Saudi aviation sector needs foreign investment to meet 330 million passenger target, official says
RIYADH: Private and foreign investment is needed to elevate Saudi Arabia’s aviation industry, even as the country targets 330 million passengers and 250 international destinations by the end of this decade, a senior civil aviation official has said .
“The Public Investment Fund is our main partner. We are very happy to have such an investment powerhouse. But not only PIF; we need everyone’s cooperation. We need the private sector. We need foreign investors as much as we need the PIF,” said Mohammed Alkhuraisi, Head of Strategy, General Civil Aviation Authority, in an exclusive interview with Arab News.
Regional logistics hub
During the interview, Alkhuraisi revealed that GACA has solid plans to turn Saudi Arabia into a logistics hub as it targets a shipment of 4.5 million by 2030.
He added that of the 4.5 million cargo shipments targeted, 2 million would be transshipments exclusively.
We need foreign investors as much as we need the PIF
Mohammed Alkhuraisi, Head of Strategy, General Civil Aviation Authority
Outlining GACA’s plans for logistics regulations, Alkhuraisi said, “There is a clear roadmap on what we will do in cargo in terms of relaxing regulations, streamlining processes and building specialized economic zones. , specialized warehouses and facilities, etc.”
He added: “With the help of the services of the Ministry of Transport and Logistics, we are marching on the execution of these regulations and publishing them.”
GACA is no longer an operator
During the interview, Alkhuraisi clarified that GACA is no longer an operator but a regulator.
“So today, GACA is a pure regulator and no longer an operator. GACA operated airports for the past decades, and now we have completely separated that. All airports and operations are within companies focused on operational matters, while GACA focuses solely on regulatory affairs,” he added.
During the interview, Alkhuraisi also highlighted the steps to be taken to revive the aviation industry which has been severely affected by the COVID-19 pandemic.
“To smooth the recovery of airline business, you need to optimize the cost environment. And that is the responsibility of the regulator. So there is a need to ensure that we have the right sets of regulations and incentive schemes to have a cost structure in line with best practices.
However, he admitted that there are several other things over which the regulator has no control, including the cost of owning aircraft, labor and human capital.
More partnerships with foreign carriers
Alkhuraisi also added that Saudi Arabia wants more foreign carriers connected to the Kingdom through bilateral agreements.
“We would like to have more foreign carriers connected to the Kingdom under our bilateral agreements. For example, KLM. They exploited the roads of Amsterdam. Other airlines would be encouraged and welcome; whether Asian, Latin American, North American or from different parts of Europe, all are welcome to come and start operating direct routes in the Kingdom.
Alkhuraisi also confirmed that a new flag carrier will soon be launched in Saudi Arabia, which was announced earlier by Saudi Transport Minister Saleh Al-Jasser at the recently concluded Future Aviation Forum.