Global economic growth to average at 3.1% in next 5 years: IMF official
Updated 23 March 2025
Nirmal Narayanan
RIYADH: Global economic growth is expected to average around 3.1 percent in the next five years, below the pre-pandemic level of 3.7 percent, according to an International Monetary Fund official.
Speaking at the China Development Forum in Beijing on March 23, Nigel Clarke, deputy managing director of the IMF, said that total factor productivity internationally, which measures the ability to create more outputs with the same inputs, has been growing at a slower pace since the 2008-09 global financial crisis.
The worldwide growth projections of the IMF indicate that countries in the Middle East are expected to show future financial resilience.
In January, the UN financial agency said Saudi Arabia’s economy is projected to grow by 3.3 percent in 2025 and 4.1 percent in 2026.
“Global growth is steady but underwhelming. Our five-year ahead growth forecast remains at 3.1 percent— well below the pre-pandemic average of 3.7 percent,” said Clarke.
He added: “Patterns of trade and capital flows are shifting. AI (artificial intelligence) is rapidly advancing. Trade is no longer the engine of global growth it used to be. Divergences across countries are widening. And governments worldwide are shifting their policy priorities.”
Clarke argues that countries should pursue structural reforms to boost productivity and ensure medium-term growth.
He further said that in aging societies— where the share of the working-age population is shrinking— productivity growth plays a vital role in maintaining living standards.
“It also applies to emerging markets and developing economies trying to close the gap with richer countries. To provide better jobs and a higher standard of living, they too need to ignite productivity growth,” added the deputy managing director.
He added that this productivity growth could be achieved only by innovation, technological advancements, and ample investments in research and development.
Citing IMF research, Clarke highlighted that productivity growth in advanced economies could increase by 0.2 percentage points a year with a hybrid policy that boosts public research expenditure by a third and doubles subsidies to private research.
He noted that AI could boost global gross domestic product growth between 0.1 and 0.8 percentage points per year in the medium term, depending on how it is adopted.
Clarke also underscored the necessity of better resource allocation in the future to maintain a healthy global productivity level.
“The movement of labor and capital toward more productive firms and industries has long been an important source of overall productivity growth. As workers move from farms to factories, for example, their productivity increases dramatically. So too do their income and living standards, with spillovers to the whole economy,” he said.
According to Clarke, effective measures should be taken to strengthen the private sector, as well as create an environment that could help them thrive.
“Through our policy advice, lending and capacity development, the IMF has consistently supported countries in establishing macroeconomic and financial stability as a foundation for growth,” said Clarke.
He added that a new IMF Advisory Council on Entrepreneurship and Growth has been created to help countries develop ideas on easing regulatory barriers, adapting tax systems, and incentivizing long-term savings to boost innovation.
Qatar’s producer prices steady in February as oil, gas drag index
Updated 30 March 2025
REEM WALID
RIYADH: Qatar’s general producer price index for the industrial sector stood at 114.01 points in February, reflecting stability compared to January and a 0.33 percent decrease year on year.
Released by the Gulf country’s Planning and Statistics Authority, the data indicated that the PPI for the industrial sector is made up of four main components: mining and quarrying, which constitutes 82.46 percent, manufacturing at 15.85 percent, electricity at 1.16 percent, and water at 0.53 percent.
The newly released figures align with Qatar’s inflation easing by 1.15 percent year on year in January, with the consumer price index settling at 107.45 points, driven by declines in food, housing, and transport costs, official figures showed.
This trend is consistent with the 2.53 percent drop in CPI in January, mainly attributable to a decline in housing, water, electricity, and other fuel costs.
The decline comes as Qatar is projected to record the lowest inflation in the Gulf Cooperation Council region this year, averaging 1.4 percent, below the GCC’s 1.9 percent and the wider Arab region’s 8.5 percent, according to Kamco Invest.
The data further showed that the mining and quarrying sector index declined by 0.12 percent compared to January, primarily owing to a 0.11 percent drop in the prices of crude oil and natural gas extraction, while the costs for other mining and quarrying activities remained unchanged.
