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Italy's Economic Diplomacy, 29 September: latest news from the world



Italy's Economic Diplomacy, 29 September: latest news from the world

Saudi Arabia: Call for tenders to be held shortly for Landbridge and other railway projects


The Saudi railway authority announced that it would launch a call for tenders between the end of 2017 and the beginning of 2018 to construct a railway line connecting the west to the east coast, passing through the capital Riyadh. It has now concluded the stage where it gathered expressions of interest.

The Landbridge project would significantly reduce freight transport times (now up to 5 days by ship) and improve connectivity throughout the entire Arabian Peninsula. The plan would be to connect the Port of Jeddah on the Red Sea to Riyadh (950 km), Riyadh to the industrial port city of Jubail on the Persian Gulf (115 km), and also to upgrade the existing line between Riyadh and Dammam. The project would cover 1,600 km.

The 2017 budget law drawn up by the Finance Ministry envisages a steep  increase in resources allocated to infrastructure and transport ( 14 billion dollars, up from 10 billion dollars a year earlier). A portion of these funds will be earmarked for railway transport, and not just for the Landbridge project.

Saudi Railway is determined to increase freight transport along the north-south axis from the border with Jordan down to Riyadh (2,750 km); expanding transport services to the benefit of Saudi Aramco fuel storage and distribution facilities in the north; connecting the Basayta agricultural centre in the Al Jawf region to the railway network as this is where most wheat, barley, corn, potatoes, fruit, olives and forage crops are grown. Future projects also include the Haramain high-speed line (450 km for a total value of 10 billion dollars) to link the two holy cities of Mecca and Medina, passing by Jeddah.

In view of the sky-rocketing financing costs involved and budget constraints, the Saudi authorities are counting on co-financing from private parties through public-private partnerships for both the infrastructure development and to manage operations. The railway sector will also be involved in a privatisation plan.

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