GLOBAL SUPPLY CHAIN APRIL 2019 ISSUE

April 2019 Issue 58

ENHANCING THE BUSINESS OF LOGISTICS

RAIL REVISITED Keeping Track:

GCC Rail Projects Gaining Traction

Sultanate of Oman Country Report Investing in Infrastructure

DP World

Breaking new ground in BreakBulk

Turkish Cargo

Relocating to its new hub in Istanbul

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

     

Picking up the pace with GCC rail projects 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

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The composite GCC Railway, it would appear, is chugging along just fine!

The grand, pan Gulf rail network when completed will empower the railways to catapult to the prime position of being the top carrier of freight efficiently and costeffectively. Media reports assure that the approved and allocated rail projects, despite the temporary hiatus, are far from being derailed and well on track to eventual completion on new timelines.

According to AT Kearney, the US global management consulting firm, the planned GCC railway will link Kuwait City, traversing along the Gulf, to Muscat in the Sultanate of Oman, serving the Kingdom of Saudi Arabia, the Kingdom of Bahrain, the State of Qatar and the United Arab Emirates. The total length of the GCC Railway main line is approximately 2,177 kilometres, including about 180 km of connecting lines to key traffic generators such as ports and industrial zones.

For this edition, we cover the train tracks for some ‘trainspotting’ and broadly examine the status of the current rail projects across the GCC and the wider Middle East. The rail network will radically change the logistics landscape in the region quite literally and infuse a new dynamic in this vibrant industry sector. After all, it is expected that the rail complex will be at the vanguard of a new logistics revolution.

Elsewhere, we look closely at the economic and logistics parameters of the Sultanate of Oman, the second largest of the GCC nations. The country has been developing its transportation and logistics infrastructure to keep pace with accelerated economic and industrial activities. The creation and development of the greenfield Port of Duqm in the central Wusta Governorate along the Arabian Sea is a case in point.

We also examine a host of disparate subjects like DP World, ports in Saudi Arabia all reflecting the diversity of the world of logistics and supply chain. Our usual repertoire of news, reports, features and articles makes for staple reading.

I also take this opportunity to welcome UK-based Prof.

Omera Khan, Professor of Supply Chain Management at Royal Holloway University of London (UK) and Executive Strategy Advisor for Risk Intelligence to our panel of professional writers.

All this and much more; enjoy the read!

Malcolm Dias Editor malcolm@signaturemediame.com

APRIL 2019 3

April 2019 Issue 58

ENHANCING THE BUSINESS OF LOGISTICS

48 MEFMA 2019 The Middle East Facilities Management Association’s 2019 Congress has reinforced the industry’s growing inroads in the region.

49 DHL Global Forwarding DHL Global Forwarding is the newest international tenant at KIZAD.

50 dnata dnata has made new forays at Brussels International Airport.

51 Turkish Cargo

32 06 NEWS 20 The Sultanate of Oman – A Country Report Oman has been transforming radically and presenting new opportunities to the logistics and supply chain sector.

Frost & Sullivan, a business consulting firm involved in market research and analysis, growth strategy consulting, and corporate training across multiple industries, presents us with the low down on the state of the logistics industry in the country.

26 The Sultanate of Oman We examine the development of the logistics infrastructure across the Sultanate through the lens of the Oxford Business Group.

31 EGA, Mubadala, Dubal Holdings synergy Emirates Global Aluminium (EGA) and its co-owners Mubadala and Dubal Holdings have build a powerhouse (quite literally) at the Aluminium producer’s Jebel Ali facility.

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Turkish Cargo has temporarily relocated to its new hub in Istanbul International.

32 GCC Rail Projects The planned GCC projects are now back on track and regional Governments are proceeding full steam ahead. Our Cover Story looks at the rail sector across the GCC closely.

38 DP World DP World has been demonstrating good financials for 2018.

40 Saudi Ports Authority (Mawani) Saudi Arabian ports are coming of age and the maritime sector steams ahead in the Kingdom.

42 Dubai Silicon Oasis The recently released financials and progress report of Dubai Silicon Oasis had been nothing short of impressive.

46 DP World Breakbulk In anticipation of increased business in the run up to Expo 2020, DP World has been developing its breakbulk capabilities.

52 Tom Craig Tom Craig scrutinises the E-commerce fulfillment gaps and offers suggestions on how to bridge the shortcomings.

54 Gulftainer Gulftainer’s SPOT strategy is proving successful.

55 Bahri-SWCC Saudi Arabia’s Bahri and SWCC have reached a unique pact.

56 LogiPoint LogiPoint’s new transshipment strategy is creating waves.

58 Prof. Omera Khan Prof. Omera Khan offers her opinions on how to manage complex supply chains.

60 Etihad Cargo-MICCO partnership Etihad Cargo and MICCO have forged a strong, mutually beneficial relationship.

China-Korean consortium bags US$408mn Etihad Rail project deal This section of the rail network connects UAE’s Ruwais with Ghuweifat on the Saudi border Etihad Rail, the developer and operator of the UAE national railway, has awarded the tender for the Dh1.5 billion ($408 million) Package A of Stage Two of the UAE National Rail Network to a joint venture of China State Construction Engineering Corporation and Korea’s SK Engineering and Construction (SKEC).

The Package A of Stage Two of the UAE National Rail Network connects UAE’s Ruwais with Ghuweifat on the Saudi border.

The scope of work includes all design and build, civil and track works of the 139-km long rail network line, said a statement from Etihad Rail. Stage Two, when complete, will

Intertek highlights safety and resilience of Supply Chain at Abu Dhabi seminar

Companies increasingly realise the importance of assessing workplace conditions across the supply chains Intertek, an international provider of Total Quality Assurance services to industries, discussed the significance of safety and workplace conditions in a supply chain at the third edition of Annual Safety Day held recently in Abu Dhabi. The event underscored the more complex supply chain-

6 APRIL 2019

run for 605 km from Ghuweifat to the Port of Fujairah, it stated.

The awarding of the contract was made at the Etihad Rail board meeting held in the presence of Chairman Sheikh Theyab Bin Mohamed Bin Zayed Al Nahyan, also a member of the Abu Dhabi Executive Council.

The deals were signed by Etihad Rail CEO Shadi Malak along with China State Construction Engineering Corporation Middle East President and CEO Yu Tao and SKEC Vice President Hyuntae Nam. The Package A will focus on the design and construction of rail infrastructure, including earth-works, bridges, tunnels, animal crossing, track-laying, and linking with Stage One of the network.

oriented challenges in today’s evolving business environment.

The event,‘Safety in Supply Chain’, was attended by logistics professionals and safety experts discussing issues of safety in the workplace from a holistic viewpoint, including occupational health and worker welfare.

The conference also touched on the importance of supply chain assurance services and management system audits.

Samir Ahmed, General Manager, Intertek Business Assurance, Saudi Arabia and Bahrian, highlighted how the changing business environment

Standard gauge, double track The entire route will feature standardgauge double track that will be built using 1.3 million tonne of ballast, over 400,000 concrete sleepers, and 33,000 tons of iron rail.

When complete, the 1,200-km-long 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.

Sheikh Theyab expressed his extreme delight at the rapid progress being made on the project, referring to the contract announcement as a major milestone passed in the organization’s mission to create the UAE’s modern, sustainable and cost-efficient national railway.

“With the commencement of this first phase of Stage Two, we are reaching a major turning point in the transportation sector in the UAE and GCC,”he commented.

“Pioneering and innovative, this initial link is just the beginning, as Etihad Rail expands its network to improve all aspects of freight transport across our border and around the region, placing the UAE at the center of regional goods movement as a global logistics hub,”he further stated.

Etihad Rail is working diligently and efficiently towards awarding contracts for the rest of Stage Two over the coming months, he added. .

has led to the adoption of best business practices when it comes to quality and safety management in a session titled ‘Supply chain resilience, the value it brings’.

Companies now realise the importance of assessing workplace conditions across their supply chains. This requires total visibility and advanced risk management solutions to ensure workplace safety and security. Without real transparency in companies’ supply chains, uncontrolled risks can lead to claims, loss of goodwill and brand reputation, Intertek noted in a press communiqué.

However, new assessment

tools have emerged for evaluating, benchmarking and continuously improving workplace conditions, allowing for closer alignment with industry norms and best practices as well as valuable customer feedback. “Governments are continuously working on health and safety frameworks.

Transparency in supply chains, being vigilant and having the right tools to assess and eliminate potential risks brings value to organisations and helps to avoid real disasters,”remarked Samir Ahmed in the panel session on ‘Standards, laws, regulators and industry leaders’.

PTV Group eyes Middle East growth for its traffic software solutions Client base steadily growing in the region PTV Group, a company engaged in software solutions for traffic and logistics, has strengthened its presence in the Middle East with senior level appointments. In addition to the existing offices in Dubai, Abu Dhabi and Johannesburg; the company is planning to open offices in Saudi Arabia and India to ensure greater proximity to customers.

PTV Group’s software is currently being used by key authorities and institutions in the region such as RTA, Department of Transport in Abu Dhabi, Federal Transport Authority UAE, Ras Al Khaimah Municipality, Saudi Ministry of Transport, Dubai Airports, STS GEMS and many others; to plan and simulate impact of a variety of proposed private and public transport options and derive implication for planners and operators.

“As the regional governments invest more in sustainable mobility such as autonomous vehicles and eMobility, the need for sophisticated traffic management systems will increase. We believe this market will have greater need for our software and technology.

We are experts in planning and optimising the movement of people and goods, using worldclass software, data and scientific know-how,” asserted Andrea Petti, Managing Director, PTV Group, Middle East, India and Africa.

The employee numbers at PTV Gorup’s regional operations have increased six-fold since the company signed their first client in the region in 2005. Recent team appointments include Yasmeena Alniss, Regional Marketing and Communication Manager, with over 14 years of experience in Marketing, Communication and Event Management.

In the traffic sector, PTV Group offers advanced technologies for traffic planning, transport network modelling and simulating across all modes of transport, including realtime traffic management as well as Mobilityas-a-Service (MaaS) solutions.

In the logistics sector, the company provides the latest innovative and marketleading solutions including fully automated and interactive software for scheduling

transport routes, accurate trip cost calculation and real-time journey management including Estimated Time of Arrival, truck navigation and parking.

Swisslog in expansion mode in the Middle East The company makes advances in softwaredriven warehouse technology Swisslog, specializing in robotic, datadriven and flexible automated solutions announced a series of local business initiatives from the appointment of a new Regional Sales Manager to its recent advancements in robot and data-based automation. The automated logistics firm’s recent initiatives are in response to the steady increase in demand for software and robotics solutions, designed to address the challenges of the future.

Swisslog newest recruit is the appointment of Anis El Shaar as Regional Sales Manager for the Middle East to oversee its regional business operations with a focus on the Kingdom of Saudi Arabia and the UAE. In this role, El Shaar is responsible for supporting new clients through the complete sales cycle as well as maintaining the relationships with existing accounts.

“Both UAE and Saudi Arabia are important markets for Swisslog, with plenty of opportunity for growth. Anis brings to the table a proven track record of successfully implemented large-scale automation projects for customer,” commented Alain Kaddoum, General Manager, Swisslog Middle East.

In addition to the recent appointment of a dedicated regional sales manager, Swisslog has made rapid advances in the software-driven integration of advanced warehouse technologies, with a number of innovations aimed at embedding efficiency, intelligence and competitive advantages into warehouse logistics operations.

At the upcoming Seamless Retail & E-Commerce exhibition in Dubai in April 2019, the company will present its latest unique picking technology the next generation of the ItemPiQ robotic picking system. With this solution, Swisslog has developed a unique system that supports dramatically faster work processes with improved precision.

Additionally, senior executives and experts in the field of automation at Swisslog will brief attendees on the latest developments in logistics automation and robotics revealing some of its latest technologies.

At the exhibition, Alain Kaddoum will also conduct two presentations on the importance of increasing efficiency with data-driven and robotic warehousing. The key note and seminar presentation will cover topics including innovation in retail, future-ready warehousing and distribution solutions to drive success in the hypercompetitive environment.

