Saudi Arabia leverages its strategic position to expand transport infrastructure

 

The transport and logistics sector in Saudi Arabia has been targeted for key milestones, in accordance with Vision 2030, the Kingdom’s ambitious development plan to diversify the economy, grow the non-oil sector and leverage the country’s traditional position as a crossroads for international trade. While the Covid-19 pandemic is expected to have a profound impact on the broader economy, as well as the trade and transport sectors particularly, long-term development plans have, and continue to, guide important developments in the sector in terms of growth-enabling infrastructure.

All international flights to and from the Kingdom were suspended on March 15,2020, while on March 16 restrictions were put in place regarding attending work, shopping and public gatherings, with exceptions for medical or security staff, pharmacies or grocery stores. Visitors are also being prevented from entering the capital Riyadh and the holy cities of Makkah and Medina as of April 1, while officials have cancelled the Umrah, which was scheduled to take place in July and August.

Looking ahead, once normal travel resumes, passengers arriving in Jeddah will fly into the newly opened Terminal 1 at King Abdulaziz International Airport (KAIA). From there, high-speed trains will transport passengers to Jeddah and between the holy cities of Makkah and Medina. This is in addition to upgrades at Jeddah Islamic Port (JIP), a six-line metro system in Riyadh and double-digit growth in internal air passenger numbers, which prompted four Saudi airlines to order aircraft for their fleet. The government’s vision is for both domestic and international transport to play a key role in the diversification and modernisation of the economy.

Structure & Oversight

Established in 1953, the Ministry of Transport (MoT) is tasked with overseeing all aspects of transport in the Kingdom, including roads, rail and marine ports. In October 2019 Saleh bin Nasser Al Jasser was appointed as the new minister of transport to steer the department through the next phase of development in accordance with broader Vision 2030 diversification goals.

Recent years have seen a streamlining of the governing structure, with the General Authority of Civil Aviation (GACA) and the Saudi Railway Company (SAR) coming under the umbrella of the MoT, alongside the Saudi Ports Authority (SPA) and the Public Transport Authority. A multi-agency approach has been adopted, and the MoT has been working closely with Saudi Customs and other agencies to achieve results. Another key government agency working across sectors is the National Project Management, Operation and Maintenance Organisation (Mashroat), which was created in August 2017 to serve as a centralised pool of knowledge and expertise to assist with the delivery of major infrastructure developments.

Vision Realisation

Vision 2030 was launched in 2016 with specific performance indicators for individual ministries declared under various Vision Realisation Programmes (VRPs). The most relevant to the transport sector are the National Transformation Programme (NTP), which was established to guide development of the required infrastructure to meet Vision 2030 goals; and the National Industrial Development and Logistics Programme (NIDLP), which is focused on four keys sectors – industry, mining, energy and logistics – to transform the Kingdom into a leading industrial power and global logistics platform. Government planners acknowledged that given the scale, ambition and complexity of Vision 2030, progress towards objectives would be regularly reviewed, assessed, reappraised and organised under a succession of interim plans.

In 2018 the Council of Economic and Development Affairs reformed the VRPs and the objectives of the NTP and NIDLP were adapted. Under the revised NTP, a number of transport initiatives were launched with a focus on improving road safety, urban road networks, traffic-management systems and public transport networks. A specific target was set to reduce the number of road accident fatalities from 26 per 100,000 people in 2016 to 20 by end-2020.

Regarding the revised NIDLP, the logistics component focuses on creating an export platform, developing regional distribution, and establishing an efficient internal logistics network to enable the development of industry and supply chains. According to the NIDLP, in the decade to 2018 Saudi Arabia spent more than SR400bn ($106.6bn) on the transport and logistics sector, developing new road infrastructure, ports, railways and airports. Vision 2030 objectives are mapped onto the NIDLP with specific relevance for the MoT. These include creating logistics hubs and enhancing existing facilities; boosting local, regional and international connectivity; and developing trade and transport networks. The overarching target is to increase the value of Saudi Arabia’s annual exports to SR1trn ($266.6bn) by 2030 and optimise the Kingdom’s strategic location at the crossroads of global trade.

