Saudi Arabia has unveiled an ambitious plan to end its oil dependence – by transforming itself into a regional logistics hub.
According to supply chain expert Samer Almadhoun, the country’s Vision 2030 involves a slew of social and economic policies that will end the Middle Eastern kingdom’s oil dependence.
The brainchild of crown prince Mohammed bin Salman, commonly referred to as MbS, Vision 2030 postulates that delivering a thriving economy starts with the creation of a logistics hub.
According to Almadhoun the idea is to leverage its geographic location and move Saudi Arabia from its current 49th spot on the global logistics ranking to that of 25 internationally and first regionally.
The first step in this plan, explained Almadhoun, was transforming customs operations.
“Looking at customs they have reduced the paperwork so that now only 12 documents are required to export and two to import. They have implemented an electronic system across the board and everything is now done digitally, while customs is also operating 24 hours a day, seven days a week, which means goods are cleared in hours or a day or two at most.”
Customs trade partnerships have been introduced and seven free trade zones are being developed. Investments in ports, roads and airports had also been significantly increased, said Almadhoun.
“Jeddah was ranked the worst airport in the world. It is being revamped completely and the new airport is nearly 80% complete. The new Riyadh airport will be operational this year,” he said. “The country also decided to allow the private sector to manage and run the airports rather than keeping them in state hands.”
This, he said, was impacting positively on operations. “The expectation is that the kingdom will increase its total air cargo capacity from the current 0.8 million tons per year to 6.8 million by 2030.” Another exciting project being planned was the building of a bridge across the Red Sea which would link Africa and the Middle East, he added.
“At least 13% of world trade passes through the Red Sea and Saudi Arabia benefits zero from that,” said Almadhoun.
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The idea is to move Saudi Arabia from 49th in the global logistics rankings to 25 internationally and first regionally. – Samer Almadhoun
