The Ministry of Communications and Information Technology announced that three major global companies are set to enter the postal and logistics sector, specifically parcel delivery services, and their entry is expected to contribute investments estimated at more than 6 billion riyals to the Saudi market.
According to the ministry, this achievement is the culmination of a package of policies and legislation recently issued that have made the postal and logistics services market more attractive than before, Meetings held with the Logistics Services Committee, chaired by His Excellency the Minister of Transport and Logistics, Engineer Saleh Al-Jasser, also played a role in enabling one of these companies to enter the market after the challenges hindering its entry into this promising and opportunity-rich sector were removed, especially given the availability of numerous advantages, most notably the fact that the Kingdom is a leading investment power, in addition to its geographic location, which positions it to serve as a hub connecting the three continents—Africa, Asia, and Europe—since it is a 5-hour flight from half the world’s population, along with its distinction of high demand for various goods, as the volume of demand in the Kingdom is equivalent to 75% of
the demand in the Gulf states and 50% of the combined demand of all Arab countries.
For his part, Engineer Khalid bin Abdulaziz Al-Bakri, Deputy Minister of Communications and Information Technology for Postal and Logistics Services, affirmed that the Kingdom’s geographic location, robust digital infrastructure, and investment-friendly policies will make it a destination and home for major companies, noting that the three companies entering the Saudi market will have a clear impact on providing efficient and fast services. Their entry will also strengthen the Kingdom’s position as a key player in the e-commerce market and contribute to the localization of supply chains.
Al-Bakri noted that the entry of foreign companies will enhance service levels and improve the customer experience, expressing his gratitude for the efforts of partners at the Ministry of Investment, the General Authority of Civil Aviation, and the transportation and logistics sector, which resulted in this achievement—one that aligns with the goals of the ambitious Vision 2030, which calls for attracting local and global investments and promoting growth across all sectors, including the postal and logistics services sector.
In its efforts to develop the postal and logistics services sector, the Ministry—represented by the Postal and Logistics Services Agency—has successfully implemented numerous initiatives and established the best policies and strategic plans, in collaboration with the Communications and Information Technology Commission, which has contributed to major advancements in this vital and important sector, enabling the market to grow to a size of approximately 70 billion riyals, of which 6.5 billion representing the postal services market, with an annual growth rate of 6.3%. As of 2020, approximately 51,000 employees worked in the postal sector, and the number of employees is expected to reach 140,000 by 2030. Private-sector investment in the sector is estimated at approximately 5 billion riyals and is targeted to reach 21 billion riyals by 2030.
It is worth noting that the Ministry of Communications oversees the postal and logistics services sector based on a decision issued by the Council of Ministers to separate operations from regulation, which has had a significant impact on the development and improvement of the quality of postal services provided, and ensuring business continuity in the sector during the COVID-19 pandemic, in line with the Kingdom’s Vision 2030.
With an investment of 6 billion riyals. Saudi Arabia attracts 3 international parcel transportation companies