Global Rankings

Additional NIDLP targets included improving Saudi Arabia’s ranking on the World Bank’s Logistics Performance Index (LPI) from 55th out of 163 countries in 2016 to 25th place. At that time, the relatively lower scores for Customs handling, logistics quality and timeliness weighed on Saudi Arabia’s overall rank. While it placed 58th on the 2018 LPI, a number of recent changes will likely see its place move up on the 2020 index. Indeed, Saudi Arabia was recognised as the most improved economy in the World Bank’s “Doing Business 2020” report, due to wide-ranging reforms in eight areas, including trade across borders (see analysis). “With regards to the LPI, Saudi Arabia has made tremendous efforts in recent years to boost efficiency and smooth processes,” Mohammed Al Bayati, CEO at supply chain solutions provider Naqel Express, told OBG. “One of the most prominent achievements was the issuance of the new Customs clearance guide, which authorises firms to issue clearance licences.”

The World Economic Forum’s “Global Competitiveness Report 2019” ranked Saudi Arabia 34th out of 141 countries on the quality of its overall transport infrastructure pillar, with the country showing improvements on six out of eight indicators that year. According to the report, the kingdom placed first globally in road connectivity, as well as 21st in liner shipping connectivity. Other notable rankings include airport connectivity (24th), the quality of road infrastructure (26th), efficiency of train services (26th), efficiency of air transport services (34th) and efficiency of seaport services (40th).

Performance

While the transport sector plays a vital role in enabling other industries, it makes a significant contribution to the economy on its own. According to the General Authority for Statistics (GaStat), the transport, storage and communications (TSC) sector contributed 6.1% to total GDP in 2019. Excluding the energy sector, GDP grew by 3.3% that year, spurred by a SR163.6bn ($43.6bn), or 5.6%, expansion in TSC, making it the fourth-fastest-growing economic sector. TSC activities were outperformed only by finance, insurance and business services (8%), community, social and personal services (6.9%), and wholesale and retail trade/ restaurants and hotels (6.3%).

Transport and storage businesses are also key employers. According to GaStat, in the third quarter of 2019 the sector employed 262,995 people, making it the fifth-largest employer after construction, wholesale and retail trade, manufacturing, and accommodation and food service activities. That year, there were 75,300 Saudi transport workers, of which 65,700 were male and 9600 were female, and 187,695 non-Saudi workers, of which 186,951 were male and 744 were female.

The issue of female mobility also ties in with Vision 2030 goals to give women more opportunities in the labour market. In June 2018 the ban on female drivers was lifted, and in the first year local media reported that some 120,000 women had applied for licences. This, combined with improved overall economic conditions in 2019, had a positive knock-on effect for the auto industry, with new car sales increasing by 60% in 2019.

Road Network

The importance placed on building new motorway linkages to connect major cities across the Kingdom’s vast areas means the road network has had to undergo significant upgrades and expansion. According to the most recent figures from GaStat, there were 67,027 km of main paved roads and 145,132 km of rural roads in 2018. This is a rise from 61,376 km and 140,870 km, respectively in 2013. In 2018 engineers constructed 1720 km of new paved roads, including 50 km of motorway, while road repairs were conducted on 231 km.

Globally, the road network remains one of the best connected. This is due in part to the skill of road builders in overcoming significant topographical challenges, such as the country’s mountainous terrain and huge expanses of sandy desert. In mid-2019 a dual-carriage motorway was opened to directly connect Oman and Saudi Arabia across the Rub Al Khali desert. Also known as the Empty Quarter, the Rub Al Khali desert spans 650,000 sq km, and is roughly the size of France. The highway shaves 800 km off the 1638-km journey to Oman, which is home to important ports on the Arabian Sea. The project involved 600 workers clearing some 130m cu metres of sand. Before the road opened, goods traded between Oman and Saudi Arabia were shipped through the Strait of Hormuz into ports located on the Kingdom’s eastern coast.

Bridges & Causeways

Saudi Arabia’s road network included 99 tunnels and 5194 bridges, of which the most heavily trafficked is the 25-km King Fahd Causeway linking the Saudi city of Al Khobar to Bahrain via Um Al Naasan island. In 2018 the causeway was used by 5.7m vehicles crossing into Bahrain and 5.1m vehicles travelling into Saudi Arabia. In January 2020 the King Fahd Causeway Authority reported that 133,000 travellers used the bridge, the highest daily total since it opened in 1986.

A number of measures have been taken to ease congestion on the causeway, including the 2017 introduction of a one-stop crossing for passport control and Customs. In addition, in October 2019 the authority announced an $8.9m consultancy agreement with a consortium including KPMG, US multinational engineering firm AECOM and UK global law firm CMS. The consortium will work to develop financial, legal and engineering aspects of a second crossing between Saudi Arabia and Bahrain, the King Hamad Causeway. The new causeway is expected to cost $3.5bn and will be financed on a public-private partnership basis, in line with broader government privatisation goals. The following month, Mashroat announced a memorandum of understanding to work with the authority to provide technical support and enhance the level of efficiency in the management of facilities and assets.

