GLOBAL SUPPLY CHAIN JULY AUGUST 2019 ISSUE

July/August 2019 Issue 61

ENHANCING THE BUSINESS OF LOGISTICS

ARBITRATION COMES OF AGE IN THE UAE

EMAC takes business mainstream World Distribution Centre Leveraging distribution proďŹ ciencies

Etihad Rail

Phase 2 on track with contracts awards

RAKEZ

The magnet for investors and investments

TURKISH CARGO MAINTAINS

ITS SPEED OF OPERATION. Turkish Cargo continues its operations both at Ataturk and at Istanbul Airpo s maintaining its consistency for quality and care. Its “on-time pe ormance�, defined as planned arrival/depa ure hours, reached an even higher level this year than in the first qua er of 2018.

According to WACD (World Air Cargo Data), the company maintained its 7th position in the rankings, with a tonnage in the first qua er of 2019 amounting to 11.6%. When all phases are complete, Turkish Cargo will comprise a total area of 300,000 m2, giving it the capacity to handle four million tons of cargo at the terminal every year. Freighter operations will continue to be carried out from the existing terminal at Ataturk Airpo .

turkishcargo.com

                                                                  ’                            

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Arbitration: Walking the fine line between negotiation and adjudication SIGNATURE MEDIA FZ LLE P. O. Box 49784, Dubai, UAE Tel: 04 3978847/3795678 Email: info@signaturemediame.com Exclusive Sales Agent Signature Media LLC P.O. Box 49784, Dubai, UAE Publisher: Jason Verhoven jason@signaturemediame.com Editor: Malcolm Dias malcolm@signaturemediame.com Art Director: B Raveendran ravi@signaturemediame.com Production Manager: Roy Varghese roy@signaturemediame.com

Printed by United Printing Press (UPP) – Abu Dhabi Distributed by Tawseel Distribution & Logistics – Dubai

Contributor’s opinions do not necessarily reflect those of the publisher or editor and while every precaution has been taken to ensure that the information contained in this handbook is accurate and timely, no liability is accepted by them for errors or omissions, however caused.

Articles and information contained in this publication are the copyright of Signature Media FZ LLE & SIGNATURE MEDIA LLC and cannot be reproduced in any form without written permission.

According to historians, ‘Arbitration’ in the maritime and logistics sectors has been a practical and largely wellimplemented and successful method of dispute resolution even in Ancient Greece. The model has also been widely used in the Middle Ages.

Subsequently, arbitration has evolved considerably and continues in tandem with the rise of international uniform law. Its application and suitability is in part due to its remarkable advantages over litigation, such as flexibility, confidentiality and, more generally, the option for the litigants to determine a mutually acceptable and beneficial outcome and solution.

It is with this perspective in mind we chose to focus on arbitration and its ancillary fallout – mediation, negotiation and intercession in this edition of Global Supply Chain. The Emirates Maritime Arbitration Centre (EMAC) was established

by Emiri Decree in April 2016 with its stated goal and mandate to develop a ‘hybrid-form, ad hoc arbitration mechanism with a light-touch case management and regulations that allow for emergency arbitration and fast-tracking’.

Accordingly EMAC enjoys financial and administrative independence, in order to provide its services with full transparency and impartiality. We talk exclusively with Majid Obaid Bin Bashir, Acting Chairman and Secretary General. EMAC. Ras Al Khaimah Economic Zone (RAKEZ) has been one of the most successful free zones in the Middle East, currently home to over 14,000 business entities from 100 countries in over 50 industry sectors. In a wide-ranging interview, we speak to Ramy Jallad, Group CEO, RAKEZ to get the low down on this progressive free zone.

Also included in this edition are an interesting string of contributory articles from the ethereal world of academia and professionals in high corporate positions. These include an analysis of the importance and practicality of the cold chain in the agricultural sector; technology and technological skills vitally needed to successfully roll-out Industry 4.0 Pilot Projects, Fintech and a commentary on the not too-smooth Silk Road as part of China’s Belt-and Road Initiative.

All this and much more; enjoy the read!

Malcolm Dias Editor malcolm@signaturemediame.com

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July/August 2019 Issue 61

ENHANCING THE BUSINESS OF LOGISTICS

by Emirates Global Aluminium for expansion of the latter’s production facilities.

48 SirajPower powers up RSA TALKE Solar panels have been installed by SirajPower in RSA TALKE’s complex in Jebel Ali, Dubai.

20 06 NEWS 20 Maritime & Logistics Arbitration Arbitration takes centre-stage with the establishment of the Emirates Maritime Arbitration Centre in Dubai International Financial Centre (DIFC) tasked with the directive to preside over and resolve disputes between litigants.

26 World Distribution Centre Founder-CEO Khamid Ismatullaev talks business, realities, challenges and his vision for the future.

30 Etihad Rail – Phase 2 The UAE’s National Rail Network gets chugging along and dispenses bigticket contracts to qualified bidders.

32 Skills required to successfully harness Technology Andy Coussins, Head of International, Epicor Software, highlights the vitally needed skills to successfully rollout Industry 4.0 Pilot Projects in the Logistics sector

49 Avoid Analysis Paralysis capabilities with the establishment of a dedicated facility in Chicago, Illinois, USA.

36 Abu Dhabi Ports Port Khalifa is now capable of berthing Capesize vessel, the mega bulk carriers carrying the raw material bauxite from the Republic of Guinea (Africa) for the Emirates Global Aluminium plant adjacent the Port.

38 Abu Dhabi-Mauritius Ports Agreement Abu Dhabi Ports and Mauritius Ports Authority recently signed a cooperation agreement in the UAE capital.

39 DP World makes energy forays DP World has acquired Topaz Energy, thereby sealing its entry in the energy sector.

40 RAKEZ Ramy Jallad, Group CEO, Ras Al Khaimah Economic Zone (RAKEZ) chars exclusively to Global Supply Chain.

47 EGA-SNC Lavalin 34 Emirates SkyCargo’s cold Cooperation chain sector heats up Canadian company SNC-Lavalin UAE’s carrier expands its pharma

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has been awarded a major contract

Hesham El Komy, Regional Vice President, Middle East, Africa & India (MEAI), Epicor Software, makes the case for using data to enable decision-making and growth.

50 Warehousing Bonanza The Senaeyat Project in Dubai Investment Park (DIP) by Lootah Real Estate Development opens new warehousing possibilities.

52 Expert Contribution Prof. Omera Khan comments on the not-so-smooth Silk Road and the ambitions of the Chinese Government with its Belt & Road Initiative.

54 Cold Chains Professor in Clean Cold Economy, The University of Birmingham, UK, puts the cold chain sector under the scanner.

56 Fintech-Logistics Interface Chartered Accountant Mahmood Bangara, Chairman of the Institute of Chartered Accountants of India (ICAI) Dubai Chapter comments on what binds the two sectors.

60 GCC construction industry in high gear The recent BNC Construction Intelligence Report bodes well for the industry in the GCC.

FAMCO receives largest Volvo order for Euro VI City buses in the Middle East RTA has contracted FAMCO to supply 373 Volvo SB3 buses In Volvo’s largest chassis order to date in Dubai, and the largest ever purchase of Euro VI city buses in the Middle East region, FAMCO and Volvo Buses have been selected as the supplier of 373 city buses to Dubai Roads and Transport Authority (RTA).

The RTA’s contract to purchase 373 Volvo SB3 buses along with a 10-year maintenance contract with FAMCO’s newly created buses division is in support of Dubai’s mobility plan

Saudi’s Almajdouie Logistics supports Kingdom’s wind energy projects Top Saudi Arabian logistics services provider Al Majdouie Logistics, has invested in new trailers from Germany’s Goldhofer to support the Kingdom’s renewable energy expansion In line with ongoing efforts to support Saudi Arabia’s ambitious Vision 2030 renewable energy goals, Almajdouie Logistics has purchased 60 axle lines of

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and to cope with the rising number of public bus riders. It will be the first time that the new Euro 6 standard-compliant buses will be operated in the MENA region. FAMCO is the exclusive dealer for Volvo buses and trucks in the UAE. The contract signing took place on the sidelines of UITP Summit in the Swedish capital Stockholm. Mattar Al Tayer, DirectorGeneral and Chairman of the Board of Executive Directors, RTA, and Håkan Agnevall, President, Volvo Bus Corporation, signed the contract in the presence of

hydraulic trailers from Goldhofer.

Eyad Arafah, General Manager – Heavy Lift, Almajdouie Logistics, said the units, which will be delivered within the next two months will be used to support upcoming wind energy projects.

“These specialised blade trailers will be able to support upcoming renewable energy projects in northern Saudi Arabia, which should start in 2020. When we look at the current projects that we are bidding on, we can see that there is a lot of potential – the demand is there,”he explained.

representatives from FAMCO, Volvo and RTA. “The procurement of these new buses is part of RTA’s strategy to improve Dubai’s public transport services in the Emirate and meet the sustained growth of public transport riders. It serves RTA’s efforts to raise the share of public transport ridership to 26% by 2030,”said Al Tayer.

Each bus can accommodate 74 riders and is fitted with interactive touch screens to display instant information about the journey. Buses are also equipped with Raqeeb (Driver Behaviour Monitoring) System to track drivers’ exhaustion by using innovative technology to enhance bus safety standards.

They also have Rasid (Automated Passenger Counting) System to record the actual number of passengers and match it with the Automated Fare Collection System.

“This tender was evaluated based on total cost of ownership comparison, including fuel and operational costs, and Volvo came out as the most competitive alternative. The order is a recognition of the value we deliver to the RTA”, commented Håkan Agnevall.

“During the procurement process, RTA was keen to ensure that these buses are compatible with European Carbon Emission Standards, which are in line with RTA’s efforts to protect the environment and enhance power efficiency,”remarked Ahmed Hashim Bahrozyan, CEO of RTA’s Public Transport Agency.

In addition to wind energy, a number of desalination plants, as well as petrochemical and solar projects, are being planned to support the Kingdom’s energy diversification objectives.

According to Arafah, the purchase of the Goldhofer trailers is part of the logistics services provider’s planned fleet renewal ahead of these upcoming projects.

Tristar launches 7th Sustainability Report 2019

Automotive sector on the upswing in JAFZA The Dubai Chamber of Commerce and Industry has revealed that Dubai’s automotive sector is poised for growth and is expected to increase by 35% between 2017 and 2021 due to the steadily growing spare parts and accessories market.

A key player in the automotive sector, Diesel Technic is manoeuvring itself to capitalise on this advancement. The German-headquartered group has 41,000 products covering the full range of automotive parts and accessories and has been a leading player in the GCC’s automotive and spare parts and accessories sector since 1995.

Since the commencement of its operations in JAFZA, the business has grown from AED 2 million to AED 290 million. In addition, Diesel Technic has expanded operations covering Kuwait, Syria, Libya, Iran, Iraq, Oman and Yemen.

Furthermore, they are now present in Kenya, Zimbabwe, Zambia, Angola and several other countries in Africa.

“We see tremendous potential for the UAE’s automotive sector, and we intend on leveraging the strong trade ecosystem DP World has created with Jebel Ali Port and JAFZA to enhance our access to markets across the region. We also intend on working closely with the free zone to further strengthen Dubai’s automotive and spare parts and accessories trade,” explained Dirk Heibel, General Manager, Diesel Technic (ME).

DP World’s Jebel Ali Port and JAFZA have created a hub for the automotive transport and spare parts sector in the Middle East. According to Mohammed Al Muallem, CEO and Managing Director, DP World UAE Region, as an enabler of global trade, DP World helps customers manage the complexities and reduce the costs of the global supply chain.

The integrated automotive logistics facilities offer a wide range of services such as automobile storage, parts and aftermarket logistics, distribution and transportation management, inventory management and value-added services It also enables reverse logistics, customs brokerage, freight forwarding by land, sea and air, and modal conversion, from RoRo to container.

CSR award-winning and leading oil, gas and liquids logistics services provider Tristar Group launched its 7th consecutive Sustainability Report with a commitment to further support the 17 UN Sustainable Development Goals (SDGs).

Tristar Group CEO Eugene Mayne handed the first copy of the report entitled ‘Empowering the Next Generation for Sustainable Development’ to Emirates Environmental Group Chairperson Habiba Al Marashi in a town hall meeting held recently at the Tristar head office in Jebel Ali where the company celebrated World Environment Day. “We acknowledge the social impact of our business in the communities in which we operate. We at Tristar believe that Business for Purpose must rank at par with Business for Profit and we will continue to champion this mission in the years to come,”declared Mayne.

Tristar is promoting SDG No. 3 on Good Health and Well-being and No. 4 on Quality Education with its road safety awareness campaigns in the GCC and with its support to the education sector in South Sudan and Kenya respectively.

Habiba Al Marashi commended Tristar for being a homegrown responsible business.“I am delighted to be launching the 7th edition of the sustainability report of our corporate member. I am sure Tristar will continue to be committed to reporting on its initiatives leading by example, and I hope to be part of all the sustainability milestones throughout its journey,” she remarked.

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Gallega Global Logistics opens Abu Dhabi facility in KIZAD Gallega Global Logistics, a UAE-based third-party logistics company, has opened a 325,000 square metre facility in Khalifa Industrial Zone Abu Dhabi (KIZAD) to meet the growing regional demand for automotive supply-chain services.

The facility was inaugurated at a ceremony attended by senior representatives from Abu Dhabi Ports and KIZAD, as well as senior representatives of other industries in the UAE. Gallega’s leased facility in KIZAD coincides with an increased presence of both logistics and automotive in the industrial zone where several leading industry players operate.

“KIZAD is rapidly expanding as more and more companies see the value of having a presence here, especially in the fields of logistics, manufacturing and trading enterprises. Since its inception, KIZAD

has already attracted a wide arrange of industries, including aluminium, packaging, food processing, polymers, and, of course, automotive,”said Captain Mohamed Juma Al Shamisi, CEO, Abu Dhabi Ports “Gallega will be a partner to KIZAD and Abu Dhabi Ports attracting more businesses who will benefit from our strategic location.

Large manufacturing projects will increase the need for logistics and other services in the coming years,”commented Ghassan Aboud, Chairman of the Ghassan Aboud Group.

Gallega’s facility at the zone offers finished vehicle logistics, general warehousing, automobile workshop, customs clearance

and transportation services, geared primarily towards regional distributors, dealers and global original equipment manufacturers (OEM). In addition to its operation in KIZAD, Gallega has hubs in Belgium and Jordan.

“Gallega’s new facility provides us with the ability to deliver outstanding levels of service to our customers in the region,”remarked Shirish Deshpande, CEO, Gallega.

Gallega offers end-to-end supply chain solutions for global customers in air, sea and land freight forwarding, land transportation to GCC and the Levant, as well as customs bonded warehousing and customs and VAT documentation.

BIMCO, the objective was to ensure that parties pay attention to terms that work for the purchase and supply of marine fuels to ships when the 0.5% Sulphur Cap takes effect.

The seminar further shed some light on the transition of fuels specific to Time Charter Parties that are in place and will overlap the Sulphur Cap application date.

“Hosting BIMCO for a seminar on a very relevant matter, is yet another way that EMAC is able to add value to maritime stakeholders in the region who may seek alternative dispute resolution support in

future,”said Majid Obaid Bin Bashir, Acting Chairman and Secretary General, EMAC. “The shipping industry is in need of contractual clarity and standard contracts and clauses to assist in a period of big change for the shipping community,”commented Erik Jensby of BIMCO. BIMCO is the largest of the international shipping associations representing shipowners; its membership controls around 65% of the world’s tonnage and it has members in more than 120 countries, including managers, brokers and agents.

Emirates Maritime Arbitration Centre hosts BIMCO Bunker Terms Seminar The Emirates Maritime Arbitration Centre (EMAC) has continued to engage with various firms to provide a platform that brings attention to trending regulatory and law related discussions specific to maritime.

In hosting the recent ‘BIMCO’s Bunker Terms 2019’ seminar, the Centre has once again ensured that stakeholders learn more about risk management specific to contracts that are tied to the changes in regulations applicable to the IMO’s 2020 Sulphur Cap. In an announcement followed by the IMO’s regulation capping the global fuel sulphur limit international regulation at 0.50% being enforced from 1st January, 2020, the bunker fuel supply and availability landscape will undoubtedly change and as a result impact the shipping industry.

Presented by Erik Jensby, Head of Membership and Business Development,

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Bahri orders new VLCCs from IMI and HHI Bahri, the leading Saudi Arabiaheadquartered logistics and transportation services provider has announced the signing of a Memorandum of Understanding (MoU) with International Maritime Industries (IMI) and Hyundai Heavy Industries (HHI) to build new Very Large Crude-oil Carriers (VLCCs).

As part of the agreement, Bahri is committed to issuing IMI its first order before the end of July 2019. Following the placing of the order, IMI will engage HHI as a subcontractor to build the vessel in South Korea.

HHI, in turn, will help facilitate the transfer of knowledge enabling IMI to independently build VLCCs to international shipbuilding standards in Saudi Arabia.