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Trustworthy.ae Group breaks ground on its first facility in KIZAD The Inland Container Depot (ICD) will be operational in June 2019 Dubai-based Trustworthy.ae Group today announced the groundbreaking of its first Inland Container Depot (ICD) and a third-party logistics (3PL) facility in Khalifa Industrial Zone Abu Dhabi (KIZAD), one of the largest industrial zones in the Middle East and a subsidiary of Abu Dhabi Ports.

Hayleys Advantis Limited, the transportation and logistics arm of multinational conglomerate Hayleys Group, will manage and operate the two facilities.

Advantis brings forth over two decades of experience in ICD and 3PL management, with operating multiple facilities across the South Asian region.

Trustworthy.ae Group’s ICD and 3PL facility, located in close proximity to the Khalifa Port, will be geared up to serve the expected rise of container volumes to 8.5 million twenty-foot equivalent units (TEUs) from existing 1.5 million TEUs per annum over the next five years.

The groundbreaking ceremony was attended by Captain Mohamed Juma Al Shamsi, Chief Executive Officer, Abu Dhabi

Avis Budget and Etihad Aviation announce exclusive partnership

The partnership will see the Avis, Budget and Maggiore brands offered across the various Etihad booking channels worldwide Avis Budget Group and Abu Dhabi based Etihad Aviation Group have recently announced a new, global partnership which will see Avis Budget Group become the exclusive car rental provider for Etihad Airways, Etihad Holidays and Etihad Guest, the airlines loyalty programme.

The partnership will see the Avis, Budget and Maggiore brands offered across the various Etihad booking channels worldwide.

Etihad Guest members will benefit from the Avis Preferred programme and an improved earning proposition.

8 APRIL 2019

“We are delighted that we have extended our partnership with Etihad to be the exclusive global mobility provider,”said Julia Kemp, Director of International Sales & Partnerships, Avis Budget Group.

“This partnership gives our guests a seamless travel experience door to door,”commented Yasser Al Yousuf, Vice President, Commercial Partnerships, Etihad Airways.

Ports; Samir Chaturvedi, Chief Executive Officer, KIZAD; Abdul Lathif, Managing Director, Trustworthy.ae Group; Jalal Essudeen, Executive Director, Trustworthy. ae Group; Mohan Pandithage, Chairman, Hayleys Group; Ruwan Waidyaratne, Managing Director, Hayleys Advantis Limited, along with many other VIP guests.

“Today’s groundbreaking ceremony marks an important milestone on our project.

Trustworthy.ae Group’s investment in building the ICD and 3PL facility in KIZAD demonstrates our continued commitment to the UAE,”said Abdul Lathif, Managing Director, Trustworthy.ae Group.

“The investment of Sri Lanka’s leading logistics firm at our industrial zone is testament to KIZAD’s established position as a global industrial and trading hub,” commented Chaturvedi.

“We are indeed delighted to be partnering the Trustworthy.ae Group on this project and look forward to serving the Abu Dhabi clientele,”asserted Waidyaratne.

Mobilisation work on the facilities will begin this month with the ICD becoming operational in June 2019. Spread over a builtup area of 40,000 square metres along with 25,000 sqm of open yard for storage area, the 3PL facility will be ready for business by the first quarter of 2020.

The ICD will offer washing, cleaning, repairs and certification for containers with an operational capacity of 1,500 to 1,800 trucks daily. Major and minor container repairs will be served by a state-of-the-art workshop within the facility. The 3PL operations will cater to cold, ambient and open yard storage.

Etihad Airways and Saudia to consolidate current codeshare partnership New codeshare routes planned in Africa and Asia Etihad Airways, the national airline of the United Arab Emirates and Saudia have jointly announced positive growth in traffic since their codeshare partnership began in November 2018.

Jointly, Etihad and SAUDIA have flown over 16,000 guests across the partnership, solidifying the airlines’ commitment to growing inbound business and tourism in their respective markets.

“The close and expanding partnership between Etihad and Saudia is giving us a unique opportunity to build on the deep ties that exist between the Kingdom of Saudi Arabia and the United Arab Emirates,” observed Tony Douglas, Group CEO, Etihad Aviation Group.

The codeshare agreement has seen ‘EY’ and ‘SV’ codes already placed on 14 routes with the addition of Vienna this week. In the coming months, Etihad will place its ‘EY’

code on Tunis, Sharm El Sheikh and Alexandria.

At the same time, Saudia will place its ‘SV’ code on Etihad flights to Tokyo, Nagoya (Japan), and Baku.

Phase two for the ‘EY’ code will include Algiers, Dhaka and Erbil (Iraq). Phase two for the ‘SV’ code will include Brisbane, Melbourne, Sydney, Moscow, Dusseldorf, Hong Kong, Kathmandu, Lagos, Minsk, Rabat, Astana, and more points in India.

“By leveraging each of our networks, we are able to provide a wide array of choice and convenience that lends itself well for business and leisure travellers alike,”commented Engr. Saleh Al-Jasser, Director General, Saudia. Etihad Cargo carried more than 23,200 tons of cargo between the two countries in 2018.

Saudi Aramco hosts GPCA’s ‘Leaders of Tomorrow’ Programme in Dhahran

Exchange Centre (TEC) in Dhahran.

Held as part of the 6th GPCA Research and Innovation (R&I) Summit, the seminar focused on the theme ‘R&I in the Digital Age’ and aims to enable knowledge transfer and ‘future proof’ skills building among students engaged in science, technology, engineering and mathematics (STEM).

The seminar began with a presentation on the petrochemical industry’s challenges and opportunities by Dr. Fahad Al-Sherehy, VP–Technology & Innovation, SABIC,

GPCA joins hands with nine member companies to empower next generation of industry leaders in the Arabian Gulf region The one-day, 10th edition of the Gulf Petrochemicals and Chemicals Association (GPCA)’s ‘Leaders of Tomorrow’ Programme, powered by SABIC and Saudi Aramco recently concluded at the company’s Technical

followed by Dr. Salman Fahad Alajmi, Head of Mega Projects and Research and Technology Division, Petrochemical Industries Company (PIC) and Dr. Elie Fayad, Honeywell UOP Manager, Research & Development, based in Dhahran Techno Valley (DTV).

“Research and innovation have been the driving engine behind the success and rapid growth of the chemical industry since its inception, a trend that is set to continue for decades to come,”commented Dr. Abdulwahab Al-Sadoun, Secretary General, GPCA.

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Etihad Airways Engineering expands in-house capabilities with A350 MRO services Aircraft hangars at the facility cover approximately 66,000sqm Etihad Airways Engineering, the largest independent maintenance, repair and overhaul (MRO) service provider in the Middle East, has announced the addition of Airbus A350 maintenance capabilities to its extensive in-house portfolio.

Etihad Airways Engineering is part of the Airbus MRO Alliance and has emerged as a centre of excellence for the Airbus A380, having supported the A380 fleets of Etihad Airways and third-party customers in the Middle East, Asia, Europe and Australia.

The company continues to extend its coverage of major commercial aircraft types and has now received the landmark approval for Airbus A350 maintenance, awarded by the UAE General Civil Aviation Authority (GCAA).

dnata makes top management appointment Dirk Goovaerts will oversee dnata’s operations at 10 airports in three countries dnata has announced the appointment of Dirk Goovaerts as the company’s Regional Chief Executive Officer for the Asia Pacific region. In his role, Dirk Goovaerts will oversee dnata’s operations at 10 airports in three countries, including Australia, the Philippines and Singapore, managing a workforce of 6,000 employees.

Goovaerts will be based in Singapore and report to Ross Marino, Senior Vice President for dnata’s International Airport Operations Division. He joins dnata from Saudi Ground Services Company (SGS), where he held the position of Chief Operations Officer since 2016. Previously he held senior leadership roles at Menzies

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The first A350 aircraft to arrive for maintenance in Abu Dhabi comes from the company’s long-term client, LATAM Airlines group, the leading airline group in Latin America. The aircraft will undergo an intensive maintenance check and modifications as part of its routine maintenance programme.

“Building on our position as a centre of excellence for the Boeing 787 and the Airbus

A380, we are now ready to support the A350 fleet of our customers from around the world,”remarked Abdul Khaliq Saeed, CEO, Etihad Airways Engineering.

Aircraft hangars at the facility cover approximately 66,000sqm, including 10,000sqm of aircraft painting facilities and a custom-designed hangar that can accommodate up to three Airbus A380 aircraft simultaneously.

Aviation managing the company’s operations in more than 50 airports. ”We are pleased to have Dirk join our global management team to strengthen

and expand our operations in the Asia Pacific region,”said Ross Marino, Senior Vice President, International Airport Operations, dnata.

Air Cargo Priorities: Trade, Global Standards and Modernisation

The International Air Transport Association (IATA) called on governments and the air cargo industry to focus on three priorities to accommodate the expanding demand for air cargo and ensure the economic and social benefits of aviation can be maximised.

The operating environment for air cargo is increasingly challenging. Demand for air cargo grew by 3.5% in 2018, a significant deceleration from 2017 which saw extraordinary growth of 9.7%.

Weakening global trade, sagging consumer confidence and geopolitical headwinds contributed to a general slowdown in demand growth commencing in mid-2018.

And January 2019 saw a year-on-year contraction of 1.8%.

Against the backdrop of this rather dismal landscape, IATA has called for fresh policies and reforms to drive growth in the global air cargo industry. The call came during the opening address by Alexandre de Juniac, Director General and CEO, IATA, at the 13th World Cargo Symposium recently held in Singapore.

industry’s most promising growth markets – E-commerce and the transport of time and temperature-sensitive goods such as pharmaceuticals and perishables.

Aligned with a resolution on modernising air cargo from the 2017 IATA Annual General Meeting, IATA called for faster progress on the digitisation of the supply chain and more effective use of data to drive improvements in operational quality. The industry’s digital vision is focused on four areas:

The three priorities are: • Accelerating the speed of process modernisation, • Implementing and enforcing global standards, and • Keeping borders open to trade and commerce.

IATA also called for modernisation of air cargo facilities.“The E-commerce world is looking for fully automated high-rack warehouses, with autonomous green vehicles navigating through the facility, and employees equipped with artificial intelligence and augmented reality tools.

The average cargo warehouse today is an impressive sight. However, there is a huge gap to fill,”said de Juniac.

“The problem is not technology. The problem is the speed to market. It’s exceptionally tough to drive change in a global industry with a huge number of

Modernisation is key IATA called for the modernisation of industry processes. This will be critical to efficiently meet the doubling of demand expected over the next two decades. Furthermore, it is already being called for by customers of the

• Global implementation of the e-Air Waybill (e-AWB) • Universal adoption of a common data language – Cargo XML standards • Smart data sharing • Use of performance data to drive quality improvements

stakeholders where safety is top priority.

But it is not mission impossible. I challenge stakeholders to find ways to drive critical change at the speed our customers expect,” added de Juniac.

Implementation of Global Standards IATA urged governments to ensure that global standards are consistently implemented and enforced when necessary. In this regard, de Juniac highlighted two examples: Global standards for the safe transport of lithium batteries:“Global standards are being ignored by rogue shippers. To compound the matter, governments are not enforcing the rules. In some cases, we see more effort going into stopping counterfeit production of Louis Vuitton bags than lithium batteries. Both require attention. Clearly, lithium batteries are a safety risk. And we need governments to do better at enforcement,”de Juniac pointed out.

Implementation of global agreements to make trade simpler, cheaper and faster: IATA called on governments to implement three important agreements: (1) The World Trade Organisation’s Trade Facilitation Agreement, (2) the Montreal Convention 1999 (MC99); and (3) revisions to the Kyoto Convention of the World Customs Organisation.

Borders must be accessible to trade IATA urged governments to keep borders open to trade. “Protectionism, trade friction, BREXIT and anti-globalisation rhetoric are part of a genre of developments that pose real risk to our business and broadly across the economies of the world. We need to be a strong voice reminding governments that the work of aviation – including air cargo – is critically important. Trade generates prosperity. There are no long-term winners from trade wars or protectionist measures,” noted de Juniac.

The need to keep the world trading aligned with the theme of the 13th World Cargo Symposium – Enabling Global Trade.

“Enabling global trade is a mission of great importance. It helps economies to grow. In doing so it promotes better livelihoods and a better quality of life for real people in every corner of the planet. This is an integral part of why we call aviation the Business of Freedom.

