Introduction:

Since the launch of Saudi Arabia's Vision 2030, the Kingdom has witnessed remarkable progress and unprecedented prosperity across various fields, including industry, trade, and technology. Tangible achievements have also been made in human capital development, transportation services, public investments, and national transformation initiatives. The future is unfolding before us, promising the tomorrow we have always dreamed of, as the Kingdom takes its rightful place among the world's nations, proudly raising the banner of progress and innovation in the Middle East and the Gulf region.

The vision included specific plans to follow and pathways paved with clear strategies and realistic planning, guiding all participants in this vision and those aspiring for a brighter future. It was built on 11 programs with defined frameworks and focused themes, spanning diverse sectors such as finance, healthcare, housing, public investments, national transformation, industry, and logistics. These programs also extend to human capital development, quality of life, and serving the Guests of the Holy Mosques.

The work on these programs is progressing at full speed, with coordinated efforts to achieve the vision and witness its results across all fields within the specified timeframe—if not sooner. Since the vision’s launch in 2016, remarkable achievements have reshaped life in the Kingdom, leaving an impact felt by everyone, near and far.

In this article, we will illuminate one of the pathways within these programs to explore it in greater depth and share the latest developments it has undergone since its launch in 2019. Today’s focus is on the National Industrial Development and Logistics Program, specifically the logistics services pathway. Let’s delve into its progress and achievements.

National Logistics Sector Strategy for the Kingdom

God has blessed Saudi Arabia with numerous gifts, among them its strategic location at the crossroads of three key continents: Africa, Asia, and Europe. This prime position has linked the Kingdom to global trade and transport networks, facilitating the flow of goods, enabling smoother trade exchanges, and expanding job creation opportunities. It was both expected and essential for the Kingdom to channel its efforts toward maximizing the benefits of this advantage. With its potential to connect markets encompassing over 6 billion people, the logistics sector naturally claimed its rightful place among the Vision 2030 programs.

The master plan for logistics centers aims to develop Saudi Arabia’s infrastructure, diversify the local economy, and strengthen the Kingdom’s position as a leading investment destination and a global logistics hub. It encompasses all aspects of managing the flow of goods and resources from production to consumption, including import and export activities, facilitating transportation and shipping, enhancing infrastructure, managing packaging and warehousing operations, and leveraging modern technologies to streamline and digitize processes. The plan includes 59 logistics centers spanning over 100 million square meters across various regions of the Kingdom, with all centers set for completion by 2030.

The National Logistics Sector Strategy prioritizes the integration of maritime, land, and air logistics within the Kingdom. A substantial budget of 1 trillion SAR has been allocated to implement and advance this strategy. The strategy equally emphasizes three key directions:

1. Maritime Sector:

The maritime sector plan focuses on developing the Kingdom's ports to expand their capacity and maximize their potential. This plan is built on three core pillars:

• Establishing a New Business Model: Introducing a private sector-led model to drive investments into ports. This involves contracts known as privatization or concession agreements, where private entities handle expansion, operational management, and development of port operations.

• Creating Logistic Centers, Villages, and Cities: Developing logistical hubs connected to ports, designed to serve as storage and distribution zones. These centers facilitate sorting, packaging, and the subsequent reshipping of goods both domestically and internationally.

• Enhancing Connectivity with Global Ports: Strengthening links with international ports through maritime navigation points. Connections have already been established with Africa, Europe, the Indian subcontinent, and approximately 31 maritime routes, boosting the capacity for container imports and exports.

2. Land Sector:

The land sector development plan places significant emphasis on the railway network, with 5,000 kilometers of tracks already completed across the Kingdom. The plan aims to double this figure in the coming years. Among the most prominent and ambitious railway projects are:

• The East Train: This state-of-the-art project is the largest modern land transportation initiative. It connects the Eastern Region to Riyadh, passing through Jeddah, Rabigh, and Yanbu. By linking the Eastern Region to the Western Region, it facilitates the transportation of goods from Dammam Port to Jubail Port and onwards to the western parts of the Kingdom, supporting domestic economic activity and enhancing connections with the African continent.