“This agreement, which further strengthens our strong strategic relationship with IMI and HHI, signifies a major development in this direction, and we are confident it will provide a boost to our ongoing efforts aimed at enhancing our

offerings and bolstering our capabilities,” affirmed Abdullah Aldubaikhi, CEO, Bahri.

“This agreement contributes to the development of a localized maritime industry supply chain infrastructure, technical expertise for Saudi nationals, and a track record in shipbuilding,”asserted Fathi K. AlSaleem, CEO, IMI. International Maritime Industries is a joint venture between Saudi Aramco, Bahri, Lamprell, and Hyundai Heavy Industries.

Located in the King Salman Complex for International Maritime Industries and

Services at Ras Al-Khair, Saudi Arabia, IMI is tipped to be the largest, full-service maritime facility in the Middle East and North Africa.

With a capacity to manufacture four offshore rigs, over 40 vessels including three VLCCs, and service over 260 maritime products on an annual basis, the facility will propel growth in the Kingdom’s logistics and transportation sector.

Major production operations are expected to commence toward the end of 2020 with the facility reaching its full production capacity by 2022.

Executive Officer, Etihad Aviation Group.

The new platform leverages artificial intelligence to support and augment written business proposals generated by staff, while

enabling an open feedback and collaboration learning loop, based on the principles of transparency and meritocracy, to help escalate the best ideas forward efficiently.

For the first time, employees have the power to shape organisational strategy by voting, commenting and providing constructive feedback on their colleague’s ideas, playing a direct role in the decisionmaking process.

Ideas that ‘graduate’ from the platform will be provided with seed funding and support through Innovate Lab, Etihad’s innovation lab. The Lab supports rapid trial and iteration of promising ideas and projects, accelerating the delivery of prototypes, pilots, proof of concepts and minimum viable products.

“We believe Swae’s platform can help Etihad improve the inclusivity and quality of bottom-up ideas, and allow employee generated innovations to significantly influence the broader strategic direction of the organisation,”remarked Soushiant Zangenehpour, CEO, Swae.

Etihad Airways partners with Swae to launch crowd sourcing platform for employees Etihad Airways and Swae, an awardwinning startup based in Vancouver, have partnered to launch iFikra, an artificial intelligence-powered platform aimed at unlocking the full potential of Etihad’s workforce by enabling every employee to contribute to innovation.

Designed to harness the collective creativity of the organisation, the iFikra platform is a pilot aimed at promoting ‘intrapreneurship’ by allowing employees to propose innovative solutions to address Etihad’s ongoing business challenges and untapped opportunities.

“If we are operating more inventively internally, our guests will have a far more superior experience when they choose Etihad,” said Tony Douglas, Group Chief

JULY/AUGUST 2019 9

ADNOC and OCI in JV to develop new nitrogen fertilizer complex The Abu Dhabi National Oil Company (ADNOC) recently announced a new strategic partnership with OCI, a global producer and distributor of natural gasbased fertilizers and industrial chemicals, headquartered in the Netherlands.

The partnership will see ADNOC combine its fertilizer business, ADNOC Fertilizers, into OCI’s Middle East and North Africa (MENA) nitrogen fertilizer platform to form a new joint venture (JV).

The JV will become the largest export-focused nitrogen fertilizer platform globally and the largest producer in the MENA region with a production capacity of 5mn tons of urea and 1.5 million tons of sellable ammonia. ADNOC and OCI will own a 42% and 58% stake in the JV respectively.

In conjunction with this joint venture, ADNOC Fertilizers has also signed a new long-term gas supply agreement with ADNOC, which will provide its facilities in Ruwais with the required feedstock for its operations based on a competitive pricing formula.

Dr. Sultan Ahmed Al Jaber, UAE Minister of State and CEO, ADNOC Group, will be Chairman of the Board. Nassef Sawiris will assume the role of CEO of the JV, alongside his current role as CEO, OCI. “Pooling our assets and capabilities is a value enhancing step for both companies, allowing us to leapfrog competitors to become the top nitrogen export platform globally,”commented Dr. Sultan Al Jaber.

“I believe that this platform has significant potential for future

PTV Group selected as a sub-contractor for Ashghal’s Road Management Centre PTV Group, a leading provider of traffic and logistics software solutions, recently announced that they are appointed as a sub-contractor to the Consortium selected by Ashghal, Qatar’s Public Works Authority, for its project to design, build and implement an Intelligent Transportation System (ITS) software solution for the Roads Management Centre (RMC).

The ITS software solution will seamlessly integrate all the currently separate road sub-systems making RMC the central hub of all monitoring, operation and management within Qatar.

PTV Group will provide software for micro simulation and traffic forecasting. The company will collect

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growth and value creation, with the support and under the guidance of its two key shareholders,”said Sawiris.

ADNOC Fertilizers has a track record of more than 35 years in fertilizer production, operating two plants in ADNOC’s integrated downstream complex in Ruwais in the UAE. The plants combined have an annual capacity of 1.2mn tons of gross ammonia and 2.1mn tons of urea.

available GPS data and extract speeds that can be used for simulation and real-time and mid-term forecasts, for the whole Qatar network.

PTV software will also be used to calculate Estimated Time of Arrivals (ETA) of public transport services at stops, as well as transfer alerts on stops where transfer time exceeds given threshold, due to delays. The software programmes that will be used for this project are PTV Optima, PTV Visum and PTV Vissim.

“Our software programmes offer an extensive range of dedicated features and detailed modelling possibilities. We will implement real-time model-based solutions and microsimulation modelling to assist in managing and monitoring the roads under the responsibility of the Roads Management Centre,” affirmed Andrea Petti, Managing Director, PTV Group MENA.

Intertek awards Almarai the ISO 9001:2015 Certification Intertek, a leading Total Quality Assurance provider to industries worldwide, has awarded Saudi Arabia’s Almarai Company, Middle East’s leading food and beverage manufacturer and distributor, the ISO 9001:2015 certification for Quality Management Systems.

The certification has been obtained for all Almarai’s operations in the Kingdom through a series of multi-site certification audits across its various subsidiaries and facilities in the Kingdom. The Intertek ISO 9001 certificate is accredited by the United Kingdom Accreditation Service (UKAS).

Intertek has collaborated with Almarai for the certification since 2018, when it began an extensive audit process which involved numerous production facilities and subsidiaries. As one of the world’s largest dairy companies and the world’s largest vertically integrated producer, Almarai controls all facets of the production process

from crop production and dairy farming to manufacturing, processing and packing.

The vertical integration requires Almarai’s stringent quality standards to be met at every stage of the production, and the Quality Management Systems to be put in place across all operations.

“The standard provides a competitive advantage and helps ensure that customers get consistent, good quality products and services through continuous improvement,” remarked Phil Clarke, Head of Quality,

Almarai.“Almarai’s continued success and leadership in the market is driven by a strategic commitment to quality,”commented Samir Ahmed, General Manager, Intertek Business Assurance, Gulf Region.

“From the initial stages of our audit planning process, and by applying the risk-based Plan-Do-Check-Act (PDCA) approach, we were confident with Intertek as our certification partner,”noted Tariq Naeem, Group Quality Audit Manager - Quality, Regulatory, HSS & Sustainability, Almarai.

cargo and logistical services through freighter flights and the belly-capacity on board Saudi Arabian Airlines.

Saudia Cargo, the national Saudi air freight carrier, offers 900 destinations in more than

175 countries, through a dedicated, advanced freighter fleet in addition to the belly capacity on board Saudia passenger flights. Saudia Cargo is a member of SkyTeam Cargo, the world’s leading cargo alliance established in 2000.

Saudia Cargo launches new flights to Athens and Marrakesh Saudia Cargo recently launched two new cargo routes from Riyadh to Athens, Greece and Marrakesh, Morocco commencing June 2019, aiming to meet the growing demand for cargo operations and stimulate trade movement to and from both destinations.

Athens is Saudia Cargo’s new destination to be operated year-round, with four weekly flights from Riyadh starting in June on-board the belly-capacity of Saudia A-320 aircraft.

Furthermore, the Marrakesh destination is operated by seasonal flights from the 2 June until 25 October with three weekly flights from Jeddah through the belly-capacity on board the Saudia 787 aircraft.

Through the introduction of these flights, Saudia Cargo aims to increase its presence across the African and the European continents to fill the increased demand for air

JULY/AUGUST 2019 11

SITA celebrates 70th Anniversary with record revenues

More than 100 of the world’s airlines and airports gathered in Belgium recently as SITA, the air transport IT provider, celebrated its 70th anniversary.

At the company’s Annual General

Assembly, SITA’s CEO, Barbara Dalibard outlined its path of growth noting how SITA has remained a vital part of the industry over the past seven decades. Along with the highest ever revenues, 2018 also

Abu Dhabi and Dubai fare well on the Global Traffic Index TomTom, a Corporate Social Responsibility (CSR) Partner of RoadSafetyUAE released the results of the TomTom Traffic Index, a report detailing the traffic situation in 403 cities in 56 countries around the world.

Mumbai takes the top spot this year with drivers in the Indian city expecting to spend an average of 65% extra travel time stuck in traffic. Next in the global rankings are Colombian capital, Bogota (63%), Lima in Peru (58%), New Delhi in India (58%) and the Russian capital, Moscow (56%), making up the top five most congested cities in the world.

Traffic congestion has increased globally during the last decade, and nearly 75% of the cities TomTom includes in the new Traffic Index report had increased or stable congestion levels between 2017 and 2018, with only 90 cities showing measurable decreases.

“Globally, traffic congestion is rising.

And that’s both good, and bad, news. It’s good because it indicates a strong global economy, but the flip side is drivers wasting time sitting in traffic, not to mention the huge environmental impact,”said Ralf-Peter Schäfer, VP of Traffic Information, TomTom.

12 JULY/AUGUST 2019

The two top UAE cities Abu Dhabi and Dubai have been included in the survey. Abu Dhabi ranks 396 with a congestion level of 11% extra travel time stuck in traffic (unchanged vs. 2017).

Dubai ranks 202 with a congestion level of 23% (with a positive trend -4% vs.

2017).

“From our own studies we observe, that UAE’s motorists give a lot of credit to the UAE authorities for continuously improving the road infrastructure,” commented Thomas Edelmann, Managing Director of RoadSafetyUAE.

marked a turning point for the company as its application-led business overtook its connectivity business.

“We had a very successful 2018 with record revenues of US$1.7 billion and for the first time in our 70-year history, our application business now represents more than 50% of our revenues,” said Barbara Dalibard, CEO, SITA. In 1949, 11 founding airlines (all European) joined together to establish the communications infrastructure which remains at the heart of this interconnected global industry. Today, nearly every passenger flight relies on SITA technology.

In total, 95% of all international destinations and over 13,500 industry sites are connected

by SITA’s network.

Over the decades, SITA has delivered many innovations including; the first common-use infrastructure at airports, the first airline e-commerce booking engine and the first e-visa system for border management.

During the General Assembly, SITA also hosted its annual Innovation Forum, an exclusive event to investigate how new technologies, including artificial intelligence, biometrics and blockchain could be harnessed to deliver more efficient operations and a seamless passenger journey.

SITA has more than 400 members including airlines, airports, airport-based organizations, and air traffic management providers and is one of the most internationally diverse companies, serving more than 200 countries and territories.

Oman’s Sohar Calciner project scoops up leading industry award EMEA Finance has awarded the Sohar Calciner project in the Sultanate of Oman, the coveted award of ‘Best Natural Resource Deal of the Year’ at the EMEA Project Finance Awards 2018 dinner ceremony in London.

The ‘Sohar Calciner’ is a land mark project for the Sultanate and will produce calcined coke to the local aluminum industry and, upon completion of its first phase, will enable the production of 1.1mn tons of aluminum annually and 2.2mn tons by completion of the second phase.

MMEC Mannesmann, a leading German engineering contractor in the field of calcining petroleum coke calcining has partnered with ACWA Power, the leading developer, owner, and operator of power

generation and water desalination plants, to develop the Sohar Calciner project in Oman.

“This award proves that MMEC and ACWA Power have put together a consortium, that is highly capable to bringing enormous benefit to the project and Sohar as a whole,” said Ahmed Al-Subhi, ACWA

Power Country Managing Director, Oman.

“This award is recognition of the hard efforts being put into the project by the Sohar Calciner team and the Omani authorities, including SIPC, ORPIC and our local stakeholders,”commented Oliver Apelt, CEO of MMEC Mannesmann.

programme. A mutual recognition agreement was recently signed with South Korea, and now Dubai Customs is working on signing a similar one with China.

Dubai has made a 7% growth in the value of its trade in Q1-2019 to AED 339bn, an increase of AED 23bn compared to Q1-2018.

Dubai Customs has recently launched the ‘Virtual Stock Guarantee’ facility for licensed companies and customs warehouses in Dubai Free Zones. The new

facility was developed by Dubai Customs to support re-export activity from free zones to global markets. This initiative is the first of its kind in the world.

Dubai Customs has recently launched a new disruptive berthing service for the vessels using the Dubai Creek (Khor Dubai). The new ‘Smart Vessel Berthing System’ will help vessels load and unload their goods with the help of an advanced AI based service.

Dubai Customs honours top performers in recent recognition ceremony Dubai Customs held its monthly 3rd client recognition ceremony of 2019 to honour best performing clients and businesses in various categories.

Abdullah Mohammed Al Khaja, Executive Director, Customer Management Division, Dubai Customs, thanked all its corporate clients including traders and local and global firms for their innovative ideas and suggestions that contributed to a better customs performance and more streamlined product and service offering.

“In 2018 Dubai Customs topped the list of government departments on the client happiness meter scoring 98 out of a possible 100,” remarked Al Khaja.

“This helps us grow and take on great projects and initiatives such as the Authorized Economic Operator (AEO), which, under the aegis of the Federal Customs Authorities, provides member companies with a number of benefits and privileges,”added Al Khaja.

There are 55 member companies in the

JULY/AUGUST 2019 13

Gulftainer’s subsidiary to operate Saudi Arabia’s Yanbu port Gulf Stevedoring Contracting Company (GSCCO), part of the Gulftainer group of companies, has entered an agreement with Red Sea Marine Services Company Limited to manage and operate King Fahad Industrial Port in Yanbu (KFIP) on Saudi Arabia’s western Red Sea coast.

This takes GSCCO’s portfolio of terminals in Saudi Arabia up to four, cementing the company’s position as the largest and most geographically diverse port operator in the country. GSCCO will handle all types of cargo at KFIP, including containers,

breakbulk cargo, vehicles and bulk cargo. To support operations at the port, the company will invest in significant amounts of new equipment to ensure it can deliver its awardwinning levels of operational excellence and turn KFIP into another jewel in the crown of Saudi Arabia’s growing maritime presence.

GSCCO also celebrated another major milestone in 2018 when it passed the 30-million-TEU mark in container volume, corresponding to a 50% increase in throughput in just five years across all its facilities. “We are truly excited at the

potential to develop KFIP in Yanbu into another industry-leading port in line with the strong commitment to the maritime and logistics industry expressed in the Saudi Vision 2030,”remarked Richard James, Managing Director, GSCCO. The current infrastructure at KIFP enables the handling of container vessels with up to 8,000 TEU capacity. With roll-on / roll-off (RoRo) capabilities, a range of cargohandling equipment and water depth of 18 metres at low tide, the port is equipped to handle all types and sizes of cargo to support the growing developments in the Royal Commission for Jubail and Yanbu (RCJY) and the surrounding areas in the Northwest of Saudi Arabia.

the growth and development of local startups,”noted Christensen.

“Through this partnership, we aim to make Sage Business Cloud Accounting more accessible to the DTEC community

helping them to manage their finances more professionally, automate administrative processes, and drive better business performance with VAT compliant software,” observed Harduth.

DTEC appoints Sage as strategic partner Dubai Technology Entrepreneur Campus (DTEC), the largest co-working space in the Middle East, wholly owned by Dubai Silicon Oasis Authority (DSOA), signed a non-exclusive, one-year strategic partnership agreement with Sage, one of the leaders in cloud business management solutions.

Hans Christensen, Vice President, DTEC, and Viresh Harduth, VP New Customer Acquisitions (Start-up & Small Business), Africa & Middle East, Sage, signed the memorandum of understanding, under the terms of which Sage will be listed as a recommended service provider to DTEC’s startup community.

“DSOA is keen to forge agreements with leading international institutions to support

14 JULY/AUGUST 2019

UPS recently announced that it has renewed its partnership with Emirates Foundation, a national organization set up by the Abu Dhabi Government to facilitate public-private funded initiatives for the empowerment of youth across the UAE, to continue supporting road safety campaigns in the country.

The agreement was signed at UPS regional headquarters in Jebel Ali in the presence of Emirates Foundation Chief Executive Officer Maytha Al Habsi and Rami Suleiman, UPS President for the Indian Subcontinent, Middle East and Africa (ISMEA).

As a continuation of the successful collaboration, the UPS Foundation has approved a grant for 2019 to the Emirates Foundation in the amount of US$ 185,000.

