Vision 2030: the triumph of the logistics sector in Saudi Arabia
- Government and structural initiatives
- Achievements and international recognition
- Investments and the future of the logistics sector
Saudi Arabia has demonstrated its capacity to lead logistics development, consolidating itself as a fundamental pillar within the Vision 2030 transformation agenda. This ambitious plan seeks to diversify and strengthen the Saudi economy, betting on promising sectors beyond oil.
As reported by Al Arab, in the second quarter of this year, logistics services led the growth of ten promising sectors with an impressive annual rate of 76%. This growth not only supports the national Gross Domestic Product (GDP), but also offers ample opportunities for the development of business activities and the expansion of strategic partnerships.
Government and structural initiatives
The Ministry of Commerce report, released by the Saudi Press Agency (SPA), highlights the leadership of the logistics sector, followed by artificial intelligence technologies with 53% growth and container handling services with 48%. Other sectors that showed notable growth include cloud computing, pharmaceuticals, ground transportation and the electronic games industry.
Minister of Economy and Planning Faisal Al-Ibrahim has stressed the importance of expanding non-oil activities to generate new sources of revenue. According to Al-Ibrahim, most of Saudi Arabia's recent economic growth has come from sectors developed from scratch under Vision 2030, such as sports, entertainment, tourism and industries.
As for the rest of what the country's economy could face, Fitch Solutions estimates that growth in non-oil activity will slow from 4.4% to 2.9% this year, mainly due to rising corporate borrowing and investment costs. Despite this, the development of the logistics sector enhances the country's competitiveness in the Middle East region, supported by its strategic location and efficient ports.
Achievements and international recognition
Saudi Arabia has made significant progress in international competitiveness indices. In April, it moved up 17 places in the World Bank's Logistics Index, ranking 38th out of 160 countries. This progress reflects improvements in logistics efficiency, tracking and tracing, delivery times, customs, basic infrastructure and shipping.
Furthermore, Transport Minister Saleh Al-Jasser attributes this success to structural reforms and strategic initiatives implemented by the government. In addition, the country has improved its position in UNCTAD's maritime connectivity index, reaching 71.33 points thanks to the addition of new shipping lines and services in partnership with major international companies.
Investments and the future of the logistics sector
The Ministry of Transport has launched a series of initiatives to increase logistics efficiency, restructure procedures and adopt international best practices. These initiatives include the creation of the special integrated logistics zone at King Khalid International Airport in Riyadh and the unified logistics licence to ease the working environment and streamline licensing procedures.
In February, Saudi Arabia announced its goal of doubling the logistics market by 2024, with the market size increasing from 4.5 billion to 15.2 billion dollars by the end of this year. These measures are part of a series of strategic investment initiatives launched by Crown Prince Mohammed bin Salman, which seek to transform current and future challenges into attractive opportunities.
Ultimately, the Saudi government is working to position the country in the top ten of the Logistics Performance Index by the end of the decade, consolidating its leadership in the global logistics sector.