YANBU INDUSTRIAL CITY: WHERE INNOVATION DRIVES INDUSTRY

An Interview with Abdulhadi Al-Juhani, CEO of the Royal Commission in Yanbu

What are the biggest challenges and opportunities in order to achieve the Kingdom’s Vision 2030 goals?

"Since the launch of Vision 2030, we have laid a solid foundation for success by implementing unprecedented reforms in the public sector, the economy, and society as a whole. Saudi Arabia has a favorable business environment due to its policies and incentives for investors. Our ambitious Vision 2030 is pushing Saudi Arabia through a transformation toward an optimistic future with plans for nurturing a more spirited and diverse society. To achieve this, Yanbu is expanding itself to almost twice its current size with new infrastructure, utilities, and support services. Yanbu also has an increased focus on environmental sustainability and expansion into new industrial sectors.

Yanbu is a typical industrial fortress, a work of art in architectural engineering, and a platform with unlimited capabilities, among other cities. It is strong evidence of what has been achieved under our rational leadership strategy. In Yanbu, we have a major port city on the Red Sea coast of Saudi Arabia, which provides access to the world economy. During the pandemic, global industries faced major disruptions and rising production costs. Therefore, companies are now relocating their facilities to safer and more secure investment environments.

Since the inception of Vision 2030, we have laid a robust foundation for success by implementing unprecedented reforms across the public sector, economy, and society as a whole. Saudi Arabia has cultivated a favorable business environment, characterized by progressive policies and incentives designed to attract investors. Our ambitious Vision 2030 is propelling Saudi Arabia through a transformative journey toward a brighter future, emphasizing the cultivation of a more dynamic and diverse society. To accomplish this vision, Yanbu is undergoing substantial expansion—nearly doubling its current size—with investments in infrastructure, utilities, and support services. Yanbu is also placing heightened emphasis on environmental sustainability and venturing into new industrial sectors."

KSA is transforming its cities into world-class retail destinations to become a global economic powerhouse and an international business hub through the National Transformation Plan (NTP) and Vision 2030. Could you elaborate on the strategic vision for Yanbu Industrial City in the coming years?

"I can discern the distinct priorities and focal points that Yanbu diligently upholds for its investors. In fact, Yanbu boasts seven primary priority areas of focus. Notably, Yanbu City stands as the world's third-largest refining hub, underscored by its distinction as home to the largest oil shipping port and a major liquid handling terminal along the Red Sea. The Royal Commission in Yanbu provides world-class infrastructure, encompassing an extensive utility network, meticulously designed to accommodate diverse industries. Yanbu offers an extensive gas network, encompassing hydrogen, oxygen, nitrogen, and natural gas, alongside a well-developed community that ensures a high quality of life.

Yanbu ranks among the most favorable investment destinations. As previously mentioned, we are referring to the critical raw material feedstock, facilitated through Saudi Aramco, particularly oil and gases. All the various industries operating within Yanbu rely on this feedstock, gas network, infrastructure, and industrial gases, all readily available within Yanbu. In my humble opinion, Yanbu stands as one of the world's most well-suited industrial cities for investors to consider."

Yanbu Industrial City: A Hub of Sustainable Growth and Industrial Innovation

Yanbu Industrial City is ideally situated for the development of minerals and mining. Saudi Arabia has identified mining as a key sector with significant potential for future development. The country estimates its untapped mineral resources have a potential value exceeding SR4.9 trillion ($1.3 trillion), according to the Saudi Geological Survey (SGS). What stage is the mineral sector at now, considering Saudi Arabia is the most mineral-rich country in the region, and how is Yanbu positioned to take advantage of this scenario?

"In the mining sector, the Royal Commission is engaged in a collaborative partnership with the Ministry of Industry and Mineral Resources. Among the strategic initiatives within Yanbu's industrial cities is the development of a mineral and metal center that will serve as a regional hub for the distribution and transshipment of mining materials along the Red Sea coast. The primary objective of this mineral distribution hub is to facilitate the export of minerals extracted from the Arabian Shield, including gold, iron, copper, and various other mineral deposits. Yanbu remains committed to advancing in this sector, and I believe it holds significant promise, poised to shine brightly for years to come."

