Saudi Arabia’s aviation ambitions highlighted at 56th ACCO AGM

AACO has wrapped up in Riyadh with Saleh bin Nasser Al-Jasser, the Minister of Transport and Logistic Services and the Chairman of Saudi Arabian Airlines Corporation, saying that the country’s hosting of the event has “elevated and evolving position within the aviation industry and the air transport sector.”

According to Abdul Wahab Teffaha, AACO Secretary General: “Our meeting coincides with a transformative phase for the Kingdom, transitioning it toward new horizons that enhance its global economic significance and expand its presence across various sectors within the framework of Saudi Vision 2030.”

“What sets our meeting apart is its unique convergence of the Arab aviation and the global aviation communities in the city that will soon emerge as a central hub in the global aviation landscape,” he added.

The AACO event was significant for although it is the sixth time the AGM has been hosted by Saudi Arabia and Saudia, it was the first one taking place in Riyadh, with previous AGMs held in Jeddah.

The Kingdom has high ambitions for air transport to help drive its economic growth with a target of 330 million passengers handled, 250 destinations served, and 4.5 million tonnes of cargo handled annually by 2030, explained Al-Jasser.

Speaking at the AACO AGM, IATA director general Willie Walsh said that Saudi Arabia is “an all too rare example of a government fostering its connectivity as a key element of its overall economic strategy.”

Presenting the National Aviation Sector Strategy, Mohammed Alkhuraisi, Executive Vice President of Strategy and Business Intelligence at the General Authority of Civil Aviation (GACA) explained the government’s priorities of fuelling demand from the National Tourism Strategy, delivering global long-haul connecting hubs for international transit passengers at both Riyadh and Jeddah, and growing a sustainable aviation sector with attractive returns.

The plan also encourages the growth of low-cost carriers for short-haul connectivity in the Kingdom, said Alkhuraisi. It also envisages that the Jeddah hub will be served by Saudia and Saudia Cargo, while Riyadh will be served by start-up Riyadh Air.

To match airline growth, Saudi Arabia will build new airports and invest in its current ones. This will include a new airport for Jeddah, which is in the master planning phase, which could handle up to 100 million passengers, explained Alkhuraisi.

The strategy requires estimated total funding up to 2030 of $100 billion, with two-thirds of this coming from the private sector and a third from the state.

As the Riyadh event closed, AACO announced that its 57th annual meeting will be hosted by Royal Jordanian in the Dead Sea in November 2024.

In parallel with airline and infrastructure developments, Saudi Arabia has unveiled an aviation regulatory overhaul with an “economic policy transformation to unleash the Kingdom’s aviation sector”.

“GACA’s transformation of Saudi Arabia’s aviation economic regulations will drive further investment, growth, and performance across the aviation sector,” said GACA President His Excellency Abdulaziz Al-Duailej.

He explained the changes align with global best practice and “create an open, dynamic and competitive market, setting a level playing field for global operators and investors in the Kingdom.”

Among the reforms are new rules to support the privatisation of Saudi Arabia’s airports with easier access for new entrants. There will be new airport charging frameworks with airports having more flexibility to diversify revenues by growing non-aeronautical revenues.

Ground handling services and air cargo will be opened to competition, with a ‘general freedom of access’ principle being supported by competition levels across the Kingdom’s airports.

IATA’s Willie Walsh welcomed GACA’s “proactive approach in engaging with industry stakeholders to help shape and upgrade the Kingdom's new aviation regulations.”

“GACA's revision of its charging scheme, to make KSA’s airports more competitive in the region is good news,” continued Walsh. “As is its establishment of an independent economic regulatory framework. The Kingdom is the first country in the MENA region do this and we encourage other states to follow.”