Maersk global integrator of container logistics yesterday signed an agreement with Saudi Ports Authority committing to an investment of US$ 136 Million (510 million Saudi Riyals) over a period of 25 years to set up an Integrated Logistics Park at the Jeddah Islamic Port in Saudi Arabia.
The agreement was signed by His Excellency the President of the SPA, Mr. Omar bin Talal Hariri, and the Managing Director of Maersk Saudi Arabia, Mr. Mohammad Shihab.
The green-field project spread over an area of 205,000 sq. m. will be the first of its kind at the Jeddah Islamic Port offering an array of solutions with an aim to connect and simplify the supply chains of importers and exporters in the Kingdom, AP Moller said in a statement.
“Maersk will also be investing heavily in renewable energy to power this facility and eventually achieve carbon-neutrality. The project is expected to create more than 2,500 direct and indirect jobs in Saudi Arabia,” the statement said.
Saudi Arabia’s Vision 2030 lays great importance in capitalizing the Kingdom’s strategic location to build its role as an integral driver of international trade connecting the continents of Africa, Asia and Europe.
Vision 2030 aims at more than tripling the share of non-oil exports from Saudi Arabia from its current levels to reach 50% of its total exports. It aims at substantially raising the Kingdom’s global ranking to top 25 in Logistics Performance Index to ensure that Saudi Arabia becomes the regional leader in logistics.
Commenting on the signing of the agreement, His Excellency the Minister of Transport, Engineer Saleh bin Nasser Al-Jasser, said, “We are pleased today by the signing of this agreement, which will be a remarkable milestone in strengthening the Kingdom’s position regionally and globally and will contribute to transforming the Kingdom into a leading global center in the field of transportation and logistics services.”
He added, “The authority’s new strategy supports the maritime transport journey in the Kingdom and enables the authority to continue developing a sustainable and prosperous maritime transport system that supports the Kingdom’s social and economic ambitions and contributes to achieving the ambitious goals of Vision 2030.”
Saudi Arabia is building an innovative, digital, and technologically-advanced logistics infrastructure on the foundations of its strong network of global shipping and logistics & services to create value for customers in the region.
The strategic partnership between the authority and Maersk is an important step to achieve the Jeddah Islamic Port to become among the top ten ports in the world by 2030, with the volume of container handling reaching 18 million TEUs.
Saudi Arabia’s Jeddah Islamic Port sits strategically on the Red Sea Coast connecting the international shipping route between the east and the west. With over 5 million Twenty-feet Equivalent Units (TEUs) of containers flowing in and out of Jeddah Islamic Port, it is the largest port in terms of volume and cargo handling in Saudi Arabia and second largest in GCC (Gulf Cooperation Council) countries. Over 2.5 million TEU tranship through the Jeddah Islamic Port every year. The port also connects to hinterland through a strong road and rail network.
Maersk, announced that it will deploy state-of-the-art warehouse management system that implements modern technologies and digital solutions for efficient inventory management, track & trace at unit-level and offers rich dashboards for higher visibility and deeper insights. These systems will help in improving efficiencies and build a cost competitive edge for Maersk’s customers.
Hariri said the Kingdom enjoys an unprecedented status in the sector, ranking 16th internationally in terms of sea cargo handling according to the annual report Lloyd’s List 2021.
He added that three Saudi ports were among the 100 biggest ports in the world: Jeddah Islamic Port made a big leap to the 37th rank globally, while King Abdullah Port is placed at the 84th rank and King Abdulaziz Port at the 93rd place.
He also said that Saudi Arabia was ranked fifth among the fastest growing countries in handling container vessels according to the 2021 United Nations Conference on Trade and Development report.