SAHIR BIN M. TAHLAWI Director General of Jeddah Islamic Port

PM Communications: Jeddah Islamic Port has a very secular tradition, bringing pilgrims from all over the world for many centuries, and has been one of the most important commercial ports in the Gulf region. What would you say are the comparative advantages of Jeddah Islamic Port comparing to other main ports in the area?

Capt. Tahlawi, Jeddah Islamic Port: We are different from other ports in this area, mainly because we have everything here. We handle, as you mentioned, passengers during the pilgrimages, live stock, cold storage/reefer cargo and containers. We have two container terminals, and we are now working very hard to extend that capacity to comply with requirements. We are ranked thirtieth in the top 100 Container ports in the world in terms of volume, and are the second largest port in the Middle East after Dubai.

Of course, one of the main advantages of the Jeddah Port is its strategic location in the middle of the Red Sea, while Dubai is on the other side. However, we are trying to improve many things not related to location, such as making our procedures easier, changing our tariffs depending on the market level, or trying to give the best services in terms of productivity to the shipliners.

We have invested already more than two billion Riyals in equipment and infrastructure in the last five years. There are almost twenty-two million tons more of cargo being handled now than five years ago, which is a huge increase.

PM Communications: Is there any chance of surpassing Dubai's capacity?

Capt. Tahlawi, Jeddah Islamic Port: They are working hard to increase their capacity, and so are we. There is enough business for everyone. It is not really a competition, but we are all trying to improve ourselves. Business is growing, as you know.

PM Communications: How do you differ from another port that is close by land, like Jizan for example?

Capt. Tahlawi, Jeddah Islamic Port: In Saudi Arabia, Jeddah is the main port; around sixty percent of the local market comes through Jeddah. Jizan is a smaller port than Jeddah and in a different location. Jeddah is the main commercial capital, most of the business is here, and that is why we are very happy that Jizan gets some business too. It is like a "younger brother", so to speak. But I think Jeddah's location and standards are leading.

PM Communications: How will the accession of Saudi Arabia into the WTO affect the activities of the Port?

Capt. Tahlawi, Jeddah Islamic Port: I think this will increase our business volume. We have a very open market here in Saudi Arabia. When you look at the market, you see items from everywhere, and we expect goods from all around the world. As long as you bring good standard items, you are most welcome.

PM Communications: As Director General of the Port, what are your top priorities both in the short and long terms?

Capt. Tahlawi, Jeddah Islamic Port: The biggest problem is that most of the cargo operations in Saudi Arabia have changed from traditional cargo to containers. Now, more than seventy percent of the cargo comes in containers, and this makes the general cargo and other cargo less competitive. Of course, we need to convert our port so it can meet the requirements of the container ships. The first step that I am going to do is to increase the container handling capacity in this port, which will be a big change. We now have a 3.5 million capacity and we are working to make it six million in a very short time.

With this rhythm, in one or two years we will not have any space left for containers. That is why our first priority is to increase the capacity of those containers by turning some general cargo berths into container berths, as well as building new terminals. That includes bringing new equipments, like container cranes and all the other supporting equipment that container terminals need.

We will start with this first step next year. We will increase our capacity by around one million containers, and then we will go to the next step, which is the container terminals, to be built within the next five years.

PM Communications: What about the Bond and Re-export zone? This zone was constructed in 2003. Could you tell us a little more about this and how to increase the productivity of the port?

Capt. Tahlawi, Jeddah Islamic Port: We will build the new container terminal in the free zone area, and this will help the free zone to operate. We are not happy about the free zone now. It still needs to be more developed. We are looking forward to being more active, but I think building a new container terminal there will make it a very busy area. I am confident we will reach the six million target.
For 2005 have achieved more than what we expected. We now have an increase of thirty percent, so we will reach our capacity faster than what we thought.

PM communications: What would be the reasons for such a success?

Capt. Tahlawi, Jeddah Islamic Port: One of the reasons is the country's booming economy. The port is ready to give the ships the best service. Our tariff now is competitive to others. Our procedure is becoming very easy now. These are the main points.