A second mega-project is under consideration on the other side of the country, with plans to build a 7-to 9-km bridge connecting the Saudi coastal city of Tabuk to Egypt’s Sinai Peninsula and the resort town Sharm El Sheikh. The bridge will open trade routes into Africa, including an overland route to Cairo and Alexandria that would bypass the Suez Canal and achieve more than $200bn in annual trade revenue. The project, first announced by King Salman bin Abdulaziz Al Saud in 2016, would also include passenger and freight rail services, providing a key alternative route for Hajj and Umrah pilgrims.

Rail 

In January 2020 a two-day Railway Forum in Riyadh emphasised the importance of the 5000-km rail network and potential investment opportunities (see analysis). The forum was organised by SAR, which was founded by the Public Investment Fund (PIF) in 2006 to build the 2750-km North-South rail lines connecting mining areas in the north to Ras Al Khair Industrial Port and Riyadh. In May 2019 the Council of Ministers announced that SAR would be assuming responsibility for all rail operations. Previously, projects and operations were split between SAR and another state-owned entity, the Saudi Railways Organisation (SRO). In 2016 SAR took charge of all new rail construction projects, including the 950-km Saudi Landbridge Project linking Riyadh with Jeddah. This left the SRO responsible for passenger and freight routes from Riyadh to Dammam; the 450-km Haramain High-Speed Rail (HHSR) line, which provides a direct connection between Jeddah, KAIA, and the two holy cities of Makkah and Medina; and for planning the 2177-km Saudi portion of the GCC railway, which is designed to eventually connect countries across the peninsula. However, SRO’s operations and assets will be transferred to the SAR in a merger that is expected to take between two and three years to complete.

In September 2019 a fire destroyed the upper floors of the iconic Jeddah HHSR station, which was designed by the architect Norman Foster. The fire delayed services until mid-December 2019 as a new 1.5-km branch was built to circumvent the station during its reconstruction, allowing trains to run between Medina and Makkah. That same month, a new 5-km branch line, including a 4-km tunnel, was completed to KAIA, which will serve as the main station for Jeddah until the original is rebuilt.

Air

Saudi Arabia is home to 27 airports, spit between six international, eight regional and 13 domestic facilities. KAIA is the busiest airport in Saudi Arabia. According to GACA, KAIA handled 36% of the 94.4m passengers entering the country in 2018. This was followed by King Khalid International Airport (KKIA) in Riyadh, which accounted for 28%, Dammam’s King Fahd International Airport (KFIA, 10%) and Medina’s Prince Mohammed Bin Abdulaziz International Airport (PMAI, 8.5%).

In the first quarter of 2020 airlines at KAIA were gradually moving their services to the newly opened Terminal 1. The 800,000-sq-metre facility had a soft opening in March 2018, but officially came on-line in September 2019. There are 46 contact gates, and 30,000 sq metres of shops and food outlets. Terminal 1 has an initial capacity of 30m passengers per year, with subsequent planned expansions set to see this rise to 43m by 2025 and 80m by 2035.

According to KAIA’s website, the airport handled 41.2m passengers in 2018. Of this figure, 23.1m passed through the South Terminal, 10.5m passed through the North Terminal and 7.3m were processed via the dedicated Hajj Terminal. At that point, just 385,729 passengers had used the new Terminal 1. While Covid-19 is disrupting pilgrimage plans in 2020, the government is set on increasing Hajj and Umrah foreign arrivals from under 7m in 2017 to around 30m by 2030. “In response to the pandemic, we are coordinating with the authorities to establish Covid-19 prevention measures at KAIA to ensure the safe return of pilgrims,” Adnan Al Saggaf, CEO of Ports Projects Management and Development Company, told OBG. “In the longer term, we are also collaborating with the government as we work to meet growing passenger numbers in line with Vision 2030.” Echoing similar statements, Ismael Alkoshy, the managing director of Prince Sultan Aviation Academy, told OBG that expansion projects and increased capacity at KAIA were helping prepare the region to absorb future passenger demand.

