Saudi Arabia’s government has revealed its intention to attract the world’s biggest players in ship building and bulk carrying to a new Special Economic Zone (SEZ) on the Persian Gulf coast.
The new SEZ will be hosted in Ras al-Khair, just north of Jubail. It will encompass the King Salman International Complex for Maritime Industries and Services, which will be 12 million square metres when complete, making it the largest in the region.
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Four joint venture holding companies have been set up in advance of the shipyard’s opening, including International Maritime Industries (IMI) owned by The Arabian American Oil Company (Aramco), Lamprell, Bahri (Saudi’s major shipping carrier), and Hyundai Heavy Industries (HHI).
The financial arrangements for the SEZ are intended to attract international investment and business. They include “5% corporate income tax for up to 20 years. There will also be 0% customs duties deferral for goods inside the zone and 0% withholding tax for profit repatriation abroad – both indefinite. There will also be 0% VAT for intra-SEZ goods exchanged within the zone and between zones,” according to promotional materials.
Before the yard and its surrounding infrastructure is completed (the project end date is set at 2024, but more detail is unclear at this stage) Aramco has already signed up for 20 offshore rigs and Bahri has commissioned at least 52 new vessels.
The SEZ port zone will also cover an “offshore hub” in Ras al-Kair, which is aimed at attracting global companies to work (tax-free) in the Kingdom – much like existing SEZ’s covering other industry hubs.
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By GlobalDataThe development of Ras al-Khair is part of the wide-ranging Saudi Vision 2030, the Crown Prince’s plan to diversify the oil-reliant economy by the end of the decade.