Now we have the EDI system in the ports, as well as X-ray machines to inspect the containers, making things easier for controlling. As you can see, nowadays we have mostly large ships, and most of the liners are there. We are very busy. My people in the control tower know very well that I am here, and even when they do not expect me to be here, I control everything. We want to keep our standards very high. I do not allow any irregular procedures. Even when a pilot comes out of the ship earlier than what he is supposed to, I do not accept it. He has to come off the ship in a certain location after he feels the ship is well safe outside the reef area. That is why I control everything from here very well. You know, I am a marine guy. I graduated from the Arab Maritime Academy in Egypt, and then I have been working with the government for twenty-eight years now, all of them in ports and shipping businesses.

PM Communications: What has been the most significant moment, if you can think back in time, for the port?

Capt. Tahlawi, Jeddah Islamic Port: The most significant moment was when we changed to the private sector, seven years ago when the Royal Decree came out, in 1998. That was a big change for the port, because this gave the private sector the chance to operate the port.

We have been increasing the capacity little by little: now we have two general cargo terminals, and in total, nine terminals. Every terminal is operated by a different private entity, which is a big change. Before the operators, when we wanted to buy a crane, it would take us one or two years to convince the Ministry of Finance to buy it. Now, with two private sectors ,we can buy twenty cranes without anyone's permission. Getting the Private sector in is a big revolution.

PM Communications: The revolution that will come soon is the privatization of the railways system, and its mega project "the Landbridge", which will link both sides of Saudi Arabia, from Dammam to Jeddah. To what extent will it increase the productivity of the port? Could it be another big boom as well?

Capt. Tahlawi, Jeddah Islamic Port: We expect the railway line to be operational in 2010. We also have another project under study to increase our capacity to nine million, but we will not start with this step unless the picture of the railway is very clear. When the contractors are awarded, or when the operations start, we will start doing that. It will be of great help to all the Gulf countries, like Bahrain or Qatar. It will be easier for them to transfer their cargos from here to any area, like Iran or the Asian countries.

But there is another project that has already been started, announced two years ago. It will help transfer raw materials from some mines in the north area to the industrial cities, such as Jubail, or Yanbu. This is mostly an industrial railway. It is not commercial. The government wants to do it, because the private sector is not willing to. This railway between Jeddah and Dammam would be a passenger and cargo railway.

PM Communications: Indeed, most of the cargo coming in containers is unloaded here and transported to Riyadh by truck, isn´t it?

Capt. Tahlawi, Jeddah Islamic Port: They go everywhere to the Kingdom by trucks, which increases the cost and damages the roads. Trucks damage the highway. One thousand trucks are going to Riyadh every day. It is a great pollution.

PM Communications: What would you say are the main challenges of the Port for the next two or three years?

Capt. Tahlawi, Jeddah Islamic Port: Keeping the standards is really difficult. People might be happy but as soon as they feel that you are not keeping the standards, they will disappear. Years ago they disappeared from here, and went somewhere else. So we brought new equipment, but ten years from now the equipments will not be advanced and new. The real challenge is to keep these equipments in a good condition, updating or even changing them.

PM Communications: King Abdullah promoted the image of the Kingdom of Saudi Arabia in the rest of the world and especially commemorated the economic ties with the UK. What do you think about this partnership with the UK, compared, for example, with the one held with the United States? How will it affect the resources of the ports?

Capt. Tahlawi, Jeddah Islamic Port: This relationship is not a new one. Since the foundation of Saudi Arabia, one of the countries with which we have a stronger relationship is the UK, and it is continuously improving. With some other countries, one day you have good relations but the second day you drop them. I grew up here, and I never saw, even with different Governments in England, that this relationship changed. It is not only the Government, but also the people. Saudis tend to spend their vacation in London. They prefer to go shopping in London, where you even find them wearing the Abaya. And sometimes more than the Abaya! This might not be acceptable in some other countries. There are big training contracts here for the Air Force and the Army. And there are so many Saudis studying in England. Some of them are on scholarships, or even the Government is supporting them. If the relation between the two countries was not good, they would never go there.

PM Communications: Did you notice any misperceptions towards Saudi businessmen when you traveled there?