Nothing should stand in the way of air cargo delivering its unique contribution to the prosperity of our world,”observed de Juniac.

IATA (International Air Transport Association) represents some 290 airlines comprising 82% of global air traffic.

APRIL 2019 11

Al Madina Group inaugurates its new headquarters at Dubai Industrial Park Purpose-built complex spanning 400,000sqft. houses corporate offices, distribution centre, and industrial bakery

Dubai Industrial Park, one of the largest industrial hubs in the region and a member of TECOM Group, recently hosted a reception to mark the opening of the new

corporate headquarters of the UAE-based Al Madina Group.

The new 400,000sqft. complex, which also houses Al Madina Distribution Centre

Saudia Cargo participates in the first Saudi International Airshow

Omar Hariri, CEO, Saudia Cargo, underscored that the company’s presence in the Airshow as a must attend event for the Kingdom’s aviation and air-logistics industries.

The company’s participation came as part of its pivotal role in achieving Saudi vision 2030 which aims to make the Kingdom a global leading logistics hub.

Saudia Cargo has an extensive global network spanning four continents, 225 international destinations, and 26 domestic destinations; it operates a modern dedicated freighter fleet and offers substantial cargo capacity on Saudia passenger fleet.

The Carrier showcased its newest products and services in Air Cargo and Ground Handling Saudi Airlines Cargo Company participated in the three-day (12 to 14 March) Saudi International Airshow, the first of its kind in the Kingdom, held at the AlThumamah Airport in Riyadh.

The Saudia booth showcased the carrier’s newest products and services in the air cargo and ground handling industries demonstrating its logistical capabilities and achievements.

12 APRIL 2019

that services the whole of the UAE, and its industrial manufacturer of bakery and readyto-eat products Oasis Cuisines, commenced operations following the ceremony.

The inauguration was attended by Abdulla Belhoul, Chief Commercial Officer, TECOM Group; Saud Abu Al-Shawareb, Managing Director, Dubai Industrial Park and Abdulla Poyil, Managing Director, Al Madina Group, along with senior officials and other invitees.

The 400,000sqft. complex with an investment of over AED 200mn (US$ 54.5mn) was purpose built on a 700,000sqft plot of land in Dubai Industrial Park, and is strategically situated close to Maktoum Airport, Jebel Ali Port and the Expo 2020 Dubai site.

From within the same complex, Al Madina Distribution Centre will supply all the Group’s FMCG products to over 100 branches of Al Madina Hypermarket in the UAE. Oasis Cuisines, one of the largest industrial bakeries in the UAE, will distribute its fresh goods all over the UAE from its new location.

The industrial bakery, which is engaged in the manufacturing of bakery, confectionery, sandwiches, hot meals and more than 250 ready to eat products, is best known for its brands BreadKing, Royal Breads and Fresh from Dubai.

Al Madina Group, operating in the UAE since 1971, will be running its diverse portfolio of businesses, which include Al Madina Hypermarket, Oasis Cuisines, Clikon Electronics & Home Appliances, community shopping centres and several other subsidiaries from its new headquarters in Dubai Industrial Park.

“We are pleased to welcome Al Madina Group to Dubai Industrial Park. We are committed to meeting the evolving needs of manufacturers and other complementary business operators through our advanced infrastructure; integrated solutions that cater to a business’s corporate, industrial and logistical needs,”noted Saud Abu Al-Shawareb.

“Consolidating all our group’s operations in one central location will be key to enhance efficiency even further, and is an important step in our extensive international expansion plans,”observed Abdulla Poyil.

Al Madina Group is currently building five malls, including a mall at Muwaileh in Sharjah, in addition to seven new hypermarkets and other new ventures. This pioneering Group has introduced several locally developed brands across the wider GCC region.

dnata’s Dallas facility gets IATA’s CEIV Pharma Certification The global air services provider opened its 37,000sqft. cargo centre at Dallas DFW dnata has been certified by IATA’s Center of Excellence for Independent Validators in Pharmaceutical Logistics (CEIV Pharma) for its pharma handling processes at advanced cargo facility in Dallas. The prestigious accreditation demonstrates dnata’s capability to move pharma products under the strictest standards. dnata opened its 37,000sqfr cargo centre at Dallas Fort Worth International Airport (DFW) in November 2017. The centre includes a 14,000 square feet perishable handling facility, which is dedicated to innovative cool-chain solutions with experienced staff to ensure that perishables such as pharmaceuticals, fruits, vegetables, fresh fish and seafood, meat and flowers maintain their freshness during the

Continental announces new appointment for its regional operations Newly promoted Karel Kucera will oversee more than 19 markets across the region Continental Tyres of Germany has announced the appointment of Karel Kucera to lead the company’s Middle East and Africa operations as the new Managing Director.

A Continental veteran of almost 20 years, Kucera took on the new role on 1 March 2019 and will be based in the company’s regional office in Dubai, overseeing more than 19 markets across the region.

The announcement coincides with the recent opening of the company’s first ever office in Saudi Arabia to support the growing demand for Continental’s products and services in the Kingdom.

In his new role, Kucera will also lead the recently unveiled expansion plans for Continental that include the first-of-itskind warehouse in the region, located in Jebel Ali, Dubai. The facility will act as a

entire air transportation process. The CEIV Pharma program was created by IATA to provide a globally consistent and recognized pharmaceutical product handling certification that focuses on airfreight and temporary storage.

“We continue to invest in infrastructure and technology to deliver safe, quality and innovative services for our customers,”said David Barker, CEO, dnata USA.

dnata commenced ground handling and cargo operations in the United States in 2016.

Since then, the company has invested more than US$ 45mgn in facilities, equipment, training and technology, while continually expanding its operations in the country. dnata provides global air to over 300 airline customers and ground handling, cargo and catering services at 129 airports in 19 countries.

hub, connecting plants in Europe, North America and South America with the brand’s distribution partners in the Middle East.

“There is a great potential for Continental in the Middle East since the establishment of the brand’s regional office in 2009 and many opportunities for Karel to capitalise on and add to his previous achievements,”said Jon Ander Garcia, Continental Regional Manager Africa & Middle East.

“We have a strong team and highlyqualified local partners in place with whom I look forward to working closely to further grow the Continental business in the region,” commented Kucera.

Prior to his new Middle East role, Kucera, a citizen of the Czech Republic, served as the Regional Managing Director of ContiTrade Central & East, Northwest Europe, located in the company’s headquarters in the Czech Republic.

The newly appointed Managing Director of Continental Middle East has replaced Jose-Luis De La Fuente, who will take on the role of Managing Director, Continental Mexico.

APRIL 2019 13

Singapore’s ‘Giti Tyre’ opens first Middle East flagship store in Dubai The #11 tyre manufacturing company plans expansion in the Middle East Singapore-based Giti Tyre Dubai, recently inaugurated its first brand flagship store in Dubai Investment Park, Dubai’s one of the Emirate’s prime industrial zones, in partnership with Amin Auto Care, a 32 year old auto service provider based in the UAE. The inauguration marked the ceremonial signing of a ‘Commitment to Service’ by both partners to provide world class customer service.

One of the world’s largest tyre companies with US$ $3.4bn (AED 12.47bn) revenues in 2017, Giti Tyre has had a strong presence in

DP World to invest in new infrastructure in Kazakhstan Global trade enabler reaffirms commitment to enabling Kazakhstan’s trade and economic growth The potential of DP World investing in new infrastructure in Kazakhstan’s ports and logistics sectors was the focus of recent discussions between global trade enabler DP World’s Chairman and CEO Sultan Ahmed Bin Sulayem and Kazakhstan’s Prime Minister Askar Mamin in Astana.

This follows the signing of two framework agreements with the government of Kazakhstan for Special Economic Zones (SEZ) in Aktau and Khorgos.

DP World has been providing management services to the Port of Aktau, Kazakhstan’s main cargo and bulk terminal on the Caspian Sea, and Khorgos SEZ and Inland Container Terminal (ICD), which is strategically situated on the China-Kazakhstan border and has been acting as the primary transit point for trans-Eurasian cargo trains.

14 APRIL 2019

the Middle East for more than a quarter of a century, selling multiple products in the region.

The Giti Tyre new mega flagship inauguration was lead by Chris Bloor, Executive Director, International Sales and Marketing and Chirenj Chandran, Managing Director, Amin Auto Care, along high-ranking officials from Singapore and UAE and local partners. Manish Rathor, Product Marketing Manager, Giti Tyres, UAE, subsequently led a media tour of the expansive store.

Strong partnership Chris Bloor, Executive Director, International

DP World considers that both facilities play an important role in enhancing trade connectivity along the New Silk Route and have further actively promoted business connectivity between Kazakhstan and Dubai.

“We believe that the economic fundamentals of Kazakhstan are very strong, which is why look forward to continue investing there,”remarked Bin Sulayem.

Sales and Marketing, highlighted the importance of Dubai as the Middle East’s first Giti Tyre flagship store base.“The flagship store opening in Dubai is symbolic of Giti opening new doors across the region. The Middle East is important to Giti Tyre’s objectives and providing top service in this region which will continue to be a major focus, across all tyre types and segments,”he remarked.

We are happy to partner with Amin Auto Care. Giti’s retail store programme carefully selects only the stores with best service, customer experience,”he further observed.

“Giti Tyres in conjunction with committed partner Amin Tyre Care is a standout for quality and care. We pride in our synergy that matches tyres that meet exacting roadworthy criteria with excellent service.

We plan further inroads and expansion across the UAE. Our pledge to hold fast to exacting standards of service is our invaluable asset,” noted Chandran.

Giti Tyre’s dedication to retail service was highlighted by an unveiling and signing of a ‘Commitment to Service’ agreement-plaque, signed both by senior Giti Tyre and Amin Auto Care executives.

Shared interests Addressing the assembly, Elson Tsai, Head of International Marketing for Giti Tyre, shared the importance of the commitment.“The signing of this agreement is a shared agreement for Giti and Amin Auto Care to provide the best levels of service to our customers. Every regional Giti flagship store must adhere to the rigorous principles of the company and brand in order to be selected,”he emphasised.

With a full range of passenger car, SUV/4x4, and commercial truck and bus tyres produced in eight factories in China, Indonesia, and the US, as well as expanded brand presence, Giti Tyre is strongly poised to continue growing its brand presence in the Middle East, where it has dedicated distribution partners in all major markets.

Giti Tyre recently established a local Middle East office located in the Dubai Free Zone.

1951-established Giti Tyres currently operates in over 130 countries worldwide.

With over 16 Fitting Centres and 800+ Corporate clients they are one of the most widespread service providers in the UAE, Amin Auto Care services some of the prestigious fleets of the UAE such as Dubai Taxi, Cars Taxi, National Car Rental, Massar Solutions, Al Ghurair and Arabian Automobiles to name a few.

Saudi Arabia in high gear towards transformation drive Four well-being projects announced for the Kingdom’s capital Riyadh King Salman Bin Abdulaziz Al Saud of Saudi Arabia recently launched four wellbeing projects for the Kingdom’s capital Riyadh, which will significantly improve the lives of its citizens, transform the city into an attractive destination and make it one of the world’s most livable cities.

The four wellbeing projects—King Salman Park, Sports Boulevard, Green Riyadh and Riyadh Art–complement the Saudi Vision 2030’s ‘Quality of Life’ Programme and are aligned with the UN Sustainable Development Goals-SDGs), to create sustainable cities and communities, while driving urgent action against climate change.

Developed with a government investment of US$ 23bn, the four projects will offer opportunities worth US$ 15bn on for the private sector to invest in the residential, commercial, recreational and wellness areas.

In addition to providing tens of thousands of new jobs, they will also contribute to an integrated approach to wellness, health, sports, culture and the arts, underpinned by a commitment to environmental sustainability.

The 13.4sqkm, King Salman Park will be a green oasis in an urban setting and will be the largest city park in the world.

Besides residences and hotels, it will also feature a Royal Arts Complex, theatres, museums, cinemas, sports venues, water features, restaurants and an 18-hole Royal Golf Course One of the world’s largest urban greening projects, Green Riyadh will increase the green cover in the Saudi capital with the planting of 7.5mn trees. This will help increase the city’s green cover from 1.5% of the total area to 9.1%, or approximately 541sqkm, by 2030.

