Arab News, Sunday, Apr 15, 2018 | Rajab 28, 1439
The man who will ship the goods for the Red Sea renaissance
As a son of Madinah and the Hijjaz, Rayan
Qutub is acutely aware that his homeland’s time has come.
“I spent a lot of my childhood in the US, where my father worked. But I was
always dreaming of a great Saudi Arabia, so this is music to my ears,” he said
in an interview in the King Abdullah Economic City, outside Jeddah.
He was referring to the Vision 2030 strategy, and, two years into the plan to
transform the economy of Saudi Arabia, one aspect is striking: The Kingdom’s Red
Sea coast and the Hijjaz region appear to be the focus of many of the enormous
The whole country will benefit, and there are big projects elsewhere, notably
the plan to build a 334 square kilometer leisure park outside the capital
Riyadh, as well as the big infrastructure investments underway and planned on
the east coast by Aramco and other industrial groups.
But the west coast, which was already in the middle of a regeneration plan
before the Vision was announced, will be home to two other “giga projects”:
Neom, the $500 billion project to create a futuristic urban hub in the north of
the region, and the Red Sea Resort, the tourism and leisure development further
south along the coast.
Qutub, the 45-year-old chief executive of King Abdullah Port, knows what this
orientation means for his part of the world. The port — just four years in
operation — is the commercial hub of KAEC and is set to become a major staging
post for the transformation of the west coast.
“The port is the key economic driver for KAEC, set in the middle of a growing
trade region and that connects the big populations of the Middle East and
Africa. And it has a big part to play in the Vision 2030 plan, too. The focus of
the Vision is to give the Kingdom an outward focus, and that is all adding to
the gravity and momentum for the port,” he said.
The port, known by the acronym KAP, is a first in several respects: The first
new port along the Red Sea coast, the first in Saudi Arabia funded entirely by
private capital, and the first to be planned as the commercial engine of an
entire new urban development — the KAEC project that surrounds it.
KAEC is listed on the Riyadh stock exchange as Emaar the Economic City to
reflect the fact the UAE company is master developer and major investor, and KAP
also looked to the private sector for seed capital. It is owned by a joint
venture, the Ports Development Company, comprised of KAEC itself and the Huta
Marine conglomerate of Jeddah.
“The banks and other private sector investors were keen to be involved when they
saw the potential,” said Qutub.
That potential is significant. Saudi business strategists, notably Fahd
Al-Rasheed, the chief executive of KAEC who appointed Qutub to the CEO job at
KAP late last year, have been arguing the case for the Kingdom’s west coast for
Before the discovery of oil in the Eastern Province about 80 years ago, the
ports along the west coast were the main commercial gateways to Saudi Arabia.
Not only did they serve the two holy cities of Makkah and Madinah, but they were
also the economic link with the Suez Canal, then the world’s principal trade
Al-Rasheed, CEO of the 13-year-old KAEC project since the beginning, launched
the Red Sea Foundation to advance the region’s cause in 2016, putting KAEC at
the center of a geographical area linking the Middle East, Africa and south Asia
with a population of 1.3 billion and projected trade of $4.7 trillion by 2050.
He called it the “fastest-growing emerging market in the world.”
Qutub, who headed KAEC’s industrial operations for 10 years before he got the
KAP job, has a similar view of the strategic potential. “I feel like a soldier
in this project, and strongly believe in it,” he said.
The Arabian Gulf ports are “cluttered,” he said, and while KAP faces competition
from the Kingdom’s biggest port an hour’s drive away in Jeddah, he believes KAP
has many advantages.
The port was recently named eighth fastest-growing in the world by maritime
experts, taking its place in the top 100 global ports for the first time. Aides
say that KAP in its four years has become bigger than established world hubs as
Gdansk, Poland, and Southampton in Britain.
Qutub believes it has other advantages over Jeddah and the Gulf coast ports: The
latest technology gives it a very short “dwell time,” which means it can handle
perishable goods, such as foodstuffs and pharmaceutical products, more
KAP has also invested heavily in roll-on, roll-off (RoRo) capability, making it
one of the largest vehicle ports in the region. With the Saudi car market set
for a boom when women can legally drive later this year, that is a big impetus.
But the future commercial core of KAP will continue to be the container traffic
that will provide the essentials for the Red Sea coast “giga projects.”
Qutub recognized that there will have to be further improvements to the road and
rail systems to speed these good northwards, and hinted that such plans are
under consideration. “There will need to be greater connectivity with the north
of Saudi Arabia, and there are plans to do this. They are in the final stages of
consideration, and I don’t want to talk about those before the time is right,”
It is not all about heavy industry, however. KAEC was planned as a complete
urban environment, with residential, leisure and retail developments. Qutub does
not feel that his commercial and industrial hub has been downgraded. “KAP was
designed as and remains the core of KAEC. But a community like KAEC has to be
more than just a port. It’s designed as a ‘live, work, play’ environment.”
That scope at the moment does not include leisure cruises, but with the prospect
of the Red Sea becoming an international tourist destination, he is not closed
to the possibility. “In principle, it would make a lot of sense for Saudi to
have more leisure cruising facilities on the Red Sea — all those fantastic coral
reefs were given by God and deserve to be seen.”
The ports business, in many ways, is subject to global geopolitical strains more
than most other industrial sectors. They depend on world trade growth, which
these days is threatened by a possible trade war between the US and China; and
they are at risk from the security threats that always complicate commercial
prospects in the Middle East.
Qutub was cautious on these sensitive subjects. “I don’t want to talk about
political issues, but I would say that the overall global trend is for trade to
go eastwards, and we are ideally placed to take advantage of that,” he said.
Qutub, whose career background is firmly in the private sector, with stints at
food group Savola and consumer products giant Unilever, was the driving force
behind the establishment of the CEO Think Tank, a “virtual platform” aimed at
providing advice and analysis from the private sector for policymakers
implementing the Vision 2030 strategy.
“We have 70 members who are interactive with government as thinkers and
executers. As the Vision evolves, more private sector effort is required, and we
see it as our role to give that kind of advice,” he said.
However, Qutub does not see himself as being in competition with the big global
consulting firms and strategic advisers. “We are trying to contribute, along
with everybody else. Contributions from all are required,” he said.