Saudis attend a competition of short films in October in Riyadh. The rare movie night was a precursor to a lifting of the kingdom’s ban on cinemas. (Fayez Nureldine/AFP/Getty Images)

Saudi Arabia said Monday that it would allow cinemas to operate in the strictly conservative kingdom for the first time in decades, in the latest sign of a broader government push to relax some social restrictions.

In a statement, the Saudi Ministry of Culture and Information said the process of licensing commercial movie theaters — banned since the early 1980s — was underway and the first theaters would open early next year.

The move is part of a social and economic reform program led by Saudi Arabia’s 32-year-old Crown Prince Mohammed bin Salman, who is increasingly at the helm of the kingdom’s planning even though his father, King Salman, remains the ultimate authority.

Under the crown prince, officials have recently announced they would end a ban on women driving, allow public concerts and curb the authority of “religious police” tasked with enforcing the country’s strict social codes.

But Saudi Arabia has also arrested hundreds of business executives, princes and former government officials as part of an anti-corruption drive that also appeared aimed at consolidating the crown prince’s authority as well as filling the state’s coffers.

While the changes have been broadly welcomed by young Saudis as long overdue, they have risked angering ultraconservatives, including powerful clerics who give the monarchy legitimacy to rule over Islam’s holiest sites.

The limits of the crown prince’s reforms reflect this delicate balancing act. So far, the social shifts have not included any broadening of political freedoms in Saudi Arabia or the repeal of “guardianship” laws that require women to gain the consent of a male relative to travel abroad or work.

Yet the arrests over the last few months have included some influential clerics as well as government opponents — suggesting the crown prince could be testing how much the religious establishment will push back.

The emerging model in Saudi Arabia — of diversifying the economy and encouraging social reforms, rather than political liberalization — follows the example of the United Arab Emirates, a neighboring state that has emerged as the Saudi leadership’s closest regional ally. Still, Saudi Arabia is unlikely to follow the UAE in allowing the consumption of alcohol and free mingling of genders, for instance.

Awwad Alawwad, the Saudi minister of culture and information, called the return of movie theaters “a watershed moment in the development of the cultural economy of the kingdom,” according to the government statement.

The opening of cinemas also clears the way for a potentially huge market for foreign investors, according to John Fithian, president of the Washington-based National Association for Theater Owners, which led a delegation that met with Saudi officials before the announcement Monday.

“This could be a billion-dollar market down the road” and employ more than 20,000 people, Fithian said in an interview last week. Companies from the United Arab Emirates as well as the United States were bidding for a slice of the anticipated windfall, he said.

But there are also regulatory and logistical issues ahead. They include how strictly men and women would be segregated in the new theaters, and what kind of films would be permitted. The Saudi authorities heavily censor film content on TV, including love scenes, women’s bodies or scenes that depict alcohol or drug use.

Saudi officials have also discussed plans to better support the kingdom's indigenous film industry. Saudi filmmakers have produced several critically acclaimed features in recent years, including the feature-length "Wadjda," but they have been overshadowed by more seasoned and better-supported regional competitors, including Egyptian, Palestinian and Iranian filmmakers.

Saudi filmmakers have faced special challenges because of society's red lines as well as fuzzy regulations governing their profession. Sources of funding have also remained a concern. A member of the Saudi royal family, Prince Alwaleed bin Talal, a billionaire investor who had shown an interest in local filmmaking and was a producer of "Wadjda," was one of the business executives arrested during the anti-corruption sweep in November.

The Saudi announcement said the country seeks to have more than 300 cinemas in operation by 2030 — a target date for many of the crown prince’s reform plans that include efforts to move the Saudi economy away from its dependence on oil revenue.

Brian Murphy in Washington contributed to this report.

Read more: