Saudi Arabia plans to create an independent firm that will manage the kingdom’s eight ports under a gradual privatization process, the state-run Saudi Ports Authority said.

The authority has completed privatisation studies of the ports, which will lead to the inception of the independent managing entity, its head Khaled Bubshait said in remarks carried by the official SPA news agency.

While Bubshait did not say when this entity would be set up, his remarks reactivate a process that has been frozen since late-1997.

A royal decree in 1997 allowed private firms to operate and maintain berths and equipment owned by the Ports Authority on a commercial basis, while keeping the ports and their facilities under government ownership. The move was aimed at raising efficiency and creating more jobs for Saudi nationals.

The bidding process then was on the basis of the share of terminal revenues the government would get. In late 1997, the Ports Authority started passing port terminals to the private sector on a terminal by terminal basis.

Shipments of oil—the kingdom’s main export—are excluded from operations covered by the ports authority or private firms that are operating the ports.

Bubshait also said the body plans to raise the kingdom’s container handling capacity to 15 million twenty-foot equivalent units by 2020. According to the authority’s website, the overall handling capacity of the ports stands at about 9 million TEUs.

In addition to ports, the world’s largest oil exporter has been planning to privatize several state-controlled firms including flag carrier Saudi Arabian Airlines and National Commercial Bank, the kingdom’s biggest lender by assets.

But these have made modest progress compared to the ports privatisation. Only the airline’s catering, luggage handling and ground services have been privatised or are in the process of being privatised. (Reuters)