Maersk to Build First Integrated Logistics Park at Jeddah Islamic Port

Saudi Ports Authority (MAWANI) has signed an agreement with A. P. Moller - Maersk, global integrator of container logistics, committing to an investment of $136 million over a period of 25 years to set up an Integrated Logistics Park at Jeddah Islamic Port in Saudi Arabia.

The signing took place in the presence of His Excellency the Minister of Transport and Logistics, Chairman of the Board of Directors of Saudi Ports Authority, Engineer Saleh bin Nasser Al-Jasser, and Richard Morgan, Managing Director Maersk West & Central Asia, together with several officials from related sectors.

The agreement was signed by His Excellency the President of the Saudi Ports Authority, Mr. Omar bin Talal Hariri, and the Managing Director of Maersk Saudi Arabia, Mr. Mohammad Shihab.

Spread over an area of 205,000 sq. m., the greenfield project will be the first of its kind at Jeddah Islamic Port offering an array of solutions with the goal of connecting and simplifying the supply chains of importers and exporters in the Kingdom.

Maersk will also be investing heavily in renewable energy to power the facility and eventually achieve carbon-neutrality. The project is expected to create more than 2,500 direct and indirect jobs in Saudi Arabia.

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Saudi Arabia’s Vision 2030 aims to more than triple the share of non-oil exports from Saudi Arabia from its current levels, to reach 50% of total exports.

It also seeks to substantially raise the Kingdom’s global ranking in the Logistics Performance Index to ensure that Saudi Arabia becomes the regional leader in logistics.

Commenting on the signing of the agreement, His Excellency the Minister of Transport, Saleh bin Nasser Al-Jasser, said, “We are pleased to enter into this agreement today, which represents another remarkable milestone in strengthening Saudi Arabia’s position on the regional and global stage.

"The development of the new Integrated Logistics Park will further enhance the capabilities of Jeddah Islamic Port and contribute to consolidating the Kingdom’s position as a leading global hub for maritime transport and logistics services.”

Richard Morgan, Managing Director, Maersk West & Central Asia said: “We are building an innovative, digital and technologically-advanced logistics infrastructure on the foundations of our strong network of global shipping and logistics services to create value for customers in the region.

"Our ambition is not only to connect and simplify our customers’ supply chains, but also be a catalyst in the growth of trade and economies through our customer-centric solutions."

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His Excellency Omar bin Talal Hariri, President of the Saudi Ports Authority, said: “The strategic partnership between the authority and Maersk is an important step to achieve our ambition for Jeddah Islamic Port to become among the top ten ports in the world by 2030.

"I am confident that this partnership will greatly enhance the distinguished operational capabilities of Jeddah Islamic Port, which ranks first among the Red Sea ports due to its strategic location linking the international shipping route between East and West.”

The bonded and non-bonded Warehousing & Distribution (W&D) facility will cover more than 70% of the total area, while the remaining part will act as a hub for transshipment, air freight, and LCL cargo.

The W&D facility will feature several different sections to accommodate general warehousing (food & beverages, furniture, automobiles, chemicals, textile & apparel, and machinery, appliances & electronics) and cold chain storage (fruits & vegetables, protein, and confectionary & consumables).

To cater to the rapid penetration of eCommerce in Saudi Arabia, the facility will also have a dedicated eCommerce fulfilment center. The Integrated Logistics Park will be able to handle annual volumes close to 200,000 TEUs across different products.

Maersk will deploy a state-of-the-art warehouse management system that implements modern technologies and digital solutions for efficient inventory management and track & trace at unit-level, and offers rich dashboards for higher visibility and deeper insights.

These systems will help in improving efficiencies and build a cost competitive edge for Maersk’s customers.

Maersk is also charting its path to eventually make the facility carbon-neutral. The warehouses, cold storages and office building will all be powered with renewable solar energy.

Even the yard machinery including forklifts, reach stackers, empty container handlers, trucks and other vehicles deployed for the movement of cargo will be electric.

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