The grant will be split to focus on three key areas: US$ 100,000 towards the joint UPS Road Code Programme, US$ 50,000 towards the Community Preparedness Programme and US$ 35,000 towards the Emirates Foundation regional conferences.

“The UPS Foundation is truly honored to partner with the Emirates Foundation, and

UPS partners with Emirates Foundation to enforce road safety we highly regard the invaluable work that it is leading around the world,”commented Eduardo Martinez, President of the UPS Foundation and UPS Chief Diversity & Inclusion Officer.

According to Martinez, UPS has pledged to complete 20 million hours of global volunteering and community service by the end of 2020.

“Our partnership with the Emirates Foundation has always been results-driven and we believe that the UPS Road Code Program is a demonstration of our joint hands-on approach and our commitment to ensuring the youth of today are the strength of tomorrow,”concluded Martinez.

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Web: www.tranzone.ae JULY/AUGUST 2019 15

experience with gas as a fuel for land based power; 2017-established Mac dual-fuel marine engines have successfully penetrated the maritime market, driving the industry’s adoption of gas technology.

“After much deliberation by shipping companies, LNG is now regarded as a bridge

technology. Together with the International Maritime Organization (IMO)’s mandate for reduction in global emission limit on the seas, these have been the key drivers in the success of our LNG-fueled Mac engines,” commented Alan Naisby, Managing Director, Mac Middle East and Mac Asia.

Caterpillar Motormen’s addition of dualfuel engines to its portfolio of Mac marine diesel engines was in the works even prior to Mac Middle East’s inception as a regional service provider. Currently there are nine cruise ships on order to be delivered with Mac dual-fuel engines.

According to Naisby, the appeal of the company’s LNG-powered engines includes its ability to start and run on gas versus diesel, meaning ships can leave the dock or harbour in cleaner-burning mode.

Additionally, the ability to operate on gas for extended periods in low load when only a fraction of the full power of the engine is required, is an important characteristic. These are both key features for cruise lines operating in heavily populated or environmentally sensitive areas, in Naisby’s estimation.

Caterpillar Marine’s product offering of green MaK solutions has effectively allowed the company to improve emissions and its clients’ fuel consumption system design technology has also played a major role in this area.

for the Middle East market,”said Borhene Ben Mena, CEO, Shipa Delivery.“Our technology, customer service, and understanding of these markets are what set us apart. We make life simpler for businesses and consumers,”he added.

In addition to easy booking, Shipa Delivery offers online dashboards, analytics and application programme interface (APIs) to help businesses manage deliveries and analyze performance. It also works with e-commerce companies to simplify fulfillment from warehousing through to delivery and payment processing.

The benefits for end users include Shipa Delivery’s two-hour delivery windows, a range of payment options, and a customer service available both online and by phone.

Shipa Delivery also offers live delivery updates and real-time tracking, improved address locations, digital self-service, and customized delivery and reporting, the company said in a press statement.

Shipa Delivery, a pioneer in techenabled delivery in the Middle East, is backed by Agility, one of the region’s largest logistics providers.

MaK eco-friendly power solutions a boon for the maritime industry MaK Middle East, the factory direct parts and service arm of parent Caterpillar Motoren, has announced the next level of MaK branded eco-friendly and fuel efficient maritime propulsion system with its industry-leading LNG engines.

Relying on Caterpillar’s many years of

Shipa delivery expands to more GCC countries Shipa Delivery, a leading provider of local and cross-border delivery services in the Middle East, is now offering same-day, nextday and on-demand delivery in five GCC countries, expanding from its original market in the UAE, to launch operations in Kuwait, Saudi Arabia, Bahrain and Oman.

Shipa Delivery’s expansion comes amid a surge in demand across the Middle East by individual consumers and businesses of all sizes wanting more reliable, convenient, affordable deliveries of in-store and on-line purchases and important parcels of all sizes from credit cards to furniture.

Based in Dubai, Shipa Delivery has already delivered more than one million packages and established itself as the region’s most versatile, easy-to-use delivery provider.

“Shipa Delivery was designed specifically

16 JULY/AUGUST 2019

Silk Road Fund acquires shareholding in ACWA Power ACWA Power, developer, owner, and operator of power generation and water desalination plants recently signed an agreement with Silk Road Fund, introducing it as a partner and shareholder in ACWA Power Renewable Energy Holding.

ACWA Power’s renewable energy platform that currently owns a number of its existing renewable energy projects with a 49% stake in the company. The transaction is subject to regulatory consents.

ACWA Power RenewCo will own ACWA Power’s CSP, PV, and wind assets across the United Arab Emirates, South Africa, Jordan, Egypt and Morocco, yielding an aggregate capacity of 1668 MW.

“ACWA Power and Silk Road Fund’s further collaboration is a mirror image of the robust and strategic ties between Saudi Arabia and China that is strengthened year after year,”remarked Paddy Padmanathan, President and CEO of ACWA Power.

“Our continual achievements with Silk Road Fund set an example of building strategic business ties, and making the best use of the competitive advantages of

both companies,”said Rajit Nanda, Chief Investment Officer, ACWA Power.

ACWA Power and Silk Road Fund have previously successfully co-invested in two UAE-based projects, including the 2400MW Hassyan clean coal power plant and the 950MW Hybrid CSP and PV fourth phase of MBR Solar Park to respectively power 1.3 million people and 320,00 residential homes.

JULY/AUGUST 2019 17

Sustainability and technology in logistics in focus at USW Dubai event After the successful opening of the University of South Wales (USW) Dubai in September, the University has launched a new MSc International Logistics and Supply Chain Management, to be offered at its Dubai South campus this year.

Logistics industry experts gathered for the launch at the USW Dubai campus

in Dubai South today and explored the theme of ‘Sustainability and Technology in Logistics’. The event featured a keynote address from Mohsen Ahmad, CEO, Logistics District, Dubai South, and a presentation of sustainability initiatives in the industry from Raji Hatter, Chief Sustainability Officer, Aramex International, as well as a discussion

First Emirati female cargo managers appointed by Emirates SkyCargo Emirates SkyCargo has announced the appointment of Alyazeya Saeed and Fatma Ahli to the key positions of Cargo Managers

18 JULY/AUGUST 2019

of Oman and Kuwait respectively. The two appointees, who graduated from Emirates SkyCargo’s Commercial Management

on how sustainability and technology shape logistics by Stuart Milligan, USW’s Logistics Course Leader.

Starting in September 2019, the new KHDA-approved postgraduate course will complement the specialist aerospace engineering education facility in Dubai South and will be delivered in a block-mode format, which will enable practicing professionals to study whilst working. The programme is positioned to provide for the future development needs of the aerospace sector and other strategically important sectors in the UAE, according to a USW statement.

“The aircraft maintenance courses that USW provides in Dubai are giving students in the region the chance to learn from industryleading experts in the field, and this additional course will expand these opportunities for students,”affirmed Professor Julie Lydon, Vice Chancellor, University of South Wales.

“Our international logistics and supply chain expertise is already renowned in the United Kingdom whereby we enjoy accreditation from the Chartered Institute of Logistics and Transport-CILT and the Chartered Institute of Purchasing & Supply, and work with industry leaders including Thales and Airbus,”she added.

Programme, will manage the airline’s cargo operations in the two countries.

Alyazeya Saeed, Cargo Manager for Oman, joined Emirates SkyCargo in 2016 as a fresh graduate, holding a Bachelor’s Degree in International Business Management and a Master’s Degree in Business Administration. Alyazeya worked briefly worked as Cargo Commercial Operations manager for Europe.

The second appointee, Fatma Ahli, graduated with a Bachelor’s Degree in Supply Chain Management from Higher Colleges of Technology. She was selected for the Emirates SkyCargo Commercial Management Programme after joining the organization in November 2016.

“Emirates SkyCargo’s Commercial Management programme also plays a significant role in preparing the trainees for future responsibilities as leaders in the logistics industry. I am confident that both Alyazeya and Fatma will be great assets to the team,” commented Nabil Sultan, Divisional Senior Vice President, Emirates SkyCargo.

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EMIRATES MARITIME ARBITRATION CENTRE (EMAC): MARITIME AND LOGISTICS ARBITRATION

Navigating the Arbitration Channel The Emirates Maritime Arbitration Centre (EMAC), established by the Government of Dubai, is tasked to provide excellence and prudence in arbitration and related authorised services for the maritime and logistics community in the region consistent with international standards and regulations. EMAC is pulling out all the stops to ensure that it fulfills its mandate fairly, professionally and effectively, a top official affirmed

T

he Emirates Maritime Arbitration Centre (EMAC) was established by Emiri Decree Number 14/2016 in April 2016. With the Decree, through appointment, 14 board of trustees, all of whom are high profile leaders in various sub segments of the industry have ensured that EMAC follows a well-established business plan, bringing to stakeholders the latest alternative dispute resolution practices by adopting international standards.

To get better acquainted with the mandate and scope of services offered by EMAC, Global Supply Chain conducted an exclusive interview with Majid Obaid Bin Bashir, Acting Chairman and Secretary General.

Global Supply Chain (GSC): Briefly and in your own words what is EMAC’s mandate and jurisdiction within the operating sectors?

Majid Obaid Bin Bashir (MOBB): To determine a mandate for legal support services in maritime, one needs to consider the value of maritime to the United Arab Emirates. Shipping and logistics are notably two of the country’s economic pillars which serve as a vital link between East and West. This would see the Gulf a strategic trading corridor.

As a result, many multinational companies have seen value in setting up their regional offices in the UAE, availing of the strategic location, which provides ease of access to international locations from one of the world’s busiest airports in Dubai.

From a maritime and logistics perspective, investment in infrastructure has been extensive. The UAE

20 JULY/AUGUST 2019

boasts some of the most sophisticated port terminal container handling technology through the Jebel Ali Ports. In addition, in Abu Dhabi, the Khalifa Port has heavily invested in major projects to drive up its cargo handling capacity.

Amid this port development is Fujairah’s bunkering business, which has seen between 8 to 9 million MT of bunkers provided in 2017 alone. These examples merely scratch the surface when one takes a more in-depth look into everything maritime in the UAE. It is not surprising therefore that ancillary services of a legal nature are a vital requirement in the UAE. Considering the vast number of transactions that change hands in the logistics and maritime sectors, a body that could hear what is often complex, specialist cases was called for by industry stakeholders.

EMAC’s carefully selected secretariat ensures that the business plan is carried out by providing first class arbitration and mediation services to a much targeted community.

EMAC’s arbitration platform is somewhat hybrid, providing for choice and flexibility in process through options that include administrated arbitration, emergency arbitration, ad-hoc arbitration or fast track arbitration. The UAE has fast established itself as a perfect seat of arbitration, having updated its laws to ensure up-keep with international best practices.

GSC: EMAC is located in DIFC…..what is your relationship to DIFC? MOBB: The UAE is home to 37 Free Zones that offer 100% foreign ownership to many of the multinational companies referred to in the previous question. These companies have a choice in jurisdiction in the UAE, through its civil law offerings in any one of the seven Emirates or through common law practices in either the Dubai International Financial Centre (DIFC) or the Abu Dhabi Global Markets (ADGM).

JULY/AUGUST 2019 21

EMIRATES MARITIME ARBITRATION CENTRE (EMAC): MARITIME AND LOGISTICS ARBITRATION

Majid Obaid Bin Bashir, Acting Chairman and Secretary General at EMAC.

It is one of the only countries in the world that has successfully implemented both jurisdictions, giving companies who trade here the comfort to contract law of choice.

By setting up its offices in the DIFC, EMAC is not only located next door to the DIFC Courts, but is also close to the maritime and legal communities. Logistically, EMAC is 20 minutes from the nearest airport, surrounded by a multitude of hotels and travel services. This makes for an ideal location to hear cases but does not limit parties to hear cases anywhere else in the country.

For EMAC, it is about providing ease of access and the DIFC has worked out well in terms of facility and office location.

GSC: Can the DIFC Courts supersede EMAC’s Tribunals?

MOBB: There is no superseding from the courts. For the sake of clarity, when it comes to EMAC arbitration, the DIFC Courts have jurisdiction to provide support when ordering interim measures; authentication of arbitral awards or to consider challenges to awards.

22 JULY/AUGUST 2019

GSC: Tell us about the composition of EMAC? MOBB: EMAC’s corporate governance is set out in its Decree. The ‘Board of Trustees’ currently constitutes 14 members, with a sub-executive committee of four. These members represent various segments within shipping and logistics including commercial, operations and legal. The ‘Board of Trustees’ together approves the Centre’s business plan and is responsible for overseeing its budget. The Centre is independently managed and operated.

Typically, Arbitration Centres or Associations are operated by a small secretariat and at EMAC each one brings to the table versatile skillsets that see the business plan run accordingly.

Keeping the team small helps our nonprofit Centre control costs, that in turn support disputing parties when a case is filed and administration fees are due.

Further EMAC offers membership that is available to individuals who wish to join in their personal or corporate capacity. The two subscriptions based on a 12-month renewal

basis, are valued at US$ 100 and US$ 200 per annum, respectively.

Aside from panel listing, other members who join are given priority to EMAC organised events and are awarded discounts on delegate participation and sponsorships at trade events throughout the country.

Our members are testament of a growing community that is open to discussion about concerns and solutions for issues within the industry. There are no limitations to who can join as a member. The portfolio consists of 230 individuals comprising 51 arbitrators, 23 mediators and 24 experts.

GSC: Does EMAC’s arbitration authority extend outside of the UAE? MOBB: Adopting EMAC into a contract is a choice. EMAC has not sought to reinvent the arbitration or mediation wheel.

It provides a service to a community closer to home and industry focused. That said, EMAC is an ideal place for arbitration when disputing parties are considering a neutral seat of arbitration, especially in the Middle East.

Prior to 2016, maritime disputes were referred to commercial arbitration centres in the country which presented its own set of challenges. Other choices were based abroad which meant working around time zones and more often than not, were far more expensive.

GSC: Does EMAC’s authority also include regulation?

MOBB: EMAC provides for arbitration rules which are founded on the UNCITRAL (United Nations Commission on International Trade Law) arbitration laws, and mediation rules which meet with international standards.

Arbitration is an alternative, more flexible and private method of settling disputes, with awards enforceable by law.

One would need a day to explain the intricacies of the difference between arbitration and litigation, but for the sake of this article, we will try to simplify it.

EMAC is not a regulatory body. It is a service provider for arbitration and mediation that predominantly focuses on maritime, offshore energy and logistics.

We engage some the world’s most experienced arbitrators and mediators, by way of panel listing, so that disputing parties have a regional point of reference when looking to appointing their arbitrator, tribunal or mediator. This directory of arbitrators and mediators are pre-qualified by the EMAC executive committee.

One could say, that in arbitration and mediation, you and your counterpart appoint your own agreed upon, ‘judge’ based on experience in reference to the merit of a specific case.

EMAC provides the procedure for the arbitration and mediation through its rules, controlled and adjusted by the disputing parties and arbitrator/tribunal/ mediator. Case managers at EMAC, ensure thorough administration of the process.

Essentially, this gives the parties a central point of administration, which is neutral, to ensure that all paperwork, appointments and communication is in line with the EMAC rules.

In reference to regulation, this is determined with reference to the contract that may be in dispute. Parties will decide the jurisdiction of the contract and the seat of arbitration. EMAC’s rules being based on UNCITRAL rules, meet with international best practice.

GSC: In the EMAC context how is arbitration different from mediation from combined rules? Explain MOBB: EMAC presents rules for arbitration and rules for mediation. Parties will resort to mediation when they seek intervention or a specialist opinion in a structured way to aid the process of dispute settlement amicably, keeping away from enforcement by law.

Claims that are of smaller value, where parties actively participate in the process to find a means of settlement helps keep dispute costs down and maintain the business as usual relationship.

GSC: How many cases has the Centre handled to date?

MOBB: Within 18 months of operation, the Centre received its first referral valued in excess of AED45 million. EMAC’s approach to market has seen many concerns opt EMAC into contracts which in turn will see the Centre accept more referrals.

The Centre’s case management team, with the supervision of the executive committee ensures that excellence in maritime arbitration and mediation remains at the core of its values.

GSC: For maritime and logistics related disputes, is it possible to bypass EMAC and take recourse to other regular legal channels?

MOBB: Disputes are never a pleasant experience. No one walks into a contract waiting for a dispute. But when things go wrong, as they often do, the incorporation of a clause that stipulates the means by which the parties agree to settle their grievances is the most effective way to choose the mechanism of dispute resolution.

Clearly, not all disputes are suitable for conciliation, arbitration or mediation.

Sometimes, it is in the parties’ best interest to stipulate litigation and courts of preference.

It’s down to the type of contract and the value of the dispute amongst other legal factors.

The beauty of arbitration though, is the fact that the parties choose their ‘judge/s’ in the form of an arbitrator/tribunal and that the process is led by the parties in a confidential and flexible manner which is enforceable by law.

In addition, specialised arbitration or mediation means that there is a focus on industry and that the facilities and resources meet industry needs.

