Saudi's ambitious plan to become a top global logistics hub

Saudi has ambitions to become a global logistics hub with plans to establish 59 logistics zones, create 200,000 jobs, and increase GDP contribution to 10%

Not a day goes by without Saudi Arabia announcing a new strategy or goal, in its bid to become an economic powerhouse.

Led by Vision 2030, an ambitious plan to transform Saudi into a more diversified country and create jobs for nationals, the Kingdom is already seeing its strategies deliver.

Take tourism. With plans to become one of the world’s top 10 tourism hotspots, the country recently ranked as the second fastest-growing destination for tourism globally, with international tourists surging 64% in the first quarter of 2023, compared to 2019.

In Artificial Intelligence too, Saudi is looking to lead. And the Kingdom recently ranked first globally in government strategy for AI.

Now, Saudi is looking to logistics as its latest strategy to power economic growth.

It makes sense, of course, given the country’s unique geographical location, connecting three continents (Europe, Asia and Africa). Saudi already handles 12% of the global container trade passing annually, with logistics contributing 6% to the country’s GDP.

Plans to establish 59 logistics zones

But the ambitious Kingdom is looking to grow this contribution to 10% by 2030 and to become a top 10 global hub for logistics.

To do this, they have announced a strategy to establish 59 logistics zones by 2030, and to target the creation of more than 200,000 jobs in the logistics sector by 2030.

At a recent reception hosted by the Saudi Transport General Authority in London, Dr Al Rumaih, the Deputy Minister of Transport and Logistic Services, revealed plans to increase port capacity to more than 40 million containers.

“Our aim by 2030 is to be among the top ten countries in the Logistics Performance Index,” Al Rumaih said.

Saudi currently ranks 38th among 160 countries, having recently jumped 17 spots, thanks to progress made in its national strategy.

Dr Al Rumaih, the Deputy Minister of Transport and Logistic Services

The Ministry of Transport & Logistics Services (MOTLS) has set an ambitious strategy to strengthen the Kingdom’s logistics capabilities and grow its market size to US$15.31 billion by 2030.

Among initiatives designed to reach this goal, the recently launched Global Supply Chain Resilience Initiative (GXCRI) aims to attract both local and international investments to the Kingdom’s logistics and supply chain sectors – with massive incentives totalling US$2.6 billion to lure investors.

Plans also include the launch of 59 logistics zones throughout the Kingdom, with 21 of them already operational. Saudi has also inaugurated its first Special Integrated Logistics Zone at King Khalid International Airport in Riyadh.

Oxagon – Port of NEOM

One such hub is the recently opened Oxagon, Port of NEOM, Saudi’s mega port, which is “pivotal to the continued commercial competitiveness, economic diversification and maritime trade ambitions of the Kingdom”, NEOM CEO Nadhmi Al Nasr said.

The business end of the Saudi giga project, NEOM, Oxagon aims to establish its position as one of the world’s most tech-advanced, efficient and sustainable ports with the first fully integrated and automated supply chain and logistics network.

Located on the trade route which runs through the Suez Canal (13% of global trade moves through the Suez Canal), Oxagon is not only a critical enabler to the ambitions of NEOM, but a blueprint of how future logistics hubs can be – with its clean energy, carbon neutrality, waste management and IoT practices.

According to the port’s MD Sean Kelly, the Port of NEOM will be a “critical enabler to the overall build, operations and economic ambit5ions of NEOM

Given its location at the crossroads of global trading routes on the Red Sea, the port is expected to be a “critical enabler” for Neom – Saudi’s gigacity.

“The Port of Neom will be pivotal to the continued commercial competitiveness, economic diversification and maritime trade ambitions of the Kingdom,” said Al Nasr.


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