$20 billion.. Gains of new airline to GDP in Saudi Arabia

Saudi Crown Prince Mohammed bin Salman announced the establishment of a new national airline.

The company to be established is Riyadh Airlines, and it will be headed by Tony Douglas, as the Kingdom is heading to compete with regional transport and travel hubs.

The official Saudi Press Agency said that Riyadh Airlines will serve more than 100 destinations around the world by 2030, taking advantage of the Kingdom’s location between Asia, Africa and Europe.

$20 billion

   The new airline is expected to add $20 billion to Saudi Arabia's non-oil GDP growth and create more than 200,000 jobs directly and indirectly.

competition with airlines in the region

The announcement could lead to an even tougher battle for passengers, as they go head-to-head with regional giants Emirates Airlines, Qatar Airways and Turkish Airlines as the travel industry recovers from the pandemic.

Saudi Arabia's sovereign wealth fund

Riyadh Air is wholly owned by Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), which owns more than $600 billion in assets and is the main driver of the kingdom's efforts to diversify its economy and wean itself off oil.

 Saudi Arabia was last October in advanced negotiations to order nearly 40 A350s from Airbus, and Boeing has also pressed for a slice of the kingdom's transport expansion.

The head of state-owned Saudi Arabian Airlines told Reuters at the time that it was in talks with Boeing and Airbus about orders for it and a planned new carrier.

Boeing commercial jets

The Wall Street Journal reported Saturday, citing people familiar with the matter, that Saudi Arabia's Public Investment Fund is close to closing a deal to buy Boeing commercial jets for the fleet of a new national airline.

$35 billion

The value of the aircraft order is $35 billion, the report said, adding that the deal may be announced as soon as Sunday during the official launch of the national airline.

The report added that the deal includes wide-body aircraft that are often used on long-haul international flights.