An iconic new health and wellness destination in the heart of the city, Sports Boulevard will feature a 135 kilometer-long professional cycling track covering the city and the surrounding valleys, the first of its kind in the region. Adding 3.5mn sqm of new open space across the city, this grand project will also feature a sports pavilion, riding stables and athletics tracks, in fact accommodating a wide variety of sports activities.

Riyadh Art is the world’s single largest government investment in public art and will establish the city as ‘a gallery without walls’ through a world-class interactive public arts program.

Construction for the above four well-being projects will start in the H2- 2019.

Solutions for a healthy world Tranzone operates a state-of-the-art 3PL warehouse in Jebel Ali Free Zone. We have partnerships with the leading pharmaceutical, medical device and animal health companies around the world.

Healthcare Logistic Services: Air Freight Sea Freight Land Transportation Value Added Services Warehousing & Distribution Return logistics Documentation Tranzone FZCO (Member of Banaja Holdings)

Jebel Ali Free Zone (South) Plot No: S20129 P.O Box : 262955, Dubai, United Arab Emirates, Tel : +971 4 811 0000

Web: www.tranzone.ae APRIL 2019 15

Atkins opens office in Saudi Arabia

Company’s presence in the Kingdom extends to over half a century Atkins inaugurated its new office in Riyadh to drive its expansion in Saudi Arabia, by increasing resources for existing clients and developing new opportunities

for growth. The inauguration was attended

by Grant Porter, CEO, Atkins, Middle East and Africa; Adrian Lindon, Managing Director, Design & Engineering, Atkins; Campbell Gray, Managing Director, Middle East, Faithful+Gould; Johan

Hesselsøe, Managing Director, Middle East, Atkins Acuity; Spencer Wylie, Country Director, KSA, Faithful+Gould and Nassib Al-Sibassi, Director, Atkins Acuity.

“For half a century, we have helped our clients in Saudi Arabia deliver a multitude of iconic projects, and are proud to have been part of the Kingdom’s transformation,” said Porter.

Working together as a blended team of international, regional and local expertise, Atkins was involved with large infrastructure projects such as the Riyadh Metro, to cultural destinations such as the Diriyah Gate Development that is set next to the At-Turaif District (a UNESCO World Heritage Site) in addition to lifestyle destinations such as the Avenues and Mall of Saudi shopping malls in Riyadh.

Saudi nationals have also contributed to different key projects across the company’s offices in the Middle East and United Kingdom, including over 100 Saudi nationals working on major projects for the Saudi Arabian National Guard over a twoyear period.

The Atkins business also includes the Faithful+Gould and Atkins Acuity capabilities and service offerings. Faithful+Gould provides integrated project and programme management consultancy, independently or alongside Atkins.

year using over 100,000 containers. EGA’s aluminium is the biggest made-in-the-UAE export after oil and gas.

“Meeting our customers’ expectations depends on both the quality of our

production and the efficiency of getting the metal to them, so I am pleased to sign this agreement today with one of our most important shipping partners, Maersk,” remarked Walid Al Attar, Chief Marketing Officer, EGA. EGA works with 20 different shipping lines to ship its products, transporting metal to over 70 global ports. Maersk is one of EGA’s most significant shipping partners and has provided shipping services to the UAE aluminium giant since 1992.

“As the global integrator of container logistics, this agreement enables us to continue to partner with EGA to ensure their aluminium reaches customers rapidly and as cost-effectively as possible,” commented Christopher Cook, Managing Director, Maersk for UAE, Oman and Qatar.

EGA extends aluminium transportation agreement with Maersk The shipping giant has been providing services to the aluminium producer since 1992 Emirates Global Aluminium, (EGA) recently signed a volume commitment extension agreement for 2019 with the global shipping company AP Moller–Maersk for transporting EGA’s aluminium to customers around the world.

EGA exports its metal to customers in more than 60 countries worldwide and makes more than 11,000 shipments each

16 APRIL 2019

Faisal Holding signs a joint venture with Spain’s Asisa Group Agreement paves the way for the establishment of the first international dental network in the UAE Faisal Holding, the pioneering investment holding company with over 44 years of extensive presence in the Middle East, has expanded its horizons by signing a joint venture with Spanish giant, Asisa Group.

The project is named Faisal Holding Asisa Dental Network, which will be operational in Dubai & Abu Dhabi and soon across the UAE. The joint venture will cater to the local and expat residents of the UAE, it would offer an international dental network clinic focusing on quality, integrity and world-class service.

Faisal Holding was established by HE Sheikh Faisal Bin Sultan Al Qassimi, a scion of the Sharjah Ruling Family in 1975. Coupled with its specialisation in

construction-related developments and large-scale projects the company has expanded into property and real estate

management, investments, retail, hospitality, integrated marketing services, and the healthcare sector.

Asisa Group is the largest medical corporation in Spain with over 40 years of market presence and was listed as the world’s 4th top Group. Asisa Group has created one of Europe’s largest dental networks of solely owned clinics–Asisa Dental.

“This offering will set a benchmark for the Dental industry in the UAE, with an aim to give our local community and expat residents consistent dental care across our network of clinics,”commented Sheikh Khalid Al Qassimi.

“This is the first international dental network which will be launched in the UAE market,” noted Brett Schafer, CEO, Faisal Holding. ”It is our responsibility to provide to the UAE residents the same international treatment and services across all our clinics, through our specialised and carefully selected doctors,”observed Alvaro Martinez-Arroyo Lopez, Director and General Manager, Asisa Middle East. The clinics will be operational in a couple of months.

APRIL 2019 17

Saudia Cargo makes top key appointment

Sharjah Container Terminal welcomes MV Port Klang Port operator completes maiden vessel call at 45 GMPH Gulftainer welcomed the MV Port Klang from Sunmarine Shipping Services on a maiden call at its gateway flagship Sharjah Container Terminal (SCT). The vessel is one of the shipping group’s fastest services between the Indian subcontinent and the UAE. The MV Port Klang offers the fastest direct express service between Sharjah’s Port Khalid and the Kandla, Hazira and Nhava Sheva ports in India with only three days’ transit time from the last port in India to Sharjah. The maiden vessel’s call at SCT was completed at an impressive 45 gross moves per hour (GMPH).

“This is a promising start to our new relationship with Sunmarine Shipping Services, and we look forward to building strong synergies between our two companies

based on shared value and operational efficiencies,” remarked Peter Richards, Group CEO, Gulftainer.

To mark the occasion, Stephen Barron, SCT Terminal Manager, presented a commemorative shield to Captain Mykola Chernikov, Master of the MV Port Klang, in the presence of senior management from Gulftainer and representatives of Sunmarine Shipping Services.

With recent terminal upgrades, including the expansion of SCT’s full container storage yard by over 17% and the ability to service bigger vessels, Gulftainer continues to enhance its operational capabilities. The company is committed to developing its port facilities in the UAE – SCT, Khorfakkan Container Terminal and Hamriya Port – to ensure fast and efficient service delivery to all terminal customers.

Poland promotes biotech and pharma sectors in UAE

participated to promote biotech and pharmaceutical services at the Congress with four major companies including Global Pharma, Gofarm, Exim Pharma, and ZF Unia exhibiting at the event.

“Poland is well known as the supplier of raw materials for pharma and nutrition manufacturers in the UAE. We are also pleased to see growing interest from Polish manufacturers to expand into the UAE,” explained Moneer Faour, Head of the Polish Foreign Trade Office in Dubai.

The Middle East Pharma Cold Chain Congress was organised by Maarefah Management and supported by the Saudi Pharmaceutical Society.

Polish companies highlighted their biopharma offerings at the recent Middle East Pharma Cold Chain Congress in Dubai Leading pharmaceutical and nutrition supplement manufacturing firms from Poland highlighted their offerings and expertise at the recent Middle East Pharma Cold Chain Congress in Dubai.

The UAE remains one of the high potential markets for Poland with trade between both countries crossing US$ 750mn in 2018.

The Polish Investment and Trade Agency, under its Sector-Promotion Programme,

18 APRIL 2019

Per Hojland will be responsible for Saudia Cargo’s international operations Saudi Airlines Cargo Company has recently appointed Per Hojland, a Danish national, to the position of Executive Director, Cargo Operations Worldwide.

He joins Saudia Cargo after having spent the past 25 years in various roles in the air cargo- and logistics industry.

Hojland, based in Jeddah, has worked for companies such as SAS and Spirit

Air Cargo Handling, as well as logistic companies outside the aviation sector. In his new role, Hojland will be responsible for the management of all Saudia Cargo’s International operations including overseeing the standards and services world-wide.

“Per has vast experience in the air cargo industry and within logistics and this will make him a great addition to our team,” remarked Teddy Zebitz, Chief Air Cargo Officer, Saudia Cargo.

“I am proud to be joining Saudia Cargo with its strong vision for the future and I look forward to be a part of the Saudia Cargo team and contributing to its continued success,”said Hojland commenting on his appointment.

Saudia Cargo has an extensive global network spanning four continents, 225 international destinations, and 26 domestic destinations.

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OMAN COUNTRY REPORT

Transformational trends and growth opportunities in

logistics industry Trade and logistics are emerging as key drivers of economic growth

In a press interview at an industry conference in the capital Muscat HE Dr Ahmed Bin Mohammed Al Futaisi, the Omani Minister of Transport and Communications (MoTC) affirmed that the Sultanate aims to be among top ten in the world in logistics by 2040. He elaborated that 20 APRIL 2019

OMAN COUNTRY REPORT

Panoramic view of Muscat

the country’s focus will be on developing the soft infrastructure, marketing, human capital and trade facilitations.

The Minister added that Oman, the second biggest of the GCC countries by area, has world-class road networks linking ports, free zones, airports and industrial zones, and maintains three deep ports – Sohar, Salalah in the Dhofar region and Duqm, that serve the needs of emerging markets in India, East Africa, Iran and Gulf countries that are fully integrated with its free zones These ambitions are consistent with Frost & Sullivan’s analyses and projections in their latest report on the course and extent of the logistics and supply chain industry in this south GCC country, as this report reveals – Editor.

O

man has been proactively pursuing its economic diversification initiatives through its five year development plans to decrease its dependence on oil. The Government has also planned to strengthen non-oil sectors such as agriculture, mining, manufacturing, transportation and logistics to increase revenue contribution to the overall GDP. On the trade front, around 45% of the country’s imports are from the GCC region, whereas around 13% of the exports are routed to the GCC, reinstating its strong reliance on the regional growth.

Ports located in Oman play an important role in facilitating trade and connectivity with the rest of the GCC region. Free Trade Agreement with the USA and strong trade connections with Singapore and European Free Trade Association (EFTA) as part of GCC membership provides access to international markets, which is further expected to increase trade contribution to GDP. The logistics industry in Oman is largely fragmented with more than 8,000 registered companies competing to provide varied logistics services. Market share of the organised 3rd Party Logistics (3PL) service providers with capabilities and capacity to provide full range of integrated logistics services is low.

Due to the presence of numerous unorganised service providers with low capacity levels and lack of

APRIL 2019 21

Fort Al-Jalali and Sultan Palace in Muscat, Oman

economies of scale, freight transportation and warehousing services are inefficient.

Other key challenges that limit the growth potential of logistics market segments include lower capacity levels of domestic logistics network, increasing competition among ports in the region for investment, regulatory hurdles relating to customs procedures and border clearance.

Oman’s strategic geographical location on the trans-continental trade route between the east and west is a key advantage the country possesses which is likely to support its ambition to become a regional logistics hub and improve economic contribution of logistics industry.

Priorities of National Logistics Strategy Recognising the importance of the logistics industry, the Government framed the Logistics strategy (SOLS 2040), which is being implemented by Oman Logistics Group (ASYAD) with the support of Oman Logistics Centre. SOLS2040 aims to increase contribution of logistics industry from 5%

22 APRIL 2019

in 2015 to 12% of GDP by 2040, with focus on market development, trade facilitation, and development of human resources and encourage adoption of digital technologies across logistics segments.