Majid Obaid Bin Bashir Acting Chairman and Secretary General at EMAC Majid Obaid Bin Bashir is a highly experienced legal consultant with extensive experience across a range of UAE governmental departments and corporations.

As a registered Arbitrator with the Abu Dhabi Conciliation and Arbitration Centre and Dubai International Arbitration Centre (DIAC), he has been appointed as Sole Arbitrator or Co-Arbitrator across a number of cases.

Between 2005 and 2007, Majid served as Chief Executive Officer and board member for the Dubai Developmental Board, and as a conciliator of the Dubai Chamber for 13 years. He has also previously served as a Public Prosecutor, and has been a member of several judicial committees.

With a key role in drafting the bylaws for the Dubai Chamber, the Islamic Chambers and the Gulf Arbitration Centre, Majid served as Legal Advisor and Director of the Legal Department of the Dubai Chamber, and as Secretary General of the Arbitration Centre of the Dubai Chamber between 1996 and 2000.

He then joined the DIAC board of trustees and was appointed Vice Chairman of the organisation’s executive committee. Majid is also Chairman of the Islamic International Arbitration Centre and Chairman of the board of trustees for the International Islamic Centre for Reconciliation and Arbitration.

JULY/AUGUST 2019 23

EMIRATES MARITIME ARBITRATION CENTRE (EMAC): MARITIME AND LOGISTICS ARBITRATION

GSC: Briefly what is your mission statement?

MOBB: In one sentence is to ‘Provide Excellence in Maritime Arbitration and Mediation’.

GSC: What are the benefits going the EMAC route and what are the challenges confronting EMAC? MOBB: Allow me to break this into two parts.

With regard to the benefits of Arbitration, our mandate is to provide alternative dispute resolution (ADR) support services specific to maritime, offshore energy and logistics.

We have approached the regional maritime cluster through discussion and education that facilitate an understanding about the legal challenges that the industry faces, and how attention to detailed terms in transactions, specifically related to claims and disputes can avoid undue costs and save a significant amount of time.

As a nonprofit community focused Centre, we face the challenge of engagement. A Centre of this nature typically has a gestation period of ten years. EMAC has been in operation for 30 months and has attended over 200 events to build awareness and to ensure that the Middle East maritime community understands that they now have

24 JULY/AUGUST 2019

local support when turning to specialist arbitration and mediation.

A small team always means all hands-on deck. The EMAC Secretariat has worked tirelessly to establish a solid, reliable and responsive platform.

Maritime on its own is a very traditional industry and slow to change. It takes an approach of ‘if it’s not broken, why fix it?’

Building credibility and confidence that EMAC delivers the excellence in its mission statement has to be consistent in order to see an increase in engagement from the industry.

GSC: What is the wider vision-mission of EMAC? MOBB: EMAC’s objectives are to settle local and international maritime, offshore energy and logistics disputes using methods of alternative dispute resolution efficiently and effectively. It aims to enhancing arbitration procedures to be more impartial and just, by providing flexible and neutral mechanisms.

Our goal is to promote awareness of the practice of arbitration, locally, regionally and internationally.

GSC: Is EMAC answerable to the Ministry or Government?

MOBB: EMAC is independently managed.

The Secretariat is answerable to the 14 member board of trustees.

GSC: What kind of enforcement powers does EMAC have?

MOBB: You may be aware that arbitration award enforcement is based on the law of a country. The UAE’s arbitration law outlines award execution, as does the DIFC and ADGM arbitration laws. In case an award is enforced in one of the New York Convention states, it would be in line with the member state’s arbitration law, and in terms of award execution, that would prevail.

GSC: How significant is EMAC for the wider maritime and logistics sectors?

MOBB: The UAE is strategically placed to become one of the world’s top ten maritime hubs, and as long as world trade continues, the country’s maritime and logistics sectors will thrive.

Offering well rounded legal services, through the internationally renowned specialist law firms and now a Centre that can cater to industry disputes that are enforceable by law, goes a long way in securing the UAE’s vision of taking center stage in all things maritime and logistics.

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WORLDWIDE DISTRIBUTION CENTRE

Developing an effective and well-structured

distribution network With distribution as its primary and strongest suite, Dubai-headquartered Worldwide Distribution Centre (WDC) is eyeing a big surge for his business across the region and beyond

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orldwide Distribution Centre (WDC). based in Jebel Ali Free Zone, Dubai, UAE, is a premier and professional distributor of FMCG (fast moving consumer goods) with a potentially global reach.

The company, founded two decades ago. currently represents such well-known companies as Himalaya Herbals, Unilever, Imperial Dax, Namaste Laboratories, Luster Products, Dr. Miracle’s, Fruit of the Earth, WIPRO-UNZA, Strength of Nature Co., J. Strickland, just to name a few.

Housed in an advanced, sophisticated 20,000 sqft. sprawling warehouse facility in Dubai and empowered with a fleet of modern delivery vehicles, WDC distributes its line of products in the United Arab Emirates, Middle East, North Africa and CIS countries.

WDC’s Founder-CEO Khamid Ismatullaev spoke recently to Global Supply Chain on a wide range of issues – his origins, provenance, current ambitions and vision for the future.

Global Supply Chain (GSC): Worldwide Distribution Centre in Dubai at the turn of the millennium, you have grown the company to one of the largest retail and

26 JULY/AUGUST 2019

wholesale distribution companies in the Middle East. Briefly, walk us through the genesis and the growth of the company over the last two decades?

Khamid Ismatullaev (KI): I started my professional life back in 1998 in my homeland Tashkent, Uzbekistan. Since 1999, I have been running organisations with a full P&L responsibility, incorporated and successfully run several profitable companies around the world.

I subsequently identified an opportunity to expand the business in the Middle East, so relocated to Dubai and launched the company in the UAE with a new name to reflect my global vision for the business – Worldwide Distribution Centre.

WDC is now one of the largest FMCG retail and wholesale distribution companies in the Middle East. We specialise in supplying hair and body care, beauty and consumer products, perfumeries, soap and baby care items.

We distribute products for multinationals such as L’Oréal, Henkel, Himalaya and others across the Middle East, Africa, East Asia and CIS. We are also the leading distribution house for multicultural and a range of consumer products in the Middle East and Africa.

GSC: What range of capabilities and services do you offer your principals?

KI: Through an established and structured distribution network, WDC provides global companies the opportunity to launch products in new and untapped markets, offering an effective solution to help grow their businesses. In short, we provide the ultimate distribution service for multinational companies.

GSC: What do you attribute your success to?

KI: Initially we were in the right place at the right time. There were no professional distribution companies efficiently and reliably supplying to small and mediumsized stores, which we call traditional trade.

The hypermarkets and larger pharmacy groups had stable supply chains from other distribution companies.

From day one, I set out to build a company that had a positive and ethical culture at its core. I prioritise providing an efficient yet personal and professional service to manufacturers and multinationals, whilst ensuring my workforce enjoys the working environment of the company.

GSC: Are you planning to expand your current product range?

KI: Yes. We are working closely with our principal companies. We also keep them informed of emerging market trends and we help them to launch innovative products.

GSC: Describe your distribution model across countries where your

WORLDWIDE DISTRIBUTION CENTRE

Khamid Ismatullaev, Founder-CEO, WDC.

JULY/AUGUST 2019 27

WORLDWIDE DISTRIBUTION CENTRE

principals have official national agents and distributors? How does the mechanism work?

KI: We don’t supply where the principal company has agents and distributors. We provide distribution only in untapped, new markets for the manufacturer. The process starts from receiving the products from the manufacturer through to making sure they get to the retailer to place on their shelves.

GSC: Talk to us about the scale and scope of your centralised logistics operations.

KI: It’s very beneficial to us being located in the UAE and especially in Jebel Ali Port because it’s one of the largest distribution hubs in this region. The transport network and infrastructure that has been developed by the local government has helped us to reach our customers and dealers timely and efficiently.

Over the years, we have established a secure and accurate system that helps us deliver the products smoothly and on time.

We have an efficient transportation system managed by a trusted shipping company.

While we prepare the documentation in house, the shipping company assists us with booking containers to ensure we are always on time with deliveries. We also own a fleet of trucks in the UAE to facilitate with the local distribution.

GSC: Retail is generally perceived in the current scenario to be soft at the present time and fraught with challenges. What are the challenges confronting the retail industry?

KI: The cost of manufacturing and raw materials is increasing so manufactures are facing issues of rising costs. If they increase their prices, the retailers reduce the quantity that they buy. Retailers also face passing on these increasing costs to their customers.

There are now also more manufacturers producing more products, meaning there is more competition. A few years ago, say there may have been five dominant suppliers of shampoo products that you would have found on the supermarket shelves.

Now, these large suppliers have diversified their range offering a wider selection of shampoos, plus there are smaller, niche products available now also available on the shelves. This doesn’t impact the retailer

28 JULY/AUGUST 2019

as they have a wider product selection to offer consumers, but it does impact the manufacturer as there is more competition and they have a smaller slice of the pie.

GSC: Staying upbeat, what opportunities do you anticipate for WDC going forward?

KI: Over the past ten years we have seen a change in what consumers in the region are looking for from hair and body care products and that provides us with new opportunities.

Consumers in the region are very welleducated about the industry (in part due to social media) so the demands here reflect global trends. New innovative products and expanding product ranges allow us to reinforce our position with new products in existing markets as well as expanding into new markets.

Natural ingredients are very popular and in the last year or so, there has been an increasing demand for more eco-friendly and sustainable packaging. We are also finding that customers in the region are demanding more innovative products that contain high-quality ingredients, which are effective, time-saving and affordable. Customers want to have easy access to globally-recognised brands and also smaller, niche manufacturers.

GSC: What do you make of the E-commerce sector? What competition is it providing the traditional retailing sector?

KI: It’s a big challenge for traditional retailers. Online shopping offers the consumer the opportunity to save time and money and gives them a wider variety of products to choose from compared to what is available on the retailers’ shelves.

GSC: How did WDC fare in 2018 / last fiscal year and what is your outlook for the current year?

KI: We had a very strong start to 2019.

Our gross revenue figure has increased by 20% between January and April 2019. The increase in revenue over these four months can be attributed to the company’s strategic expansion across Africa and East Asia, capitalising on the fast-growing personal care markets in both regions. These markets are consumer hot spots, fueling the current growth in the beauty and personal care market.

GSC: Which countries or regions offer the best promise for future growth?

KI: Globally, it is East and West Africa and India.

GSC: Where do you hope to take the company in the short and long-term futures?

KI: Over the next 5-10 years, we will expand WDC into more new markets and ultimately, we want to become the largest FMCG retail and wholesale distribution company globally. We already have offices in the UAE, India and Uzbekistan to ensure that we can efficiently supply across the Middle East, Africa, East Asia and CIS.

Consumers can also educate themselves before they decide to buy a product.

GSC: How is it impacting your business?

KI: It’s good for us as we supply to both!

GSC: How important is bricks-andmortar outlets in the light of the current scenario?

KI: There will always be space in the market for small stores and hypermarkets. Small, local stores offer a convenient solution for customers to buy beauty and personal care items on the go, whereas the hypermarkets offer a wide selection usually at lower prices.

It’s also worth bearing in mind that in some parts of the Middle East, Africa, East Asia and CIS where we supply to, there are customers who prefer not to shop online or who have limited access to the internet.

GSC: Talk to us about the changing dynamics of the retail industry. How significant are the millennials to your business and how are retailers wooing this segment?

KI: The industry is changing with the growth of the E-commerce market.

Millennials will look to buy more and more products online and through social media.

There will still be a place in the market for traditional retailers. The small stores, such as the ones in the ground floors of the apartment buildings in Dubai, provide a convenient solution to that building’s residents and the neighbourhood. The hypermarkets will also continue to thrive as they are the major product holders and offer variety and lower prices.

In either scenario, customers are still supporting my business as they are buying the products.

Worldwide Distribution Centre reports 20% revenue growth Distributor sees growth in Africa and East Asia in the first four months of 2019 Dubai-headquartered Worldwide Distribution Centre (WDC) has announced that its gross revenue figure has increased by 20% between January and April 2019.

WDC is one of the largest FMCG retail and wholesale distribution companies in the Middle East, specialising in supplying hair and body care products, perfumeries, soap and baby care items.

The company supplies thousands of international, local and multicultural brands to retailers across the Middle East, Africa, East Asia and CIS. The increase in revenue in the first four months of this year can be attributed to the company’s strategic expansion across Africa and East Asia, capitalising on the fast-growing personal care markets in both regions.

Dubbed the next consumer hotspot, sub-Saharan Africa is witnessing the second fastest economic growth after Asia-Pacific. A rising middle class and increased urbanisation in counties such as South Africa, Nigeria and Kenya is fueling the growth of the personal care market.

“We have been the leading supplier of local and multicultural brands to retailers in Africa for a number of years and we have seen steadily growing our network across the continent over the past 18 months,” affirmed Khamid Ismatullaev, Founder and CEO, Worldwide Distribution Centre.

The company has been operating in the Emirates for almost 20 years. WDC has also been exploring new markets across East Asia including China, Japan, South Korea and Mongolia in recent years. The company has also taken rapid strides in South East Asia and in China following the growth of the middle class both in numbers and value.

“There are a lot of exciting innovations being developed in East Asia, particularly in Japan and South Korea, which are now becoming mainstream in other parts of the world,” concluded Ismatullaev.

JULY/AUGUST 2019 29

ETIHAD RAIL

Etihad Rail awards two major works tenders for the Abu Dhabi-Dubai phase

of the emirates is a milestone in the future prospects of the United Arab Emirates. The importance of the two packages lies in the fact that they link key industrial entities such as Khalifa Port, Khalifa Industrial City (KIZAD), and Jebel Ali Port.

The project includes links to strategic ports and industrial areas nationwide, along a distance of 310 km. It is the backbone of the UAE national railway network, upgrading the transport and shipping industry by connecting ports, manufacturing and production points, as well as urban locations.

The works on this part of Stage Two focus on the design and construction of rail infrastructure, including earth works, bridges, tunnels, animal-crossings and track-laying, connecting Package B with Package A, and Package C with Package B.

Contracts awarded

Two significant, high-value contracts dubbed Package B and Package C to develop ‘Phase Two’ connecting Abu Dhabi and Dubai on the UAE National Rail Link were recently awarded to Chinese and UAE companies

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tihad Rail, the developer and operator of the UAE national railway, has approved the award agreement for civil and track works of Packages B and C for ‘Stage Two’ of the UAE National Railway Network connecting Abu Dhabi and Dubai, during a recent board meeting, chaired by Sheikh Theyab Bin Mohamed Bin Zayed Al Nahayan, Chairman of Etihad Rail, according to a report

by WAM, the UAE state news agency.

The total value of the works awarded is AED 4.4bn (US$ 1.2bn). Package B runs for 216km, and Package C runs for 94km, and the two packages are part of the 605km line from Ghuweifat on the Saudi Arabian border to the Port of Fujairah on the UAE East coast.

Sheikh Theyab Al Nahayan attended the contract signing ceremony to award the civil and track works on the two packages to

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China Railway Construction Corporation, (CRCC), and Ghantoot Transport & General Contracting Company.

The contract was signed by Shadi Malak, CEO, Etihad Rail; Wang Jinsong, the authorized representative of CRCC, and Ali Mohamed Sadiq Albloushi, Chairman of Ghantoot Transport & General Contracting.

Growth sustenance “Etihad Rail will sustain the growth of our transport industry and freight carriage sector throughout the UAE, as railway systems are one of the most important means of transport on which countries depend to achieve their economic and social objectives,” affirmed Sheikh Theyab Al Nahayan.

The launch of Packages B and C as part of the second stage of this project to connect all

Etihad Rail has previously awarded Package A to a consortium of the China State Construction Engineering Corporation and South Korea’s SK Engineering and Construction. When complete, the 1,200km Etihad Rail project will link the UAE’s principal centres of industry, manufacturing, production, population, and import/export points, forming an integral part of the GCCwide railway network.

Etihad Rail was established in June 2009 under Federal Law No. 2, with the mandate to manage the development, construction and operation of the UAE’s national freight and passenger railway network. The railway network will link the principal centres of population and industry of the UAE, and will form a vital part of the planned GCC railway network across the GCC. Etihad Rail has successfully completed Stage One of the network which is now fully operational having been delivered on schedule and within budget. The route spans 264 km, transporting sulphur from sources at Shah and Habshan to the export point at Ruwais in the country’s sprawling Western Al Dhafra region.

Stage Two links the United Arab Emirates and Saudi Arabia from Fujairah to Ghuweifat via Mussafah, Khalifa Port and Jebel Ali Port.

Built to international standards, Etihad Rail’s advanced network will span approximately 1,200 km, acting as a catalyst for economic growth and sustained social development countries.

