Saudi Arabia’s Vision 2030 initiative is transforming Ras al-Khair into a leading shipyard destination within the region.
The Saudi government aims to magnetize top-tier shipbuilders and bulk carriers to the newly established Special Economic Zone (SEZ) situated along the Persian Gulf. This SEZ, located near Jubail, will include the sprawling King Salman International Complex for Maritime Industries and Services, anticipated to span 12 million square meters upon completion, becoming the region’s most extensive facility of its kind.
Preparations for the shipyard’s inauguration involve the creation of four joint ventures, including International Maritime Industries (IMI) with stakeholders such as The Arabian American Oil Company (Aramco), Lamprell, Bahri—Saudi Arabia’s principal shipping company—and Hyundai Heavy Industries (HHI).
The financial incentives for the SEZ are crafted to draw global investment and enterprises. Prospective benefits outlined in promotional literature include a 5% corporate income tax rate for two decades, indefinite exemption from customs duties on goods within the zone, and a zero-percent withholding tax on profit sent overseas. Furthermore, transactions within the SEZ and between zones will be subjected to zero-percent VAT.
Even before the full completion of the yard and its infrastructure, expected by 2024, Aramco has committed to acquiring 20 offshore rigs, and Bahri has placed orders for at least 52 new vessels.
The SEZ will also feature an “offshore hub” in Ras al-Khair, designed to draw international businesses to operate tax-free in Saudi Arabia, similar to other existing SEZs specializing in various industries.
Ras al-Khair’s development is a crucial element of the broader Saudi Vision 2030—Crown Prince Mohammed bin Salman’s strategy to lessen the kingdom’s dependence on oil by diversifying its economy within this decade.