To improve efficiency and competitiveness in the logistics operations, high priority was given to improve trade facilitation measures such as establishment of border one-stopshops for joint inspections and introduction of new rules for establishment of customs bonded warehouses to ease space constraints at custom ports.

Additional initiatives Other initiatives included introduction of the Authorised Economic Operator (AEO) programme with an aim to improve joint relations between customs authorities and the private sector. Adoption of electronic air waybill (e-AWB) in 2018 further simplified the process and reduced delays at customs clearance.

As a result of these developments, Oman has made remarkable progress, which has helped improve its rank in the Logistics Performance Index by 16 positions from

being ranked 59th in 2014 to 43rd in 2018.

The country aims to establish a single window system and mobile technology for most of its logistics services, which would further reduce time in customs clearance, and enable tracking and tracing of the goods transported.

Infrastructure Expansion Leading the Improvement in Connectivity The Government is committed to developing high quality road infrastructure, as it realises that high quality road infrastructure decreases transport times, and enables faster movement of goods within the country, and to neighbouring countries, resulting in improved logistics efficiency.

Significant initiatives have been taken to develop inter-country roads such as Saudi– Oman highway – a 680 km roadway, and Al-Batinah Expressway – a 256 km 8-lane expressway connecting the UAE and Muscat.

Direct road connections to the neighbouring countries not only reduce transport time, but also aid in reinforcing the country’s potential to emerge as a logistics hub.

OMAN COUNTRY REPORT

In an effort to improve multimodal transportation, the Government is planning to develop a railway line, extending 375 km to transport minerals like gypsum and limestone. This railway network in Oman is expected to be interoperable by linking it with the GCC rail network and the major sea

ports of Oman, namely, Sohar, Duqm and Salalah, as sea remains a predominant mode of transport.

Salalah and Sohar Around 80% of the country’s freight was handled by Salalah and Sohar ports. The

port of Salalah is directly connected with more than 54 major ports around the world, making it an ideal transshipment hub.

In 2018, the port handled around 3.3 million TEUs of containers and 16.2 million tonnes of general cargo. In order to aid further developments, the port has adopted a 20-year master plan; it envisions to position itself as a transshipment hub in the region featuring rail connectivity for intermodal transportation, distribution centres, food processing centres, warehouses, and other logistics facilities.

Sohar on the upswing

Port of Salalah,Oman

Significant investments have been made in the development of Sohar port infrastructure, and development of a free zone for agricultural bulk, given the significance of food imports in the region as GCC is import reliant for its food products.

The warehousing segment in Oman is highly fragmented with the share of major players accounting for around 30% of the market. Most of the companies provide dry storage services, which has resulted in excess

APRIL 2019 23

OMAN COUNTRY REPORT

Container Terminal , Port Salalah, Oman

supply, reducing the capacity utilisation of dry storage facilities to around 60-70%.

However, the capacity utilisation of temperature controlled storage spaces remains higher at 85-90%, during peak times such as Ramadan. The demand for temperature controlled storage is driven by the increasing demand for food products, which in turn is the result of a rapidly growing population.

Demand for temperature controlled storage services is expected to increase and largest capacity additions will be required in Muscat as more than 40% of the population resides there, followed by other cities such as Sohar, Salalah, Nizwa, Ibri, and Al Kamel.

Outlook and Emerging Growth Opportunities Due to a combination of economic diversification efforts and implementation of national logistics strategies, Oman has made significant progress in terms of development of logistics infrastructure, and improvement in regulations conducive for the development of logistics industry.

As Oman is emerging as a logistics hub in the region, capacity to provide integrated

24 APRIL 2019

logistics services at the regional level has become an important factor influencing competitiveness for logistics operators.

Competition With changes in the logistics landscape, competition is expected to intensify among local service providers with global and regional players due to increasing customer demand for personalised and value added services.

As a consequence, investment opportunities opened up in a number of areas across logistics segments in freight transportation, cold storage, warehousing and value-added services. Most notable among them are increasing demand for warehousing and dry ports to support growth in volume of cargo in key ports, increasing storage and warehousing to meet the requirement from economic free zones and special economic zones.

Development of Khazen integrated Economic City, which comprises of Industrial and Free Zones, business and social infrastructure, retail, logistics infrastructure is expected to strengthen capacity levels of dry ports and cold storage facilities.

National Logistics Strategy As the national logistics strategy focuses on improving the efficiency and competency of transport and logistics services by adopting disruptive logistics technologies, development of modern automated warehouses with robotics applications in material handling, sorting, warehouse management and optimisation solutions are expected to gain prominence.

With regard to freight transportation, opportunities exist in IT based logistics solutions, fleet modernisation, connected physical transportation infrastructure driven by the application of smart sensors.

Companies are likely to experiment with use of autonomous vehicles and drones for efficient and faster last mile deliveries. The role of digital technologies will be eminent in forthcoming years supported by digital service offerings such as track and trace, and live monitoring, improving visibility across the supply chain.

As a result of these opportunities and developments, Oman is likely to remain an attractive investment destination for supply chain and logistics solution providers.

(Global Supply Chain thanks Frost & Sullivan for making this report available for publication.)

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OMAN LOGISTICS REPORT

Oman races to develop its road-sea-rail infrastructure

26 APRIL 2019

OMAN LOGISTICS REPORT

The Sultanate seeks to capitalize on its prime, strategic location Bolstered by steady investments from a Government mindful of its potential, Oman’s transport and logistics sector has continued to expand even as the impact of lower oil prices continues to be felt

W

Highway Number 15 connection Muscat and Nizwa, Oman

ith a coastline of 2100 km at the mouth of the Gulf, longstanding and well-established sea-faring credentials and a history of friendly relations with its neighbours, Oman has a unique opportunity to become the logistics gateway to the GCC’s 50mn-plus consumers, and a key trans-shipment centre between Europe and Asia, says a recent Oxford Business (OBG) Report.

Government officials have given this idea traction by making investments in transport infrastructure a key pillar of the country’s diversification plans. This push was accelerated in 2017 by a 50-year development deal with Chinese companies that has already secured around one-third of US$ 10.7bn in planned investment.

In recent years they have facilitated investments in the billions of dollars into expanding the country’s ports, not just at established centres like Sohar and Salalah, but also a greenfield free zone site at Duqm that aspires to become the top industrial and transshipment hub on the Indian Ocean rim.

A new airport terminal in Muscat opened in March 2018, driving fresh growth in the airline industry, which saw a new budget carrier formed in 2017. On land, investments in the road network continue apace, as vehicle registrations reach new highs. Though postponed in 2017, a US$ 14bn national rail project holds significant potential for efficiency gains in overland transportation,

APRIL 2019 27

OMAN LOGISTICS REPORT

The Duty Free Zone, inside the new international airport of Muscat, Oman

particularly to support the country’s burgeoning mining sector.

Strategy for growth All of this brings important opportunities for foreign investors. The country’s ninth five-year plan for 2016-20 foresees investments of Omani Rials OR 6.1bn (US$ 15.8bn) and an annual growth rate of 5.4% over that period, raising the sector’s GDP contribution from 6.2% to 7%. By nearly all measures, Oman’s transport and logistics sector has seen consistently strong growth patterns in recent years.

Regulators The sector’s main regulator is the Ministry of Transport and Communications’ (MoTC), which is responsible for overseeing the building and maintenance of the country’s roads, airports, seaports and other infrastructure, as well as drafting policies and improving the quality of public transport services.

Founded in 1973 soon after independence, it was originally merged with the public services ministry until 2000-01, when it was divested of its responsibilities in housing and gained comprehensive oversight of communications.

The MoTC is currently overseeing large investments in public infrastructure under

28 APRIL 2019

the ninth five-year plan for 2016-20 and its long-term development blueprint, Vision 2040. In early 2015 the MoTC set up an Oman Logistics Centre to implement and oversee the country’s logistics strategy.

Many ports throughout the country, for example, are managed by foreign firms. The Dutch operator APM Terminals runs the Port of Salalah, while the Port of Duqm Company is a joint venture between the government and Belgium’s Consortium Antwerp Port.

Duqm is currently looking for private operators to run the four terminals it is developing for containers, general cargo, bulk goods and liquids.

Competitiveness In the World Economic Forum’s ‘Global Competitiveness Report 2017-18’, the Sultanate moved up four places to rank 62nd out of 138 countries.

Oman has established four free zones, three at the main ports of Sohar, Salalah and Duqm and one 4 km from the border with Yemen called Al Mazunah. The zone at Sohar, built on a 4500-ha plot and housing 26 companies and a large oil refinery, in 2014 received the bulk of cargo traffic from Muscat’s Port Sultan Qaboos, which is being retooled as a tourism complex.

Salalah’s Free Zone has seen more than US$ 5.6bn in investments since its founding in 2006.

The 19m-sq-metre free zone will complement the port, which boasts a capacity of 4.4m twenty-foot equivalent units (TEUs) per year.

Duqm, the most recent of the three, was set up in 2011 on a 2000 sq km area, with planned investments of more than US$ 10.7bn under way in the industrial city complementing the port. All three ports are seeing large expansion projects in this fiscal year.

Shipping Port expansions have occurred in tandem with the ambitions of the country’s shipping and maritime industries. The largest domestic shipping firm, state-owned Oman Shipping Company, with a fleet of 51 vessels and a total capacity of 8m deadweight tonnes, took early steps to move into the bulk carrier market during the year.

According to local media reports, elevated growth in aggregate exports has led the firm to seek two to 10 bulk carriers for transporting loose cargo, partly to serve the needs of a recent deal with Kuwait to supply crude oil to Oman’s planned 230,000-barrerlper-day refinery in Duqm.

According to sources the firm was also seeking two second-hand carriers with a

OMAN LOGISTICS REPORT

1.1bn), the infrastructure package consists of two underpasses and two overpasses, as well as nine interchanges, 171 reinforced culverts and retaining walls.

Rail

Oman International Container Terminal in Sohar, Oman

3000-TEU capacity each to replace its current chartered ships.

Shipping capacity continues to grow in line with demand forecasts. This comes on the back of three-fold growth over the past five years at its Terminal C, which can handle vessels of up to 20,000 TEUs. Upgrades of soft infrastructure have aided this: Sohar recently added remote-controlled quayside cranes, integrated with a new automated gate and appointment systems to shorten wait times for drivers hauling freight to and from the port.

That same month, the greenfield Port of Duqm saw its first containers arrive from global shipping lines CMA CGM and Mediterranean Shipping Company, bearing equipment to be used for expansion of its commercial quay.

Its more-developed sister port, Salalah, meanwhile saw its throughput grow 29% in 2016, to 3.33m TEU, lifting its rank 17 places in 2017 to 44th out of 100 top ports worldwide on the Lloyds List, the world’s oldest shipping journal.

Roads Until Oman’s national railway is completed, road transport remains the staple method of inland transport. The number of driving licences issued reached a record high of 172,000 in 2016, up from 156,000 the year before and just 129,000 in 2012, according to the National Centre for Statistics & Information (NCSI).

Increases in registered vehicles alongside rapid economic and population growth, have sustained a need for building new highways. As of end-2016 Oman had 37,000

30 APRIL 2019

km of paved roads – 7.4% of this being dual carriageway – and 32,300 km of graded roads, representing increases of 18% and 2.3% on 2012, respectively, according to NCSI data.

Several recent projects have contributed to this increase. MoTC records show that as of mid-2017 there were 118 road projects under way, including 77 interchanges, 41 bridges, 23 flyovers, 67 underpasses and 34 pedestrian bridges throughout the Sultanate.

Among the largest were the Mirbat-Hasik rehabilitation project, a US$ 500mn road stretching 200 km between Bidbid and Sur, and the 283-km Al Batinah Expressway – all set for completion by the end of 2018, the ministry has reported.

The Batinah project, a four-lane carriageway stretching from the outskirts of Muscat to the border with the UAE at Shinas, is split into six separate packages comprising 31 bridges over wadis (valleys), 23 interchanges, roadway pull-off areas for traffic control and emergency vehicles, and internal and external shoulders spanning five metres on each side.

In March 2017 the MoTC opened a 34-km stretch of the road from Shinas to the Liwa interchange south-eastwards towards the capital. This followed the opening of another chunk connecting Barka, on the western outskirts of Muscat, to Rustaq, at the foot of the Jebel Shams mountain range and home to one of Oman’s most frequented tourist attractions.

