The Saudi Ports Authority (Mawani) and AlJeri Logistic Service Company signed two agreements on August 14, 2024, to establish new logistics zones at Jeddah Islamic Port and King Abdulaziz Port in Dammam, with a combined investment of SAR160 million. The agreements were signed by Mawani President Omar Hariri and AlJeri Investment Vice Chairman Khaled Al Qahtani in the presence of other key officials. The new zones, spanning a total area of 150,000 square meters, are set to enhance port efficiency, facilitate trade, and strengthen supply chains in line with the Kingdom’s National Transport and Logistics Strategy.
Context and Background
Saudi Arabia has been actively advancing its logistics infrastructure as part of its Vision 2030 objectives to diversify the economy and become a global logistics hub. The National Transport and Logistics Strategy, a cornerstone of this vision, aims to elevate the Kingdom’s ranking in the Logistics Performance Index and increase the sector’s contribution to the national GDP. Mawani, responsible for the management and development of Saudi ports, has been at the forefront of these efforts, signing multiple agreements this year to develop over 600,000 square meters of logistics space at Jeddah Islamic Port, with investments totaling SAR675 million. Additionally, a 100,000-square-meter logistics zone is already under development at King Abdulaziz Port in Dammam. These initiatives reflect a broader push to attract foreign and domestic investment, improve operational efficiency, and integrate advanced technologies into port operations.
Key Details
The two agreements, signed by Omar Hariri, President of Mawani, and Khaled Al Qahtani, Vice Chairman of AlJeri Investment, will see the creation of state-of-the-art logistics zones at two of Saudi Arabia’s most vital ports. The zones will cover 150,000 square meters and are expected to significantly boost commercial activities by streamlining stakeholder requirements and leveraging AlJeri’s 35 years of experience in the logistics sector. According to a Mawani press release, the partnership aims to enhance logistics services at the Kingdom’s ports, bolster operational capabilities, and facilitate trade flows. The total investment of SAR160 million underscores the private sector’s confidence in Saudi Arabia’s logistics potential and the government’s commitment to fostering a business-friendly environment.
Implications and Impact
The establishment of these logistics zones is poised to have a positive impact on Saudi Arabia’s trade ecosystem and its position in global supply chains. By improving port efficiency and reducing bottlenecks, the new facilities will enable faster movement of goods, lower costs for businesses, and ultimately benefit consumers. This development also aligns with the Kingdom’s efforts to diversify its economy away from oil dependency, as logistics is a key non-oil sector targeted for growth. Furthermore, the partnership with AlJeri highlights the increasing role of the private sector in driving infrastructure projects, a trend that is expected to accelerate under Vision 2030. Regionally, the enhanced capabilities at Jeddah Islamic Port and King Abdulaziz Port will strengthen Saudi Arabia’s competitiveness as a trade gateway for the Middle East and beyond, potentially capturing a larger share of transshipment traffic between Asia, Europe, and Africa.
Vision 2030 Alignment
This agreement is a concrete step toward realizing Saudi Arabia’s Vision 2030 goal of transforming the Kingdom into a global logistics hub. By expanding logistics infrastructure and fostering strategic partnerships, Mawani is contributing to the National Transport and Logistics Strategy’s objectives of increasing port capacity, improving service quality, and attracting investment. As Saudi Arabia continues to invest in its ports and logistics sector, it is not only enhancing its economic resilience but also reinforcing its role as a pivotal player in global trade. The successful implementation of these projects will bring the Kingdom closer to its ambition of ranking among the top 10 countries in the Logistics Performance Index and achieving sustainable, diversified growth for future generations.
20 Questions
Q1. What did Mawani and AlJeri sign agreements for?
A1. Mawani and AlJeri signed two agreements to establish new logistics zones at Jeddah Islamic Port and King Abdulaziz Port in Dammam, with a total investment of SAR160 million.
Q2. Who signed the agreements on behalf of Mawani and AlJeri?
A2. The agreements were signed by Omar Hariri, President of Mawani, and Khaled Al Qahtani, Vice Chairman of AlJeri Investment, in the presence of other key officials.
Q3. What is the total investment value of the agreements?
A3. The total investment value is SAR160 million, which will be used to develop the logistics zones at the two ports.
Q4. What is the combined area of the new logistics zones?
A4. The new logistics zones will cover a combined area of 150,000 square meters, providing ample space for logistics operations.
Q5. Which ports will host the new logistics zones?
A5. The logistics zones will be established at Jeddah Islamic Port and King Abdulaziz Port in Dammam, two of Saudi Arabia’s major ports.
Q6. What is the expected benefit of these logistics zones?
A6. The zones are expected to enhance port efficiency, facilitate trade, strengthen supply chains, and bolster commercial activities at the Kingdom’s ports.
Q7. How does this development align with Saudi Arabia’s national strategy?
A7. It aligns with the National Transport and Logistics Strategy’s goal of positioning Saudi Arabia as a global logistics hub and supporting Vision 2030.
Q8. What experience does AlJeri bring to the partnership?
A8. AlJeri brings 35 years of experience in the logistics sector, which will be leveraged to enhance logistics services and operational capabilities.
Q9. What other investments has Mawani made this year?
A9. Mawani has signed agreements to develop over 600,000 square meters of logistics space at Jeddah Islamic Port, with a total investment of SAR675 million.
Q10. Is there any other logistics zone under development?
A10. Yes, a 100,000-square-meter logistics zone is currently under development at King Abdulaziz Port in Dammam.
Q11. What is Mawani’s role in Saudi Arabia?
A11. Mawani, the Saudi Ports Authority, is responsible for managing and developing the Kingdom’s ports to support trade and economic growth.
Q12. How will these zones impact trade in Saudi Arabia?
A12. They will streamline stakeholder requirements, reduce bottlenecks, and facilitate smoother trade flows, enhancing Saudi Arabia’s competitiveness as a trade hub.
Q13. What is the significance of the private sector in this project?
A13. The partnership with AlJeri highlights the private sector’s growing role in infrastructure development, a key aspect of Vision 2030.
Q14. What is the National Transport and Logistics Strategy?
A14. It is a comprehensive strategy aimed at making Saudi Arabia a global logistics hub, improving port efficiency, and increasing the sector’s contribution to GDP.
Q15. How does this project contribute to Vision 2030?
A15. It supports economic diversification, attracts investment, and enhances Saudi Arabia’s position as a global logistics leader, aligning with Vision 2030 objectives.
Q16. What benefits will the logistics zones bring to the local economy?
A16. They will create jobs, stimulate commercial activities, and improve supply chain efficiency, contributing to overall economic growth.
Q17. Are there any environmental considerations in the development?
A17. Mawani is committed to sustainable development, and the logistics zones will be designed to meet environmental standards and support green initiatives.
Q18. How will these zones improve supply chains?
A18. By providing modern infrastructure and efficient services, the zones will reduce delays, lower costs, and enhance the reliability of supply chains.
Q19. What is the expected timeline for the completion of these zones?
A19. Mawani has not specified a timeline, but such projects typically take 12-24 months to complete after signing.
Q20. How does this agreement reflect on Saudi Arabia’s global standing?
A20. It demonstrates Saudi Arabia’s attractiveness to investors and its commitment to becoming a leading global logistics hub, enhancing its international reputation.
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