Apple heads list of key investors in Saudi’s cargo logistics zone

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• US tech giant signs up for Riyadh’s Special Integrated Logistics Zone
• ‘Tax holidays and exemptions, relaxed Saudisation’ among incentives
• Zone is part of Vision 2030 plan to raise cargo capacity to 4.5m tonnes

Apple will be one of the global anchor investors in Saudi Arabia’s special logistics zone – part of the kingdom’s plan to more than quadruple the amount of cargo processed through its airports by 2030.

The Special Integrated Logistics Zone was launched on Monday by Saudi Arabia’s General Authority for Civil Aviation (GACA).

The zone measures 3 million square metres, within the parameters of King Khalid International Airport in Riyadh. If there is sufficient demand from investors, the facility can be doubled in size.

Apple – which vies with Saudi oil giant Aramco for the title of the world’s largest company by market capitalisation – will be one of the global giants that operates from the new zone.

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“[The zone] has a very generous incentive scheme in terms of tax holidays and exemptions, relaxed Saudisation law and other incentives that are in place,” Mohammed Alkhuraisi, vice president of strategy and business intelligence at the GACA, told AGBI.

Earlier this summer, the authority reported that it was planning a series of global roadshows to attract large companies to set up cargo operations in the kingdom. Bloomberg reported that brands such as Amazon, Alibaba and DHL were among the types of companies it was looking to attract.

“The zone is not targeting small and medium enterprises. This is targeting the top 100 leading companies within the supply chain,” Alkhuraisi said. He added that it covers multiple sectors, including pharmaceuticals, consumer products, electronics, luxury and aerospace.

Saleh bin Nasser Al Jasser, Saudi Arabia’s minister of transport and logistics, said the zone would “strengthen Saudi Arabia’s position as the largest, fastest-growing market and leading strategic trading nation in the Middle East”.

One of the aims of Saudi Arabia’s Vision 2030 is to transform the kingdom’s aviation and logistics sector, increasing annual cargo capacity from around 1 million tons to 4.5 million tons by the end of this decade.

Riyadh has also set itself a target of boosting the transport and logistics sector’s contribution to national GDP from the current 6 percent to 10 percent, helping to boost the sector’s non-oil revenues to about SAR 45 billion ($12 billion) a year by 2030. 

Some of the incentives on offer to attract foreign logistics companies to the zone include value-added tax advantages on servicing, manufacturing and assembly, the offer of 100 percent foreign ownership and faster certification and permit procedures.

There will also be cost reductions for multinationals and their third-party suppliers who reassemble products in the zone for onward sale in Saudi Arabia and the wider Middle East.