How does the company bring more support to the aims of Saudi Vison 2030?
It was created as an independent company in 2020 with the mandate of being a leading logistics provider in the country, and, derived from Vision 2030, of being a logistics hub in order for the company to participate and support the vision, encompassing sea, air, and land transportation. The company is fortunate in the sense that it can seamlessly draw on its broad network and deep expertise built over decades as the cargo handling unit of the national flag carrier, Saudia. We are, therefore, well positioned to support the logistics and transportation agenda of Saudi Arabia's Vision 2030 economic strategy, fueled by the Kingdom's youthful demographics, rising consumption and digitalization, and increased global connectivity in trade and investment.
How is the growth of e-commerce regionally and globally affecting the logistics sector, especially in Saudi Arabia?
The global rise of e-commerce, accelerated by the global pandemic, is very much evident in Saudi Arabia and is a key driver for the company's growth. The Kingdom has embraced a rapid transformation in retail, for example by significantly increasing courier company licenses in the last year to meet rising demand and announcing new Integrated Logistics Bonded Zones to facilitate access for global e-retailers to the rapid growth and spending power of the Saudi market. Both SAL Saudi Logistics Services and Saudia Cargo are not just a beneficiary of the increase in e-commerce but are actively driving its progress. Fulfilling the increasing e-commerce volumes from infrastructural requirements is where SAL comes into play with its facilities. We have a dedicated operational courier facility in Riyadh whilst a similar facility is being evaluated for Jeddah.
What is the company's diversification strategy?
While continuing to build our core business of cargo handling, the firm is furthering its diversification through the logistics sector increasing its portfolio of activities to include e-commerce fulfilment, 3PL solutions, and further supporting the pharmaceutical industry. In the air cargo handling business, we have built a strong track record in managing diverse cargo that require specialized attention. All this necessitates close attention to detail and customer requirements, in addition to a high level of customer engagement. We will continue to develop this core offering through horizontal and vertical business integration, both inside and outside of airport premises.
Would you tell us about the recent infrastructural development at the company that is contributing to Saudi Arabia becoming a global logistics hub?
We are investing heavily in both our infrastructure and technological capabilities. In 2018, we initiated two multi-billion-riyal investment projects at the Riyadh and Jeddah airports, building state-of-the-art cargo terminal facilities. The first phase in Riyadh has been completed operational since April 2020, while the first phase in Jeddah is scheduled to be completed and operational by the end of this year. By 2023, when both projects are completed, we will have the capacity to handle over 3.5 million tonnes of cargo annually. The developments include dedicated e-commerce, cold-chain, export and re-export facilities, which will support our ambition to attract larger cargo volumes into the Saudi Arabian hub, both for the domestic market and as transshipments into the Middle East, Europe and the Americas.
Despite the pandemic, Saudia Cargo continues its operations. How did you manage to maintain the supply chain?
Demand for air cargo services has risen during the global pandemic, with air freight providing the most reliable and efficient means of transporting medical and healthcare supplies. This was especially the case given the disruption to supply chain stemming from lockdowns and travel restrictions. To ensure continuity in transportation, especially of essentials, we needed to respond rapidly and with a high degree of flexibility to fast-changing circumstances. We proved our agility to adapt in an ever-changing environment through altering the global freighter and increasing the passenger freighter network around the globe and within the region.