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MAWANI, Bahri Sign Deal to Establish Logistics Zone in Western Saudi Arabia

MAWANI has agreed on a long-term deal with shipping giant Bahri to build and operate an integrated logistics park on land leased at the Jeddah Islamic Port. (Asharq Al-Awsat)
MAWANI has agreed on a long-term deal with shipping giant Bahri to build and operate an integrated logistics park on land leased at the Jeddah Islamic Port. (Asharq Al-Awsat)
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MAWANI, Bahri Sign Deal to Establish Logistics Zone in Western Saudi Arabia

MAWANI has agreed on a long-term deal with shipping giant Bahri to build and operate an integrated logistics park on land leased at the Jeddah Islamic Port. (Asharq Al-Awsat)
MAWANI has agreed on a long-term deal with shipping giant Bahri to build and operate an integrated logistics park on land leased at the Jeddah Islamic Port. (Asharq Al-Awsat)

The Saudi Ports Authority (MAWANI) has agreed on a long-term deal with shipping giant Bahri to build and operate an integrated logistics park on land leased at the Jeddah Islamic Port.

The agreement was signed Tuesday by President of MAWANI Omar Talal Hariri and Bahri CEO Abdullah Ali Aldubaikhi, in the presence of senior officials from both sides.

Hariri stated that launching this project forms a core part of the initiatives to achieve the objectives of the National Transportation and Logistics Strategy (NTLS), which envisions setting up similar logistics zones within and beyond Saudi ports.

He noted that it aims to empower the Kingdom’s bid to become a global logistics hub and provide world-class logistics services to accelerate economic development and enable overall transformation in line with Vision 2030.

Aldubaikhi expressed his delight at signing the deal, which is expected to boost his company’s partnership with MAWANI in the pursuit of developing the Kingdom’s logistics services and consolidating its stature as a global hub that links three continents.

“Leveraging Jeddah Islamic Port’s strategic location, this agreement will further expand Bahri’s import, transport, distribution, and storage capabilities and help the company raise the level of its services according to international standards,” said the CEO.

“We constantly strive to be a responsible business that builds sustainable capabilities and offers solutions that meet the exact needs of our partners.”

Bahri will manage operations at the state-of-the-art facility for a duration of 20 years.

The logistics zone will provide storage and handling services for all types of inbound and outbound shipping containers owned by Bahri and other entities.

It will be capable of storing reefer, insulated, and dry containers with services like container maintenance and repair, container cleaning, bonded storage, and haulage available to clients at any given point.

Jeddah Islamic Port leads the Kingdom’s ports in terms of imports and exports, besides being a Red Sea re-export hub as 75 percent of the total incoming trade and transshipment traffic at Saudi ports takes place through this important trade gateway.

The Port is equipped with 62 berths and four terminals, and MAWANI is all geared in its drive to position it amongst the top ten globally.

Efforts are underway to expand the Port’s capacity and upgrade its operations with the help of development projects and concessions.

A recent concession worth SR9 billion was awarded to DP World for 30 years to improve the operational efficiency of the Port’s container terminals and raise its capacity by 70 percent to handle more than 13 million units.

MAWANI signed a similar deal with Maersk Saudi Arabia to establish an integrated logistics park at the Jeddah Islamic Port.

The park is set to be the company’s largest in the Middle East and enhance the Port’s exceptional operational capabilities and value-added services.

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Israel’s ‘Economic War’ Chokes Occupied West Bank

Palestinians queue to withdraw money from an ATM in the main market in Ramallah city in the Israel-occupied West Bank on June 9, 2024.
Palestinians queue to withdraw money from an ATM in the main market in Ramallah city in the Israel-occupied West Bank on June 9, 2024.
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Israel’s ‘Economic War’ Chokes Occupied West Bank

Palestinians queue to withdraw money from an ATM in the main market in Ramallah city in the Israel-occupied West Bank on June 9, 2024.
Palestinians queue to withdraw money from an ATM in the main market in Ramallah city in the Israel-occupied West Bank on June 9, 2024.