As of June some 93 km of the expressway had been opened, according to the ministry.

The Bidbid-Sur Road is a six-lane highway of some 247 km being built between its two namesake cities. At a cost of OR423m (US$

Oman has long been planning a national railway, a network of 2135 km that would speed up transportation of freight from the country’s natural resource assets to its top intermediary destinations for export abroad.

Billed at an estimated cost of around US$ 11bn, the rail service would be built virtually from scratch, with its main arteries connecting Muscat to border crossings with the UAE and Yemen as well as to the country’s three main three ports – Sohar in the north, Salalah in the south, and Duqm in the centre. Additional offshoots would then link it to key mining assets in Ibri, Ibra and Thumrait, as well as to oil and gas fields in the country’s central desert hinterland.

Designed as a double-track, standard-gauge railway system capable of supporting doublestack container trains with axle loads of 32.4 tonnes, the project would require construction of some 12,000 km of railway lines, 35 km of tunnels, 132 km of bridges, as well as 245 overpasses and underpasses, according to specifications reported in Rail Journal.

Outlook Oman’s strategic location will serve it increasingly well as its logistics infrastructure grows and connectivity improves. This will be complemented by ongoing expansion of industrial estates and state-owned enterprises (see Industry chapter), which provide anchor clientele for logistics and can build fresh momentum in trans-shipment, adding further appeal for foreign investors.

The challenge in the short term will be financing amid budget constraints and oil price uncertainty. By the language of official strategies, this will involve a larger role for the private sector, not only in providing capital, but increasingly in tie-ups with the public sector to help manage state assets.

In public announcements and the signing of contracts, authorities have made one thing clear: their willingness to partner with businesses in cases where they can provide credible proposals that optimise costs.

(Global Supply Chain thanks Oxford Business Group (OBG) for the publication of this report’)

NEW EGA POWER FACILITY

EGA breaks ground on

AED 1 billion new power block Emirates Global Aluminium, Mubadala and Dubal Holding recently broke ground on a new AED 1 billion (US$ 273mn) sophisticated power block at EGA’s Jebel Ali smelter in Dubai

E

mirates Global Aluminium (EGA) has set into motion the process to instal a new power generation provision at its Jebel Ali plant.

EGA is the largest industrial company in the UAE outside the oil and gas sector, and is jointly owned by Mubadala Investment Company and Dubal Holding.

The ground-breaking ceremony was held in the presence of HE Saeed Mohammed Al Tayer, Vice Chairman of Dubal Holding and Vice Chairman of EGA, and Khaled Al Qubaisi, EGA Board member and CEO, Aerospace, Renewables & ICT at Mubadala.

Care for the Environment The new, highly-efficient power facility is expected to reduce greenhouse gas emissions

from EGA’s power generation at Jebel Ali by some 10%. Emissions reductions per tonne of aluminium produced at Jebel Ali, which includes both power generation and aluminium smelting, are expected to be up to 7%.

Mubadala and Dubal Holding have formed a joint venture to develop the new power facility. EGA intends to buy the facility’s output for 25 years following commissioning.

Siemens is to install the UAE’s first combined cycle H-class gas turbine at the power block. The project is also the first in the global aluminium industry to use a Siemens’ H-class gas turbine, a leading technology in efficient power generation.

“This project reinforces our sustainable development journey, as well as our support of one of the UAE’s most vital industries.

This is done through ambitious initiatives and sustainable development projects that are highly efficient in power generation and water desalination that support the objectives of the UAE Centennial 2071. Now we have broken ground, we look forward to developing this project successfully,” remarked HE Saeed Mohammed Al Tayer.

Improving power generation capability “We are pleased to break ground on this important project which will improve our power generation efficiency at Jebel Ali, saving costs and environmental emissions.

We are now focused on safe construction and ultimately starting up the new power block in line with our plans,”noted Abdulla Kalban, Managing Director and CEO, EGA. Once the new power block is commissioned, five older, smaller and less efficient turbines at EGA Jebel Ali will be put on standby for use only in emergencies.

The project is expected to reduce EGA’s obnoxious emissions at Jebel Ali by 58%.

Vapours emitted by motor vehicles are amongst a group of emissions targeted for reductions under ‘UAE Vision 2021’ to improve local air quality.

EGA requires electricity for aluminium smelting and other industrial operations, and has captive power plants at both Jebel Ali and Al Taweelah. EGA’s electricity generation capacity is 5,450 megawatts. In 2018, EGA produced 2.64 million tonnes of cast metal.

APRIL 2019 31

MIDDLE EAST RAIL

T

he transport priorities of this region rely on the development of the railway system, including the urban rail transport system, its promotion and implementation of state-of-the-art technologies to meet both passenger and freight mobility needs, as well as the new trends of digitalisation and implementation of measures that will reduce climate change effects.

The development and improvement of the railway transport system and the elimination of missing links are projects that will support the integration of countries by developing international corridors and increasing accessibility, by connecting the region to the other networks and providing connections between the large urban centres, attracting investments and economic growth.

According to UIC (French: Union Internationale des Chemins de fer) or International Union of Railways currently there are 20,000 km of railways under construction in the region, while several other lines in the planning phase.

In order to meet mobility needs, especially considering the increasing level of urbanisation, over the next decade, Middle East will invest hundreds of billions of dollars in railway and rail public transport projects, many of them under development. The allocation of massive investments in new projects will result in

the construction of a railway network of a staggering 67,000 km in the region.

GCC Railway The six countries decided to build a railway network with a total length of 2,177 km that includes over 180 km connected to traffic hubs, transport facilities and industrial cities.

In order to establish the network, Kuwait will build 145 km of lines, Bahrain 36 km, Qatar 283 km, Oman 306 km, UAE 684 km and Saudi Arabia 663 km.

Railway projects are estimated at US$ 240

billion. Projects amounting to US$ 69 billion are currently under development. Although there are delays of the different implementation phases, the countries’ commitment to build the network still stands.

As regards financing, Saudi Arabia and UAE are the countries with the biggest investments which has made the projects advance to 50% (Saudi Arabia) and to 18% (UAE), followed

by Qatar (17%), shows a study elaborated by Terrapinn and Ventures Onsite.

Saudi Arabia Railway infrastructure investments will amount to an annual growth share of 7.88% by 2022.

The Ministry of Transport plans to increase the private sector’s contribution by 50% in rail development and operation projects.

Passenger transport services on the 1,250km railway, Riyadh – Al Majma’ah (NorthSouth railway), could be launched this year after Saudi Railway company commissioned the 1,486-km Al Jalamid-Az Zabirah cargo railway at the end of 2015. North-

32 APRIL 2019

MIDDLE EAST RAIL

Middle East on

fast track to accelerate rail projects GCC countries steaming ahead with planned rail networks With 400 million citizens, the Middle East region will notch a 31% population growth reaching 500 million by 2025 and the transport system will have a major role in setting sustainable economies, providing quality transport services and integrating networks regionally South Railway project includes the construction of a 2,400-km network for freight and passenger transport.

Another important project of Saudi Arabia is Makkah – Madinah high-speed railway which has since been commissioned this year. Haramain HSR, connecting Makkah, Jeddah and Madinah, consists of the

and internationally

APRIL 2019 33

MIDDLE EAST RAIL

construction of a 450-km double railway.

35 trains will run on the railway providing transport to 166,000 passengers daily.

Riyadh Metro is the largest urban transport project developed so far by Saudi Arabia. The metro system includes the construction of a 176-km network (6 railways and 85 stations) and could be operated in 2019. Lines 1 and 2 are developed by BACS consortium, lines 4, 5 and 6 by FAST consortium, while Line 3 by ArRiyadh New Mobility.

Line 3 Tunnel was completed in January 2017. The line is the longest of Riyadh Metro network (40 km of which 11 km in the underground).

Jeddah Metro Company has projects for urban transport development, plans that also include the construction of a metro network and of a LRT. The metro network includes 4 lines with a total length of 150 km, served by 85 stations. The LRT network will be formed of three lines with a total length of 37 km and 39 stations. Line 3 (9km) also includes a 28-km extension.

Moreover, there is also Corniche tram project with a length of 16 km (15 stations).

34 APRIL 2019

Makkah – the metro network plan includes the construction of 45-km of railways and 22 stations in the first phase.

The development strategy includes its extension to 6 railways (182 km) and 88 stations. Makkah Mass Rail Transit Company (MMRTC) is to announce the winner of the tender with bids technically and financially reviewed last year.

Qatar The 2030 Strategy focuses on the establishment of an integrated transport system that would support the shift of traffic to public transport, while relying on railway transport. Qatar Rail implements the Long Distance Passenger and Freight Rail project, as part of the GCC rail network. The project consists of the construction of 486 km in several phases.

United Arab Emirates It is among the top countries with important investments in rail projects with Strategy 2021 as objective. Under the strategy, a rail network will be built to connect important

urban and commercial centres. After the completion of the projects, railway transport will define the transport and logistics sector in the region.

The railway network will measure 1,200 km providing connections to Saudi Arabia and Oman, within the GCC network, as well as to main transport hubs, freight terminals and distribution centres.

Last year, Etihad Rail DB (a JV of Etihad Rail – 51% and DB – 49%) officially launched commercial operations on the first Shah – Habshan – Ruwais railway (254 km). Last year, Etihad Rail suspended the tendering process concerning phase II of Mussafah railway development to Khalifa and Jebel Ali (Gulf) ports, then to the frontiers with Saudi Arabia and Oman. The railway will be 628-km long.

UAE railway projects require investments of over USD 30 billion and, apart from the national network, they also include the metro and the LRT of Abu Dhabi, skyTran Yas Island, as well as Dubai’s public rail transport projects – extension of the metro and implementation of the tram system new phase.

MIDDLE EAST RAIL

36 APRIL 2019

MIDDLE EAST RAIL

Abu Dhabi metro will have the greatest impact over public transport. The authorities plan to build a network of 131 km, providing connections to the suburbs and to developing communities (such as Saadiyat, Yas Islands and Al Raha Beach).

The first phase will see the construction of lines with a total length of 42.5 km, while during the following phases, the authorities will initiate the construction of another 70 km of metro lines.

Apart from this project, the city will benefit from ultramodern transport systems. At the end of 2016, the Department of Municipal Affairs and Transport (DMAT) announced the conclusion of an agreement with Hyperloop Transportation Technologies to elaborate the feasibility study of Abu Dhabi and Al Ain connection with a Hyperloop system.

At the same time, Dubai Roads and Transport Authority (RTA) and Hyperloop One are elaborating the feasibility study for an Abu Dhabi link, using the new transport system concept.

SkyTran Yas Island project is also an ultramodern transport system for which Miral signed a MoU with skyTran® Inc., a NASA Space Act Company. The agreement permits the launch of the feasibility study for the implementation of the project in Abu Dhabi. The project will connect Yas Island and, eventually, Abu Dhabi International Airport.

Dubai Dubai public transport is a way of living.

The number of people using these services is increasing from one year to another. In 2016, 543.6 million passengers used public transport, more users compared to the previous year. By mode of transport, the metro system had the highest share of 35% of total users. The Roads and Transport Authority (RTA) plans to implement projects to increase public transport share to 20% by 2020 and to 30% by 2030.

In the third quarter of 2016, the authorities signed an important contract to develop the metro system: the construction of Route 2020. Alstom-led Expolink Consortium, which also includes Acciona and Gulermak, signed the EUR 2.6 billion contract to build

GCC Railway

The Gulf Railway, also known as the GCC Railway, is a proposed railway system to connect all six Gulf Cooperation Council (GCC)-member states in the Arabian Gulf. The rail network will have a total length of 2,177 km. The project is estimated to cost US$ 250 billion. It is scheduled to be completed by 2023.

Each of the six GCC member states are responsible for implementing the portion of the project that lies within their territory, and will construct their own railway lines and branches, stations and freight terminals. The cost will be shared by the six countries in proportion to the length of the rail network in each country.