Annually, the sector’s index dropped by 0.42 percent, primarily due to a decline in oil and gas extraction, although there was a modest 0.06 percent increase in prices for other mining and quarrying activities.
In the manufacturing sector, the index rose by 0.50 percent on a monthly basis, driven by price increases in rubber and plastic products, refined petroleum, chemicals, and basic metals, as well as cement, non-metallic minerals, and beverages.
On an annual basis, the manufacturing sector index increased by 0.60 percent compared to the corresponding month a year earlier, driven by a notable rise in prices for basic metals, cement and non-metallic mineral products, and rubber and plastic products, as well as chemical products, beverages, and printing.
In the electricity, gas, and air conditioning supply sector, the index rose by 1.01 percent compared to January but showed a year-on-year decline of 8.28 percent.
The water supply sector saw a decrease in its index by 2.75 percent compared to January but recorded an annual increase of 7.24 percent in February.
The numbers also indicated that prices declined for refined petroleum goods and food products, while there was no change in the prices of printing and reproduction of recorded media.
Saudi Arabia’s domestic tourism thrives as Eid travel peaks
Updated 30 March 2025
REEM WALID
RIYADH: Saudi Arabia’s domestic tourism sector is experiencing a sharp rise in travel during Eid Al-Fitr, injecting fresh momentum into the hospitality industry. A growing preference for local destinations is reshaping the market as residents seek immersive experiences within the nation’s tourism landscape.
The Kingdom saw a 45 percent rise in domestic flight bookings in 2024, driven by expanding tourism offerings and greater connectivity through low-cost carriers, according to Almosafer’s latest travel trend report released in January.
Domestic travel has surged in recent years, with Eid Al-Fitr becoming a peak period for local tourism, said Nicolas Mayer, PwC Middle East partner and global tourism industry lead. He noted that domestic flight bookings rose 45 percent year-on-year in 2024, highlighting a growing preference for local exploration.
“There are a few key reasons behind this shift. First, the Kingdom has made huge strides in improving its tourism offerings. With more affordable flight options due to low-cost carriers, travel has become a lot more accessible,” Mayer said.
The report showed a 39 percent increase in domestic room night bookings, while combined local flight and hotel reservations accounted for over 40 percent of the travel market, up 11 percent year-on-year.
The surge in domestic travel is fueled by a broader range of destinations, accommodations, and experiences attracting leisure visitors. Family and group travel have been major drivers, with bookings in these segments soaring over 70 percent.
Saudi Arabia’s mega-projects, including NEOM, a futuristic city on the Red Sea, and The Red Sea Project, which focuses on luxury and eco-tourism, further fuel domestic tourism growth. Cultural landmarks like AlUla, known for its ancient Nabatean heritage, and Diriyah, the birthplace of the Saudi state, are undergoing significant restoration to offer visitors rich historical and cultural experiences.
“Eid Al-Fitr is a special time for families and culture, and it encourages travel and experiencing something new. There are so many great options for people to celebrate within the Kingdom — it’s a great opportunity to discover Saudi Arabia’s rich culture and hidden gems right here at home,” he added.
Mayer pointed to Saudi Arabia’s massive investment in tourism infrastructure under Vision 2030, which is making it easier for residents to explore new destinations.
The Kingdom’s Minister of Tourism Ahmed Al-Khateeb recently said that the nation’s tourism accommodation is expected to double over the next decade. The country currently has around 400,000 guest rooms, projected to reach 800,000 by 2030. Al-Khateeb reiterated Saudi Arabia’s goal of becoming one of the world’s top seven tourism destinations by the end of the decade.
At King Abdullah University of Science and Technology, officials have observed a significant rise in family and group bookings, which have grown over 70 percent across key traveler segments.
Nour El-Shikh, media and public relations specialist in global branding and communications at KAUST, said travel groups are gravitating toward destinations that offer distinctive events and experiences.
“While major cities like Makkah, Riyadh, and Jeddah remain popular, emerging spots like Abha, Al Jubail, Jizan, Tabuk, and Hail are drawing increased attention for their unique landscapes and activities,” El-Shikh said.
