Saudi Arabia announces SR 30 billion Prince AbdulAziz bin Mousaed Economic City
King Abdullah bin AbdulAziz Alsaud of the Kingdom of Saudi Arabia (KSA) has announced the launch of the Prince AbdulAziz bin Mousaed Economic City (PABMEC) in Hail. The announcement was made during an event held on June 13th to celebrate the King’s first visit to Hail since becoming monarch. PABMEC is set to be a premier commerce and industry hub promoting a diversified economy in the Kingdom of Saudi Arabia.
The city will utilize 156 million square meters with total outlay reaching Saudi Riyal (SR) 30 billion (US$ 8 billion) over the next 10 years, which will be fully funded by the private sector. Implementation is slated to begin in September 2006.
PABMEC is the second economic city launched by the King in seven months, with the first being the King Abdullah Economic City launched in Rabigh (west of Saudi Arabia) in December 2005.
PABMEC will be developed by an investment Consortium supervised by the Saudi Arabian General Investment Authority (SAGIA) and headed by Rakisa Holding Company. The Consortium comprises companies from various GCC countries; from Saudi Arabia: Yousif bin Ahmed Kano Company, Ahmad Hamad Al-Qusaibi & Bros. Co., Tanmeeyat Group, Al-Rashid Trading and Contracting Co., Rashid bin Abdulrahman Al-Rashid & Sons Co., Abullatif and Company Group, Al-Jouf (Muflih Kayid) Co., and Hail Investment and Development Co. (under establishment); from the United Arab Emirates: Abu Dhabi Investment Authority, the Abu Dhabi Investment House, and the National Investment Co.; from the Kingdom of Bahrain: Gulf Finance House; and from Kuwait: Kuwaiti Investment Co., and General Warehousing Company which holds a stake in the largest logistics services company in the world, PWC Logistics.
“The project aims to utilize the Kingdom’s second competitive advantage after energy - its strategic location as a link between East and West- and leverage it through the establishment of a fully integrated economic city providing transportation and logistics services. Produce and minerals arriving from the north of Saudi Arabia and surrounding areas within Hail region will be traded, marketed and processed to add value to the raw material,” said His Excellency SAGIA Governor Amr Abdullah Al-Dabbagh.
He added that the project is a realization of the vision of the Custodian of the Two Holy Mosques and Crown Prince Sultan to develop the various regions of the country.
Hail’s strategic location in the heart of the Kingdom’s north at the crossroads of nautical, transportation and supportive service paths and its proximity to 11 Arab capitals, has made it a prime destination to host the Prince AbdulAziz bin Mousaed Economic City.
“The Prince AbdulAziz bin Mousaed Economic City will be the largest project of its kind in the Middle East for logistic and transportation services,” said Al-Dabbagh.
Sheikh AbdulAziz Al-Quraishi will be chairman-elect of the board of directors for the new company to be established to oversee the project. He previously held the position of Governor of the Saudi Arabian Monetary Agency (SAMA), and has also sat on the board of directors of a number of major corporations in Saudi Arabia, including the Saudi Industrial Investment Group.
Abdullah Ibrahim Al-Rakhis, chairman of the board of directors of Rakisa Holding Company, the investment Consortium leader, said, “PABMEC is a leap forward not just for the Kingdom of Saudi Arabia but for the economy of the Middle East as a whole. The project will benefit various sectors of the economy and boost agriculture, mining and processing, education and residential developments. In addition, PABMEC will contribute to the expected doubling of per capita GDP in Hail within the next10 years.”
Main activities of the Prince AbdulAziz bin Mousaed Economic City
The city will become home to a number of activities which will form an integrated economic unit and represent the major economic stronghold of the Northern region.
The following activities aim to utilize regional resources:
• Logistics and Supply Chain
• Agriculture & Food Processing
• Mining and Industry
Logistics and Supply Chain
The work plan has focused on utilizing the strategic location of Hail in building an infrastructure for transportation services, seeing that Hail represents a link to a number of trade routes. Therefore, an international airport and dry port will be established as well as a supply chain center and a multi-modal passenger station.
Adding to that will be the distribution of nearly 1.5 million tons of products annually through the dry port and operations center planned on a 210 square kilometer area. The PMEC is also expected to service a high volume of visitors annually.
An entire zone will be dedicated to educational services provision in the form of colleges, research centers, vocational and training centers as well as public and private schools. The idea stems from the importance of spreading specialized education to feed market demand for specialized manpower. This will help increase the productivity rate and fuel the need for a strong, trained and skilled workforce. The education zone will be spread across 10 square kilometers and expected to serve nearly 40,000 students.
Hail and the Northern region of Saudi Arabia are blessed with a sizeable agricultural output, prompting a special zone dedicated to agricultural services. The area will group a number of services that support and develop this economic sector through activities linked to the various stages of crop growing and harvest, processing and storage. The most important is an agricultural research center that serves the people of the region with the aim of increasing output whether in storage facilities or operating a number of plants. The produce will be designated for local and export consumption.
Mining and Industry
PABMEC will host a number of conversion facilities in line with available resources in the region to add value to extracted raw materials.
Given Hail’s location, geographic and historic surroundings, it was only natural to include an entertainment zone within this development. PABMEC is expected to attract nearly 700,000 tourists annually, providing additional investment opportunities in hospitality and tourism-related industries. Visitors will also benefit from a host of planned advanced healthcare facilities.
SR10 billion (US$2.7 billion) out of the total funding were earmarked for the housing sector, which will witness the development of 30,000 housing units, accommodating nearly 140,000 inhabitants.
The investment in infrastructure will exceed SR 6 billion (US$1.6 billion) and will assist in improving the overall infrastructure of the region, especially with respect to telecommunications, water and power needs. It is expected the project will add 3,300 kilometers of paved roads to the region.
Over the last 13 years, Rakisa Holding Company has invested in a number of telecommunications and infrastructure projects throughout Saudi Arabia and neighboring GCC countries. Rakisa believes in leading investment consortia comprised of Saudi and foreign investors who bring value-added input. Through its various investments, Rakisa has helped create 60,000 job opportunities, generate revenues in excess of SR 22 billion (US$5.8 billion), as well as manage assets in excess of SR 5 billion (US$1.3 billion).
- IPO for Prince Abdul Aziz bin Mousaed Economic City
- With total investments of $2.9 billion, investment funds to be launched in Prince Abdul Aziz Bin Mousaed Economic City
- RAKISA Holding showcases Prince AbdulAziz bin Mousaed Economic City to European investors
- Opportunities at Prince AbdulAziz Bin Mousaed Economic City highlighted