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Skills vitally needed to successfully roll-out Industry 4.0 Pilot Projects – A Middle East perspective

According to a PwC report, about two-thirds of Middle East organisations expect to have advanced levels of digitisation and integration by 2021. While this indicates a strong appetite in the region for Industry 4.0, it is worth pointing out that the transition from initial pilot stage to the large-scale roll-out of an Industry 4.0 and digital transformation project is no easy task.

To successfully navigate these challenges, Andy Coussins, Head of International, Epicor Software, in this contributory article, posits that Middle East organisations need to assess six critical capabilities – cloud, analytics, business process management, MES (Manufacturing Execution System) Integration, KPIs and ecosystems – to shine a spotlight on where additional work on the IT infrastructure needs to be undertaken, and which of the options for action on the path to digital transformation should be prioritised —Editor 32 JULY/AUGUST 2019

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n its ‘Digital Manufacturing Global Expert Survey 2018’, McKinsey & Company highlights how even successful pilot projects often fail to make it into everyday industrial life.

According to McKinsey, there are three main reasons for this – no clear change vision or detailed implementation road map, no executive leadership of the transformation project, and technical infrastructures that hinder or complicate the scaling and roll-out of Industry 4.0 projects.

From our practical experiences of implementing Epicor ERP projects, we’ve found that taking a critical look at the existing technical environment is a vital first step. It’s an evaluation process that can help organisations to gauge well in advance

INDUSTRY-TECHNOLOGY INTERSECTION

exactly how simple or complex it will be to transfer promising Industry 4.0 pilot projects into everyday operations.

Assessing the following six capability areas can help regional organisations shine a spotlight on where additional work on the IT infrastructure needs to be undertaken, and which of the options for action on the path to digital transformation should be prioritised.

Ability to scale IT infrastructures – cloud Any digital transformation – Internet of Things (IoT), machine learning (ML), artificial intelligence (AI) or robotics – will require IT services and performance that is only technically achievable and economically viable via cloud infrastructures.

Cloud services ensure that applications are available quickly and are demand-oriented and scalable – whether for pilot projects, test environments, peak loads or standard processes. Adopting a cloud strategy also ensures that the IT team can focus on tasks that add strategic business value, rather than being caught up managing operational routines.

Ability to reach consensus – central data and analytics Industry 4.0 solutions will affect a wide number of different business areas, so everyone involved must be able to participate in making decisions on the viability of any proposed innovation-driven change.

Enabling these joint decisions means everyone in the decision-making circle will need cross-departmental access to all relevant data and a consolidated view of all relationships and consequences.

Today’s integrated ERP systems are key to enabling these vital decision-support capabilities. Centrally capturing and analysing information from operational, finance and corporate management areas of the business, these platforms make it possible to identify dependencies and model different scenarios. This ensures that decisions can be made using comprehensive and reliable data that is supported by all parties involved.

Ability to change processes – business process management Inflexible business processes can hamper a firm’s ability to grow or evolve and from

experience, this is often down to the business software which organisations use.

Either processes are controlled via multiple individual solutions, which mean that process changes to an isolated system can trigger a whole cascade of follow-up measures and interface problems. Or the central management system is so complex that the overview of processes and interfaces is missing. As a result, processes cannot be designed flexibly, and changes can only be made by specialists at great expense.

Ability to connect from production to management – MES integration Improvements in manufacturing generated from Industry 4.0 solutions can only be fully exploited if all business units are able to benefit. This means that as soon as the Manufacturing Execution System (MES) is directly connected to the ERP system, the advantages of a ‘smart factory’ can also be applied to business processes such as sales, service and support, purchasing, or business development.

The ERP-MES connection is also essential for directly evaluating the returnon-investment generated by Industry 4.0 measures in a financial context, so as to support future investment decisions.

Ability to analyse performance – KPIs From intelligent control systems to new human-machine interfaces with voicecontrolled technologies or data glasses, the implementation of Industry 4.0 technologies has a far-reaching impact on familiar processes and performance values.

To obtain precise figures from the outset and understand the influence of innovative technologies on business results, an integrated Enterprise Performance Management (EPM) will be helpful.

As an integrated element of modern ERP systems, EPM provides industry and role-specific key performance indicators (KPIs). This enables all hierarchies and areas of responsibility to be transparently represented, so that weak points can be identified and KPIs achieved. Leveraging an integrated EPM, enables organisations to pinpoint which individual digital transformation measures have had an impact on value creation and business development as a whole.

Ability to cooperate – ecosystems Digital transformation is often accompanied by new business models and services that require close cooperation with partners and customers.

According to a recent study by PwC, manufacturing ‘digital champions’ are highly adept at connecting people, systems and partners across the extended value chain, as well as enabling multichannel customer interactions – either directly, or through third parties.

Similarly, in its 2018 Global Manufacturing Outlook report, KPMG highlights how supply chains are evolving into multidimensional ecosystems that enable growth-oriented organisations to develop a much higher level of collaboration and networking with partners, suppliers and customers.

Capitalising on the business opportunities created by this interconnectivity, however, depends on having a broad access to data and the ability to manage data exchange in a seamless manner. To achieve these twin goals, the ERP system, as a platform, will need to be based on modern software architectures that make it possible to integrate innovative collaboration technologies such as digital twinning, blockchain or IoT into automated processes for collaboration in ecosystems.

If the ERP system lacks this technical integration capability, the IT environment will become unmanageably complex and the advantages of Industry 4.0 initiatives will not be realised, or only selectively.

Industry 4.0 for business growth The process of assessing current technical capabilities and identifying potential Industry 4.0 implementation hurdles will help Middle East companies define a future strategic direction for growth more clearly, to make investment decisions accordingly.

With the right technology in place – cloud scalability and connected platforms that make it easy to integrate and automate operations and supply chains – successful Industry 4.0 pilot projects can become a measurable reality. Delivering the analyticsenabled intelligence will make it possible for transformation projects to be implemented in consensus by decision-makers across the business, and for bottom-line benefits to be appropriately evaluated and refined.

JULY/AUGUST 2019 33

COLD CHAIN CONSOLIDATION

Emirates SkyCargo

enhances its pharma capabilities Emirates SkyCargo has significantly boosted its worldwide pharma handling capabilities and infrastructure thereby boosting its position as a key provider of air transport of temperature sensitive pharmaceuticals. The new dedicated pharma facility is located in Chicago

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mirates SkyCargo has commenced handling pharmaceutical cargo at a new purpose-built facility in Chicago.

The facility, dedicated solely for pharmaceutical shipments, is spread over 1,000sqm, with scope for additional expansion and provides comprehensive protection for pharma cargo through temperature controlled zones for acceptance and delivery, pharma cargo build up and break down, storage and direct ramp access.

Developed in partnership with ground handling company Maestro, the facility has a capacity of 15,000 tonnes of pharma shipments per annum.

34 JULY/AUGUST 2019

“Having a dedicated facility for pharma at one of our busiest stations for pharma in our network is a big boost to our pharma handling credentials and capability,” said Nabil Sultan, Divisional Senior Vice President, Emirates SkyCargo.

The facility offers temperature controlled zones (2-8 degree Celsius and 15-25 degree Celsius) for acceptance and delivery, pharma cargo build up, breakdown and storage. The proximity of the facility to the ramp also means that cargo has to spend lesser time in transit to and from the terminal to the aircraft.

Expansion of global pharma corridor network The dedicated pharma facility in Chicago is part of Emirates SkyCargo’s broader strategy to enhance protection for temperature sensitive pharma shipments not just at its hub in Dubai but from origin to destination.

Following up on the success of the pharma corridors initiative which was announced in Jan 2018, Emirates SkyCargo has expanded its initial network of 12 pharma stations to 20.

As part of pharma corridors, Emirates SkyCargo works with ground handling partners and other local stakeholders at the stations that are important origin or destination points for pharma, in order to ensure a high standard of handling operations for pharmaceuticals in line with

Emirates SkyCargo’s stringent norms.

“We introduced the pharma corridors initiative because we wanted to expand the required high standard of handling for pharma shipments further into our network and serve markets better from origin to destination,” commented Henrik Ambak, Senior Vice President, Cargo Operations Worldwide, Emirates.

GDP Recertification for Emirates SkyCargo’s hub operations in Dubai Emirates SkyCargo’s pharma operations in Dubai including the 24X7 trucking operations between its terminals at Dubai International Airport and Dubai World Central have been certified as compliant to EU GDP (Good Distribution Practices) guidelines this year.

Emirates SkyCargo first received GDP certification in 2016 which was then revalidated in 2017 and 2018. In 2019, the air cargo carrier went through a rigorous audit

by Bureau Veritas where its pharma handling facilities and processes were evaluated completely from the ground up.

With over 8,000sqm of dedicated pharma storage and handling space, Emirates SkyCargo operates the world’s largest multi-airport GDP certified hubs in Dubai.

During the financial year 2018/19, the carrier transported more than 75,000 tonnes of pharmaceuticals through its network.

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ABU DHABI PORTS

In a regional first, Khalifa Port welcomes the largest bulk cargo ship Abu Dhabi Ports has modified the approaches to Khalifa Port to accommodate Capesize vessels bound for EGA, making it the first port in the Gulf able to accommodate these fully-loaded ships

ships in the world. Capesize vessels are up to 300m long – more than the length of two football fields – and 50m wide. They can carry around 180,000 tonnes of bauxite ore.

“The arrival of Cape Taweelah is a landmark moment for EGA, but these huge ships will become a familiar sight at Khalifa Port over the years ahead,”remarked Abdulla Kalban, Managing Director and Chief Executive Officer, EGA. “Our investment in deepening and widening the channel has created better business

opportunities for all partners, including CSP Abu Dhabi, which recently received one of the largest container vessels at Khalifa Port with a capacity of 21,000 TEU,”commented Captain Mohamed Juma Al Shamisi, Chief Executive Officer, Abu Dhabi Ports.

EGA’s Al Taweelah Alumina refinery is the first in the UAE and only the second in the Middle East. The plant converts bauxite ore into alumina, the feedstock for aluminium smelters, and is expected to meet 40% EGA’s alumina needs once fully ramped-up.

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mirates Global Aluminium (EGA) recently announced the arrival of the first fully-laden Capesize vessel to call at any GCC port at its quay at Khalifa Port in Abu Dhabi, inaugurating the import of bauxite for EGA’s new Al Taweelah alumina refinery using these huge bulk cargo vessels.

EGA imports bauxite ore from the Republic of Guinea to supply Al Taweelah alumina refinery, and has commenced using Capesize vessels to import bauxite, the raw material used for producing aluminium, to reduce shipping costs per tonne.

The approaches have been deepened from 16.5m to 18.5m draft and widened from 250m to 280m.

With a draft of 18.2m fully-laden, Capesize vessels are amongst the largest bulk cargo

36 JULY/AUGUST 2019

Engr. Saeed Ghufran Al Remeithi (L) and Ismail Fahmy at the deal signing ceremony

ABU DHABI PORTS

EGA invested around US$ 3.3bn to build the Al Taweelah alumina refinery, which commented production in April 2019.

Khalifa Port is located halfway between Abu Dhabi and Dubai and is one of the most efficient and technologically advanced in the world, currently serving 25 shipping lines.

Emirates Global Aluminium, equallyowned by Mubadala Investment Company of Abu Dhabi and the Investment Corporation of Dubai, is the largest industrial company in the United Arab Emirates outside the oil and

gas industry, and the largest company jointly owned by the two Emirates.

EGA’s aluminium is the second largest made-in-the UAE export after oil and gas. In 2018, EGA produced 2.6 million tonnes of cast metal. EGA is the only UAE producer and makes the UAE the fifth largest aluminium producing nation in the world. EGA’s aluminium is primarily used in the construction, automotive, packaging, aerospace and electronics industries in over 60 countries.

Emirates Steel signs slag management agreement with Finnish company Emirates Steel, the only integrated steel plant in the UAE and a subsidiary of the General Holding Corporation (SENAAT), has signed an agreement with the Finnish company, Ecofer.

The agreement, due to take effect in 2020, will provide Emirates Steel with sustainable slag management services for the next 10 years, in line with the company’s long-term commitment and objective of eventually producing zero waste.

Under this new agreement, signed at Emirates Steel’s headquarters in Abu Dhabi between the CEO of Emirates Steel, Eng. Saeed Al Remeithi, and the Managing Partner of Ecofer Technologies, Ismail Fahmy. Ecofer will process slag from Emirates Steel’s Electric Arc Furnace and Ladle Furnace.

The slag, which will be crushed down to one to five millimetre

Capesize ships are the largest dry cargo ships.

They are too large to transit the Suez Canal (Suezmax limits) or the Panama Canal (Neopanamax limits) and so have to pass either the Cape of Good Hope or Cape Horn (the southernmost point on the South American continent) to traverse between oceans.

Ships in this class are bulk carriers, usually transporting coal, ore and other commodity raw materials. The average size of a capesize bulker is around 156,000 DWT although larger ships (normally dedicated to ore transportation) have been built, up to 400,000 DWT.

granules, will be sold as raw product for the construction industry, after any remaining metals have been extracted from the slag. In addition to waste slag, Ecofer will also process refractory, heatresistant materials which are exhausted during manufacturing.

With this new agreement, Emirates Steel’s slag will be processed and recycled more efficiently. This will enable the company to continue delivering high quality products at competitive costs to customers around the world, while further enhancing the sustainability of its operations by facilitating the reuse of slag as construction material. Emirates Steel has been recycling its Electric Arc Furnace (EAF) slag product since 2014, producing roughly 2,800,000 tons of EAF slag over the past five years and successfully selling it for use in the construction industry.

“This initiative, our first partnership in the UAE, is part of our expanding global business strategy, as we make strategic partnerships across the Middle East,” commented Ismail Fahmy.

JULY/AUGUST 2019 37

PORTS’ COOPERATION

country’s capital to position itself in the Indian Ocean Circuit and to tap into potential cruise visitors from the Arabian Peninsula. Additionally, the two parties aim to attract more cruise lines to the region and explore new routes such as UAE, the Indian Ocean and Southern and Eastern Africa.

“Our collaboration plays a pivotal role in accelerating global growth opportunities for both parties. Trade across the Indian Ocean has been a key bridge between East and West throughout history, and Abu Dhabi’s strategic location makes us the ideal partner for organisations in both parts of the world,” asserted Captain Al Shamisi.

Africa rising

Captain Mohamed Juma Al Shamisi and Ramalingum Maistry at the signing ceremony at Abu Dha bi Ports’ HQ in Abu Dhabi.

Abu Dhabi Ports and Mauritius Ports Authority reach co-operation agreement The two ports will pool their combined expertise and increase cooperation in key aspects of the maritime sector across the Indian Ocean.

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bu Dhabi Ports and the Mauritius Ports Authority have inked a deal that will see enhanced collaboration between the two port authorities in maritime matters from port infrastructure and security to protecting the environment and driving the cruise industry.

The Memorandum of Understanding (MoU) was inked by Captain Mohamed Juma Al Shamisi, CEO, Abu Dhabi Ports (ADP) and Ramalingum Maistry, Chairman, Mauritius Ports Authority (MPA).

38 JULY/AUGUST 2019

Under the MoU, Abu Dhabi Ports and MPA will explore areas of collaboration between the public and private sectors, as well as how to ensure the safety and security of passengers, crew members, vessels and port facilities. The agreement will also see the two ports research the most effective use of tugboats, as well as training initiatives for deck and engine officers.

The two organisations will also work together on the cruise industry sector by helping Port Louis Harbour in the island

“Global economic investment in Africa continues to grow reflecting both the increasing business opportunities and strategic location. Given the expertise of Abu Dhabi Ports in developing world class facilities and infrastructure we are confident that this agreement will fulfill our needs and allow us to raise awareness of Mauritius as the preferred maritime gateway for Africa,” affirmed Maistry.

“Our value creation strategy at Safeen is guided by our drive to build win-win partnerships with port operators and their communities overseas. We are confident that our partnership with the MPA will help us build greater synergies and improve efficiency by sharing industry-shaping data, knowledge and expertise, enhancing the way we do business,’’ remarked Captain Adil Banihammad, Acting CEO, Safeen, who will act as the main liaison between the two organisations.

The maritime sector is a vital part of Mauritius’ economy, with the country’s principal gateway, Port Louis Harbour, handling 99% of external trade. The MPA provides port infrastructure and superstructure and marine services and navigation aid and oversees all port activities and environmental issues.

Abu Dhabi Ports owns, manages and operates 11 ports and terminals in the UAE and abroad, while the Mauritius Ports Authority regulates the port sector in the Republic of Mauritius, including Rodrigues, a 108-square-kilometre (42 sqmi) autonomous outer island off the Republic of Mauritius in the Indian Ocean, about 560 km (350 mi) east of Mauritius.

DP WORLD ACQUISITION

DP World makes foray in the energy sector DP World has acquired Dubai-headquartered oil services and marine logistics company Topaz Energy and Marine in a deal worth $1.08bn on an enterprise value basis

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n an official press notification DP World has recently announced its 100% acquisition of Dubai-based oil services company Topaz Energy and Marine from the Sultanate of Oman’s Renaissance Services and Standard Chartered Private Equity / Affirma Capital for an enterprise value of US$ 1,079mn.

