Maritime Saudi Arabia 2010Agility Logistics

KSA MARKET OVERVIEW

KSA Market Overview

KSA Market Overview

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• GCC road freight market is estimated at $3.5 bn

• KSA represents 45% and is projected to reach USD 2.1bn by 2011

Source: booze&co. 2009 report

• Annual growth rate of demand is expected to be 7% CAGR

• Major growth areas are Jeddah, Riyadh and Dammam

Road Transport Growth Warehousing Growth

Factors that will contribute to the success of the Saudi Landbridge

KSA: domestic advantages– Riyadh is the large and fast-growing city

– Consignees prefer clearance at final destination

– Bonded container transport allowed only by rail

– 25 year proven dry port operation

– Dammam key oil & gas and commercial centre

– Jubail & Yanbu strategic industrial locations

KSA: regional advantages– Largest economy in the region

– Unique location between two international waterways

– Jeddah Port is strategicly located

KSA Market Overview

CONNECTING THE RED SEA TO THE GULF

The Saudi Landbridge

Current scenario

Connecting the Red Sea to the Gulf

• The Saudi Landbridge (SLB) will be the first rail link between the Red Sea in the west and the Gulf in the east.

• The SLB will provide a world-class freight rail link across the country, connecting all major cities and ports

• Will offer significant time savings compared to shipping by sea around the Arabian peninsula (5/6 days)

• Reduce reliance on the road network and lower the carbon footprint of the supply chain

Connecting the Red Sea to the Gulf

Creating a hub

• In the Gulf region, Jebel Ali has emerged as a regional distribution center. Currently shipping lines divert from main haul to call at Jebel Ali to deliver the region's containers

• Because of its hub status, the UAE has benefited twice over from regional growth

• The introduction of the SLB will develop the required infrastructure to position Saudi as a viable alternative to other hubs in the region

Resulting in:

• Avoiding the need to go to other hubs

• Shorter transit times

• Quicker route to Riyadh

• Reduced congestion at other ports

• Ability for companies to service the largest consumer market in the GCC more effectively

New scenario

Summary of key benefits to the logistics industry

• The Saudi Landbridge will be an important step in developing the wider logistics infrastructure of KSA by servicing all major locations

• Develop Jeddah as a regional hub

• Assist KSA ports in their growth by linking Red Sea and Arabian Gulf

• Help support further investment in logistics, manufacturing and other industries

Achieving this is conditional to:

• Enhancing the regulatory framework

• Automating customs systems to facilitate transit formalities

• Developing major boarder transit points

• Wider industry investment

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