JEDDAH: Saudi Arabia’s port modernization drive is taking on added urgency as disruptions to global trade routes and supply chains reconfigure shipping patterns.
With the US-Israel war with Iran bringing conflict to the Arabian Gulf and disruptions to navigation through the Strait of Hormuz, Saudi Arabia’s port strategy is being tested by shifting maritime conditions that are influencing global shipping routes and supply chain resilience.
In response, Saudi Ports Authority, known as Mawani, has introduced logistics corridors designed to redirect cargo flows from ports in the Eastern Region and across the Gulf toward Jeddah Islamic Port and other Red Sea facilities, creating structured operational pathways that reduce reliance on a single maritime chokepoint, aligning with broader efforts to maintain the continuity of trade while adapting to evolving regional risks.
At the same time, the authority has expanded integrated services across its Eastern Region ports to support vessels operating in the Gulf, reinforcing operational continuity through measures that facilitate ship servicing, coordination, and turnaround efficiency.
These efforts complement ongoing measures to improve container availability and sustain maritime activity during periods of heightened uncertainty.
Indeed, Mawani has been working to strengthen maritime infrastructure to support industrial expansion, export growth, and the Kingdom’s integration into global trade networks.
Aligned with Vision 2030, Saudi Arabia’s modernization efforts aim to transform the Kingdom into a global logistics hub linking Asia, Europe, and Africa, with Mawani’s port development at the heart of this strategy.
With more than SR2.2 billion ($586.6 million) in private-sector investment directed toward multipurpose cargo terminals at eight Saudi ports, the overhaul reflects a broader effort to align logistics performance with Vision 2030’s industrial ambitions.
A milestone came in February, when APM Terminals acquired a 37.5 percent stake in the South Container Terminal at Jeddah Islamic Port, integrating the facility into the global network of its parent company, A.P. Moller–Maersk.
The move signals growing international operator confidence in Saudi Arabia’s port ecosystem and its role along key East–West trade corridors.
Tamer Al-Sayed, senior finance director at the Future Investment Initiative Institute, said that by modernizing port infrastructure, adopting advanced technologies, and building strategic international partnerships, Mawani is doing more than facilitating trade – it is laying the foundation for a diversified, sustainable, and globally competitive economy.
Ports as engines of industrial growth
Speaking to Arab News, Zahoor Ahmed, vice president at MIE Group and a global foreign direct investment and mega-project development expert, said the Kingdom’s economic shift reflects a deeper structural recalibration, beneath which lies a core challenge of competitiveness directly linked to logistics performance.
“Saudi Arabia’s Vision 2030 has redefined the Kingdom’s economic trajectory, shifting emphasis toward mining, advanced manufacturing, downstream processing, food security, and export diversification,” he said.
Ahmed pointed out that in a global economy shaped by supply chain recalibration, geopolitical realignment, sustainability accountability, and capital discipline, infrastructure is no longer a background variable.
Mawani is doing more than facilitating trade – it is laying the foundation for a diversified, sustainable, and globally competitive economy.
Tamer Al-Sayed, senior finance director at the Future Investment Initiative Institute
“It is a strategic signal. Ports, in particular, have evolved from transactional gateways into instruments of economic positioning”, Ahmed said, adding that within this context, Mawani’s modernization of Saudi Arabia’s commercial ports represents not only incremental improvement, but incredible structural reinforcement of the Kingdom’s non-oil economic architecture.
Saudi Arabia’s geographic position between major trade corridors offers inherent advantages, he noted, but warned that location alone does not guarantee sustained competitiveness.
“As global supply chains diversify and manufacturing footprints recalibrate, countries increasingly compete on execution capability, not geographic proximity alone,” Ahmed said.
While Ahmed framed modernization in terms of execution capability and institutional discipline, Tamer Al-Sayed, senior finance director at the Future Investment Initiative Institute, emphasized measurable performance gains, investment inflows, and digital integration as evidence that the strategy is translating into tangible results.
“This is not merely a quantitative increase; it represents a qualitative leap in our capacity to support industrial growth. The development of industrial clusters and downstream logistics, supported by efficient ports, is creating a virtuous cycle of growth,” Al-Sayed said.
Ahmed stressed that Mawani’s modernization efforts align directly with the National Transport and Logistics Strategy, which aims to position Saudi Arabia among the world’s leading logistics hubs. Through capacity expansion, concession partnerships, and logistics zone integration, the Kingdom is strengthening the connective tissue that binds industrial ambition to trade execution.
