Key studies have identified the need to diversify the Kingdom of Saudi Arabia economy beyond its heavily oil-based status if it is to attain long-term sustainable growth. Tourism, in particular religious tourism, has been recognised as one key non-tradable sector that could promote this growth. This paper applies a time series approach to examine the impact of the tourism industry on the economic prosperity of the Kingdom between 1970 and 2011. The results show that tourism only plays a minor role in improving economic growth when the economy as a whole is taken into consideration. However, when isolating the non-oil sectors, the impact of tourism could be seen to have a greater influence on economic growth. Tourism is therefore potentially important for any future diversification of the economy from growth.

Key studies have identified the need to study the role of sovereign debt on economic growth, particularly in relation to countries with heavily oilbased status economies. This paper applies a panel vector autoregressive approach to examine the impact of sovereign debt on economic prosperity in several oil-rich countries between 2002 and 2017. The results show that in oil countries, like other developing countries, government debt has not had a positive impact on enhancing economic growth, resulting in a reluctance of such countries to invest debts in production, and a desire for the type of diversification of sources of income observable in most advanced countries.

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