Saudi Arabia: $2.4 Bn Contracts to Develop Jeddah Islamic Port
The Saudi Ports Authority (Mawani) signed $2.4 billion build, operate, and transfer (BOT) contracts with global port operator DP World and regional port operator the Red Sea Gateway Terminal (RSGT) to develop and operate container terminals and use Jeddah Islamic Port as a regional hub for transshipment.
The contract is over 30 years and aims to transform the port into a logistics hub that provides services to over 500 million consumers in the region.
Speaking at the signing ceremony, Saudi Minister of Transport and Mawani's Chairman of the Board, Saleh al-Jasser stated that the agreements with DP World and RSGT are part of the Ministry and Authority's strategic plan to transform Saudi Arabia into a vibrant trading hub in the region.
Jasser spoke of the importance of increasing the capacity of Saudi ports by strengthening partnerships with the local and global private sector, providing the latest operating systems aligned with global standards, and accelerating the import and export ecosystem.
Also at the ceremony, Mawani President Saad al-Khalb noted that Mawani aims to strengthen public-private partnership in line with Vision 2030.
Khalb also indicated that the authority wants to increase private sector investment in long-term contracts to advance operational efficiency of infrastructure and optimize the benefit from investments.
It also plans to increase the share of the private sector in Saudi ports to 70 percent by 2020.
For his part, DP World Group CEO Sultan Ahmed bin Sulayem announced that DP World is honored to support Vision 2030 to transform the country into a global logistics hub.
He indicated that DP’s investment in Jeddah South Container terminal will result in greater direct and indirect job creation and deliver efficiency and productivity to the Port's operations.
The CEO added that the strategic partnership with Mawani and the Ministry of Transport and National Centre for Privatisation will help develop the Kingdom's trade ecosystem while enhancing the nation's competitiveness.
“Our ambition is to develop inland connectivity across the Arabian Peninsula between Jeddah and Jebel Ali Port in Dubai, as well as to Saudi Arabia's cities through smart technology-led logistics, which should support further growth in this strategic hub that connects East-to-West.”
Established in 1976, the Jeddah Islamic Port is on the Red Sea and the largest port in Saudi Arabia with annual volumes of over 6 million TEU's. The Port currently handles approximately 60 percent of the country's sea-imports and is a strategic hub that connects East-West cargo.
The new terminal will also have an upgraded capacity of 3.6mn TEU up from 2.4mn TEU, to meet the expected growth demands of the future, and will provide 1,400 jobs.