Saudi Arabia must plan carefully for ‘super cities,’ says strategist

The NEOM mega-city is part of plans to transform the Saudi economy. Reuters text, Caption text. (Reuters)
Updated 22 November 2019

Saudi Arabia must plan carefully for ‘super cities,’ says strategist

  • Author and global strategist Parag Khanna held up Dubai as an example of a city that was making major progress in the drive to ”smart status”
  • In his recent book “Connectography,” he said that research by consultants McKinsey found that the minimum size for a “super city” was 4 million inhabitants

BEIJING: Saudi Arabia has the potential to develop “super cities” in the Kingdom, but must pay careful attention to the economic fundamentals behind such projects, according to global strategist and author Parag Khanna.

Speaking at the Bloomberg New Economy Forum in Beijing, Khanna told Arab News: “When you are building a city from scratch, you have to be certain of the plan. What is the economic master plan? How self-sustaining will the city be? What will people living there do for a living?”

The Kingdom is planning the mega-city NEOM on the northwest coast, as well as several other developments, under the Vision 2030 strategy to transform the economy.

Khanna, author of the recent book “Connectography,” said that research by consultants McKinsey found that the minimum size for a “super city” was 4 million inhabitants. In Saudi Arabia, only Riyadh had surpassed that figure in a single conurbation.

“The way to make up the difference is to create “smart” cities that will increase connectivity and living standards,” Khanna said. He held up Dubai as an example of a city that was making major progress in the drive to ”smart status,” adding “for the first time in a long time, other Arab cities are looking at another Arab city as a model of the kind of city they would like to live in, rather than a city outside the Arab world.”

Khanna said that he did not know enough about plans for NEOM and other Saudi projects to know whether they would be successful in reaching “super city” status. “I’d have to kick the tires,” he said, pointing to developments along the Red Sea coast like the King Abdullah Economic City and the regeneration of Riyadh as other potentially successful urban projects. 

Super cities are conurbations that drive economic growth and improvement in living standards. “Urbanization has been the single greatest factor in improving the human condition,” Khanna said.

The Arab world and South America have historically been urban dominated, but the drive to city building recently has gathered pace in China and India.


Automechanika Riyadh opens, featuring leading global suppliers

Updated 25 February 2020

Automechanika Riyadh opens, featuring leading global suppliers

  • Saudi auto deals grew 40 percent last year with influx of female buyers

RIYADH: Leading names in the global auto services industry are out in force at Automechanika Riyadh — which opened on Monday at Al Faisaliah Hotel — vying to increase their share of a growing market expected to reach a value of $10.15 billion by 2023.

Automechanika Riyadh is the regional arm of the world’s largest trade fair, congress and event organizer, Messe Frankfurt, which has licensed the Automechanika brand to event organizer Al Harithy Company for Exhibitions (ACE) Group.

Mansour Abdullah Al-Shathri, vice chairman of the Riyadh Chamber of Commerce, inaugurated the trade event, which will run from Feb. 24-26.

It was revealed that Saudi auto deals grew approximately 40 percent last year, with female buyers accounting for between 10-15 percent of sales after the landmark decision to allow women to drive in the Kingdom for the first time.  

“International suppliers are stepping up their marketing for the resurgence in Saudi’s market, and this impacts the entire supply chain,” said Mahmut Gazi Bilikozen, show director for Automechanika Riyadh.

“While there is growth potential in the market, it is becoming a more competitive landscape and one which will also have to contend with evolving customer preferences. The conditions are ripe for new business relationships for those wishing to succeed in this transformative environment,” he added.

Zahoor Siddique, vice president of ACE, said: “Future vehicles will become more complex and challenging for the aftermarket industry. It is therefore imperative for manufacturers, local garages, technicians and mechanics to upskill and remain above the curve. 

 “Automechanika Riyadh is one such platform that can enable us to share and learn what the industry needs to unleash its potential.”

Two major US players — disc pad producer Giant Manufacturing and United Motors Mopar, the Kingdom’s sole distributor of Chrysler, Dodge, Jeep and Fiat cars — forecast a bullish market over the next few years.

Giant’s vice president, Eli Youssian, said he believed car sales in the Kingdom would grow by 9 percent annually until 2025, while United Motors District CEO Hassan Elshamarani expected another three million female drivers to be on the Kingdom’s roads by the end of the year.

Both Giant and United Motors launched new products at the show, with the former rolling out its new German-engineered Euro Premium Metallic Disc brake pads, and the latter introducing its Magneti Marelli spare parts.

The high potential of the new-look Saudi automotive landscape has also struck a major chord with South Korean suppliers.

The show’s Korean pavilion is hosting new-to-market entrants and existing suppliers all looking for business partners. With products from wiper blades to filters and air-conditioning parts to brake pads, the Korean contingent was positive about the Kingdom’s prospects.

One exhibitor, D Only Automotive, is looking to ring fence 10 percent of the Saudi brake market. “With more vehicles on the road, demand for brakes will increase, (so) we believe this is possible,” said President Jeon JaeWon.

Global research and analytics firm Aranca — Automechanika’s knowledge partner — has forecast that Saudi Arabia’s automotive spare parts and service market will grow at approximately 6 percent over the next five years to reach a value of $10.15 billion by 2023.

“The spare parts and service market for passenger cars alone is expected to eclipse $6.9 billion by 2023,” said Vishal Sanghavi, Aranca’s automotive practice head.