AlUla, a UNESCO-listed site, has also gained traction as a premier domestic and international destination, a sign of Saudi Arabia’s continued investment in diversifying its tourism appeal.
“This has fostered a renewed appreciation for the Kingdom’s rich cultural heritage and natural beauty. The combination of improved infrastructure, increased accessibility, and a growing emphasis on family-oriented activities has made exploring local destinations more appealing than ever,” El-Shikh added.
The Haramain Train, which connects Madinah, Jeddah, and Makkah, is another example of how Saudi Arabia is reducing car traffic and improving access to Islam’s two holiest cities, she added.
Nicolas Mayer, PwC Middle East partner, global tourism industry lead. Supplied.
Hotels, resorts adapt to demand
With the surge in domestic travelers, Saudi Arabia’s hospitality sector is evolving to cater to changing preferences. Mayer pointed out that hotels and resorts are focusing on personalized experiences rather than simply increasing room capacity.
“Take Eid, for example. It’s a time when families want to be together, enjoy traditions, and make memories. Operators are catching on to that and offering packages and programs that feel more meaningful — whether it’s culturally inspired dining, kids’ activities, or even small touches that reflect the spirit of the holiday,” he said.
The demand for alternative accommodations is also growing, with vacation rentals, villas, and hotel apartments gaining popularity, particularly among families. Meanwhile, digital innovation is playing a critical role in enhancing the travel experience.
“If the booking process isn’t smooth or the service isn’t responsive, people notice. Tech isn’t a nice-to-have anymore — it’s expected,” Mayer added.
El-Shikh echoed this sentiment, emphasizing that many establishments are expanding and renovating to accommodate larger groups. “They are also introducing special Eid packages with family activities, cultural events, and traditional culinary experiences,” she said.
Mobile apps, virtual tours, and seamless payment methods such as Apple Pay and buy now, pay later options are also shaping consumer behavior. Sustainability and eco-friendly practices are becoming a priority, aligning with modern travelers’ values.
Future of domestic tourism
Saudi Arabia’s domestic tourism market is set for further transformation, driven by technology and evolving consumer expectations. Mayer expects a rising demand for personalized, culturally immersive, and seamless experiences.
“On the business side, I’m seeing a lot of energy going into creating more curated, tech-enabled journeys. Travelers expect smooth bookings, helpful digital tools, and recommendations that feel relevant. It’s no longer about just having a website or an app — it’s about using tech to anticipate what people want before they even ask,” he said.
The expansion of tourism beyond the well-known urban centers is also unlocking new opportunities. “More regions across the Kingdom are starting to offer these kinds of experiences. We’re moving beyond the well-known cities, and that’s opening up a whole new set of opportunities for domestic tourism,” Mayer added.
El-Shikh highlighted a growing trend toward experiential travel, where visitors seek immersive cultural experiences. “Stakeholders are developing unique offerings that highlight the Kingdom’s diverse heritage and natural landscapes,” she said.
New infrastructure fuels demand
The Kingdom’s infrastructure expansion is proving to be a game-changer for domestic tourism. Mayer noted that investments in roads, airports, and public transport are making once-remote destinations more accessible.
“It’s not just about building new airports or roads — it’s about opening new areas of the country that people might not have explored before,” he said.
Businesses are capitalizing on this momentum by designing experiences tied to local culture. “Around Eid especially, we see more businesses take advantage of that momentum. They’re creating experiences that feel connected to a place — whether it’s a cultural festival, a family-friendly activity, or a beautifully restored heritage site that tells a local story. These touchpoints resonate with travelers because it’s not just leisure — it’s personal,” Mayer explained.
El-Shikh added that in-destination activities such as guided tours, adventure sports, and cultural experiences are central to travel, enhancing engagement with local communities. “By collaborating with local artisans, cultural institutions, and heritage sites, tourism businesses are creating unique experiences that resonate with residents and encourage them to appreciate their own cultural heritage,” she said.
