RIYADH, 11 August 2005 — Saudi Public Transport Company (SAPTCO) has denied the allegation by Saudi investors in the land transportation business that SAPTCO is trying to stop the activities of national transportation companies and monopolize the international transportation market, Riyadh newspaper reported. The allegations were made after the government decided to Saudize jobs in companies working in the land transportation sector. SAPTCO said in a statement to Riyadh that the company applied the Saudization decision by Saudizing 42 percent of its jobs. It emphasized that its control over the largest share of the international transport market was due to its ownership of a large fleet, consisting of over 3000 new buses, in addition to their ability to compete in terms of prices.
Investors in the transportation sector said that many companies were facing bankruptcy after the government refused to stand with them, insisting that 30 percent of their jobs are Saudized and ending the policy of issuing temporary visas. Investors said they tried to Saudize some of their jobs but they could not get Saudis to fill the positions. They considered the government’s insistence on their decision as an intention to drive them outside the market and make SAPTCO the monopolizing company.
Furthermore, SAPTCO reduced its international land transportation and kept it fixed, which is the opposite action from other transportation companies that increased their prices by 100 percent to make up for the loses.
SAPTCO explained that it does not rely on seasonal prices and increase in demand unlike other carriers that change prices depending on the season.
Investors in the land transportation activities relate the increase in prices to the large number of Saudis and non-Saudis wanting to travel abroad on vacation. Other investors attribute the increase to the shortage of departing buses since many national companies had to suspend their activities due to the government decision. The Saudi companies tried to hire drivers from abroad for their international routes but employment offices refused, saying that all these jobs are limited for Saudis only.
The land transportation committee in Riyadh Chamber of Commerce and Industry described the situation of the international transportation companies as a disaster. Abdul Aziz Al-Rakban, head of the committee, said that the committee contacted the Ministry of Interior to delay the decision because of the difficulties facing the investors due to the lack of Saudi drivers. Investors turned to the committee for help and a quick solution to solve this problem with the government departments concerned with implementing the Saudization policy.
In addition, since January, Saudi embassies abroad stopped issuing entry and exit visas for the companies’ drivers in compliance with the new regulations that aim to improve the mechanisms at the customs entry points of Saudi Arabia, which caused the halting of many land trips.
In related news, investors in the Saudi land transportation companies started to move their companies to neighboring countries after it became more profitable to operate outside the country than inside the country. The manager of a transportation company told Al-Watan newspaper that it was due to problems in obtaining visas for foreign drivers. Because of the lack of foreign drivers, these companies had to turn to Saudi drivers who demand high salaries compared to foreign drivers. He expects transportation prices to continue rising which will be reflected in the prices of consumer products.