• Wa’ad Al Shamal to Jubail Rail Link: The rail line connecting Waad Al-Shamal to Jubail links the phosphate and bauxite mines in the Waad Al-Shamal region to the industrial areas and factories in Jubail and Ras Al-Khair. This connection enhances the efficient transportation of natural resources and supports economic activity in these regions.

3. Aviation Sector:

The Kingdom's aviation strategy focuses on developing and increasing the capacity of its airports, enhancing the passenger experience, driving investments, and boosting tourism. Saudi Arabia’s strategic location enables connections to over 250 global destinations through its 29 airports. The strategy aims to Increase the number of annual passengers to 300 million by 2030. Expand air freight capacity to 4.5 million tons annually. Attract over $100 billion in investments from both the public and private sectors.

Progress toward these goals has been swift, with notable successes already achieved. A prime example is Prince Mohammed bin Abdulaziz International Airport in Madinah. Since its first operational year, the airport has reported profits under its investment model and consistently maintained high-performance levels according to airport performance reports.

The second phase of its development is now underway, aiming to: Increase the airport’s capacity from 8 million to 17 million passengers annually. Add a new passenger terminal capable of accommodating 4 million passengers annually by 2027. The total cost of this expansion is estimated at 1.125 billion SAR. It promises to further enhance the airport’s contribution to the Kingdom’s aviation goals.

Local logistics development and investment will inevitably reflect on the global logistics landscape. Achieving the Kingdom's aspiration to become a global logistics hub requires meticulous attention to supply chain management, transportation, infrastructure, and operations such as packaging and warehousing. Additionally, connecting with global external points is essential to fully realizing the comprehensive concept of logistics. This begins with the initial stages, including manufacturing, mining, or importation, followed by packaging, warehousing, and managing shipping processes, and finally, ensuring goods reach the consumer, whether within the Kingdom or internationally.

Key Achievements in the Logistics Sector

The dedicated efforts of both the public and private sectors have resulted in tangible achievements that Saudi citizens have witnessed in recent years. These accomplishments serve as evidence of the Kingdom’s meticulous planning and the steady progress of its logistics strategy. Below are some of the most notable milestones:

1- Saudi Arabia rose to 15th globally in container handling according to the “Lloyd’s List” 2024 report.

2- A comprehensive Port Community System was introduced, offering more than 250 electronic services across Saudi ports under the Ports Authority.

3- Saudi Arabia won the bid to host the UNCTAD Global Forum for Supply Chains in 2026 and successfully listed Jeddah Islamic Port on the London Metal Exchange (LME).

4- Numerous partnership agreements were signed with international ports and national entities from both the public and private sectors to enhance human resource development and operational efficiency. Key collaborators include: The Ministry of Transport and Logistics Services, Zakat, Tax and Customs Authority, Saudi Railway Company (SAR), Saudi Logistics Academy, British Classification Authority, Pacific International Lines, Hamburg Port and Consulting Company, Reviva and Marseille Fos Port.

5- AI technologies are being deployed for smart transportation, data analysis, inventory management, and decision-making optimization. Blockchain is utilized to reduce paperwork, enable secure data sharing, and automate operations through smart contracts, fostering trust among stakeholders.

6- Saudi aviation ranked 13th globally in the 2023 Air Connectivity Index issued by the International Air Transport Association (IATA).

7- The Kingdom ranked 1st globally in the Road Network Connectivity Index in 2019 and 23rd globally for the largest road networks.

8- King Abdullah Port recognized as the world’s fastest-growing port in 2022 and ranked 16th globally for container handling in 2023.

9- Three Saudi ports were listed among the top 20 globally in the 2021 Container Performance Index.

10- The Kingdom inaugurated the first hydrogen train in the Middle East and North Africa.

11- Electric buses were introduced for the first time in three Saudi cities.

12- The first self-driving bus was launched in Saudi Arabia.

13- Drones are now used to monitor bus movement patterns, reflecting advanced operational management.