As Saudi pumps $133bn into global hub dream, is it now logistics-washing?

Source: The Loadstar 
Date: 20th November 2023

Saudi Arabia has captured headlines with its multi-billion-dollar patronage of football, golf and boxing – which critics dismiss as sports-washing, designed to deflect attention from the country’s appalling record on human rights.

But what has often been overlooked is that the desert kingdom is also pumping an estimated $133bn into logistics infrastructure and freight handling capacity as it seeks to diversify its economy and increase non-oil GDP.

It’s aim is to become not only a regional, but a global logistics powerhouse, Dubai having had that field to itself for so long.

Large-scale projects are in the offing in the maritime sector to upgrade ports and terminals – and to develop new gateways and introduce new trade routes. The aim is to more than quadruple the country’s annual container throughput, to 40m teu, by 2030.

And the country’s rail network will be expanded considerably, linking Saudi’s Red Sea and Arabian Gulf ports, while there is a target to double air cargo capacity to at least 4.5m tonnes.

Riyadh Airport is to be transformed into a massive aviation hub, with six parallel runways and a ‘Special Integrated Logistics Zone’ covering some three million sq metres. A new national airline, Riyadh Air, is headquartered there.

Saudi Arabia has also unveiled a ‘Master Logistics Centres Plan’ to boost local, regional, and inter-continental connectivity for international trade networks and global supply chains. Approximately 40 logistics centres will be built, covering an area exceeding 100 million sq metres, around half that number presently exist, up from only two in 2020.

“Saudi Arabia has the resources and ambition to become a major regional and global hub over the next decade – a conduit for trade between some of the fastest-growing markets in Asia and Africa, as well as serving the rest of the Middle East and parts of Europe”, said the CEO of research consultancy Transport Intelligence.

“Its large domestic and export market will give it an advantage over other hub ports in the region which focus largely of transhipments.”

It is undergoing a profound transformation, marked by remarkable and rapid progress. From both a social and economic perspective, this transition has been nothing short of astonishing, at least in my view.

Saudi Arabia’s strategic access to the Red Sea and its proximity to Africa are set to be major advantages.

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