LOGISTICS

SAUDI AIMS TO MAKE LOGISTICS PIPE DREAM A REALITY

The Saudi government recently launched the National Transport and Logistics Strategy (NTLS) as part of its overarching plan to emerge as a regional and global business hub.

The strategy aims to boost the kingdom’s position as a global logistics hub connecting three continents by upgrading all forms of transport services and strengthening the integration of logistical services and future technologies in the country.

“This strategy will contribute to advancing technical capabilities and human capital in the Transport and Logistics Sector, it will invest our country’s strategic position at the heart of three continents, further concreting our integral part of global economies; by creating advanced logistical industries, ensuring high quality services and applying competitive business models, we will strengthen productivity and sustainability in the logistics sector,” said Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince, deputy prime minister, chairman of the Council of Economic and Development Affairs, and chairman of the Higher Committee for Transport and Logistics.

“Being a key pillar of Vision 2030 and an enabling sector for industries the transport and logistics sector, the strategy aims to diversify our economy and achieve sustainable development.”

The NTLS strategy aims to make Saudi Arabia the fifth air transit passenger hub in the world. It will boost the country’s international destination network to 250, launch a new national carrier, as well as double the air cargo capacity to more than 4.5 million tonnes.

“We set a target to achieve an annual container capacity of over 40 million containers, including the associated value chain investments, in developing ports’ infrastructure, enhancing integration with logistics zones, expanding connectivity with international shipping routes and integrating this all with rail and road networks,” the Crown Prince noted. “By enhancing the entire value chain, we ensure the effectiveness and efficiency of the transport ecosystem and its economics.”

The kingdom’s current railway network is also expected to expand to more than 8,000 kilometres, from its current level of 5,330 kilometres.

The new links will include the 1,300-kilometre flagship “Land Bridge” project, which will be able to handle more than 3 million passengers, 50 million tonnes of cargo per annum, while also connecting the kingdom’s ports from the Arabian Gulf to the Red Sea.

The strategy will enhance the Saudi Arabia’s logistic performance index to be among the top 10 countries globally, significantly contributing to the regional goal of achieving a railway network connectivity between Arabian Gulf Countries, and positioning the kingdom as a key regional and global transportation axis, according to the Crown Prince.

The NTLS strategy boasts several key strategic pillars, including the kingdom’s major road networks, ensuring efficient connectivity and public transportation services, and reducing fuel consumption by 25% to develop a sustainable industry.

These developments will also boost transport and logistics contribution to the country’s GDP from 6% to 10%, and generate non-oil revenues of SAR 45 billion by 2030.

SEA LOGISTICS

As part of the broad effort to boost the kingdom’s logistics sector, the Saudi Ports Authority (Mawani) announced that it has collaborated with the Ministry of Transport and Logistic Services (MOTLS) and the National Center for Privatization & PPP (NCP), as well as partnered with the private sector, in launching investment opportunities that will develop and operate multi-purpose terminals in eight Saudi ports.

“The promising opportunities are represented in build-operate-transfer (BOT) structure for terminals in each of Jeddah Islamic Port, King Abdulaziz Port in Dammam, Ras Al-Khair Port, Jizan Port, Yanbu Commercial Port, King Fahad Industrial Port in Jubail, King Fahad Industrial Port in Yanbu, and Jubail Commercial Port, equipping the ports to serve various functions including containers, general cargo, bulk cargo, RoRo cargo, passengers, and livestock,” Mawani said.

In its expression of interest (EoI) document, Mawani noted that a number of existing concession contracts at its ports, are expiring over the next two years.

“Mawani aims to re-enter into new long-term concessions with the private sector for the priority concessions, through a competitive procurement process.”

Companies that are interested in investing in the sector are invited to submit their expressions of interest. This will be followed by a request for quote (RFQ) with the aim to pre-qualify a shortlist of bidders.

Mawani also mentioned that it had adopted a similar strategy successfully at Jeddah Islamic Port and King Abdulaziz Port Dammam, where revised commercial and contractual regimes were adopted, taking into consideration the kingdom’s overarching ambition for its logistics sector.

“Mawani now intends to continue this successful journey with the competitive procurement of the projects,” the company said.