As Saudi Arabia continues to develop its tourism sector, a rising emphasis on domestic travel is expected to fuel sustained growth, further embedding Eid Al-Fitr as a cornerstone of the Kingdom’s evolving travel landscape.
Oman’s Islamic banking assets surge 17% to $22.3bn in 2024
Updated 30 March 2025
MIGUEL HADCHITY
RIYADH: Islamic banking in Oman continued its rapid expansion in 2024, with total assets reaching 8.6 billion Omani rials ($22.3 billion) by December — marking a 16.6 percent increase from the previous year, official data showed.
The segment now accounts for 19.2 percent of Oman’s total banking assets, according to data released by the Central Bank of Oman.
Financing extended by Islamic financial institutions grew by 14.2 percent to approximately 7 billion rials. Additionally, deposits at Islamic banks and windows jumped 21.3 percent, reaching nearly 6.7 billion rials by the end of December.
The steady growth of Oman’s Islamic banking sector reflects the rising demand for Shariah-compliant financial services and its expanding contribution to the country’s banking industry, CBO added.
Oman’s banking system comprises both conventional and Islamic banking services. Islamic banking is offered through standalone financial institutions and dedicated windows within conventional banks, which can be local or foreign entities licensed in Oman.
In May 2011, the CBO issued preliminary licensing guidelines to introduce Islamic banking in the Sultanate. This framework enabled full-fledged Islamic banks and Islamic windows to operate alongside conventional financial institutions.
The initiative was formally established in December 2012 through a Royal Decree that amended the Banking Law, mandating Islamic banks and windows to form their own Shariah supervisory boards. It also authorized the CBO to create a central High Shariah Supervisory Authority.
Following these developments, the CBO introduced the Islamic Banking Regulatory Framework in December 2012, alongside regulations governing the Hawala Settlement and Safeguard Account.
This initiative aligned with Oman’s broader economic strategy, promoting financial inclusion, economic diversification, and responsible financial practices.
Since its inception, Islamic banking in Oman has played a key role in advancing the objectives of Oman Vision 2040.
“This sector has played a vital role in augmenting national savings and investment, contributing to the development of a more diversified investment base and availability of wider range of financial products and services for consumers and businesses,” CBO said.
In November, Fitch Ratings forecasted continued growth in Oman’s Islamic finance sector, driven by increasing consumer demand, expanding distribution networks, greater use of sukuk for public funding, and ongoing regulatory advancements.
A key development in October was the CBO’s introduction of the Bank Deposit Protection Law, extending deposit protection to Islamic financial institutions — an essential step in bolstering confidence in the sector.
The agency added that strong economic conditions, improved asset quality, stable profitability, and solid capitalization position Islamic banks to withstand moderate financial shocks, despite regional geopolitical risks.
Saudi Arabia’s non-oil exports to UAE surge 10% in January: GASTAT
Updated 30 March 2025
Nirmal Narayanan
RIYADH: Saudi Arabia’s non-oil exports to the UAE rose to SR7.10 billion ($1.89 billion) in January, a nearly 10 percent monthly increase, highlighting the Kingdom’s push to diversify beyond oil revenues.
Machinery and mechanical equipment led the non-oil shipments at SR3.46 billion, followed by transport parts at SR1.74 billion, according to the General Authority for Statistics.
In December, Saudi Arabia’s non-oil shipments to the UAE totaled SR6.46 billion, down from SR7.17 billion in November and SR5.86 billion in October.
The rise in non-oil exports underscores the Kingdom’s progress in economic diversification, as it moves to reduce its decades-long reliance on crude revenues.
Affirming the non-oil private sector’s growth, Saudi Arabia’s Purchasing Managers’ Index reached 58.4 in February, according to the Riyad Bank Saudi Arabia PMI survey compiled by S&P Global.
In January, the Kingdom’s PMI stood at 60.5, its highest level in 10 years.
In the UAE, the PMI was 55 in February, while Qatar and Kuwait recorded 51 and 51.6, respectively.