Privatisation Push

The authorities are keen to increase private sector involvement in transport. The first airport privatisation deal was struck in 2011, when the GACA finalised a deal with Turkish group TAV Airports, with partners Al Rahji Bank and construction company Saudi Oger, to build a new terminal at PMAI under a build-operate-transfer (BOT) financing model. The facility is now operated by Tibah Airports, which signed a 25-year agreement to build a 8m-passenger-capacity terminal, in June 2012. The airport reportedly receives 80% of its annual passengers over a 40-day period during the Hajj, and in 2018 it handled 8.3m travellers.

Under the NIDLP, the role of GACA is expected to change, with a reduction in its operational duties and a greater emphasis on regulatory functions. The plan is to allow the private sector to play an increasingly prominent role as airport owners and operators. A vehicle to assist the process was created in 2008 when the Saudi Civil Aviation Holding Company (SAVC) was formed. SAVC is wholly owned by GACA, and its function is to ready targeted assets for privatisation by focusing on operational and financial efficiencies. SAVC has overseen the creation of the Riyadh Airports Company (RAC), which manages and operates KKIA, and the Dammam Airports Company, which does the same at KFIA.

In October 2019 RAC announced it had its busiest day on record, handling 100,000 passengers at KKIA. RAC also reported a 2% annual increase in passenger traffic during the 2019 Hajj and back-to-school seasons, during which 2m passengers used the airport. By the end of the third quarter of 2019 the airport had handled 20m travellers, a 4.8% increase yearon-year. This follows 2018, which saw passenger numbers up 5.5%, to over 26m. GACA is spending SR2.5bn ($666.5m) on revamping Terminals 3 and 4, to bring capacity up to 11m passengers. In February 2019 the authority reported that the work was 11.7% completed. The refurbished terminals will have 14 travel gates and 80 check-in counters.

Domestic Flights

Recent growth in domestic passenger traffic is serving as the main driver of airport upgrades. In 2019 the Kingdom recorded a 13.5% increase in domestic travellers, compared to 4.5% for international passengers. This follows a trend from the previous year, with GACA data showing growth in domestic passenger numbers outpacing international traveller numbers in Riyadh and Jeddah. At KKIA, domestic traveller numbers rose by 12.6% in 2018 to 15.7m people, while international passengers numbers grew by 8% to 12.3m. At KAIA, the number of domestic fliers was up 15.4%, to 13.1m people, while international travellers rose by 4.9%, to 22.7m passengers.

E-Visa

As aviation and tourism are two of the key sectors targeted by Vision 2030, a new e-visa system for citizens of 49 countries was launched in September 2019. The e-visa makes it easier for tourists to visit the Kingdom, which could help drive up international traveller numbers. The multiple-entry visa costs SR440 ($117) and is valid for one year allowing for a maximum cumulative 90 days in-country. The introduction of e-visas is part of Vision 2030’s objective to see tourism contribute 10% to GDP by 2030, up from 3% in 2016, by attracting 100m tourist visits per year (see Tourism & Entertainment chapter). It is also worth noting that overall growth in international passengers has continued despite the recent departure of significant numbers of expatriate workers. Jadwa Investment estimates that from the start of 2017 to the third quarter of 2019 nearly 2m expatriates exited the local labour market.

Air Freight

In addition to transporting passengers, the air network plays an important role in the movement of goods. However, according to GaStat data, in 2018 there was a fall in the tonnage of goods handled by airports. In 2018 the total amount of air cargo handled by the top-five airports fell by more than 8.8% to 856,317 tonnes. More detailed data comparing the top-13 Saudi airports showed the decline was due to a fall in international freight volumes, which dropped by 7.9%, from 853,367 tonnes to 788,391 tonnes, while domestic freight loads only increased marginally from 87,897 tonnes to 88,968 tonnes. Prince Naif Bin Abdulaziz International Airport in Al Qassim bucked the trend, with domestic air freight up from 627 tonnes to 17,412 tonnes, and international cargo up from zero to 2587 tonnes.

Airlines

There are five airlines based in Saudi Arabia. State-owned Saudia has been the national carrier since 1945. The airline is based in Jeddah but has another equally comparable hub in Riyadh. In 2007 Saudia’s first competitor came along with the launch of the privately owned Flynas, which started as a low-cost carrier. For nearly a decade, Saudia and Flynas operated a duopoly in domestic aviation; however, two new airlines came on-line in October 2016, providing a competitive challenge. SaudiGulf Airlines is headquartered in Dammam, where it caters to the upper end of the market, providing domestic and regional international flights. Nesma, a sister of a private Egyptian airline, is based in Hail, where it operates mostly domestic flights, as well as services to Cairo. In 2017 Saudia launched its own low-cost airline, flyadeal, to compete domestically.

