SAR 550 billion ($147 billion) is to be invested in transportation and logistics over the next nine years, as Crown Prince Mohammed bin Salman looks to transform the country into a global aviation hub.
According to Transport Minister Saleh Al Jasser, approximately 35% of that spending will come from the government. The remainder will come from the private sector, as officials launch a new international airline, expand airports, enlarge the train network, and investigate new technologies.
“Many of the targeted projects are bankable projects, attractive projects. This will open big opportunities for partnership with the private sector, whether local or international,” the minister explained.
The proposals are part of a strategy revealed by Prince Mohammed to help the world’s largest crude exporter diversify its economy. Officials in Saudi Arabia aim to convert Riyadh into a worldwide commercial hub, recruit more international talent, and lure 100 million tourists per year by 2030. These are objectives that would necessitate a significant increase in flights, with the kingdom only issuing tourist visas since 2019.
There is also a desire to nearly quadruple the number of Muslims who make religious pilgrimages to Mecca.
Saudi Arabia aims to lure 100 million tourists per year by 2030
Saudi officials seek to develop Riyadh, the country’s capital, into a global economic centre.
About 35% of spending will come from the government, with the remainder coming from the private sector
New Airline, Growth for Saudia
The sovereign Public Investment Fund’s proposal to build a new international airline with a hub in Riyadh is at the heart of the strategy. Saudia, the kingdom’s existing national carrier, would keep a base in Jeddah, which officials hope to develop into a second centre for religious and traditional tourism.
“We believe that we need another hub in Riyadh, and it makes sense that a new operator will take that mission,” Al Jasser added that. Given the extent of the anticipated demand, he expects to Saudia expand as well. “There will be room for Saudia to grow, and there will be room for the new airline to prosper, and also there will be more room for other international operators to grow their business in Saudi Arabia,” he said.
When asked if the new airline would compete with big Gulf carriers like Emirates and Qatar Airways, Al Jasser said Saudi officials were merely looking to optimise the opportunities for a hub in Riyadh to meet the kingdom’s own needs.
Other details of the new strategy include a significant expansion of airport infrastructure in Jeddah and Riyadh; a railroad linking Riyadh with Jeddah and the East Coast; and investigating the application of futuristic technology such as Hyperloop and the new generation of Maglev trains.
The new airline is slated to begin operations as soon as practicable. “It won’t take many years before this airline is operational,” concluded Al Jasser.