At the World Economic Forum in Davos in January, Saudi Finance Minister Mohammed Al-Jadaan reiterated the Kingdom’s commitment to economic diversification under Vision 2030, emphasizing that growing non-oil gross domestic product remains a priority over traditional oil revenues.
According to the GASTAT report, Saudi Arabia also exported plastic goods worth SR307 million in January, followed by base metals at SR288.2 million and chemical products at SR266.2 million.
China was another major destination for the Kingdom’s non-oil goods, receiving SR2.22 billion worth of products.
Saudi Arabia exported plastic goods worth SR990.9 million to China, followed by chemical products at SR703.2 million.
India ranked third among non-oil export destinations, importing Saudi products worth SR2.00 billion in January, a 7.52 percent increase from the previous month.
Other top destinations for the Kingdom’s non-hydrocarbon goods in January were Turkiye, with a value of SR1.10 billion; the US at SR1.02 billion; and Qatar at SR763.6 million.
Egypt received non-oil goods valued at SR751.7 million in January, while exports to Kuwait and Belgium totaled SR646.9 million and SR632.2 million, respectively.
Overall non-oil exports
Saudi Arabia’s total non-oil exports in January reached SR26.48 billion, reflecting a 10.7 percent year-on-year increase.
In November, Saudi Arabia's Minister of Economy and Planning, Faisal Al-Ibrahim, stated that non-oil activities now account for 52 percent of GDP, with the sector growing at 20 percent annually since Vision 2030’s launch.
GASTAT noted that national non-oil exports, excluding re-exports, rose by 13.1 percent over the same period.
A December report by Mastercard Economics highlighted Saudi Arabia’s strong non-oil sector growth, forecasting a 3.7 percent GDP expansion in 2025 driven by further non-oil advancements.
Jeddah Islamic Sea Port was the primary exit point for non-oil goods in January, handling SR3.12 billion worth of shipments.
King Fahad Industrial Sea Port in Jubail and King Abdulaziz Sea Port in Dammam managed SR3.23 billion and SR2.50 billion in outbound goods, respectively.
Jubail Sea Port was the exit point for goods worth SR2.49 billion, followed by Ras Tanura Sea Port at SR1.65 billion and Ras Al Khair Sea Port at SR1.41 billion.
Via land, Al Batha Port processed SR1.89 billion in exports, while Al Hadithah Port handled SR706.5 million.
Among airports, King Khalid International Airport in Riyadh saw outbound shipments worth SR2.67 billion, followed by King Abdulaziz International Airport at SR2.26 billion.
King Fahd International Airport in Dammam handled SR286.9 million in exports.
Overall merchandise exports
Saudi Arabia’s total merchandise exports in January stood at SR97.18 billion, marking a 2.4 percent year-on-year rise.
The ratio of non-oil exports, including re-exports, to imports, increased to 36.5 percent in January from 35.7 percent in 2024.
However, oil exports declined by 0.4 percent year on year in January, reducing oil’s share of total exports from 74.8 percent in 2024 to 72.7 percent in 2025.
Saudi Arabia’s merchandise exports to Asia totaled SR75.43 billion in January, a 6.01 percent increase from the previous month.
Exports to Europe reached SR10.17 billion, followed by Africa at SR7.28 billion and North America at SR3.95 billion.
China was the top recipient of Saudi exports, receiving SR14.74 billion in January, a 20.32 percent increase from the previous month.
Other key destinations included India at SR10.60 billion, Japan at SR9.90 billion, and South Korea at SR9.05 billion.
Saudi Arabia’s exports to the UAE totaled SR8.44 billion, while outbound shipments to Egypt stood at SR2.84 billion.
Imports in January
Saudi Arabia’s imports rose 8.3 percent year on year in January 2025, reaching SR72.62 billion.
China remained the Kingdom’s top import source, supplying SR19.16 billion worth of goods, led by mechanical appliances and electrical equipment at SR7.95 billion.
The Kingdom imported transport products worth SR2.78 billion from China, followed by base metals at SR1.96 billion and textiles at SR1.19 billion.
