Saudi Arabia’s Ministry of Transport & Logistics Services (MOTLS) has laid out an ambitious strategy to grow the kingdom’s logistics sector market size to SR57.4 billion ($15.31 billion) by 2030 and position it as a global logistics hub.
In October 2022, The Crown Prince Mohammed bin Salman had launched the Global Supply Chain Resilience Initiative (GSCRI) to attract local and international investments in the supply chain sector. Aiming to raise SR40 billion ($10.64 billion) in its first two years, the initiative has set SR10 billion in financial and non-financial incentives for investors.
Saudi Arabia has been on the fast track to shift its economy away from oil and build a more diverse and holistic economic ecosystem. Currently, the logistics sector contributes 6% of the KSA GDP and is projected to contribute 10% by 2030, that is, around SR20.1 billion.
59 logistics zones
Boosting its cargo capacity and bolstering supply chains further, the kingdom announced the launch of 59 logistics zones by 2030, 21 of which are already operational. The country also inaugurated its first Special Integrated Logistics Zone at King Khalid International Airport, Riyadh.
The measures are part of the infrastructure development strategy and aim to fuel business growth, attract investment, and increase the sector’s non-oil revenue to about SR45 billion a year by 2030.
In line with the Vision 2030 objective of transforming the kingdom into a leading industrial powerhouse and global logistics hub, the strategy aims to develop the kingdom's transport and logistics sector and address the increasing global demand for logistics services.
Ever since, the sector has witnessed unprecedented growth and progress, making its mark on the global logistics industry, a direct outcome of the continuous efforts by MOTLS. In the recently released Logistics Performance Index 2023 (LPI) recently published by the World Bank, Saudi Arabia made significant progress, moving up 17 ranks to achieve 38th position, from 55th in 2018.
To bolster the kingdom’s efforts in this direction, The Crown Prince has launched comprehensive programmes focused on different aspects of the sector. The National Transport and Logistics Strategy (NTLS) was launched in 2021 with the aim to strengthen human and technical capabilities in the transport and logistics sector in the kingdom.
Earlier in 2019, the National Industrial Development and Logistics Programme (NIDLP) was launched to build the country’s industrial and logistical capabilities and position it as a global leader in the industry.
Global logistics hub
The programmes aspire to position the kingdom as a global logistics hub. With a unique geographical location, connecting three continents: Europe, Asia, and Africa, the country is in an advantageous position to become the gateway facilitating easy trade and movement of goods across continents. Located on the Asia-Europe trade route, the country already hosts 12% of the global container trade passes annually.
Vision 2030 is the roadmap to building a globalised country with sustainable progress. “Transport and logistics are the backbone of any economy, and our aim is to develop the sector, build connectivity and enhance our global competitiveness as a country. We are putting all our weight into developing internal and external supply chains and streamlining processes to the best international standards to provide world-class infrastructure and services. Our focus is on opening Saudi to the world with a multitude of opportunities,” the ministry said.
Pushing toward a fast-paced transformation, the kingdom has earmarked milestones for the rail, road, maritime, and aviation sectors. The largest and most populous GCC nation, the kingdom also aims to create over two hundred thousand jobs in the sector by 2030.
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