Although the full-year figures are distorted by the fact that new airlines started operations each autumn, the overall number of passengers carried by the five airlines increased by 14% from 61.8m in 2017 to 70.6m in 2018. However, privately owned airlines as a whole saw their share of the market fall from 22.6% to 19.5% that year as newcomer flyadeal gained considerable market share, climbing from 359,683 passengers to over 5m. While SaudiGulf boosted its traveller numbers from 984,608 to 1.58m, both Nesma and Flynas saw passenger numbers fall, with Nesma down from 1.6m to 1.3m, and Flynas down from 11.5m to 10.8m. Both airlines operated fewer flights in 2018.

New Aircraft

Despite the sometimes volatile market dynamics, both privately and publicly owned Saudi airlines have been buying up new aircraft. In November 2018 SaudiGulf announced a $2.1bn deal to purchase 20 Airbus A320neo and A321neo aircraft with a firm order for 10 and an option for the others. The carrier, which started with four Airbus A320s, has planned to add between six and eight new aircraft annually from 2019 to 2021.

In January 2018 Flynas added a new Boeing 767 wide-body aircraft to its service between Jeddah, Medina and Baghdad. At that point the airline had a fleet of 30 aircraft. At the Dubai Airshow in 2019, Flynas signed a firm order for Airbus A321 XLRs, which it said increased the number of firm orders for aircraft to 90, with a combined price tag of $10bn.

Meanwhile, at the Paris Air Show in June 2019, Saudia signed an order for 100 aircraft with Airbus at an undisclosed price. Of these, flyadeal was to receive 30 Airbus 320neo planes with an option for a further 20. Deliveries of the first aircraft are due to commence in 2021. In 2020 Saudia was operating a fleet of 147 Boeing and Airbus aircraft.

New Helicopter Company

In 2018 the PIF announced it was launching The Helicopter Company (THC) as the first national commercial helicopter operator in Saudi Arabia. THC will cater to the luxury end of the tourism market by offering private trips to remote locations around the Kingdom, as well as urban transport and air ambulance services. THC was formed with initial capital of SR565m ($150.6m), and in July 2019 the company received its airworthiness operations certificate from GACA in Riyadh. THC began commercial operations the following September, using an AgustaWestland AW139 medium-sized, twin-engined helicopter that can be configured to seat up to 15 people. In November 2019 THC participated in the Dubai Airshow as a means of achieving better brand recognition.

Ports

Saudi Arabia is home to nine ports, of which six are commercial and three are industrial. In 1996 the port sector was privatised and commercial terminal operators were appointed, although the SPA remains the overseer of all port activity.

SPA data shows that in 2019 the combined throughput at all Saudi ports reached 289m tonnes, up from 267m tonnes in 2018 and 234m tonnes in 2015. JIP is the busiest commercial port, while the two King Fahad Industrial Ports – one at Yanbu on the Red Sea and the other in Jubail on the Gulf – remain the busiest industrial ports due to their importance to the petroleum industry. In 2019 the industrial ports at Yanbu and Jubail processed more than 115m tonnes and 60m tonnes of cargo, respectively. JIP, meanwhile, handled 55m tonnes that year.

In December 2019 the SPA awarded two, 30-year BOT concessions to the local terminal operator Red Sea Gateway Terminal (RSGT) and UAE logistics firm DP World to manage and develop JIP’s north and south container terminals, respectively. RSGT will expand the capacity of the north terminal from 3m twenty-foot equivalent units (TEUs) to 5m TEUs in the short term, while the agreement with DP World stipulates it will invest $500m to modernise its part of the port, including infrastructure to enable it to cater for ultra-large container carriers. The south terminal’s annual capacity will expand from 2.4m TEUs to 3.6m TEUs, providing 1400 jobs. “The expansion of JIP is being driven by the growing demand for vessels and maritime freight,” Mohammed Mudarres, CEO of Saudi Industrial Services Company, told OBG. “Its strategic location on the Red Sea and the economic growth of the Makkah region are highlighting its importance to the local maritime sector.”

In 2019 JIP discharged 2.22m TEUs of containers and loaded 2.21m TEUs, for a combined total of 4.43m TEUs. The total length of JIP stands at 12.3 km. It has 62 berths, of which 32 are used for general cargo, 19 for container shipments, six for passengers, three for grain and two for livestock. In 2019 JIP handled 37.3% of all passenger traffic arriving at Red Sea ports. This was followed by Jazan Port (35.6%), Dhiba Port (26.3%) and Yanbu Commercial Port (<0.1%). While Saudi Arabia’s Red Sea ports do not cater to cruise liners, in May 2019 local media reported cruise operators hope this may change. At present, once passing the Suez Canal, cruise liners can only call at the Port of Aqaba in Jordan.