Imports from the US totaled SR6.04 billion, while inbound shipments from the UAE and India stood at SR3.96 billion and SR3.80 billion, respectively.
Saudi Arabia also imported goods worth SR3.00 billion from Germany and SR2.48 billion from Egypt.
Japan supplied SR3.44 billion in imports, followed by Italy at SR2.41 billion and France at SR1.85 billion.
Sea shipments accounted for SR44.72 billion of total imports, while land and air imports stood at SR8.62 billion and SR19.27 billion, respectively.
King Abdulaziz Sea Port in Dammam was the leading entry point, handling SR20.92 billion in imports, or 28.8 percent of total inbound shipments.
Jeddah Islamic Sea Port followed with SR16.75 billion, while Ras Tanura Sea Port and King Abdullah Sea Port processed SR1.70 billion and SR1.11 billion, respectively.
On land, Al Batha Port and Riyadh Dry Port handled SR3.82 billion and SR2.52 billion in incoming goods, respectively.
Among airports, King Khalid International Airport in Riyadh received SR9.01 billion in imports, followed by King Abdulaziz International Airport at SR6.24 billion and King Fahd International Airport at SR4.00 billion.
Saudi maritime industry spurring global trade shift
Saudi Arabia advancing its shipbuilding and maritime technology through strategic partnerships
Updated 29 March 2025
MOHAMMED AL-KINANI
JEDDAH: Saudi Arabia’s investment in its maritime sector could see a shift in global trade logistics that helps reduce reliance on traditional routes, leading industry figures have told Arab News.
With its strategic location at the crossroads of global trade, the Kingdom is positioning itself as an international logistics hub, enhancing its maritime infrastructure and embracing sustainability.
This drive is a key part of Saudi Arabia’s economic diversification initiative under Vision 2030, which seeks to reduce the Kingdom’s reliance on oil revenues.
In August, Omar Hariri, president of the Saudi Ports Authority, revealed that investments in the Kingdom’s maritime sector have exceeded SR25 billion ($6.66 billion) thanks to successful collaborations between his organization and private sector partners.
Hariri said that significant investments have been made over the past four years through partnerships with both national and international companies.
Speaking to Arab News, Pierroberto Folgiero, CEO of Fincantieri, one of the world’s largest shipbuilding companies, highlighted how Saudi Arabia’s investment in maritime infrastructure is influencing the future of global trade routes.
“By expanding its shipbuilding capacity and enhancing its logistics infrastructure, the Kingdom can address global supply chain bottlenecks, strengthen its maritime influence, and foster resilience in international trade flows,” he said.
Folgiero noted that Saudi investments in advanced maritime infrastructure could create alternative trade routes, reducing reliance on chokepoints like the Suez Canal, adding that his company sees this as an opportunity to apply its shipbuilding and maritime technology expertise.
“Investments in shipbuilding, ports, logistics, and shipping services have allowed the Kingdom to capitalize on its geographic advantages. Notable projects include the development of the King Salman International Maritime Industries Complex in Ras Al-Khair, set to become one of the world’s largest shipyards, and modernizing key ports such as the Jeddah Islamic Port and King Abdulaziz Port,” he said.
The CEO added that Saudi Arabia is also advancing its shipbuilding and maritime technology through strategic partnerships with global industry leaders.
We are leveraging the adoption of digitization, automation, and AI-driven solutions to optimize port operations and streamline the logistics chain.
Poul Hestbaek, Folk Maritime CEO
“These collaborations focus on transferring expertise and technology, accelerating the Kingdom’s evolution into an influential player in the international maritime and shipping sectors,” he said.
He pointed out that Saudi Arabia’s focus on smart ports, using automation, IoT, and AI, is central to its maritime strategy. These technologies will streamline trade, improve turnaround times, reduce costs, and boost transparency, making the Kingdom an attractive hub for global shipping and logistics companies.
In May, Fincantieri launched Fincantieri Arabia, a subsidiary with a focus on shipbuilding, maritime equipment and systems, and naval logistic support services, including training and simulation.
Folgiero said this expansion will contribute to localizing technology, creating jobs, and boosting Saudi Arabia’s global maritime presence.