As a result, the United Arab Emirates and Saudi Arabia will spend the most on the project, followed by Oman, Qatar, Kuwait and Bahrain. The Saudi Railway Company will develop the network in Saudi Arabia, Eithad Rail in the UAE, Oman Rail in Oman, and Qatar Rail in Qatar.

the Red Line extension (Route 2020) and to upgrade the existing line.

The project includes the construction of the 15-km line, of which 11.8 km suspended and 3.2 km in the underground. The extension will have 7 stations, of which one transfer station – Nakheel Harbour – and one station within the World Expo site.

The tram system will also be developed, a project for which RTA published the design bids for phase 2 of the project. It includes the extension of the network by 4 km to Mall of the Emirates Madinat Jumeirah and Burj Al Arab.

The extension project will also include phase 3, consisting of the construction of the railway along Jumeirah Beach Road to 2nd December Street. This section will provide connection to the metro system and Palm Monorail.

(Abridged from a report by Pamela Luica, Editor, Chief Editor Railway PRO)

APRIL 2019 37

DP WORLD

DP World reports robust 2018 results, revenues up

20%

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

The UAE-headquartered trade enabler and global ports operator made US$ 2,5bn worth of acquisitions last year

38 APRIL 2019

D

P World has recorded strong financial results for the year ended December 31, 2018 and revenue grew 20%, it recently announced.

Announcing the 2018 results, the Dubai Group said its adjusted EBITDA increased 13.7% with adjusted EBITDA margin of 49.7%, delivering profit attributable to owners of the company, before separately disclosed items, of US$ 1.27bn, up 5.1% and EPS (earnings per share) of 153 US cents.

“This robust performance has been delivered in an uncertain trade environment, once again highlighting the resilience of our portfolio,”said Sultan Ahmed Bin Sulayem, Group Chairman and CEO, DP World.

“We have made good progress in delivering on our strategy of strengthening our portfolio to become a global solution provider and trade enabler

with approximately US$ 2.5bn worth of acquisitions announced in the year,”noted Bin Sulayem.

Acquisitions spawn opportunities “These acquisitions offer strong growth opportunities and enhance DP World’s presence in the global supply chain as we continue to diversify our revenue base and look at opportunities to connect directly with the owners of cargo and aggregators of demand,”he stated.

“Going forward, we aim to integrate our new acquisitions and drive synergies across the portfolio with the objective of removing inefficiencies in global trade, improving the quality of our earnings and driving returns,” he added. The Dubai group said the capital expenditure of $908 million was invested across the portfolio during the year, below the group’s

DP WORLD

guidance of approximately US$ 1.4bn in 2018.

In 2018, gross global capacity was at 90.8mn TEU, while the consolidated capacity was put at 49mn TEU.

Multiple Acquisitions According to DP World, the acquisitions of Drydocks, DMC, CWC, Cosmos Agencia and Unifeeder were performing in line with expectations and have led to increased contribution to its revenue line.

“We expect capital expenditure in 2019 to be up to US$ 1.4bn with investment planned mainly into UAE, Posorja (Ecuador), Berbera (Somaliland), Dakar (Senegal) and Sokhna (Egypt),” said Bin Sulayem.

DP World continued to invest in solution providers and acquired the integrated multimodal logistics player Continental Warehousing Corporation (CWC) in India,

Mohammed Al Muallem, CEO and Managing Director, DP World, UAE Region, with school children at the book’s launch DP World 2018 Financial Results infographic

Cosmos Agencia Marítima in Peru, and the Unifeeder Group in Denmark, which operates the largest container common user feeder and growing shortsea network in Europe.

The company has also announced the acquisition of the pan-European logistics business, P&O Ferries.

“Aside from our investments in solution providers, we won a 30-year concession for the management and development of a greenfield port project at Banana in the Democratic Republic of the Congo (DRC). We announced the acquisition of two ports in Chile, which will allow us to serve cargo owners at five major gateway terminals in the west coast of South America,”remarked Bin Sulayem.

“We have also consolidated our position once again in Australia, where there is an opportunity to expand beyond the ports into logistics,”he added.

DP WORLD releases book to commemorate the ‘Month of Reading’ As part of its efforts to support the UAE’s education system DP World, UAE Region unveiled its first book, the’DP World Success Story’, to be used in government and private schools as an introduction to logistics and global trade.

The book was launched by Mohammed Al Muallem, CEO and Managing Director, DP World, UAE Region at a ceremony held at Raffles School International in Dubai.

It includes details of how the global supply chain works and is aimed at students between grades six to ten.

Using creative storytelling, it tells the story of Saeed, a young publisher, who manages to ship over five million copies of a book from the UAE to different Arab countries.

“As our first official book, DP World Success Story helps broaden the horizons of our children so they can learn about trade and explore career options. Providing them with a broader outlook while in school will help them choose different career paths later in life,” remarked Al Muallem.

“March 2019 has been designated the Month of Reading, so it was an ideal time to launch the book which also shows how important national assets such Jebel Ali Port, Jebel Ali Free Zone, and other related facilities are key to the economic health of our nation,” he added.

The book’s release is part of DP World’s Global Education Programme, launched in 2016 that seeks to introduce children to the world of port operations, logistics, and other related fields using DP World volunteers, the programme aims to engage with 34,000 children between the ages of 8-14 by 2020 across its global network of 40 countries and has already been delivered in India, Senegal, the UK, Argentina, and the Philippines.

APRIL 2019 39

SAUDI PORTS AUTHORITY

Saudi Arabia launches major maritime expansion

Mawani plans to increase productivity and competitiveness of the Kingdom’s ports

T

he Saudi Ports Authority (Mawaniports in Arabic), as part of a ‘qualitative leap’ in its management methods and operational performance, has announced plans to increase the productivity and competitiveness of the Kingdom’s ports.

The plan calls for a substantial reduction of container waiting times by next year.

Addressing the recent 2nd Saudi Maritime Congress in the Saudi capital Riyadh, Saad Bin Abdulaziz AlKhalb, President, Mawani, announced that containers’ length of stay at the ports will be reduced to three days by 2020 while the volume of container handling will be more than doubled by 2030.

“What’s more, the share of Saudi ports handling transshipment containers will be

increased, the production capacity within the terminals will be optimized, and new horizons will be opened for promising investment and commercial partnerships,” AlKhalb added in remarks carried by the official Saudi Press Agency (SPA).

Kingdom’s Vision 2030 Saudi Arabia’s Vision 2030 roadmap to a more diversified economy in the future includes development plans to reduce average customs times across all Saudi ports from 14 days to 24 hours.

The Congress offered key insights into the booming shipping and logistics sector in light of the major transformation initiatives launched by the Saudi Government in line with Saudi Vision 2030. The logistics sector

40 APRIL 2019

is one of the key economic pillars for further economic diversification in the Kingdom and is expected to be worth US$ $18 billion.

Delivering the keynote address at the conference, Dr. Nabil Al Amoudi, the Saudi Minister of Transport, highlighted the importance of the show, the Kingdom’s growing economy and the aim of Vision 2030 to drive sustainable growth and development in the country.

“The Kingdom has provided a pioneering model in the development of the maritime sector, accompanied by the unlimited support and unprecedented attention of our wise leadership, which translates to a quality-focused shift in facilities, operational and logistical mechanisms, to position Saudi ports among the ranks of the most important regional ports and

SAUDI PORTS AUTHORITY

Mawani monitored ports

an ideal destination for major global shipping lines,”Dr. Al Amoudi remarked.

PPP (Public-Private partnership) Model “We seek to continue fruitful cooperation with the public and private sectors to promote this vital sector, successfully connect bridges to three continents and make the Kingdom a global logistics center,”he continued.

Alkhalb praised government efforts as well as the public sector’s strategic partnership with the private sector to realize the objectives of Saudi Vision 2030. The goal is to optimise the Kingdom’s geographical advantages and transform it into a global logistics platform that links three continents.

The intended result is to make the

Kingdom a major centre for international trade by upgrading its services, efficiency, operational and logistic capabilities, and developing its infrastructure, in addition to finding and training qualified national cadres, to enhance its important developmental, economic and trade roles.

AlKhalb indicated that the nine ports supervised by Mawani are currently reaping the benefits of services and initiatives launched recently. The ports’ total container deliveries since the beginning of this year through the end of February 2019, amounted to more than 44 million tons, an increase of 10.19% over the same period in 2018, while the total number of inbound and outbound containers during the same period was 1,131,959, an increase of 6.18% over the corresponding period last year.

The ports are Jeddah Islamic Port; King Abdulaziz Port in Dammam; King Fahad Industrial Port in Yanbu; King Fahad Industrial Port in Jubail; Jubail Commercial Port; Yanbu Commercial Port; Jizan Port; Dhiba Port located at the North end of the Red Sea coast and Ras Al-Khair Port located 60km North of Jubail on the Eastern Arabian Gulf coast.

Chris Hayman, Chairman, Seatrade, the conference organiser, recalled the debut Saudi Maritime Conference that was held in Dammam in Eastern Saudi Arabia in 2014, saying that the message then was clear: The Kingdom of Saudi Arabia is committed to the major development of its maritime and logistics sector.

“Four years on, that forecast has been overwhelmingly fulfilled in the Saudi Vision 2030 programme. The world is watching with admiration the unfolding of a strategy that will position the Kingdom of Saudi Arabia as a global hub, delivering connectivity between Asia, Europe and Africa,”he said.

“In 2014, there were 17 countries represented at this event. This year we have 36 countries, the exhibition booth area has doubled in size, and we are expecting more than twice as many attendees,”he added.

APRIL 2019 41

DUBAI SILICON OASIS

42 APRIL 2019

DUBAI SILICON OASIS

Dubai Silicon Oasis Authority registers

42.1% revenue growth in

2018

2,620 companies operate in Dubai Silicon Oasis, an increase of 161 companies from 2017 reflecting a rise of 6%. In 2018 revenues topped AED 576.9 million whilst net profits stood at AED 292.4 million

HH Sheikh Ahmad bin Said Al Maktoum

Dr. Mohamed Alzarooni, Vice Chairman & CEO of DSOA

H

H Sheikh Ahmed Bin Saeed Al Maktoum, Chairman of Dubai Silicon Oasis Authority (DSOA), the regulatory body for Dubai Silicon Oasis (DSO), recently announced that the integrated free zone technology park achieved remarkable results during 2018 with a total revenue of AED 576.9 million, as well as overall net profit of AED292.4 million in comparison with AED 205.7 million in 2017, marking a surge of 42.1%.

For his part, Dr Mohammed Al Zarooni, Vice Chairman and CEO, DSOA, emphasised the significant role played by the integrated environment of DSOA in providing opportunities for investment, innovation and entrepreneurship. He highlighted the contribution of startups to the country’s economy and to attracting experts from all over the world. Dr Al Zarooni announced the addition of several

new companies operating in the technology sector to the DSO community. The total number of companies based in DSO increased by 161 – from 2,459 in 2017 to 2,620 in 2018, marking a rise of 6%.

Among the companies based in DSO, 37% are from the Middle East and Africa, 23% from Europe, 33% from Asia, and 7% from the Americas. 81% of these companies specialise in technology, while 19% focus on commercial services and other service sectors.

Silicon Park is 87% complete Dr Al Zarooni pointed out that Silicon Park, Dubai’s first integrated smart city project in DSO, achieved 87% completion, and is scheduled for handover in Q2-2019. Silicon Park comprises 71,000 sqm of office space, 25,000 sqm of commercial space, 46,000 sqm of residential area, as well as a host of valueadded contemporary lifestyle facilities.

APRIL 2019 43

DUBAI SILICON OASIS

Light Industrial Units DSOA completed the construction of Phase 6 of the Light Industrial Units project, one of its strategic investments that contribute to enhancing DSO’s position as a preferred destination for industrial companies. The development is in line with DSOA’s strategy to create an integrated business environment and technology infrastructure that provides ready solutions to existing and potential customers looking to build their headquarters or expand their business in the region. The total investment in Light Industrial Units since DSOA’s establishment reached approximately AED 324 million.

Dubai Blockchain Commercial Registry Project In line with the Emirates Blockchain Strategy 2021, launched by HH Sheikh Hamdan bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of The Executive Council of Dubai, DSOA in partnership with the Department of Economic Development (DED) unveiled the Dubai Blockchain Business Registry Project.

