$266bn logistics hub spend starts in Saudi Arabia

Reuters/Ahmed Yosri

• SAR200bn already spent
• Rail network growth cuts CO2
• Plan to make region a global hub

The first phase of a planned $266 billion budget to turn Saudi Arabia into a global logistics hub has already “drastically” reduced carbon emissions, a government minister has revealed.

“The national transport and logistics strategy launched in mid-2021 is set to invest more than a trillion riyals [$266 billion] by 2030, of which 200 billion riyals have already been deployed,” Saudi Arabia’s transport and logistics minister, Saleh Al-Jasser, told a logistics forum in Riyadh. 

“Last year alone, using the Saudi rail network, the equivalent of one million truck journeys were eliminated from our roads, drastically reducing carbon emissions,” he said. 

Saudi Arabia wants to become the Middle East’s main logistics centre. It launched a national logistics plan last year for 59 logistics centres, and is also investing huge amounts in ports, rail and aviation. 

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“We are at the forefront of global trade through cutting-edge infrastructure such as King Salman International Airport, which is set to be one of the world’s largest, and building state of the art seaports and doubling the length of our rail network. Saudi Arabia is creating the future,” Al-Jasser said. 

Agility Public Warehousing, the Kuwait-headquartered logistics company, announced on Monday that it was planning to invest SAR250 million expanding its warehousing facilities in Riyadh.

Agility Logistics Parks will add 100,000 square metres of space, increasing its total size to 551,000 sqm, and the new space will be operational by the first quarter of 2025, the company said in a filing on the Dubai stock exchange.

King Salman International Airport Development Company, a subsidiary of Saudi Arabia’s Public Investment Fund (PIF), has been tasked with completing a new airport by 2030 that will be home to the new national airline Riyadh Air, also owned by PIF. 

Future policy

Saudi Arabia plans for tourism to account for 10 percent of GDP by 2030, and the government believes that Riyadh could receive 40 million visitors during the World Expo 2030, which will run from October 2030 to April 2031 in the Saudi capital. 

However, investment minister Khalid al-Falih said future Saudi policy would be to cooperate with regional partners to make the region as a whole a global logistics hub. 

Al-Falih said: “Globalisation has been good to humanity, it’s been good to the global economy and it’s not going away, but it’s going to evolve into more of a regional multi-hub type logistics and transport system. 

“The Middle East is at the centre of it. We’re going to create our own regional logistics hub. There will be rapid acceleration.”