the level of sustained demand throughout the Kingdom for diverse forms of entertainment and cultural offerings. In addition to having one of the largest populations in the region, around 50% of the Kingdom is under the age of 30 (see Country Profile). Demographic realities, alongside the government’s aforementioned aim to grow the sector to a value of SR30bn ($8bn) by 2030, present a pipeline of opportunities for private and international investment in the entertainment sector. Building on the success of Saudi Seasons, the government has announced that a number of regions will see their local festivals expanded into year-round event schedules, known as Calendars.
Both the Riyadh and Jeddah Calendars have been launched, with the 2022 programme in the capital featuring events such as Riyadh Outlet, a shopping festival through which major international and local brands offered significant discounts on merchandise, stimulating over 330,000 sales and attracting more than 180,000 attendees over its 14-day timeframe. Meanwhile, the Riyadh Homecoming Festival saw 47 events staged, attracting around 160,000 attendees.
Tailoring leisure and entertainment developments to cater for specific locations and demographics is key to the Kingdom’s approach to expanding and diversifying its entertainment and tourism industry.
In May 2023 the GEA announced the official opening of a new luxury shopping and entertainment destination in the capital, Via Riyadh, close to the Diplomatic Quarter. The Via Riyadh development includes a five-star St Regis hotel; 22 high-end retail outlets; an array of eateries, including a Michelin-star restaurant; as well as seven cinemas and a theatre.
Meanwhile, the PIF has established an entertainment-focused subsidiary, Saudi Entertainment Ventures, which in 2023 announced its intention to invest $13.3bn in installing permanent entertainment centres to highlight local culture throughout the country (see analysis). One such development has already broken ground in Tabuk. Tabuk is a key contributor to Saudi agriculture, and the project is set to house an innovative hydroponics tower attraction as a homage to the region’s history and heritage.
Outlook
In the space of just a few years Saudi Arabia has rapidly evolved to become a regional hub for entertainment activities. The growing array of investment opportunities that have emerged as a result of various large-scale developments suggests that demand growth will gain additional pace in the years ahead. Furthermore, the relevant authorities’ stated intention to increase their focus on local content creation and SME development indicates that entertainment should remain among the most dynamic areas of the economy moving forwards.