The $640m Ras Al Khair Industrial Port serves the mining and industrial areas in the north. In line with NIDLP goals, in November 2018 the Waad Al Shamal project was inaugurated. Spread over 440 sq km, the development aims to leverage the over 50m tonnes of phosphate reserves in the Northern Region to make Saudi Arabia the second-largest producer of the mineral worldwide. “For a long time, goods have transited through neighbouring ports such as Dubai,” Khaled Dhafer, chairman of local company KDL Logistics, told OBG. “However, we now believe that Saudi Arabia’s Gulf ports offer a competitive value proposition, and can attract freight transporters in order to increase overall port activity.”

Urban Transport

A headline development in public transport is the Riyadh Metro, which is expected to come on-line in the second half of 2020. Once fully operational, the 176-km, $23bn metro will serve 85 stations via six train lines, and will be fed by a 1900-km network of buses with 3000 stops.

The project is overseen by the Royal Commission for Riyadh City (formerly the Riyadh Development Authority), which is tasked with the urban, economic, social and cultural development of the capital. Three international consortia have been responsible for the development of the metro network’s six lines. The first package, consisting of lines 1 and 2 and valued at $9.45bn, was awarded to the BACS consortium, made up of Bechtel, Siemens, Almabani General Contractors and the Consolidated Contractors Company. The package includes the construction of 38 km of track and 22 stations for line 1, the majority of which will be below ground, as well as 25 km and 13 stations for line 2, some of which will be elevated. The rolling stock for these lines will be supplied by Siemens and consist of 74 Inspiro driverless trains with a capacity of 21,000 passengers per hour.

The second package, comprising line 3 and valued at around $5.9bn, was awarded to the ArRiyadh New Mobility consortium, which is made up of Hitachi Rail STS, Bombardier, Salini-Impreglio, Larsen & Toubro, and Nesma. Line 3 will be 40.7-km long and include 22 stations, with rolling stock consisting of 47 driverless Bombardier Innovia Metro 300 trains.

The third and final package, valued at $7.82bn, consists of lines 4, 5 and 6, and was awarded to the FAST consortium, led by Spanish construction firm FCC. The group includes Samsung, Alstom, Strukton, Freyssinet Saudi Arabia, Typsa and Setec. The three lines will consist of 29.8 km of elevated track, 8.2 km at surface and 26.6 km below surface, totalling 64.6 km, as well as 25 stations. Rolling stock will be provided by Alstom and will comprise 69 two-car Metropolis driverless trains. Although the network has been built by three consortia, the trains will have a common technical design.

In line with greater privatisation goals, two 12-year operation and maintenance (O&M) contracts were awarded for the network. The Flow Consortium of Alstom, Hitachi Rail STS and Ferrovie dello Stato Italiane, was awarded lines 3, 4, 5 and 6; while the Capital Metro Company, a joint venture between Saudi Public Transport Company and RATP Dev, was awarded lines 1 and 2. The contracts stipulate a minimum Saudiisation rate of 45%, and a 55% target for local content procurement of supplies and services. The delivery of the metro looks set to transform commuting in the capital city, where just 2% of the city’s 7m people use public transport.

Jeddah has also drawn up a master plan for public transport. The Metro Jeddah Company, which was formed in 2013, has created a blueprint for the city which includes four metro lines, three light rail transportation lines, a coastal tram system stretching along Jeddah corniche, two bus rapid transit routes, a commuter rail line around the city’s eastern periphery and a seabus network along the coastline. Consultancy contracts were awarded from 2014 to 2018 for the network, but as of April 2020 development had yet to commence.

Outlook

Although the Covid-19 pandemic has cast a shadow of uncertainty over parts of the global transport sector – particularly aviation – beyond those immediate issues, Saudi Arabia’s transport sector is positioned to play an increasingly important role in the economy in the years ahead. Improving the Kingdom’s logistics and transport infrastructure is a central goal of the NIDLP, with early wins in speeding up the movement of cargo through its seaports demonstrating a coordinated, multi-agency effort to make significant improvements. With new roads and bridges to Bahrain and Egypt planned, Saudi Arabia is also demonstrating its intention to leverage its location to serve as a transport hub, connecting countries and continents in the region.

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