Capt. Tahlawi, Jeddah Islamic Port: I never noticed that. I know about it from the newspapers, the radio, the news... There is security, and people who are watching, but it is their right. And they never disturbed me.

Things have changed. You do not have to be silly or easy, you have to be careful and helping the security, not disturbing them. You cannot go there and move freely like ten years go, this is a mistake people from here do. I think my decision was the right one. I did not face a problem because I was a little bit careful not to put myself in an uncomfortable position. That is to be questioned at least. This is the right thing to do. I will do it everywhere in the world. I will not put myself in a place where I can be suspicious. Politicians always try to take advantage of the situation, but the police sends a strong message to others; that they will not negotiate.

In Saudi Arabia, everyday they are catching two thousand or three thousand people involved in gambling, drinking, or drugs. They are captured because there is a security concern. The same goes for the flats. They monitor the flat and see that there are five or six people going in. So they think they are terrorists and go in. They capture them only to find that what they were really doing is gambling. Gambling here is prohibited.

They are catching a lot of people because they are now very suspicious and observant. People who have certain practices have to be more careful, not because the Government is against that, but because the Government is watching everywhere. Two years ago, they would not care even if they knew that one was gambling. Because they never watch private things unless you disturb others.

PM Communications: From a Saudi point of view, what would be your expectations from English businessmen coming to Saudi Arabia?

Capt. Tahlawi, Jeddah Islamic Port: I think that Saudi Arabia is more open now to the foreign investors. Saudi Arabia is changing its rules here to be accepted by the investors. I think that now a lot of investors are seeing changes here, like sponsorships or money business laws, and I think some of them are starting to come to Saudi Arabia for the huge businesses. Maybe the British do not take those risks like others, but I think very soon they will be convinced that we have good market and that things have really changed.

PM Communications: The report that we have from the World Bank, released last Monday says that Saudi Arabia was voted number one destination in the Arab World to do business in 2006, well ahead of Dubai and other countries. The eyes of the West are looking at the country with great interest. There is a lot of potential in many sectors, and great partnerships bring investors.

Capt. Tahlawi, Jeddah Islamic Port: Last week, the Japanese took part in a big petrochemical project in RABIGH, a 50%-50% joint venture with Saudi ARAMCO. They came here just last week with a British consultant. They are the consultants for RABIGH projects. It is a four billion dollar project.

ARAMCO always goes by the book. I used to tell jokes about ARAMCO. You come to them with a problem and they tell you that the answer will be in paragraph A number 0.5 in their law manual. They are very accurate. They are very different from us. That is why they also make jokes about us, that we have a governmental mentality, and all that. But there is also something called ARAMCO mentality. They are a very professional company. They are also very successful in Saudization; eighty five percent are Saudis. They pay well, but you have to work hard; at six thirty you have to be in the office, no matter what. Quarter to seven is the maximum, because at seven o'clock, conference calls start all over Saudi Arabia by telephones. You cannot leave before four or five o'clock in the evening. It is a very strict and well disciplined company.

ARAMCO was not here in Jeddah, they were always in Damman, Riyadh, and Yanbu. RABIGH refinery was added only a few years ago. Jeddah has a different lifestyle; people here are relaxed. They like to enjoy the beach and enjoy their life, so most of the Saudis quit ARAMCO and work somewhere else.

The older staff members call ARAMCO "The Serbs", as in tough invaders. Most of them left their work to work somewhere else, because in Jeddah people go to bed at four in the morning, so they cannot be in their offices at six thirty. And if you fail to check in with your card at six thirty in the office, it automatically goes out of your salary. And in fifteen days later you are terminated by the computer. They are one of the best companies in the world.

PM Communication: Captain Tahlawy, to finalize the interview, would you have a message to address to our readers? Is there anything you would like to add?

Capt. Tahlawi, Jeddah Islamic Port: As I said, we are working very hard to improve the ports, to keep them in a better shape. Until now, we have succeeded in keeping the customers happy. We will continue doing that, and we are welcoming any comments, suggestion, or ideas to improve. We will keep working hard.