Kingdom agrees to buy $7bn in precision munitions from US firms

RIYADH: Saudi Arabia aims to start issuing tourist visas to foreigners next year, a senior Saudi official told CNN, as the government seeks to open up the conservative kingdom and find new sources of revenue to diversify its economy.

DUBAI: Saudi Arabia aims to start issuing tourist visas to foreigners next year, a senior Saudi official told CNN, as the government seeks to open up the conservative kingdom and find new sources of revenue to diversify its economy. At present, foreigners travelling to Saudi Arabia are largely restricted to resident workers and their dependents, business travellers, and Muslim pilgrims who are given special visas to travel to holy sites.

"The targets are people who want to come and literally experience this country, and really the grandness of this country," Prince Sultan bin Salman bin Abdulaziz, head of the Saudi Commission for Tourism and Natural Heritage, said in an interview broadcast late on Wednesday.

Asked about plans for the visas, he replied: "Hopefully in 2018," adding that the government would use online technology to make applying for visas easy. Saudi Arabia's 32-year-old heir to the throne, Crown Prince Mohammed bin Salman, is seeking to develop new industries to wean his country off its dependency on oil exports. He has also taken some steps to loosen its ultra-strict social restrictions, scaling back the role of religious morality police and announcing plans to allowing women to drive next year.

Plans to admit significant numbers of tourists from abroad have been discussed for years, only to be blocked by conservative opinion and bureaucracy; the commission announced such a plan as long ago as 2006, but it did not go ahead.

This time, the government appears determined to push through the change, partly because of financial pressures. It hopes to earn billions of dollars to cover a state budget deficit caused by low oil prices. Economic reforms aim to lift total tourism spending in the country - by local citizens as well as foreigners - to $46.6 billion in 2020 from $27.9 billion in 2015. Prince Sultan said his commission was focusing mainly on increasing numbers of local tourists. The commission has estimated Saudis spend more than $20 billion annually on tourism abroad, and persuading more of them to holiday inside the country would reduce that drain on the economy.

But Prince Sultan told CNN that his commission was also working to prepare tourist spots for foreigners. The government announced plans in August to develop resorts on about 50 islands off the Red Sea coast, with the first phase of the project to be completed in 2022.

The kingdom also intends to offer visits to historic sites such as Mada'in Saleh, a 2,000-year-old Nabatean city carved into the rocks of the northern desert.

Heir to the throne Prince Mohammed would be the first ruler from a new generation since 1953, after six kings who were all sons of state founder Abdulaziz ibn Saud.

He has announced wide plans for social and political reforms to the kingdom, which is ruled as an absolute monarchy with a powerful clergy that adheres to Wahhabism, an ultra-austere version of Sunni Islam.

Weapons sale

Saudi Arabia has agreed to buy about $7 billion worth of precision guided munitions from US defense contractors, sources familiar with the matter said.

Raytheon Co and Boeing Co are the companies selected, the sources said, in a deal that was part of a $110 billion weapons agreement that coincided with President Donald Trump's visit to Saudi Arabia in May. Both companies declined comment on the weapons sale.

Arms sales to the kingdom and other Gulf Cooperation Council member states have become increasingly contentious in the US Congress, which must approve such sales. The US State Department has yet to formally notify Congress of the precision guided munitions deal.

"We do not comment to confirm or deny sales until they are formally notified to Congress," a State Department official said, adding the US government will take into account factors "including regional balance and human rights as well as the impact on the US defense industrial base."

Saudi Arabia has either denied attacks or cited the presence of fighters in the targeted areas and has said it has tried to reduce civilian casualties.

Saudi Arabia's Ambassador to Washington, Prince Khalid bin Salman declined to comment on the specific sale, but said in a statement his country will follow through on the agreements signed during Trump's visit. He said that while the kingdom has always chosen the United States for weapons purchases, "... Saudi Arabia's market selection remains a choice and is committed to defending its security."

Trump, a Republican who views weapons sales as a way to create jobs in the United States, has announced billions of dollars in arms sales since taking office in January.

A US government official who spoke on condition of anonymity said the agreement is designed to cover a 10-year period and it could be years before actual transfers of weapons take place.

The agreement could be held up in Congress, where Bob Corker, the Republican chairman of the Senate Foreign Relations Committee, announced in June that he would block arms sales to Saudi Arabia, the United Arab Emirates and other members of the GCC, over a dispute with Qatar, another US ally in the Gulf.

In November 2016, the administration of President Barack Obama, a Democrat, halted the sale of $1.29 billion worth of precision guided weapons because of concerns about the extent of civilian casualties in Yemen. That sale process started in 2015 and included more than 8,000 Laser Guided Bombs for the Royal Saudi Air Force. The package also included more than 10,000 general purpose bombs, and more than 5,000 tail kits used to inexpensively convert "dumb" bombs into laser or GPS-guided weapons. -- Reuters