Topaz, a leading international critical logistics and solutions provider to the global energy industry, operates a modern, versatile fleet of 117 vessels, predominantly in the Caspian Sea, MENA, and West Africa regions.

The deal, which is subject to regulatory approvals, is expected to be completed in the second half of the year, DP World said in a statement to Nasdaq Dubai, where its shares trade. The group enjoys a particularly strong position in its core Caspian Sea market. The Caspian Sea is the largest inland body of water in the world and one of the most strategic oil basins. Long-term contracts and high barriers to entry characterise the basin, which holds approximately 6% of global oil reserves.

Outstanding contracts Topaz also maintains long-standing relationships with many of the leading international and national oil companies, including BP, Chevron, Dragon Oil, Dubai Petroleum, ExxonMobil and Tengizchevroil.

Topaz’s enduring focus on securing long term strategic contracts has allowed it to outperform the market, and the Company’s market-leading contract backlog of US$ 1.6bn as of 31 March 2019, far exceeds

Sultan Ahmed Bin Sulayem, Group Chairman and CEO, DP World

industry benchmarks, demonstrating the success of the Company’s strategic approach. For DP World, the transaction supports its objective of increasing the company’s presence in the global logistics and marine services industry, the press communiqué continued.

“This acquisition of Topaz strengthens DP World’s position as a world-leading operator in maritime logistics services. In recent years, we have been investing selectively in the marine logistics sector in companies with high revenue visibility, consistent track record and strong customer relationships. This latest acquisition complements the operations of our P&O Maritime Services (POMS) business, which maintains over 300 vessels globally,” affirmed Sultan Ahmed Bin Sulayem, Group Chairman and CEO, DP World.

Business expansion prospects “Furthermore, this new partnership opens the door for DP World to explore

new business areas more extensively, for example, increasing transit volumes through Azerbaijan within the East-West trade corridor,” he continued.

“This transaction is in line with our strategy to grow our presence in marine logistics and become a solutions provider to end customers.

We look forward to welcoming the Topaz team into the DP World family,”he concluded.

A leading enabler of global trade, DP World’s current portfolio of 78 operating marine and inland terminals is supported by more than 50 related businesses in over 40 countries across six continents, with a significant presence in both high growth and mature markets.

Container handling is the company’s core business and generates more than 50% of its revenue. In 2018, DP World handled 71.4mn TEU (twenty-foot equivalent units) across its portfolio. With its committed pipeline of developments and expansions, the current gross capacity of 91.2mn TEUs is expected to rise in line with market demand.

JULY/AUGUST 2019 39

FOCUS FEATURE: RAS AL KHAIMAH ECONOMIC ZONE (RAKEZ)

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Powering Ras Al Khaimah’s economic and industrial progress The picturesque and verdant Emirate of Ras Al Khaimah is on an economic roll given its strategic and coastal location as the UAE’s most northerly Emirate, its rich maritime traditions, its highly developed infrastructure and its drive to attract investments and perpetuate an investment friendly ambience

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he Emirate of Ras Al Khaimah is witnessing tremendous economic growth and developing as a global manufacturing destination thanks to the prudent leadership of HH Sheikh Saud Bin Saqr Al Qasimi, United Arab Emirates Supreme Council Member and Ruler of Ras Al Khaimah.

Today, Ras Al Khaimah has the highest level of industrialisation in the UAE, with manufacturing constituting 26% of the GDP. Currently the Emirate’s diversified economy comprises services, trading, tourism and production.

Ras Al Kahimah Economic Zone (RAKEZ) is a powerhouse business and industrial hub that offers wide-ranging industrial and commercial solutions to investors from all over the globe. Presently, the economic zone is home to over 14,500 multinational companies and thousands of SMEs from more than 100 countries, covering over 50 industries, making it one of the largest economic zones in the region.

Highly developed infrastructure These include: an international airport; multi-lane superhighways that connect to the rest of the emirates and neighbouring countries; and five seaports, led by Saqr Port, one of the largest bulk handling ports in the Middle East.

A leading economic zone, RAKEZ is dedicated to global attracting investors to underpin Ras Al Khaimah’s thriving economy and nurture them in its cost-effective ecosystem where businesses effectively collaborate and grow.

Ramy Jallad, Group CEO, Ras Al Khaimah Economic Zone (RAKEZ), has been at the executive helm of the organisation for the past over five years now. He has spearheaded the move to grow

JULY/AUGUST 2019 41

FOCUS FEATURE: RAS AL KHAIMAH ECONOMIC ZONE (RAKEZ)

RAKEZ and project it as the must-go-to destination for conducting business activities.

The following is the transcript of the exclusive interview conducted with Ramy Jallad by Global Supply Chain.

Global Supply Chain (GSC): Please bring us to speed on the scale of new company registrations in RAKEZ? Ramy Jallad (RJ): One of our core objectives at RAKEZ is to bring in new businesses and investments to the emirate that will help sustain and strengthen its economy, and I am glad to say that we are doing well with this.

Over the course of 2018, we have successfully attracted a total of over 3,300 companies coming from all over the world,

42 JULY/AUGUST 2019

and for the first half of 2019, we have already registered nearly 1,500 companies. I am quite positive that we can surpass the number of companies we attracted last year.

GSC: From which countries / regions / geographies are the new investments coming from and where is your focus?

RJ: New investments for the first half of 2019 are coming from all over the world with the highest number coming from India which is around 350 companies. This is followed by the UK with 89, Pakistan with 77, Egypt with 64 and France with 53.

The rest of our new businesses were from Jordan, Germany, Italy, Russia, the UAE, Canada, Lebanon, China, USA, Ukraine,

Netherlands, Switzerland, Sudan and Ethiopia. Over the years, one of the markets we are focusing on is India as investors from this side of the world have been supporting Ras Al Khaimah’s economy remarkably.

Other countries we are strongly targeting are the UK and China.

GSC: What sectors do these new companies represent?

RJ: Most of the new companies that we registered are in the commercial and services sectors with over 560 and 500 companies in these fields respectively. General trading comes in at third spot with more than 130 companies. Media is also one of our rising sectors, thanks to the relaunch of RAKEZ

Ramy Jallad Group Chief Executive Officer Ras Al Khaimah Economic Zone (RAKEZ)

In his current position, Ramy Jallad’s role is to develop and drive the strategic growth, creating a thriving commercial and industrial business hub that attracts and welcomes investors from all around the world.

Jallad has over 25 years of professional experience, where he has developed and led various commercial and industrial free zones, business parks and mixed-use real estate developments.

Previously, Jallad held various key leadership positions in both government and private enterprises, such as: Vice President – Free Zone & Properties for Abu Dhabi Airports Company, Executive Director of Business Development & Customer Services for Dubai Technology and Media Free Zone (TECOM).

Jallad is fluent in English and Arabic. He holds a Bachelor of Science degree in Mechanical Engineering. He is also a Lead Assessor endorsed by the European Foundation for Quality Management and a certified trainer in sales, marketing, and customer care as well as people management.

Media Zone over a year ago. Some of our new companies are also operating in the industrial, e-commerce, educational and professional sectors.

GSC: What is the percentage of supply chain & logistics companies currently registered with RAKEZ and how important is this sector for RAKEZ? RJ: More than 8,100 companies at RAKEZ are involved in the supply chain and logistics field, and with this I am taking about trading, manufacturing and logistics companies.

That’s around 56% of the 14,500 plus companies within our zone.

With these companies making up such a large chunk of our population, they are

obviously very important to us. Having these companies operate from our zone and manufacture and move goods all over the world only proves that Ras Al Khaimah is vital to the global supply chain, and this helps us attract more businesses from these fields.

We are blessed to be strategically located at the centre of fast-emerging markets and be supported by major land, sea and air logistical hubs, making it easy for our clients to import and export.

Last year, Hutchinson Ports began operating the Saqr Port, which became very beneficial for our clients. The coming of Hutchinson Ports helped them move goods around more cost-effectively and faster than ever before.

GSC: What is your forecast for the remainder of 2019?

RJ: The situation looks bright and very positive.

We are very optimistic that the remainder of 2019 still has more in its sleeve for us to attract more clients and investments to RAKEZ in particular and Ras Al Khaimah in general.

We are exploring various possibilities in different markets with possible outcomes to generate more revenue and achieve further heights. We have both short-term and long-term strategies to reach our objectives by the end 2019 in cooperation with our strategic partners whom we work closely with to ensure efficiency and effectiveness in order to reach our ultimate goal, which is the satisfaction of all of our clients.

JULY/AUGUST 2019 43

FOCUS FEATURE: RAS AL KHAIMAH ECONOMIC ZONE (RAKEZ)

We will continue to work hard and strive to make 2019 a successful year. We are constructing new facilities to cater the needs of our clients and new investors in our industrial areas along acquiring more land for development and labour accommodations.

GSC: How are you maintaining growth momentum at RAKEZ and what briefly is your expansion strategy? How are you attracting new investments?

RJ: RAKEZ’s growth momentum is very stable as we collaborate with key entities and sign memorandums of understanding with them to maintain everlasting relationships. We recently signed a Memorandum of Understanding (MoU) with VirtuZone to promote RAKEZ, its services, set-up solutions and packages.

This is just one example out of many others like The General Directorate of Residency and Foreign Affairs and the Federal Authority for Identity and Citizenship that we seek in order to expand our network and provide more added-value services to our clients as part of our expansion strategy.

We attract new investments by going on roadshows locally and internationally as well as participating in local and international exhibitions in markets where we believe they

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have potential. More targeted B2B meetings during these exhibitions help us identify potential high-profile investors and offer them what suits them in terms of business packages.

GSC: How important is Corporate Social Responsibility (CSR) arena for RAKEZ and what specific initiatives are being taken in this regard?

RJ: CSR is an important liability that RAKEZ honourably takes towards the UAE society.

We respond positively and actively to CSR activities and initiatives by engaging our employees in community services to support the community.

CSR also helps us strengthen relationships with other entities in Ras Al Khaimah. We actively participate in the Terry Fox Marathon, Umrah trips for labours, blood donation and other awareness campaigns like breast cancer check-ups and autism programmes.

CSR is part of our business strategy; not only employees from different levels are encouraged to take part in it, but clients as well in order for them to play a positive role in the community. A good example is the ‘Go Green’ initiative where we persuade cutting the use of paper and recycling to save the environment.

Other methods include saving electricity and water in the parks and reducing the use of plastic bottles. We at RAKEZ aim to be the employer of choice and to improve our customer knowledge about CSR to increase our brand awareness and to bring happiness to the people in need regardless their age, colour and origin. We continually support charities in their activities to have a positive image in the society.

GSC: How does RAKEZ score and stand out vis-à-vis other FTZ’s in the UAE? What are your Unique Selling Propositions (USPs)?

RJ: RAKEZ furnishes clients with a suite of offerings that help them in their business journey. But you know what sets us apart from other investment hubs? It’s our strong commitment to our investors. This is among the many reasons that encourages investors to set up their business with us.

We treat them as family and make sure we are right beside them every step of the way. We are continuously striving to enhance the level of ‘ease of doing’ business in the environment that we offer to our clients. We are doing our best to simplify our processes as well as offer them quick turnaround time for results.

Subscribe today July/August 2019 Issue 61

June 2019 Issue 60

May 2019 Issue 59

ENHANCING THE BUSINESS OF LOGISTICS

ENHANCING THE BUSINESS OF LOGISTICS

ENHANCING THE BUSINESS OF LOGISTICS

KINGDOM

CALIBRATIONS THE LOGISTICS INDUSTRY ON A ROLL IN SAUDI ARABIA

ARBITRATION COMES OF AGE IN THE UAE

THE UAE:

LOGISTICS LEADER

BY FAR Log Square

Squaring the benefits with technology

Freezones

Force for economic good

EMAC takes business mainstream

SOHAR Port & Freezone

Dubai South

Shoring up new investments

•GSC_June_2019_Cover.indd 1

6/10/19 6:12

World Distribution Centre Leveraging distribution proficiencies

King Abdulaziz Port

Bracing for EXPO 2020

Major Maritime Moves

•GSC_May_2019_Cover.indd 1

Etihad Rail

Phase 2 on track with contracts awards

UD Trucks

Unfurls the New Quester

5/7/19 21:27

RAKEZ

The magnet for investors and investments

•GSC_July/Aug_2019_Cover.indd 1

7/7/19 21:35

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FOCUS FEATURE: RAS AL KHAIMAH ECONOMIC ZONE (RAKEZ)

Apart from that, we are making an ongoing effort to implement corporate governance according to global standards to allow increased transparency and reduced bureaucracy, and provide our clients a seamless experience.

Cost-effectiveness is RAKEZ’s strength over its competitors. We are blessed to be strategically located in Ras Al Khaimah where the cost of living and operating a business is up to 50% lower.

With this, we are able to come up with comprehensive solutions without putting a high price tag, especially for the startups and entrepreneurs. This quality makes RAKEZ an ideal business incubator to the SME community.

Investors who choose to base their company in RAKEZ get to save on hefty startup costs and at the same time, gain higher return on investments while enjoying the business-friendly environment that RAKEZ has to offer.

And of course, the third key benefit that we offer is the ability to customise. As I always say, customisation is key. Investors now are not after ready-made solutions. They are opting for what suits their needs and what will provide them with value for their money.

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Hence, we allow our existing and potential clients to explore our offerings and give them the option to adjust them in a way that would match the requirements of their business.

GSC: You recently appointed former Indian cricketer and current Head Coach of the Indian National cricket team & TV commentator as your Corporate Ambassador. What implications does this have for RAKEZ? RJ: Appointing a Brand Ambassador is a new venture for us and we’re very excited about it.

Indians are among our largest population of investors and we want to continue attracting new ventures from this side of the world, hence, we appointed a Brand Ambassador to the Indian business community.

We chose Ravi Shastri as he is one of the most well-respected people in the Indian community. He helped India make a mark in the cricket world and he is followed by hundreds of thousands of people as well as has valuable connections and influential in the society.

I am very positive that our association with Shastri will help position RAKEZ as an ideal investment destination for investors from India. Presently, Shastri is a coach and a motivator who leads a team to victory. I am

confident that he will be able to do the same for us in terms of attracting more Indian companies to Ras Al Khaimah.

GSC: As CEO what is your vision for RAKEZ for the short & long terms?

RJ: As CEO, I always aspire to have RAKEZ’s vision for the short and long terms consistent. In the short terms, we aim at exploring new markets and continue enticing more entrepreneurs, start-ups and SMEs to Ras Al Khaimah.

These businesses are the backbone of Ras Al Khaimah and the UAE’s economy. They are the drivers of growth and job creation, and enable the country to shift from capital and labour intensive economy to innovative and technology-driven economy.

Being important players in all value chains, we aim to offer a nurturing business environment that serves as a perfect business incubator for SMEs to become thriving enterprises. And of course, we would like to continue growing our industrial client portfolio as well.

As for the long term, we thrive to become a leading global investment destination and maintain a strong brand name among other economic zones around the world.

EGA-SNC LAVALIN PARTNERSHIP

Emirates Global Aluminium awards major engineering and project management contract to SNC-Lavalin

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nder a recently signed agreement, Montreal, Canada-headquartered EPC services provider SNC-Lavalin will provide integrated engineering services covering all multi-disciplinary aspects related to power plant, energy distribution, water desalination, aluminum smelting, casting and carbon plants of EGA’s Al Taweelah and Jebel Ali smelter complexes.

This mandate will also include delivering multi-disciplinary engineering services pertaining to Al Taweelah alumina refinery.

In addition, the services will include project management services such as construction management, cost control and planning, contract engineering and project portfolio management.

Long track record of cooperation “As a premier engineering end-to-end

services provider, we have established a long track record of delivering some of the world’s leading mining and metallurgy projects,” remarked Craig Muir, President, Resources.

“Over the past 15 years, we have been successfully delivering EGA’s large-scale projects to the highest quality and safety standards. We continue to extend our longterm partnership and to continue providing our global-calibre expertise and local knowledge to support industry growth in the UAE.” SNC-Lavalin’s partnership with EGA started in 2004 with providing FEED (Front End Engineering Design), EPCM (Engineering, Procurement and Construction Management) and Technology Packaging services for Dubai Aluminium (DUBAL) and all its extension projects.

DUBAL and Emirates Aluminium (EMAL) merged to form EGA in 2014.

Delivering repeated business on schedule and within budget has resulted in increasing the Jebel Ali smelter’s production capacity from 680,000 TPY (tones per annum) to current capacity (circa 1.1 MTPY-Metric Tonnes Per Year).

The award-winning Al Taweelah smelter complex in Abu Dhabi, the world’s largest single-site aluminum smelter when it was constructed, is another successful collaboration with EGA, where SNC-Lavalin provided EPCM services for the project’s first and second phases.

