A corridor of prosperity

My last experience with the G20 meetings was at the Antalya summit in Turkey in 2015. I attended the G20 Sherpa meetings where King Salman led the Saudi delegation. Based on media coverage, it appears that this year’s G20 meetings in India have made a historic announcement in the logistics field.

During the G20 meetings, the leaders of Saudi Arabia, the US, India, France, Germany, Italy, and the EU announced a plan to develop the new India-Middle East-Europe Economic Corridor. This landmark corridor is expected to stimulate economic development through enhanced connectivity and economic integration across two continents, thus unlocking sustainable and inclusive economic growth.

Crown Prince Mohammed bin Salman, who led the Saudi delegation at the G20 meetings, said: “This economic corridor will increase trade exchange between India, the Middle East, and Europe.

“It will contribute to ensuring global energy security and will work on laying pipelines to export electricity and hydrogen,” the crown prince added.

Indian officials emphasized the potential of the IMEC to serve as a green and digital bridge. They highlighted its ability to improve efficiency, reduce costs, generate employment, and decrease carbon emissions. This corridor is a major undertaking aimed at strengthening physical connectivity and unlocking extensive commercial prospects, which will reshape global trade routes.

The Kingdom has been implementing a strategy to consolidate its strategic position as a global logistics hub, improve the quality of life in Saudi cities, achieve a balanced public budget, and enhance the performance of the government apparatus.

The IMEC, a rail and shipping corridor connecting India to Europe through West Asia, is anticipated to have a lasting impact. The eight signatories of the IMEC collectively represent around half of the global economy and 40 percent of the world’s population, with India alone being the most populous country in the world.

The Kingdom has been implementing a strategy to consolidate its strategic position as a global logistics hub, improve the quality of life in Saudi cities, achieve a balanced public budget, and enhance the performance of the government apparatus.

Last month, the crown prince launched a plan to construct over 59 logistics centers, with the aim of transforming the Kingdom into a global logistical hub. This plan seeks to develop the infrastructure of the Saudi logistics sector, diversify the local economy, and elevate the status of Saudi Arabia as a leading investment destination. These 59 centers will be established across the entire Kingdom, including Riyadh, Makkah, Dammam, and 18 other cities.

As we are aware, logistics plays a crucial role in any economy. While specific information regarding the timeline and cost of implementation remains undisclosed, experts anticipate that this significant announcement made during the G20 meetings will pave the way for a prosperous corridor benefiting all stakeholders.

Basil M.K. Al-Ghalayini is the chairman and CEO of BMG Financial Group.