How Transport and Logistics Sector is Evolving in Saudi Arabia?

Saudi Arabia's Vision for the Transport and Logistics Sector

Saudi Arabia is transforming its economy with the National Strategy for Transport and Logistics Services, a key part of Vision 2030. This initiative aims to improve all modes of transportation, including air, sea, land, and rail, to rank among the top 10 in the Logistics Performance Index by 2030.

By leveraging its strategic location between Asia, Africa, and Europe, Saudi Arabia seeks to diversify its economy through advanced logistics services. This includes implementing high-quality systems and competitive business models to boost productivity and sustainability.

Key Features of Saudi Arabia’s Logistics Sector

Saudi Arabia’s logistics sector is crucial due to its strategic location on major global trade routes. The Ministry of Transport and Logistics focuses on enhancing exports, increasing investments, and fostering partnerships with the private sector.

Located on the Arabian Gulf and the Red Sea, Saudi Arabia is a vital global trade hub, connecting markets of over 6 billion people. The Kingdom has improved its logistics efficiency, as seen in its rise in the World Bank’s Logistics Performance Index, supported by projects like the Al-Khamra Logistics Zone.

Master Plan for Logistics Growth

Saudi Arabia’s master plan aims to enhance the logistics sector significantly. It includes creating logistics zones to boost exports, re-exports, and e-commerce, and to facilitate trade through land ports. Key targets include increasing re-export revenues from 42 billion riyals ($11.2 billion) to 520 billion riyals ($138.65 billion) and growing export figures from 185 billion riyals ($49.33 billion) to 507 billion riyals ($135.18 billion).

By 2030, the Kingdom plans to establish 59 logistics centres across the country, with 21 currently under construction. These centres will be strategically located in regions like Riyadh, Makkah, and the Eastern region, showing Saudi Arabia’s commitment to becoming a logistics powerhouse.

Special Economic Zones and Their Benefits

Saudi Arabia is boosting its logistics sector by establishing special economic zones with unique incentives to drive economic growth and global trade. These zones are key to connecting the Kingdom more closely to the global economy.

Integrated Logistics Bonded Zone (ILBZ): Located in Riyadh, ILBZ offers incentives such as 100% foreign ownership, full capital repatriation, a 50-year tax holiday, and suspension of customs and import restrictions.
King Abdullah Economic City (KAEC) SEZ: Near Jeddah, KAEC is a hub for advanced manufacturing and logistics, with access to global trade routes and a skilled workforce.
Jazan SEZ: Leveraging Saudi Arabia’s mineral and industrial resources, Jazan SEZ is a trade hub with access to expanding markets in Africa and Asia.

Unified Logistics License

Saudi Arabia’s unified logistics license simplifies logistics activities by consolidating them into a single license for land, air, and sea freight services. This initiative supports over 1,500 logistics companies globally and aligns with the Fasah e-system in Saudi customs.

The unified logistics license streamlines procedures, enhancing logistics performance and creating investment opportunities that strengthen the local economy and its global integration.

Partner with Northman & Sterling

Northman & Sterling offers complete support for companies entering Saudi Arabia’s transport and logistics sector. We simplify the licensing process and provide post-incorporation support to help businesses thrive. With expertise in local market dynamics and regulations, Northman & Sterling is your trusted partner in navigating Saudi Arabia’s evolving transport and logistics landscape.