Performance milestones and economic impact
Operational performance metrics illustrate the scale of the shift. Saudi ports handled more than 320 million tonnes of cargo in 2024, reflecting expansion across bulk, general cargo, and containerized trade.
“In 2025, container throughput reached 8.3 million TEUs, marking a 10.58 percent year-on-year increase, with export containers rising by nearly 12 percent and transshipment volumes expanding by approximately 11.8 percent,” Ahmed said.
He added that these figures are not mere maritime statistics but rather industrial mega indicators that showcase the future direction of the port, emphasizing that each incremental TEU capacity represents “the exciting growth of mineral exports, petrochemical shipments, machinery imports, agricultural trade, or re-export consolidation.”
In capital-intensive sectors like mining, downstream petrochemicals, and advanced manufacturing, Ahmed highlighted how logistics efficiency directly affects cost structures, working capital cycles, and export competitiveness.
“Reduced vessel turnaround times, streamlined customs clearance, integrated cargo platforms, and multimodal connectivity lower transaction costs and enhance production predictability,” he said.
Technology, sustainability, and global partnerships
Al-Sayed pointed to the technological dimension of that shift, noting that under Mawani’s “Smart Ports and Logistic Transformation” initiative, 5G connectivity, IoT systems, and AI-driven analytics are being integrated into port operations to enhance transparency and coordination across supply chains.
He added that the initiative is not just about automation but rather about “creating a seamless, transparent, and highly efficient ecosystem for trade.”
Digitalization, Ahmed added, is becoming a strategic tool for competitive advantage. “Automation, predictive analytics, AI-enabled scheduling, and unified cargo management platforms reduce operational friction and enhance end-to-end visibility.”
He stressed that in an era characterized by geopolitical volatility and supply chain disruption, transparency has become a strategic asset.
Ports, in particular, have evolved from transactional gateways into instruments of economic positioning.
Zahoor Ahmed, vice president at MIE Group
Performance data throughout 2025, including consistent double-digit monthly year-on-year container growth during peak periods, suggest that modernization and digital integration are translating into sustained throughput expansion rather than isolated gains.
Sustainability, the MIE Group VP continued, has also become commercially consequential, adding that Mawani’s investment in energy-efficient terminal systems, digital optimization, and readiness for cleaner maritime fuels aligns Saudi ports with evolving international standards.
“The implementation of a Port Community System offering more than 250 digital services enhances coordination between port authorities, customs, operators, and cargo stakeholders, reducing administrative friction and improving supply chain transparency,” Ahmed said.
He emphasized that logistics underpins emerging industries central to Vision 2030, including hydrogen exports, renewable energy equipment, and advanced materials manufacturing, noting that these sectors “depend on environmentally credible logistics corridors to maintain competitiveness in international markets.”
Future outlook
Looking ahead, Ahmed said the next five years will be critical in determining whether Saudi Arabia consolidates its position as a global logistics hub, emphasizing that modernization must be paired with institutional maturity, robust performance benchmarking, and deep collaboration with the private sector.
For Al-Sayed, international partnerships remain central to that trajectory. Mawani’s collaborations with global shipping and logistics operators, including MSC and CMA CGM, are not only expanding reach but also absorbing global best practices in port management, logistics, and supply chain optimization.
“By collaborating with the best in the business, we are not only expanding our reach but also absorbing global best practices in port management, logistics, and supply chain optimization,” he said, adding that such partnerships reinforce Saudi Arabia’s position within global trade networks.
Al-Sayed highlighted that the adoption of smart technologies, and the cultivation of international partnerships are not isolated initiatives but rather interconnected pillars of a comprehensive strategy to build a prosperous and sustainable future for Saudi Arabia.
Ahmed framed the transformation in broader structural terms, noting that Vision 2030 is repositioning the Kingdom within global economic systems.
He emphasized that ambition sets direction, but execution determines outcomes, with infrastructure performance, particularly port efficiency, critical for scaling industrial diversification.
“By advancing modernization, sustainability integration, digital transformation, and global partnerships, Mawani is reinforcing the logistical backbone upon which non-oil growth depends,” he said.
Competitiveness in the next decade, Ahmed added, will depend not on strategy alone, but on systems that perform at scale, with port modernization central to economic transformation.
