JEDDAH, 20 February 2007 — Saudi Arabia will announce in 10 days the winners of contracts for establishing and operating duty-free shops at its airports, according to Abdullah Ruhaimy, president of the General Authority of Civil Aviation (GACA). He said the GACA was studying offers from five Saudi and seven international companies.
“We’ll select the Saudi company and its foreign partner within the next 10 days,” Ruhaimy told Al-Jazirah Arabic daily. He said the contract winners would make capital investments for the design, establishment and management of the markets under the authority’s supervision. GACA will share the revenues. He also disclosed plans to establish a new airport this year in the historic township of Al-Ola, which includes Madain Saleh. The contract for building the airport will be awarded within a few days, he added. The GACA is currently implementing airport projects in Yanbu, Bisha, Najran, Tabuk, Hail and Taif. Ruhaimy emphasized plans to transform the Kingdom’s international airports into state-owned companies, adding that GACA would begin commercial operations of airports within three years. “The international airports will be given corporate identities with independent financial status before being transferred to the ownership of companies fully owned by the state,” he explained.
Ruhaimy said the new plan would improve management of the airports. “This will eventually help the state take a decision on privatization of these airports.” He said the authority was studying a proposal to set up business cities within the Kingdom’s airports. “There is a plan to establish an exhibition center and a hotel at King Fahd International Airport in Dammam,” he said, adding that many businessmen in the Eastern Province had expressed their interest in the project.
Ruhaimy said the Kingdom’s newly licensed domestic private airlines would be allowed to operate international flights after a review of their performance for two years. “We’ll review the performance of NAS and Sama after two years of operation. If the two companies work in accordance with their commitment, they will be given international transport licenses,” he said.
The GACA chief said the licensing of more private airlines would depend on market requirements. “If we find that there are adequate justifications, then we’ll advise the authority’s board of directors to accept new applications,” he said. The GACA board, chaired by Crown Prince Sultan, deputy premier and minister of defense and aviation, licensed NAS and Sama in December 2006 to operate domestic flights, thus ending the monopoly of Saudi Arabian Airlines. NAS will be the first private airline to operate domestic flights in the Kingdom.
According to Peter Griffiths, CEO of NAS, the low-budget airline will initially operate with three Airbus A320s. By the end of 2007 its fleet is expected to number eight. “Our strategy is to democratize air travel to its core,” he said.
From Mar. 31, the carrier will be adding additional daily flights to Madinah, Jizan and Rafha.