Emirates Global Aluminium (EGA) has awarded a three-year Master Services Agreement to SNC-Lavalin to provide engineering and project management support services to complement its existing resources in delivering operations capital projects at its Al Taweelah and Jebel Ali smelter Complexes and Al Taweelah alumina refinery JULY/AUGUST 2019 47

HARNESSING SOLAR POWER

SirajPower installs solar rooftop for RSA-TALKE The installation of the solar rooftop marks the solar solutions provider’s 4th project for RSA Global

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irajPower, the UAE’s leading provider of solar rooftops, recently announced the installation of a solar power plant on the premises of RSA-TALKE, the chemicals-focused subsidiary of the RSA Global group of companies, continuing its strategic partnership with the supply chain solution specialists.

The installation is located on the rooftop of RSA-TALKE’s non-dangerous goods chemical facility in Dubai South. This is the fourth solar power plant installed by SirajPower on a RSA Global building since the signature of the fully financed leasing scheme two years ago, which at the time made RSA was the first to go solar in Dubai South.

RSA-TALKE, a joint venture between RSA Global and German logistics veterans, the TALKE Group, is a Supply chain partner for the

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chemical and petrochemical industry in Europe, Middle East, United States, India and China.

Long term deal The new agreement with SirajPower includes the installation, financing and operation of a 1 MWp PV system on RSA-TALKE’s warehouses, under a 20 years leasing scheme.

The plant will cover more than 78% of the electricity consumptions, saving 1,100 tons of CO2 from the first year of operation.

To mark the occasion, an inaugural ceremony was held at RSA-TALKE’s offices in Dubai South with the attendance of Abhishek Ajay Shah, Co-Founder and Group CEO of RSA Global; Markus Koespel, General Manager, RSA-TALKE; and senior leadership from SirajPower including Mohammed Abdulghaffar Hussain, Chairman and Laurent Longuet, CEO, and other guests.

Sustainability first “At RSA Global, sustainability is at the forefront of every decision we take as a business and across all our affiliates.

We embarked on a green journey with SirajPower two years ago following our first solar rooftop deal, and became pioneers in our industry,”commented Shah.

“We see a big push towards solar in different sectors of the market including logistics. We are grateful for the high level of engagement between both parties and delighted to continue supporting RSA Global and its,”remarked Longuet.

RSA Global is a tech-driven thirdparty logistics provider with international alliances. RSA-TALKE offers safe and secure integrated solutions for the storage and handling of hazardous and nonhazardous chemicals.

SirajPower is licensed and certified to offer Engineering, Procurement, Construction (EPC), O&M and financing solutions. The company provides solar leasing system solutions that reduce substantially energy expenditure while fulfilling commitment toward a sustainable future in line with the UAE’s long-term green vision.

HARNESSING TECHNOLOGY

Avoid ‘Analysis Paralysis’ – Use data to enable decision-making There is no denying that data plays a key role in the everyday decisions made by organizations and their employees. However, the sheer volume of information available today can result in data blindness and confusion, rather than clarity, when making all-important business choices – leading to ‘analysis paralysis’.

To fight against this data deluge and harness the power of data for better decision making, in this expert article, Hesham El Komy, Regional Vice President – Middle East, Africa, India (MEAI), Epicor Software, recommends that organizations, particularly in the manufacturing / logistics sector, should consider technology solutions like enterprise resource planning (ERP) platforms – Editor

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here are vast amounts of data being created, mined and managed every day – and, according to an executive summary by Cisco, global IP traffic will experience an almost threefold increase over the next five years. With broadband speeds set to double by 2021, and more data being shared, than ever before, the amount of information that now sits at our fingertips is exploding.

Dealing with the data deluge Recent research conducted by Morar Consulting indicates that the data deluge workers experience on a daily basis is becoming overwhelming. Nearly three-

quarters (74%) of employees claim they’re dealing with more and more data, while almost two-thirds (62%) said they are often overwhelmed by the sheer volume of emails they receive. Over a third (35%) went on to confess they feel stressed every day, due to information overload.

Better visibility equates to better decision-making With decision-making so pivotal to driving business growth, information overload represents a worrying development. Making the wrong decision can have serious negative implications for the bottom line, especially when it comes to adapting an export strategy

or initiating a new business plan without appropriately reviewing if there is any potential impact on profit margins.

Achieving full visibility of operations across the business is key for maximising the enterprise’s decision-making capabilities.

This includes having on-demand access to the right information, at the right time.

However, according to a KPMG Report 43% of senior executives admit they had either limited or no visibility at all into their supply chain – a concerning figure.

While no one person can have direct visibility of everything that is going on in a company, business intelligence technologies and analytic software – including enterprise resource planning (ERP) systems and manufacturing execution software (MES) – should be used to provide these insights.

These technologies work by collecting, distilling, interpreting, editing, and presenting meaningful data in a timely manner, and highlighting issues and areas of concern in a way that is clear and actionable.

Making informed business decisions Cutting through the everyday influx of data is an ongoing business need – and systems that can help make decision-makers choose quickly, and wisely, are more crucial than ever before. To eliminate analysis paralysis, businesses need to access contextualised data and present this in a format – in a dashboard, or as graphics or alerts – that users find easy to work with.

Solutions like ERP and MES make it possible to enable the integration of data across the entire product lifecycle – from design, through to engineering, manufacturing, delivery, and customer service. This gives all stakeholders – from C-level executives to those working on the manufacturing floor – access to real-time, and actionable, information and insights.

Having a filtered view of all this detail will enable decisions to be based on relevant, accurate and reliable data.

There is no room for uncertainty in business when paving the way for future growth. By applying analytics to data, decision-makers can swiftly access insights that will enable them to make the right choices to improve operations across an entire business – including customer service and demand planning – and, ultimately, profits.

JULY/AUGUST 2019 49

WAREHOUSES

Lootah Real Estate Development debuts its new offering:

Lease-to-own industrial warehouses One of the UAE’s top developers is offering modern-day industrial warehouses in Dubai on a lease-to-own, long-term basis with an enticing mix of incentives including customsexemption, modern and targeted specifications to attract buyers

Saleh Abdullah Lootah, CEO, Lootah Real Estate Development

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ootah Real Estate Development, one of the region’s leading real estate developers, announced the launch of Senaeyat, a company that provides lease-to-own industrial warehouses for businesses of different sizes.

Located in a major industrial growth hub in Dubai, the Dubai Industrial Park, Senaeyat is the first to offer a lease-to-own model for clients, in which they can have full ownership of the pre-built industrial warehouses within 10 years.

It may be recalled that Dubai Industrial Park, one of the largest industrial hubs in the region and a member of the TECOM Group, has signed a long-term agreement with Lootah Real Estate Development to establish Senaeyat, an advanced pre-built industrial manufacturing development, on its premises earlier this year.

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Saleh Abdullah Lootah (L) and Abdulla Belhoul at the deal signing ceremony

WAREHOUSES

Senaeyat Project by Lootah Real Estate Development

The deal was inked by Abdulla Belhoul, Chief Commercial Officer of TECOM Group, and Saleh Abdullah Lootah, Executive Director of Lootah Real Estate Development.

Senaeyat is the first to offer a lease-to-own model for clients, in which they can have full ownership of the pre-built industrial warehouses for businesses of different sizes within 10 years.

Lootah has acquired 3,000,000 sqft. land on lease for 49 years with Dubai Industrial Park to establish Senaeyat, an industrial warehouse development project in Dubai Industrial Park. It will be developed in two phases. The first phase includes one million sqft., and the second, two million sqft.

“We are pleased to offer this sustainable business model to different industries to help them convert their operational costs to assets. This signifies our commitment, not only to residents whom we have developed world-class residential projects for, but to the business community as well,”affirmed Saleh Abdullah Lootah.

addition to bigger built-up areas–50,000 sqft and 60,000 sqft.

According to the Saleh Lootah, Senaeyat’s wide range of modern specifications is a response to the growing demand for such warehouses in the market, as these European models aren’t widely available. The warehouses will also be ready-to-use upon handover.

“We understand the unique requirements of different businesses from multiple industries and our portfolio of turnkey warehouses are designed to address these and related issues,”added Saleh Lootah.

Potential clients can also benefit from the warehouses’ proximity to major areas such as Al Maktoum International Airport (DWC), Jebel Ali Port, Expo 2020 Site, and several major highways such as Sheikh Mohammed Bin Zayed Road and Emirates Road.

Senaeyat’s location is also considered customs-exempted due to its presence at Dubai Industrial Park, thus potential clients can also cut costs if they go for its warehouse offerings.

Two phases, four size options

Competitive costs

The first phase of the project has four different built-up areas – 20,000 sqft, 24,000 sqft, 30,000 sqft and 36,000 sqft to cater to diverse market segments, especially focusing on the underserved market of small to medium-sized industries. The second phase will have the same size options, in

Senaeyat also offers warehouses on competitive rates to counter the current fluctuating prices in the market.“We found that many vacant warehouse units are due to price mismatch in the market, so we made sure that Senaeyat keeps its portfolio at a reasonable price,”explained Saleh Lootah.

Saleh Abdullah Lootah added that Senaeyat project brought by Lootah actively supports the Dubai Industrial Strategy 2030, enabling the growth for the industrial ecosystem, providing clients with an important resource to achieve short to long-term goals.

Additionally, Senaeyat development goals are in line with Dubai’s expansion plans, providing growth potential for clients.

Lootah has been in the industry for long, being one of the pioneer real estate companies in Dubai. It has developed major residential and commercial and has since been setting benchmarks for urban development.

This development has also been welcomed by investors and real estate agents.“The Lootah Real Estate Development incentive is a welcomed option for many business owners and I hope to see more developers following suit,”affirmed Emrah Yar, Head of Commercial, Allsopp & Allsopp.

Dubai Industrial Park, one of the largest industrial and manufacturing hubs in Dubai, provides advanced infrastructure and integrated solutions for businesses. The destination hosts over 250 factories and more than 700 business partners in sector-specific zones.

Dubai Industrial Park hosts several multinational and regional companies including Unilever, Al Shafar General Contracting, Emirates Printing Press, Al Futtaim Logistics, Almarai Group, Patchi, Gorica Industries, Gulf Eternit Industries and BASF.

JULY/AUGUST 2019 51

EXPERT OPINION: SUPPLY CHAIN RISKS

The not-so-smooth

Silk Road

Supply chains, far from working like welloiled machinery and in streamlined manner, are fraught with constant risks, often un-anticipated, and upheavals, both natural and man-made. In this contribution, Professor Omera Khan, accomplished academician, researcher and professor, catalogues the diverse and unforeseen risks and interruptions that confront industry every step of the way – Editor

I

n 2015, a series of explosions in the Chinese port of Tianjin were powerful enough to be seen from space. 173 people were killed, buildings destroyed, and thousands of newly-produced vehicles stored in a logistics park were left as charred wrecks. The cost to businesses of the resulting supply chain disruption: a staggering US$ 9bn, with the effects felt thousands of miles away.

As with the earthquake and tsunami that hit north-eastern Japan in 2011, dislocated supply chains recognize no borders. Within hours of the earthquake, as I wrote in my book Product Design and the Supply Chain: Competing through Design, the finely-honed supply chains of Japanese car manufacturers Toyota, Suzuki and Nissan had been hit by parts shortages.

And within days, faraway car plants belonging to Ford,Volvo, General Motors, Renault, Chrysler, and PSA Peugeot CitroĂŤn all found that huge numbers of automotive components turned out to be sourced from the disaster zone. A widely-

52 JULY/AUGUST 2019

EXPERT OPINION: SUPPLY CHAIN RISKS

used metallic paint pigment, called Xirallic, was found to have been produced at only one factory in the world, located in the Japanese coastal town of Onahama.

Supply chain risk used to be viewed in terms of currency exposure, supplier failure, political instability, and commodity price volatility. Today, the businesses approach it far less simplistic and far more complex.

New and diverse challenges Now, new and diverse challenges abound. These include sea piracy; cargo theft; terrorism; organised crime; drug smuggling; violent labour activism – and, as at Tianjin, disruption stemming from lax regulatory regimes. For the explosions, investigators found, had stemmed from poor storage practices in a facility that had been operating without proper licensing or controls.

China’s widely-publicised Belt and Road Initiative has attracted Omera Khan is a a lot of attention. By land, and by Professor of Supply sea, it recreates China’s ancient Chain Management trade routes, along which silk, at Royal Holloway tea, and spices were traded. The University of London goal: bringing China’s factories (UK) and Executive ever-closer to markets in Europe, Strategy Advisor for Africa, and the Middle East.

Risk Intelligence, a Already, Chinesedynamic world leader manufactured cars, built at in risk assessment Volvo’s plant in Daqing, reach and planning. She Europe not by sea, but by rail, is a sought-after having travelled along the speaker and has recently opened China Europe published widely on rail route – which cuts two thirds supply chain risk off the time taken by ships on management and the usual ocean route. resilience. Read However, it is not just China’s more on www. factories that are brought omerakhan.co.uk closer to Europe. It’s China’s supply chain risks, too. These are risks that include not just the usual range of disruptive possibilities, but also geopolitical risk.

CIS inclusivity These risks, it must be remembered, extend to the countries through which this modern-day Silk Road travels – countries such as Uzbekistan, Kazakhstan, and Kyrgyzstan.

Global trade is good, and to be encouraged. But in an era when politics moves at the speed of a tweet, and global leaders openly use threats to trade as tools of political leverage, the dangers are clear.

China’s Belt and Road Initiative cannot be un-invented. It’s smart to assume that it will come to fruition, and that goods destined for Western businesses will flow through it.

So businesses should do all they can to mitigate the additional risks entailed – risks on land, in ports, and at sea.

Specialist supply chain risk intelligence providers can help: smart businesses will avail themselves of their services.

Overview: A World Bank Perspective The People’s Republic of China proposed the Belt and Road Initiative (BRI) in 2013 to improve connectivity and cooperation on a transcontinental scale.

Quantifying the impacts of the BRI is a major challenge, which is why the World Bank Group has produced empirical research and economic models that assess the opportunities and risks of BRI projects.

Since May 2018, the World Bank Group has produced a series of 19 background papers and one summary report that provide independent analysis of the BRI’s links to trade, investment, debt, procurement, environment, poverty reduction and infrastructure.

The research data gathered enables policymakers in countries along BRI corridors to make evidence-based assessments of how to maximize the benefits and minimize the risks of participating in the BRI. The research also aims to inform the public debates surrounding BRI, by grounding the discussion in data and analysis.

Belt and Road Economics

BELT & ROAD INITIATIVE (BRI) at a Glance How big is the BRI? China has presented the BRI as an open arrangement in which all countries are welcome to participate. However, an official list of participating countries does not yet exist.

The research has focused on 71 economies geographically located along BRI transport corridors, including China. In 2017, these economies received 35% of global foreign direct investments and accounted for 40% of global merchandise exports.

The Belt and Road Initiative includes one-third of world trade and GDP and impacts over 60% of the world’s population.

How much does the BRI cost?

For the 70 BRI“corridor economies”(excluding China), projects in all sectors that are already executed, in implementation, or planned are estimated to amount to US$ 575bn.

What potential opportunities does the BRI present?

If completed, BRI transport projects could reduce travel times along economic corridors by 12%, increase trade between 2.7% and 9.7%, increase income by up to 3.4% and lift 7.6 million people from extreme poverty.

What risks are involved with BRI projects?

The BRI presents risks common to many major infrastructure projects: debt risks, governance risks (corruption and procurement), stranded infrastructure, environmental risks and social risks.

What needs to happen for the BRI to succeed?

BRI transport projects have the potential to substantially improve trade, foreign investment, and living conditions for citizens in participating countries – but only if China and other corridor economies adopt deeper policy reforms that increase transparency, expand trade, improve debt sustainability and mitigate environmental, social and corruption risks.

(Source: The World Bank.)

JULY/AUGUST 2019 53

Cold-chains connect

farmers to markets - delivering maximum economic benefit with minimal environmental impact Approached correctly, cold-chains are an essential contributor to our global Sustainable Development and Climate Goals (SDGs).

The challenge is how to expand cold chain capacity quickly and affordably, delivering societal and economic impact with minimal pollution and environmental impact, writes Toby Peters, Professor in Clean Cold Economy, The University of Birmingham, UK – Editor

C

old-chains connect local clusters of farmers, growers and fishers with higher-value local, national and international markets whilst building sustainable and resilient food supply systems. For example, they can allow farmers and growers in countries such as India to transition from staple crops to grow micronutrient rich, but temperature sensitive, foods such as fresh fruits, vegetables and animal sourced foods.

Using more than 1,300 TWhs (Terra Watt hours) annually, the global cold-chain is already energy intensive and accounts for 1.3 gigatons of CO2e globally. Equally, it currently relies on diesel in both transport and off-grid applications.

If we meet the Sustainable Development Goals (SDGs) and reduce food loss to similar levels to the UK or US, without appropriate intervention energy demand could increase by 130% to 3,000TWhs by 2050. Unplanned, ill-informed investment in the cold-chain sector can create a carbon intensive standalone infrastructure of cold storages, reefer vehicles and ripening chambers instead of a sustainable and cohesive agri-supply system.

