SAUDI ARABIA’S TRANSPORTATION BOOM OPENS DOORS FOR PRIVATE INVESTMENT
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Saudi Arabia’s transportation boom opens doors for private investment
RIYADH: Saudi Arabia’s rapidly expanding transportation sector is unlocking new investment opportunities for private players, both local and global, experts have told Arab News.
Central to the Kingdom’s Vision 2030 strategy, transportation development is seen as a key enabler for economic diversification and the drive to position Saudi Arabia as a global logistics, tourism, and business hub.
With a growing emphasis on public-private partnerships, Minister of Transport and Logistic Services Saleh Al-Jasser announced during the third PIF Private Sector Forum, held in Riyadh in February, that private entities are expected to contribute around 80 percent of the targeted investments in the country’s transport and logistics sector.
He added that the total value of projects offered to the private sector — through privatization and other models — could reach SR240 billion ($63.95 billion).
Joseph Salem, executive at Arthur D. Little, Middle East.
Joseph Salem, partner and travel, transportation and hospitality practice lead at Arthur D. Little, Middle East, told Arab News that public-private partnerships are at the core of this strategy.
“Privatization of key transport infrastructure, such as ports and airports, is creating new opportunities for private investment,” he said, adding: “The development and management of cargo terminals through PPP agreements are attracting private efficiency and capital. The construction and engineering sectors are also benefiting, with numerous megaprojects like the Riyadh Metro and Neom’s mobility network.”
Alessandro Tricamo, partner at Oliver Wyman’s transportation and services practice for India, the Middle East, and Africa, echoed similar sentiments and emphasized the importance of selecting suitable assets to attract investors.
“Globally, asset classes such as airports and seaports are typically considered bankable, with the potential to generate strong returns and attract private investment. Conversely, railways and public transport systems often require structured support from the government to become commercially viable,” said Tricamo.
Alessandro Tricamo, partner at Oliver Wyman’s transportation and services practice for India, the Middle East, and Africa.
He added: “In the Kingdom, there’s still a need to refine how these projects are structured and presented to the private sector, as expectations are sometimes misaligned with market realities. Clear, realistic frameworks will help unlock greater private sector involvement and broaden the Kingdom’s business landscape.”
The Kingdom’s logistics infrastructure is expanding rapidly. According to a report released by the General Authority for Statistics in December, the number of logistics facilities in the country has increased by 267 percent since 2021, with the Eastern Province leading in logistics hubs spanning 6.3 million sq. meters.
“Private companies are seizing opportunities in trucking, warehousing, freight forwarding, and e-commerce delivery services. Technology firms are also entering the market, offering solutions in AI, electric vehicles, and autonomous transport,” said Salem.
He added: “Overall, the transportation revolution in Saudi Arabia is creating a more diversified and competitive business environment. Private sector involvement is key to realizing the Kingdom’s ambitious Vision 2030 goals.”
Transportation as a growth enabler
Anthoine Barthes, vice president of Al-Futtaim Automotive, told Arab News that transportation infrastructure underpins nearly every pillar of Vision 2030, acting as a foundation for economic growth.
Anthoine Barthes, vice president of Al-Futtaim Automotive. (Supplied)'/
According to Barthes, transportation is not only about mobility but also about creating links between economic zones, facilitating trade, drawing investment, enhancing quality of life, and boosting tourism.
“A key objective is for Saudi Arabia to become a global logistics hub, and this requires state-of-the-art ports, efficient rail networks, extensive road infrastructure, and modern airports capable of handling significant cargo and passenger volumes,” said Barthes.
He also pointed to the Riyadh Metro — with its six lines spanning 176 km — as evidence of the Kingdom’s progress in developing effective public transport systems.
“These efforts, alongside continuous improvements to road infrastructure and the integration of smart city mobility solutions, are crucial for enhancing the quality of life, mitigating urban congestion, and fostering sustainable urban growth,” added Barthes.
Salem noted that infrastructure development supports the growth of multiple industries, including tourism and entertainment, with road upgrades linking key cities to rising destinations such as Qiddiya and Amaala.
He also highlighted how enhancements around Makkah and Madinah have improved accessibility for millions of religious visitors, reinforcing tourism and Umrah growth.