Ramadan 2021 Sets Stage for Recovery of Hajj, Umrah Economies

Experts are predicting significant recovery for Hajj and Umrah businesses during Ramadan 2021, Asharq Al-Awsat
Experts are predicting significant recovery for Hajj and Umrah businesses during Ramadan 2021, Asharq Al-Awsat
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Ramadan 2021 Sets Stage for Recovery of Hajj, Umrah Economies

Experts are predicting significant recovery for Hajj and Umrah businesses during Ramadan 2021, Asharq Al-Awsat
Experts are predicting significant recovery for Hajj and Umrah businesses during Ramadan 2021, Asharq Al-Awsat

A little over a year after the coronavirus pandemic having hit markets around the world, signs of recovery are on the horizon for pilgrimage-centered economies in the Saudi cities of Makkah and Medina.

Experts are predicting a 40% recovery for Hajj and Umrah businesses during this year’s Ramadan season, which will last from mid-April to mid-May.

The number of foreign pilgrims expected to arrive in the Kingdom, which is home to Islam’s holiest sites, has increased substantially in 2021, compared to 2020.

Umrah is an Islamic pilgrimage to Makkah and Medina undertaken any time of the year. The rite attracted 19 million people in 2019.

Saudi Arabia halted the pilgrimage at the start of the pandemic in March 2020 but restarted it in limited numbers later in October.

“Although there are many precautionary measures that will limit the number of pilgrims gathering at holy sites, this Ramadan represents a vital transitional stage and tests how relevant sectors can gradually, but safely, return to working in full capacity,” said Muhammad Burhan, an active council member at the Mecca Chamber of Commerce & Industry (MCCI).

Burhan also noted that recovery in Hajj and Umrah markets is directly proportional to the rate of vaccinations introduced to potential pilgrims worldwide.

While Ramadan will slowly restore market activity in Makkah and Medina to its pre-pandemic rates, Burhan noted that the road towards full recovery will be revealed during the 2021 Hajj season, which starts in July.

Burhan also revealed that placing the pandemic under control and countries vaccinating their citizens will lead to a breakthrough that will inspire Muslims worldwide to make pilgrimage to holy sites in Saudi Arabia.

It is worth noting that the Kingdom launched its vaccine campaign in December and has administered more than four million doses so far.

More than 400 vaccination centers have opened since the nationwide campaign began with citizens and residents able to register for inoculations through the ministry’s Sehhaty app.



World Bank Warns of Long-Term Fallout from Regional Conflict

 A man walks carrying shopping bags in a local market in downtown Riyadh (AFP). 
 A man walks carrying shopping bags in a local market in downtown Riyadh (AFP). 
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World Bank Warns of Long-Term Fallout from Regional Conflict

 A man walks carrying shopping bags in a local market in downtown Riyadh (AFP). 
 A man walks carrying shopping bags in a local market in downtown Riyadh (AFP). 

Amid mounting geopolitical tensions and growing economic uncertainty, the World Bank has warned that any conflict in the Middle East, particularly between Israel and Iran, could have far-reaching and negative consequences for the region and beyond.

Speaking to Asharq Al-Awsat on the sidelines of the launch of the World Bank’s latest economic update for the Gulf Cooperation Council (GCC), Safaa El Tayeb El-Kogali, the Bank’s Regional Director for the GCC, stated: “Any conflict, especially in this region, can have long-lasting and adverse effects.” She noted that the fallout is not limited to energy markets alone, but also includes rising shipping costs, heightened inflationary pressures, and increased investor uncertainty.

While the World Bank’s latest report, which was released on June 1, does not reflect the most recent escalation in the region, El-Kogali emphasized that it is “still too early to fully assess the impact of the ongoing conflict.” She warned, however, that in such volatile conditions, investors tend to adopt a “wait-and-see” approach, delaying decisions until clarity and stability return.

Despite challenges in the energy market, El-Kogali highlighted the resilience of the Gulf economies, thanks to sustained efforts toward economic diversification. In 2024, while the oil sector contracted by 3% due to OPEC+ production cuts, non-oil sectors grew by 3.7%, helping drive overall GDP growth to 1.8% — a notable recovery from 0.3% in 2023.

The World Bank projects the GCC economies will grow by 3.2% in 2025 and 4.5% in 2026, supported by easing oil production cuts and continued strength in non-oil sectors. However, El-Kogali stressed that these projections remain vulnerable to global trade volatility, oil price swings, and the evolving regional security landscape.

To mitigate risks, she urged Gulf countries to accelerate structural reforms, reduce dependency on oil, and boost intra-regional trade. Growth, she added, will also benefit from steady contributions from exports, investment, and domestic consumption.

El-Kogali emphasized that short-term risks include reduced export demand, oil market fluctuations, and regional instability affecting tourism and investor sentiment. Over the long term, threats such as low productivity growth, slow economic transformation, and over-reliance on fossil fuels could hinder progress.

She concluded by recommending fiscal diversification, tax reforms, and stronger regional trade links to create more resilient and adaptive Gulf economies.