Saudi Arabia plans to double the value of its manufacturing sector—currently worth $100 billion. The Saudi Advanced Manufacturing Hub (AMHUB) is a collaborative platform for the Kingdom’s industrial stakeholders. It is part of the World Economic Forum’s Global Network of Advanced Manufacturing Hubs—regional centers of collaboration aimed at tackling some of global industry’s most pressing challenges. How vital is collaboration between government, industry, and academia to create the right ecosystem to allow SMEs and companies to thrive?

"As I just mentioned, Yanbu has the capability of supplying, through Aramco, the feedstock to various industries and providing an extensive network of industrial gases. Equally important, however, is our attention to quality of life—especially in health and education. Yanbu hosts several engineering and technology colleges, as well as institutes offering tailored programs to meet the needs of industries operating within the city.

Moreover, major companies like Saudi Aramco run their own Industrial Training Centers (ITC), which graduate professionals in operations, maintenance, IT, laboratory, and administration. Yanbu has become a self-sustaining city, fully equipped to support both industry and family life—offering medical facilities, training institutions, and other services that enhance the overall quality of life."

Could you provide insights into the specific incentives and advantages that make Yanbu an appealing destination for Chinese businesses?

"I have accumulated 30 years of valuable experience with Saudi Aramco, including eight years with YasRef—the Yanbu Aramco Sinopec Refinery. YasRef stands as one of the largest and most advanced facilities for processing Arab heavy crude oil, and I had the privilege of working closely with them for a year. This joint venture reflects one of the earliest instances of cooperation between Saudi Arabia and the People’s Republic of China.

In addition to YasRef, there are numerous other Chinese investments in Yanbu that we actively support and facilitate. The Chinese presence here began approximately 12 years ago with the refinery project, and today we engage with a wide range of small and medium-sized enterprises. We look forward to deepening this bilateral cooperation in the years ahead."

The world is moving toward the increased adoption of environmental, social, and governance (ESG) standards across all sectors of the economy. What steps has Yanbu City taken to integrate sustainability practices into its operations, and what sustainability initiatives have been implemented to minimize its environmental impact?

"Yanbu Industrial City is the first operational city in the world to achieve global-level certification in Leadership in Energy and Environmental Design (LEED). This recognition demonstrates that we are on the right track toward sustainable urban-industrial development. The certification reflects not only our commitment to innovation and collaboration but also our vision of building a resilient and environmentally conscious city that serves as a global model.

Our residents enjoy access to clean water, clean air, green spaces, housing, and employment opportunities—all within a city designed for sustainable growth. This vision aligns perfectly with global frameworks, including those of the European Commission and the U.S. Green Building Council. Sustainability, while vital for the planet, also enhances industrial performance—reducing operating costs, boosting innovation, strengthening reputation, and attracting environmentally conscious investors and consumers."

Looking ahead, where do you see Yanbu in five years’ time?

"Our dedication to transparency in reporting on the economic and environmental aspects of our operations remains unwavering within the Royal Commission. Our goal is to position Yanbu as a global benchmark for sustainable industrial cities. Over four decades, the Royal Commission has remained steadfast in developing industrial cities that coexist harmoniously with nature, serve diverse communities effectively, and inspire investors to pursue a brighter future."

How does Yanbu ensure a favorable business environment for investors, including factors such as infrastructure, regulation, and access to skilled labor?

"Yanbu recently became the second city in the Kingdom to receive UNESCO recognition for its exceptional educational initiatives. In September 2022, UNESCO acknowledged Yanbu Industrial City for its strong commitment to lifelong learning and its proactive approach to fostering inclusive, resilient, and sustainable development.

We believe that embracing the concept of a ‘learning city’ enhances Yanbu’s competitiveness and long-term sustainability. Our industrial ecosystem is supported by vocational and capability-building programs, tailored to meet the specific requirements of each project. As industries establish operations, they gain access to a highly skilled workforce trained locally to meet the highest international standards."

Disclaimer: The information in this publication is provided by the interviewees. It does not reflect the editorial opinions of Forbes China.