Saudi Arabia opens special economic zone

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by Emily Atkins

Saudi Arabia’s General Authority for Civil Aviation (GACA) has opened a Special Integrated Logistics Zone in Riyadh.

Spanning 740 acres, the zone offers tax breaks on products manufactured or assembled on the site. It will allow multinationals and their third-party suppliers, who reassemble products in the zone for onward sale in Saudi Arabia and the wider Middle East and North Africa region. Companies will be permitted 100 percent foreign ownership, streamlined incorporation processes, expedited certification and permit procedures.

The zone is strategically located to serve billions of potential customers in easy reach across Africa, Asia and Europe and uses technology designed to streamline the movement of goods, including best-in-class inventory systems optimized for e-commerce, providing direct linkages between investors, suppliers, customs, and government entities.

“The Special Integrated Logistics Zone positions the Kingdom as a global logistics hub connecting three continents, attracting the largest companies in the world to our logistics sector,” said Saleh bin Nasser AlJasser, Saudi Arabia’s minister of transport and logistics.

As part of the wider transformation of the Kingdom’s logistics sector, by 2030 Saudi Arabia is significantly increasing its cargo capacity to more than 4.5 million tons per year and increasing the contribution of the transport and logistics sector to national gross domestic product from the current six percent to 10 percent. This will help to fuel business growth, attract inward investment, and increase the sector’s non-oil revenues to about SR 45 billion (US$12 billion) a year by 2030.

“The Saudi Aviation Strategy is investing $100 billion in the Kingdom’s future, creating an unprecedented growth story. The Special Integrated Logistics Zone is an opportunity to participate from the outset in Saudi Arabia’s rapid emergence as the Middle East’s pre-eminent logistics hub, and we have put the regulatory measures in place to give maximum flexibility for global businesses when they enter the Kingdom,” bin Nasser AlJasser, said.