Palestinian teenagers bounced on trampolines and jumped through hoops inside a towering tent on the outskirts of Ramallah, the financial hub of the occupied West Bank.

But the circus students weren't the only ones bending over backwards in the pavilion: the school's director faced financial hurdles to buy the tent from Europe and trampolines from Asia.

"We are suffering with international payments," said Mohamad Rabah, head of the Palestinian Circus School, describing a bureaucratic process that could delay equipment delivery by up to a month.

Banking in the Palestinian territories is challenging, with the Palestinian Authority (PA) under scrutiny for potential terror financing, hindering transactions.

Israel has occupied the West Bank since 1967, with strong economic ties allowing two Israeli lenders to serve as correspondent banks in the Palestinian territory.

But this may change if Israel's far-right Finance Minister Bezalel Smotrich carries out threats to sever a vital banking route next month.

Since Hamas's October 7 attack triggered the Gaza war, Israel has imposed economic curbs on the PA, withholding tax revenues it collects on its behalf.

Smotrich said this week he had redirected $35 million in PA tax revenues to families of "terrorism" victims, a move condemned by the United States.

After three European countries recognized Palestinian statehood in May, Smotrich told Prime Minister Benjamin Netanyahu he would not extend indemnity to banks that transfer the funds from the end of June.

Israel's Bank Hapoalim and Israel Discount Bank need protection, expiring on July 1, to avoid sanctions for dealing with Palestinian lenders.

Israel's central bank and finance ministry declined to comment when contacted by AFP.

A Palestinian fruit vendor arranges his street cart in the main market in Ramallah city in the Israel-occupied West Bank on June 9, 2024. (AFP)

- 'Humanitarian crisis' -

The banking channel used to pay for West Bank imports -- including essential goods like water, fuel and food -- handles $8 billion yearly.

Palestinian businesses receive nearly $1.7 billion annually for exports, according to the Palestine Monetary Authority.

"For us, because our economy is dependent on the Israeli economy, because Israel is controlling the border, the impact will be high," said PMA governor Feras Milhem.

The Palestinian economy is largely governed by the 1994 Paris Protocol, which granted sole control over the territories' borders to Israel, including the right to collect import duties and value-added tax for the PA.

Palestinian livelihoods have also been hurt by bans on laborers crossing into Israel and by a sharp downturn in tourism in the territory, including a quiet Christmas season in Bethlehem.

The United States has urged Israel to improve conditions, warning that severing the banking route would have a dire impact on the West Bank economy.

"I believe it would create a humanitarian crisis in due course if Palestinian banks are cut off from Israeli correspondence," US Treasury Secretary Janet Yellen said last month.

Western governments fear Israel's economic policies could destabilize the West Bank.

"The banking system may collapse and therefore the PA may collapse as well," a European diplomatic source in Jerusalem told AFP on condition of anonymity.

"The PA is in a financial crisis and it could collapse before August."

A Palestinian vendor unloads his stock in front of a shop in the main market in Ramallah city in the Israel-occupied West Bank on June 9, 2024. (AFP)

- Digital currency -

Palestinian businessmen say their bottom lines have been hit since October 7.

Imad Rabah, who owns a plastics company, said his net income had fallen 50 percent in one year.

Musa Shamieh, who owns a womenswear company said the Israeli policies were designed to push Palestinians to leave the West Bank.

"They want us to leave our land and they know it will be hard for us to stay if we can't do business," Shamieh said.

Israel's harsh economic policies could eventually drive Palestinian policymakers to pursue sweeping changes to the monetary system.

"We need to work on a plan B when it comes to the trade relations," said Milhem, governor of the PMA, which uses an image of the former Palestinian pound as its logo.

Yousef Daoud, professor at the West Bank's Birzeit University, said the territory could scrap the shekel as its de facto currency in favor of a digital alternative.

"We can make our e-currency, just collect all the shekels, issue an equivalent amount of Palestinian pounds, one-to-one fixed exchange rate, and have the Palestinians deal with e-currency," he said.

"Somehow, eventually, we'll get rid of the shekel."