WORK PACKAGES working with a small group of representative FPOs/VPOs in-country

Work Package 1 Needs Assessment against SDG impacts, gap analysis and mapping

Work Package 2 Business Model Development and socio— economic political environment for delivery

iterative process Work Package 3 Supply chain optimization fork to field and field to fork

Measure Impact against SDGdriven needs assessment

54 JULY/AUGUST 2019

Work Package 4 Pathways to Impact and technology and capacity gap analysis

Work Package 5 Dissemination

We need to simultaneously deliver sustainable cold chain to meet SDGs development, access to energy and climate goals and manage the foodwater-energy-land nexus.

Cold chain connectivity The cold chain is an integrated and seamless network of refrigerated and temperature (and humidity) controlled pack houses, distribution hubs and vehicles which maintains the safety, quality and quantity of food, while moving it swiftly from farm gate to consumption centre.

Breaks in the cold chain at any stage can jeopardize its integrity and viability as a whole.

Key to its impact and financial sustainability though is to understand with the small and margin how to actually use the integrated components of storage and transport in a demand-driven dynamic business model for cross-geography access or distance-price arbitrage, time-arbitrage or even cross-seasonal trading is as important as the physical infrastructure itself to flow food from farm to fork?

Equally can it enable farmers to diversify production to include higher value, micronutrient rich, but perishable crops as well as the wider rural communities to develop secondary agriculture employment, as a value and jobs multiplier to primary agriculture?

There is, however, often poor understanding among producers and policy makers in developing economies of the techno-economics and business models of the cold-chain as well as a lack of the essential information flow from fork to farm which can change the core business model to demanddriven production of agricultural produce, rather than production-propelled marketing.

Additionally, while there are barriers and issues through the cold chain, first to last mile, farmers have identified barriers to the deployment of cold-chain including: Government attention has been focused on larger-scale cold storage rather than the coldchain as a whole (including by developed world NGOs and grantees).

Lack of adequate/ continuous power supply (also expensive); First mile transportation; Limited financial capacity of marginal and small farmers, not only for capital expenditure, but storing; prompting them to encash the produce as soon as possible.

Distress sale is a well- known phenomenon; Lack of understanding of business models;

COLD CHAINS

refrigerants and harnessing renewable, free and waste energy sources most efficiently.

Lack of access to finance (especially for women in agriculture); Lack of access to market data; and Lack of knowledge, skills and training.

From our research at University of Birmingham, as well as extensive direct engagement in-markets since 2015, other issues in the supply chain include:

Subsistence farmers Most subsistence farmers have little, if any, experience of cold chain, still less of novel clean technologies. They will not adopt them before the technologies have been shown to work well and cost-effectively.

Many of the necessary renewable, clean technologies are already well advanced, but the value of cold chain comes from connecting suppliers to distant markets through several logistical stages. The entire chain must prove it can provide farmers with a clean, sustainable, fast and resilient link from field to cities, where their produce will command higher prices.

Equally, cold chain will only be taken up if farmers and other supply chain players can afford them. This is likely to require new business and funding models, meaning that we have to demonstrate not only a range of technologies, but also the business and financing models needed to make them accessible to small farmers and collectives.

We have to go beyond technology to address the issues and barriers discussed; considering whole system integration built on novel purpose, needs and impact-driven business models and innovative socioeconomics-political frameworks.

Done correctly we can enhance economic wealth, cash flow and security for rural and fishing communities. Clean cold can create jobs, whilst improving food quality, safety and value to the consumer - achieving these with minimum environmental impact. Not bad for a fridge.

A lack of appropriate infrastructure through the whole chain Many businesses providing logistical support from warehouses to retail shops are neither formally registered nor use formal logistical network planning, resulting in haphazard network and quality management; Even with the advent of e-commerce in India, the logistics process is not fully developed to optimize supply and demand in the food produce value-chain; and there is a lack of space and infrastructure within retail stores leading to sub-optimal management and storing of produce.

Looking to future challenges, both electrical transportation fleets and on-board battery for cold production can be relatively expensive to purchase and maintain. There is also a lack of charging infrastructure should there be an effort to support electric transportation fleet.

Exciting new technologies are available.

These include solar powered storage facilities, liquid nitrogen transport refrigeration systems, and off-grid fridges, which can last for days at a time using ice. But to cope with demand growth in an effective, efficient sustainable way, every integrated element of the cold chain must form a seamless system; each using natural or ultra-low GWP

BEYOND TECHNOLOGY Traditional energy innovation approach System

Technology

Service

Business Model

Market Arrangement

Value Chain

A new approach for clean cold chain to meet the SDGs sustainably

Procuremet and Manufacture Trained workforce– installation, maintenance

Environmental, energy and climate Impacts if developed correctly i.e.

Reduce electrical demand Clean – CO2, emissions, GWP refrigerants, whole of life Resilient Technology

Energy resource

System

Service

Socio-economic Impacts if developed correctly i.e.

Increasing farmers incomes Secondary agriculture economy Access to affordable, safe, nutritional food Purpose driven Business Model

Value Chain

Market Arrangement

SDG-driven Needs Assessment

What is the socio— economic political environment to deliver the business model ?

Measure Impact against SDGs

Peters, 2019

Development impact of cold chain Agriculture and allied sub-sectors are a substantive part of many developing country economies. In India, more than 14% of Gross Domestic Product (GDP) and half (49.8%) of the country’ employment; its food and grocery market is the world’s sixth largest.

However, for some crops, up to 40% of the harvested produce is lost between the farm gate and the market; the single largest cause of which is lack of coldchain. Just 4% of India’s fresh produce is transported in a cold-chain; in stark contrast to over 90% in the UK or the United States.

This reduces the farmer’s income, their capacity to invest and fails to provide an incentive to grow more produce. Also, in a rapidly urbanising marketplace, such huge loss of produce negatively impacts the cost of food and subsequently affects the end consumer.

We cannot address rural poverty and the needs of society’s most disadvantaged without cold chains extending the life of harvested produce while connecting farmers, growers and fishers to markets. In turn, this also impacts rural-urban migration. At the same time, maternal and child under-nutrition is estimated to be responsible for some 45% of child mortality and 11% of the global disease burden. A key factor behind high persistence of malnutrition is the low intake of micronutrient rich foods such as fresh fruits, vegetables and animal sourced foods. Connecting the supply of such nutritious foods with a vulnerable population requires cold-chains.

The consequences of food loss go far beyond malnutrition and agrarian poverty. Globally, post-harvest food loss and food waste occupies a land area almost twice the size of Australia; consumes 3.6 times the fresh water consumption of the USA and is the third biggest emitter of CO2e after America and China – more than 1GT per annum from lack of cold chain alone – Toby Peters, Professor in Clean Cold Economy, The University of Birmingham, UK.

JULY/AUGUST 2019 55

Empowering Logistics through FinTech The rise of FinTech, the synergy between technology and innovation to provide financial products and services, is transforming the global financial services landscape. The emergence of FinTech is a key growth opportunity and very transformative for the logistics and supply chain sectors, affirms our newest contributor Chartered Accountant Mahmood Bangara, Chairman of the Institute of Chartered Accountants of India (ICAI) Dubai Chapter.

Given its strong bearing in the world of logistics, FinTech may usher in a real transformation in supply chains by solving the problems of lack of transparency, inefficient use of capacity and reluctance to cooperate by supply chain partners. This especially holds for the transformation of international trade and logistics and the business redesign with blockchain technology.

“FinTech will transform business processes and drive exponential growth in the logistics and supply chain industry in the foreseeable future,” asserts CA Bangara in this maiden opinioncontribution to Global Supply Chain –Editor 56 JULY/AUGUST 2019

F

inTech isn’t just about technological advancements in finance for the sake of technology. It has a substantial purpose that is already showing promising transformations in the processes it has developed solutions for.

Great things happen when FinTech intersects industry. With the objective to facilitate both suppliers and buyers at the same time, FinTech is able to bring in greater liquidity and lesser variability during payments to enable companies to reach deep into previously inaccessible capital in their supply chains.

While FinTechs (financial technology companies) are helping suppliers fulfill orders and collect payments much faster, they are also enabling buyers to make much better use of the working capital that would otherwise be temporarily blocked in the accounts payable.

So, when FinTech meets logistics, it helps streamline payment processes in the sector, a trend that can boost productivity significantly, create higher value for all parties involved, and eventually go on to help reduce the global trade gap.

Both FinTech and logistics are beginning to reap great benefits as they join forces, and I think it is safe to say that this is only the tip of the iceberg. FinTech in logistics offers a wide range of benefits across processes.

FinTech forward By significantly improving administration, working capital utilisation, and supply chain finance for logistics organisations, FinTech

FINTECH-LOGISTICS INTERFACE

makes way for providing better financing for equipment, inventory, and even real estate.

Furthermore, if you look at the bigger picture, it helps improve international business, cross-border movements and trust in general.

The use of FinTech allows suppliers to tap into funding at an effectively lower cost of capital and brings greater efficiency into funding the supply chain as a whole.

FinTechs are in essence, after all, internet companies that streamline financial systems for their consumers by improving their working capital utilisation significantly.

They are able to create bigger opportunities for logistics service providers to exponentially expand their existing service portfolio by strategically collaborating with new-age companies to offer better propositions to their customers.

Logistics companies can ride on the potential of the innovative power of these digital intermediaries to bring about business transformation on multiple levels. FinTech applications support existing business processes to instrumentally enhance the performance of logistics service providers by addressing the biggest challenges in their financial processes.

By solving the biggest problems plaguing the logistics solution providers like lack of transparency, reluctance to cooperate by supply chain partners, and inefficient use of capacity, FinTech companies are bringing about a genuine transformation in supply chains.

Empowering supply chain

Profile:

These digital platforms are empowering supply chain finance providers to go beyond their conventional methods and access bigger markets in a more efficient manner.

These logistics services providers, who have historically been known to restrict themselves to a small selection of large buyers and a handful of suppliers, are now being able to work with numerous smaller suppliers, vendors and distributors to unlock an all-new capacity.

These small-scale vendors can prove to be critical to multinational corporates’ global supply chains but couldn’t hop on the bandwagon up until the advent of FinTech as it was not so easy for them to access affordable financing earlier.

With the growing global footprint of suppliers, the need for proprietary supply chain finance platforms to use open application programming interfaces to connect to third-party platforms is rising rapidly.

Changing the way international trade and logistics works will be determined in time.

A number of FinTech collaborations are beginning to bear fruit and deliver on the technology’s promises of digitally advancing supply chain operations entirely.

FinTech companies can work as a great ally and enabler to strengthen the financial positions of logistics enterprises and boost the overall capital available to the whole supplier ecosystem.

CA Mahmood Bangara is the founding Chairman, AMT International Group, a company in the Cellular & Digital domain with branches across GCC, China and India.

A Chartered Accountant by profession and Dubai resident for 33 years, Bangara is presently Chairman of the Institute of Chartered Accountants of India (ICAI), Dubai Chapter.

He is also the Director of two international schools in UAE and an upcoming specialty hospital in India. Earlier, he served as Vice President, Group Finance, handling key corporate and finance portfolios for 25 years in MIS at Lamprell, a listed company in the energy sector.

JULY/AUGUST 2019 57

GCC CONSTRUCTION REPORT

GCC construction projects value exceeds AED 9.25tr (US$ 2.52tr) in June 2019 Overall, the GCC has been on growth track with regard to construction projects in the region. The industry is still buoyant and not running out of steam anytime soon, reveals a recent industry report 58 JULY/AUGUST 2019

GCC CONSTRUCTION REPORT

I

n the GCC construction continuum, Saudi Arabia is topping the value of construction orders with AED 3.29trillion, closely followed by the UAE with AED 3.05trillion worth of construction projects, a freshly released BNC Construction Intelligence Report has indicated.

Key highlights are as follows: The combined value of all construction projects in the GCC reached US$ 2.52trillion (AED 9.25trillion) in June 2019 The value of 16,732 under construction projects reached US$ 769.2billion (AED 2.82trillion) The value of 4,980 projects that are in concept, design and tender stage reached US$ 898.9billion (AED 3.29trillion)

UAE-based BNC, one of the largest project intelligence providers in the MENA region, has tracked more than 32,000 live construction projects with a value exceeding US$ 7.7trillion (AED 28.3trillion) The total value of more than 26,000 construction projects exceeded US$ 2.52trillion (AED 9.25trillion) in June 2019, according to the June 2019 Issue of the BNC Projects Journal: The Next Construction Circus – Setting the Stage for Growth, a major comprehensive construction intelligence platform in the Middle East and North Africa (MENA) region.

Economic powerhouse Saudi Arabia leads the GCC region in the total value of construction projects worth US$ 895.8billion (AED 3.29trillion), followed by the UAE with projects valued at US$ 830.6billion (AED 3.05trillion) are at various stages of planning, development and execution in the Kingdom.

“The UAE and Saudi Arabia are pulling out all the stops, tearing down doors that impede trade and eliminating business barriers.

The GCC is working on building bridges economically, digitally and physically with a far-sighted vision for a future Arab world that is much more deeply integrated and pivotal to global progress,”asserted Avin Gidwani, Chief Executive Officer, BNC Network.

MEP in the lead In the BNC Projects Journal, BNC offers the latest industry news and information along with detailed analysis and the current market outlook of the construction sector – which is very crucial for those involved in

JULY/AUGUST 2019 59

GCC CONSTRUCTION REPORT

“This is the only credible reference for the construction industry for projects intelligence in the Middle East and North Africa region.

Our team of analysts assisted by technology now publishes an over-whelming 1,700+ GCC construction info-graphic reports every year, providing deep, fact-based construction market insights on countries, cities, sectors and even specific industries,”he continued.

The BNC Projects Journal has been created to encapsulate the essence of these construction analytics, our daily project stories and socio-economic happenings that influence construction.BNC Projects Journal provides the real story of GCC construction as it happens in a concise and actionable form that allows users to drill down from a story for greater depth and information.

Urban Construction Projects construction, sub-contracting, mechanical, electrical and plumbing (MEP) as well as building materials supply businesses.

“BNC Projects Journal has been designed to offer the maximum benefits

of construction intelligence – project information and analytics – for them to gain valuable insights from our vast database of more than 32,000 live projects,”Gidwani continued.

TABLE I: GCC TOTAL CONSTRUCTION PROJECT VALUE IN JUNE 2019 Country

Value(US$)

Project-Value (AED)

Percentage

KSA

US$895.8billion

AED3.29trillion

36

UAE

US$830.6billion

AED3.05trillion

33

Oman

US$226.5 billion

AED831.25billion

09

Kuwait

US$226.5billion

AED831.25billion

09

Qatar

US$226.5billion

AED831.25billion

09

Bahrain

US$105.4billion

AED386.81billion

04

Total GCC

US$2.52trillion

AED9.25trillion

100

TABLE II: URBAN CONSTRUCTION PROJECT VALUE IN JUNE 2019 Country

Project Value(US$)

Project-Value(AED)

Percentage

UAE

US$476.5billion

AED-1.75trillion

42.92

KSA

US$406.2billion

AED-1.49trillion

36.59

Qatar

US$74billion

AED-271.58billion

06.66

Oman

US$62.4billion

AED-229billion

05.62

Kuwait

US$53.5billion

AED-196.34billion

04.81

Bahrain

US$45.9billion

AED-168.45billion

04.13

Total-GCC

US$1.12trillion

AED-4.11trillion

100

TABLE III: CURRENT BUILDING PROJECTS Project Status

No of Projects

Value in US$

Value in AED

Under Construction

16,732

US$769.2billion

AED2.82trillion

Concept, Design & Tender

4,980

US$898.9billion

AED3.29trillion

60 JULY/AUGUST 2019

The total value of urban construction projects exceeded US$1.12 trillion (Dh4.11 trillion) in June 2019, according to the latest BNC Projects Journal.

The UAE leads the GCC region with urban construction projects worth US$ 476.5billion (AED 1.75trillion), followed by Saudi Arabia with projects valued at US$ 406.2billion (AED 1.49trillion). In May 2019, new project announcements worth US$ 5.3billion were recorded by BNC Network and new contract awards estimated at US$ 1.7billion while project completions reached a whopping US$ 9billion for the month.

“Even though the month of Ramadan saw activity slow down, led by the US$ 5billion Bunker Fuel Oil Refinery in Fujairah, the UAE led projects announcements in the GCC which are estimated at a healthy US$ 17billion for May 2019,”the report added.

“With close to US$ 19billion worth of work completed, May registered relatively high project completions. The UAE alone saw US$ 7.7billion worth of projects completed, while Kuwait and Qatar also registered major projects completions with the successful handover of the US$ 2.4billion Sheikh Jaber Al Ahmad Al Sabah Causeway Main Link and two Red Line projects in Qatar worth US$ 2.8billion.”

The value of 13,927 GCC Urban Construction projects that are under construction rose to US$ 308.3billion (AED 1.13trillion) in June 2019. The value of 4,980 Urban Construction projects that are in concept, design and tender stages reached US$ 256.1billion (AED 939.88billion).

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