We know that Saudi Arabia is investing a lot of money to build its non-religious tourism sector. One common question we’ve seen has been if/when the country will lift its ban on alcohol. As of now, there has seemingly not been much movement when it comes to alcohol for visitors. That being said, the country has just quietly expanded alcohol sales in a pretty major way.
Saudi Arabia now sells alcohol to wealthy expats
Bloomberg is reporting that Saudi Arabia has quietly expanded alcohol sales within the country in a material way. As a reminder, the country has banned alcohol for over 70 years, with very limited exceptions.
In 2024, we saw the introduction of an alcohol store in Riyadh, though it was initially exclusively open to foreign diplomats, with strict limits on how much they can purchase. Access to this has now been expanded to non-Muslim foreigners with “premium residency” status, which is generally given to educated foreigners who work for major corporations in the country. Having the visa requires spending at least 30 months over the past five years in the country (so at least half of your time).
Furthermore, there’s an income requirement, as the store is only open to those earning at least 50,000 riyals per month, equivalent to roughly $13,300 (and apparently a salary certificate has to be shown when registering to visit the store, in order to prove this).
Access to the store requires making reservations, and there’s a points-based system that limits how much total alcohol can be purchased.
Interestingly, there has been no official announcement from the country about this change, probably by design. Reports suggest that more of these stores are expected to open in the near future, including in other major cities in Saudi Arabia.
It’s only a matter of time before alcohol sales expand
While Saudi Arabia is starting slow, it’s pretty clear the direction the country is headed when it comes to selling alcohol. It was already a big move when the country started selling alcohol to diplomats. Now selling alcohol to rich foreigners is a pretty major development. I’d argue that the next step in all of this is also pretty obvious…
Ever since Saudi Arabia announced its lofty tourism ambitions, I’ve been curious to see how long it would take for the country to lift its ban on alcohol. To me, it’s a question of “when,” and not “if,” and one of the major tests of seeing how serious Saudi Arabia is about its ambitions.
People can debate all day long whether society is too dependent on alcohol, etc., but the point is that if you’re looking to attract visitors from around the globe as a leisure destination, alcohol in at least some venues is an expectation. Saudi Arabia has very ambitious tourism goals, and one of (several) reasons that some people don’t want to visit the country is because of the alcohol ban.
If you’re trying to gain market share in an industry (in this case Middle Eastern tourism), you have to look at what successful competitors are doing. There’s no better example of this than Dubai, which isn’t exactly a conservative place nowadays. Keep in mind that Saudi Arabia and Kuwait are the only two countries in the region that have a full-on ban on alcohol consumption for visitors.
Bottom line
Saudi Arabia is expanding alcohol sales. In 2024, the country set up a store selling alcohol in Riyadh, but it was limited to foreign diplomats. Now the store has quietly also opened up to wealthy foreigners on eligible visas.
It’s only a matter of time before alcohol sales expand to tourists (at least in some regions), if Saudi Arabia is serious about building this industry. I’m just curious if we’re talking months or years before those rules change…
When do you make of Saudi Arabia loosening alcohol restrictions, and when do you think we’ll see a more widespread policy change?