National developments
It is not just established international companies that will benefit from Saudi Arabia’s growing maritime sector.
In 2024, the Public Investment Fund-backed Folk Maritime was launched, initially operating two routes, but that number has since doubled.
Poul Hestbaek, the former CEO of Hamburg Sud, has been tasked to lead the company.
Speaking to Arab News, he highlighted the Saudi government’s proactive steps to adapt its regulatory framework and attract global investors to the industry, noting that his company is fully aligned with these efforts to drive innovation in maritime trade.
“As Saudi Arabia modernizes its regulatory framework, we are leveraging the adoption of digitization, automation, and AI-driven solutions to optimize port operations and streamline the logistics chain. This transformation is enhancing Saudi Arabia’s position as an attractive destination for international investors,” he said. Hestbaek said that his company is playing a vital role in this transformation, particularly through its expanding fleet and direct liner services along strategic routes, including those connecting India to the Red Sea and the Gulf.
M/V Folk Jeddah was Folk Maritime Services Co. first vessel. (Supplied)
He also highlighted Folk Maritime’s role in improving cargo efficiency across key trade routes, including the Red Sea and the Gulf.
“As we increase regional shipping capabilities and expand our fleet, key economic indicators to watch include the growth in port throughput, the development of new shipping routes, and the rise in non-oil exports,” said the CEO.
Sustainable maritime operations
Achieving growth in the sector is not the only goal for Saudi Arabia. As Hestbaek emphasized, expansion has to be done in a sustainable manner.
Explaining how sustainability is at the core of his company’s operations, he said: “We are aligned with Saudi Arabia’s net zero carbon by 2060 goals, incorporating advanced green technologies into our fleet, using energy-efficient technologies to reduce emissions and optimize fuel consumption.”
Hestbaek noted the Folk Maritime’s commitment to decarbonization by adhering to international standards, prioritizing International Maritime Organization regulations, adopting alternative fuels, and replacing older vessels with eco-friendly ones like the M/V Folk Jeddah. The company also recently purchased 5,600 recyclable containers.
Ensuring secure, resilient operations
As the Houthi-led attacks in the Red Sea have demonstrated, security is an ever-present concern for the maritime industry.
Hestbaek highlighted Saudi Arabia’s multi-faceted approach to ensuring secure shipping lanes, addressing both physical and cyberthreats.
“The Kingdom works closely with international and regional partners to counter piracy and maintain secure sea routes in the Arabian Gulf, Red Sea, and beyond. Saudi Arabia has invested in state-of-the-art naval and coast guard assets, as well as enhancing port security to safeguard ships and cargo,” he said.
The CEO added that his company has a strategy to safeguard operations and collaborates with local and international authorities, adding that cybersecurity is a top priority for both Saudi Arabia and Folk Maritime.
“We are committed to safeguarding our fleet and digital infrastructure from emerging cyberthreats, implementing cybersecurity measures, such as secure communication channels, real-time monitoring systems, and advanced protocols for data protection and cargo tracking,” he said.
Maritime tourism
The maritime industry is more than just transferring goods from port to port.
As Fincantieri’s Folgiero said, Saudi giga-projects such as NEOM and the Red Sea are transforming the Kingdom’s cruise ship industry, aligning with Vision 2030’s goal of making Saudi Arabia an international tourism hub.
“Futuristic cities like The Line and Sindalah Island, alongside the eco-tourism focus of the Red Sea Project, offer bespoke and sustainable experiences that cater to the high-end travel market, sharpening Saudi Arabia’s competitive edge in the global tourism landscape,” he said.
Ensuring the Kingdom capitalizes on this, the PIF-backed Cruise Saudi was created in 2021, with an aim to attract 1.3 million passengers annually by 2035.
It also plans to generate 50,000 direct and indirect jobs in the cruise sector by 2035.
Cruise Saudi’s first ship, Aroya, which features 19 decks, 1,678 cabins and suites, and can accommodate up to 3,362 passengers, was launched in December at Jeddah Islamic Port.
