Struggling Beirut businesses are hopeful that Saudi tourists will return after Riyadh lifted travel warning for Lebanon.

Beirut, Lebanon – Tucked in a market square in downtown Beirut, the Paname Cafe caters to those with a taste for luxury.

A large modern art sculpture sits in the centre of the square, with benches around the sides where customers can relax in the sunshine.

But the cafe, and much of the upscale neighbourhood, which was resurrected under a multibillion-dollar project for high-end tourism and residences after the civil war in Lebanon ended, often feels deserted.

A sharp decline in tourist traffic triggered by the war in neighbouring Syria and the travel warnings by Gulf countries that came with it has weighed on businesses in downtown Beirut and across the country for years.

But a new era may be dawning. Earlier this month, Saudi Arabia announced it is lifting its eight year travel warning for Lebanon. The decision has brought a renewed sense of optimism to downtown Beirut.

“I worked at Phoenicia hotel earlier and I know Saudis like to stay there because they like gold-plated decor,” Wissam Merhi, operations manager for the Paname Cafe, told Al Jazeera.

“Downtown is perfect for those who seek luxury. I am sure they will come here too and enable many shops to start and others to reopen,” he added.

In another block of the capital’s downtown area, around the famed Al-Abed clock tower and among several shuttered shops, Shireen Aabdi and her friend Nancy Abou Tarek puff on an argeelah; a flavoured water pipe.

Nancy, left, and Shireen enjoying an argeelah in downtown Beirut [Anchal Vohra/Al Jazeera]

Aabdi said that whatever the Saudis might be trying to achieve by lifting the travel warning, there was no harm in them coming to Lebanon for a bit of fun.

“They can neither drink alcohol, nor visit night clubs in their country,” Aabdi told Al Jazeera. “And no girls,” she giggled. “They come here to have a good time.”

Tarek approves of it because of the prospect of Saudi money supporting Lebanese businessmen.

“It will help tourism, that is good news for all of Lebanon,” she said.

Spending big bucks

Lebanon suffered a precipitous drop in the number of Saudi tourists over the last eight years, with visitor numbers falling from 190,000 in 2010 to a quarter of that by 2018, according to Lebanon’s tourism ministry.

Jean Beyrouthi, secretary general of the federation of touristic unions in Lebanon, said the trend was a blow to tourist-dependent businesses because Saudis take relatively longer vacations, opt for expensive hotels and restaurants, and spend “big bucks”.

“The Saudis come for the summers and lavishly spend which is great for the tourism industry,” Beyrouthi told Al Jazeera. “They own massive properties at the seaside and in the mountains, and that helps real estate. When they stopped coming, many people lost livelihoods.”

Al-Abed clock tower in downtown Beirut is surrounded by shuttered shops [Anchal Vohra/Al Jazeera]

Beyrouthi added that the governments of the United Arab Emirates, Bahrain and other Gulf states may follow Saudi Arabia’s lead and lift travel warnings on Lebanon, in place since 2012.

Travel and tourism is a mainstay of Lebanon’s economy, accounting for 18.4 percent of economic growth in 2017, and supporting 365,500 jobs. The country recorded 1.8 million tourist arrivals in 2017, still shy of the record 2 million in 2010, before the war in Syria and travel advisories started taking a toll on the sector.

While some are hopeful the Saudi decision could bring more deep-pocketed tourists and investment to reinvigorate Lebanon’s slumping real estate sector, others are more circumspect.

Naseeb Ghobril, head of the economic research and analysis department at Byblos Bank, warned that Saudi tourists have found other holiday destinations over the past eight years, such as Turkey, Malaysia, Indonesia and Morocco, and may not flock back to Lebanon en masse.

The return of foreign investment to the tourism sector is also not a given. According to World Bank’s 2019 Ease of Doing Business survey, Lebanon is ranked at the 75th place.

“Credible and concrete reforms to improve the investment climate are the only way to attract investments from GCC countries and from other sources,” Ghobril told Al Jazeera.

Resetting relations?

Walid Al Bukhari, the Saudi ambassador to Lebanon, said that the kingdom had received the required security assurances from the Lebanese government and no longer saw the travel warning as a necessity.

Saudi officials cited improved security and assurances from the Lebanese government as reasons for its policy change. But experts said that it was taken to undo the damage of its previous policies in Lebanon.

They said Saudi Arabia was changing tack more than a year after it strong-armed Lebanese Prime Minister Saad Hariri to resign whilst in Riyadh. Purportedly, that was an attempt to contain the growth of Hezbollah, a dominant political and armed group backed by regional rival Iran.

The move backfired. Not only did the Saudis receive widespread condemnation for what many in Lebanon termed the high-handedness of the newly anointed Crown Prince Mohammed bin Salman, it also turned the public mood in Lebanon against the Saudis.

The Lebanese hung posters across their cities accusing the Saudis of holding their prime minister captive.

Hariri returned to Lebanon after French mediation and rescinded his resignation. However, it was not he, Lebanon’s leading Sunni politician who is also a Saudi citizen, but Hezbollah which emerged stronger and gained a majority in the parliament along with its allies in the elections held in May.

A different approach

Thanassis Cambanis, the author of a book on Hezbollah and a senior fellow at The Century Foundation, said that the Saudi leadership seemed to be acknowledging that they could not simply “order” regional allies around.

“It seems that Saudi Arabia has decided not to cut ties with Lebanon and with the Sunni politicians that it sponsors, a break that seemed a very real possibility after Mohammed bin Salman’s attempt to fire Saad Hariri as prime minister of Lebanon.

“The new generation of Saudi leadership is learning, slowly, that other nations have sovereignty and that it can’t deal with other countries in the region simply as enemies or vassals,” Cambanis said.

The Saudi announcement, made a few days after Iran’s Foreign Minister Javed Zarif met Hezbollah’s chief Hassan Nasrallah in Lebanon and a few weeks after Qatar pledged aid worth $500m.

As tensions between Sunni Saudi Arabia and Shia Iran intensified, Lebanon became a concourse for their rivalry. Lebanese do not typically like to talk about the sectarian differences strengthened by regional powers. But even among friends enjoying the Argeelah, they don’t stay concealed for long.

Minutes after Aabdi and Tarek hailed the Saudi decision, the clash was evident.

Aabdi, a Sunni, did not see a negative side to the return of Saudi tourists. Tarek, a Shia, said that many people in her community opposed their presence as that would mean eventually politically conceding space to Saudi demands.

“Many Shia do not want Saudis in Lebanon because they support Israel, are against us and want Hezbollah to give up its weapons,” Tarek said.

Meanwhile, cafe manager Wissam Merhi sees no reason to place politics above business.

“Lebanon is safe for tourists. It is the media and political groups who make it unwelcoming but everything is fine here,” he said.