Apple agrees to set up regional distribution hub in Saudi Arabia
Riyadh has previously advised companies dealing inside the kingdom to set up distribution hubs in Saudi Arabia by 2024
By News Desk - November 02 2022

(Photo Credit: Apple)

On 1 November, Apple agreed to set up its West Asian distribution hub in Saudi Arabia, to diversify the kingdom’s revenue streams away from petrodollars.

According to Saudi Transport and Logistics Minister Saleh al-Jasser, the US multinational electronics company will base itself in Saudi Arabia’s new three million square meters economic zone near Riyadh’s airport.

Apple will “conduct assembly lines and repair work along with light manufacturing at the site,” Jasser added.

The zone will offer exemptions from labor regulations and certain taxes. Tax-free economic zones have been used by Gulf states to attract foreign investors, such as Dubai’s Jebel Ali business hub, for example.

Riyadh has previously announced that companies engaging in business in the kingdom have been advised to establish their regional hubs in Saudi Arabia by 2024, and if not, these companies would be at risk of losing contracts.

Since Crown Prince Mohammad bin Salman (MbS) consolidated power in late 2015, he has rolled out several social reforms to attract foreign and multinational investors. According to official reports, alcohol, which is prohibited in the kingdom due to the kingdoms Sharia law, is expected to be allowed at Red Sea resorts as part of the wider Neom mega-project. 

This comes during a period when the US government is reevaluating its relationship with Saudi Arabia, accusing the Gulf state of using its influence in the decision of OPEC+ to reduce oil output by 2 million barrels per day (bpd).

On 25 October, Saudi Energy Minister Prince Abdulaziz bin Salman said that the kingdom proved to be the “maturer guys” in the ongoing spat with the US.

“I think we as Saudi Arabia decided to be the maturer guys and let the dice fall,” Bin Salman told reporters at the Future Investment Initiative (FII) forum.

Saudi Arabia’s recent moves to attract investors also come at a time when human rights groups have filed several accusations against the kingdom regarding human rights violations and its war crimes in Yemen.

These groups have also accused the kingdom of lobbying to prevent the UN from further investigating its violations and crimes, whether domestically or abroad.

The UN has repeatedly ignored human rights violations committed by the Saudi-backed parallel government of ousted President Abdrabbuh Mansur Hadi in Shabwah, including at least 55 assassinations and over 600 arbitrary arrests.

Since 2015, Yemen has been mired in a brutal Saudi-led war that has killed hundreds of thousands and displaced millions. The country also faces a western-backed economic blockade that has sent the currency plummeting and has pushed most of its regions to the brink of famine.


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