The initiative seeks to enable the Unified Commercial Registry (UCR), the first blockchain-powered trade license repository launched by DED, to store and update company registration information issued by DED as well as the free zone authorities in Dubai.

Aimed at streamlining the process of setting up and operating a business, the collaboration is a result of DSOA’s relentless efforts to build synergies that leverage the strengths of its partners in the public and private sector to fast-track Dubai’s goal of becoming one of the smartest cities in the world.

44 APRIL 2019

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DP WORLD’S BREAK-BULK ABILITIES

DP World spotlights its non-containerised cargo handling capabilities at Breakbulk ME

2019

The key trade event provided the opportunity for host port DP World to demonstrate its dexterity in wide-ranging port handling activities at its principal Jebel Ali Port, the premier gateway and entrepôt for all break-bulk and project cargo bound for Expo 2020

46 APRIL 2019

D

P World’s high profile as a trade enabler was further enhanced as Jebel Ali Port, run by the global port operator’s UAE Region, highlighted its offerings and versatility as the region’s premier gateway for break-bulk and project cargo at the recently concluded 4th Breakbulk Middle East 2019 Conference and Exhibition in Dubai.

Hosted by DP World, UAE Region, Breakbulk ME 2019 attracted the region’s leading shippers, project cargo and logistics professionals.

As Expo 2020’s Premier Global Trade Partner, DP World has been scaling up its flagship Jebel Ali Port and hub operations to handle Expo-bound cargo and related services.

Break-bulk cargo is non-containerised and is usually transported as individual pieces due to the cargo often being oversized and overweight, implying regular freight containers cannot ordinarily accommodate the cargo. Cargoes comprise goods such as construction equipment, oil and gas

equipment, power and utility apparatus, yachts and steel and other odd-sized items.

Spurt in operations The throughput of non-containerised cargo such as break-bulk, bulk and project cargo has increased significantly at Jebel Ali Port, recording an average annual throughput of 4.8 million metric tonnes (MT) of break-bulk and 4.1 million MT of bulk between 2013 and 2017.

DP World, UAE Region, is directly responsible for ensuring all Expo-related cargoes brought into Dubai are handled safely and in a timely manner. Noncontainerised cargo constitutes a growing and significant part of its business accounting for nearly a quarter of total volumes.

Against this backdrop the stakes are high for DP World and Jebel Ali Port.“Breakbulk Middle East 2019 is the appropriate time to bring focus and attention to the breakbulk and project cargo sector, especially in light of the enormous US$ 900bn worth of infrastructure projects in the pipeline,”

DP WORLD’S BREAK-BULK ABILITIES

commented Mohammed Al Muallem, Chief Executive Officer & Managing Director, DP World, UAE Region on this occasion.

Multi-purpose capabilities The world class hub services at Jebel Ali Port are complemented by a high degree of specialisation in the storage and handling of all kinds of cargo. DP World’s integrated port and logistics offerings at Jebel Ali are supported by purpose-built facilities for the expanding demand of break-bulk, project cargo, Ro-Ro and other general cargo handling services.

The importance of break-bulk is underscored by DP World’s focus and integrated approach in harnessing Jebel Ali Port’s operations and services for its numerous industrial parks and free zones such as Jebel Ali Free Zone (JAFZA), National Industries Park and Dubai Auto Zone, its online trade services platform Dubai Trade, and security services through World Security.

This unified business model providing a comprehensive logistics and supply chain network of core competencies and related services has allowed the company to position itself across the supply chain and provide seamless, customised support to suit existing market conditions.

Mega projects to boost port operations With a staggering US$ 900bn worth of projects planned or underway, the UAE is the MENA region’s second biggest projects market. That includes US$ 589bn worth of announced projects under construction and a pipeline of non-awarded mega projects of about US$ 310bn. As a spin-off, this holds promise for potential future business that bodes well for national and regional trade and provides a major fillip for operations at Jebel Ali Port.

DP World’s flagship facility, Jebel Ali Port, is the premier gateway for over 80 weekly services connecting more than 140 ports worldwide and hinterland road connectivity across the GCC and the Middle East.

Jebel Ali is well-equipped to handle the growing demand for heavy lift and project cargo offering customised solutions (including space for storage and assembly) for irregular shipments, regardless of the size or weight.

APRIL 2019 47

LOGISTICS-FACILITIES MANAGEMENT INTERFACE

MEFMA CONFEX Dubai 2019 closes strong Leading FM event in the region takes aim at addressing emerging challenges through business intelligence and technological innovation

T

he annual Middle East Facilities Management Association (MEFMA) CONFEX Dubai 2019 brought together a high-profile gathering of leading players in the industry.

Themed ‘Business Intelligence & Technology-Driven Facilities Management’, the inauguration was led by Jamal Lootah, MEFMA President; Major General Engineer Khalid Qabbani, General Director of Military Works, Ministry of Defence, Saudi Arabia; Hend Obaid Al Marri, CEO, Dubai Real Estate Institute; Atiq Juma Nassib, Senior Vice President, Commercial Services, Dubai Chamber; and Ali Alsuwaidi, MEFMA Vice President.

This year’s event, which focused on new innovative methods that addressed the emerging challenges in the sector and explored the latest technological innovation that enhanced FM services, received wide support from many leading companies in Saudi Arabia and the UAE.

48 APRIL 2019

In his welcoming speech, Jamal Lootah explained that MEFMA Confex has become a leading and strategic platform aimed at raising awareness about best practices utilized in employing technological innovation as a mean to drive in growth and sustainability of the regional FM sector, in line with the current ambitious development projects.

FM industry worth US$ 37bn in the Middle East He also reaffirmed MEFMA’s commitment to provide the necessary means to keep abreast of technological developments to support the competitiveness and efficiency of the FM sector in the region, which is currently valued at about US$ 37 billion.

“This year’s edition of MEFMA CONFEX 2019 witnessed the hosting of a new series of FM Counselling Sessions – a new feature that we are doing for the first time to help enhance collaboration between the government and private companies while also creating direct channels to exchange critical thinking and experiences in a step to drive in growth, development and sustainability for the FM sector,” added Lootah.

The first day of the event featured the latest FM initiatives in the Kingdom of Saudi Arabia, which included the keynote presentation by Dr. Thamer Bin Abdullah Al Regeeb, Director General, General Administration of Projects & Facilities Affairs of the Ministry of Interior of the Kingdom of Saudi Arabia.

Dr. Al Regeeb discussed the ‘Facilities Management Development Road Map at the Ministry of Interior’, while Nabil AlNuaim, Executive Director, Saudi Aramco Community Services, highlighted the value of digital transformation on the growth of the sector in the GCC during his presentation on ‘Digital Transformation and Business Integration, a World of Opportunities for GCC Facility Management Industry’.

Counselling-the new initiative A ‘Counselling Session’ was also held for the first time on key topics such as CAFM systems implementation, command and control setup for buildings, contract management and handover, digital transformation of FM operations, energy audit, fire and life safety strategy, FM best practices, and FM company setup.

Among the reports issued was ‘AI in FM: The Potential of Artificial Intelligence in the GCC FM Industry’ that assessed the impact of AI and related technologies on the industry over the next five years, particularly on applications such as predictive maintenance, energy efficiency and autonomous service delivery.

The report further shed light on three key technologies based on ‘deep learning’ algorithms which enable machines to learn from experience. The second study, titled ‘Asset Maintenance Management with Internet of Things (IoT) in Commercial Management’, found that IoT can address the gap between assets and performance in commercial buildings which has been causing the failure of traditional maintenance strategies.

DHL GLOBAL FORWARDING

DHL Global Forwarding sets up distribution centre in KIZAD

DHL Global Forwarding recently signed a deal with KIZAD, an Abu Dhabi Ports subsidiary, to establish a distribution centre to serve the needs of its customers

U

nder the agreement, DHL Global Forwarding will set up warehouses in KIZAD to provide end-to-end logistics and supply chain services to its customers. The warehouses will be used for storage and consolidation of all shipments, equipped with highvolume racking, as well as fully-managed kitting, packing and dispatching process to support customers’ growing capacity requirements.

With the new Abu Dhabi warehousing facility, DHL Global Forwarding is strengthening its network of global hubs for overseas distribution. With a view to further benefit from KIZAD’s unique proposition and recognising KIZAD as its preferred location for warehousing and distribution in Abu Dhabi, DHL Global Forwarding is working closely with the authorities to expand the size of its KIZAD distribution centre by April 2019.

“We look forward to supporting DHL Global Forwarding in continuing to provide world-class logistics capabilities and are proud to help strengthen its global freight network and warehousing infrastructure,” said Samir Chaturvedi, CEO, KIZAD, said,“Beyond the immediate needs of our customers who currently operate out of KIZAD, we are also looking to invest more resources on expanding our presence here, so we can serve more customers,”remarked Amadou Diallo, CEO, DHL Global Forwarding, Middle East and Africa.

Logistics has been a key part of KIZAD’s growth since it was founded in 2010. The zone recently launched KIZAD Logistics City, which offers pre-built warehouses and Light Industrial Units (LIUs).

KIZAD’s new free zone warehouses cater to trading and export companies, Third Party Logistics (TPL) providers, freight forwarders and distributors.

DHL Global Forwarding makes key appointments in Iraq and Turkey DHL Global Forwarding has appointed Usam Alyasin and Ingo-Alexander Rahn as Country Manager in Iraq and Turkey respectively. Both of them will report to Amadou Diallo, CEO, DHL Global Forwarding Middle East and Africa.

“I am positive that Alyasin and Rahn will drive continued growth for the company in the region, as they have proven their expertise in various roles within the organization over the years,” said Amadou.

Alyasin has been with DHL Global Forwarding since 2011, and has played an important role in driving key customer relationships for industrial projects in his role as Project Operations Manager.

In his new role as Country Manager, Alyasin will leverage his understanding of the business and market, to lead business strategy and accelerate the growth for the company, in Iraq.

An industry veteran who has been with DHL for 17 years and with more than 25 years of experience in the industry, Rahn first joined the business as Vice President, Airfreight for DHL Danzas Air and Ocean based in Frankfurt, Germany.

The KIZAD and DHL Global Forwarding delegations at the deal signing ceremony

APRIL 2019 49

DNATA

dnata expands into Belgium

The air services provider opens stateof-the-art cargo facility at Brussels Airport

50 APRIL 2019

d

nata, one of the world’s largest air services providers, has continued to increase its global footprint and launched operations in Belgium by opening a new cargo centre at Brussels Airport. dnata’s expansion into the Belgian capital represents an investment of EUR 8 million (US$ 9mn) and creates up to 100 local jobs with the company. dnata’s new facility, which covers an area of 14,000 m², substantially increases the cargo capacity in the Benelux states allowing airline customers to enhance their operations in the region.

The advanced facility includes 4,500 m² warehouse space and is capable of processing 125,000 tons of cargo annually. It is equipped with the latest technologies and complies with the highest industry standards ensuring efficient and safe handling of all types of cargo, including perishables, pharmaceuticals, dangerous goods, live animals, aircraft engines and vehicles. dnata has been already providing cargo and ground handling services to 25 cargo and 8 passenger airlines at Amsterdam Airport Schiphol. dnata will ensure a close

cooperation between its Amsterdam and Brussels teams to leverage synergies and deliver the highest possible value for its customers at both airports.

“We see solid demand for our quality services and are confident that this strategic expansion will bring significant benefits to our stakeholders,” commented Erik de Goeij, Chief Executive Officer, dnata The Netherlands and Belgium. “dnata has already positioned itself as a key cargo player at our airport with a dedicated infrastructure for pharmaceuticals and an active participation in our cargo community Air Cargo Belgium,” said Arnaud Feist, CEO of Brussels Airport Company. dnata’s first customer in Brussels is Singapore Airlines, which operates eight weekly flights with an annual capacity of 45,000 tons of cargo between Brussels and Singapore, using the 747-400 F aircraft.

Including Brussels Airport, dnata now provides quality and safe ground handling and cargo services at 88 airports in 14 countries. Every day, dnata’s dedicated employees handle over 1,900 flights and move more than 9,000 tons of cargo.

TURKISH CARGO

Turkish Cargo

commences operations at Istanbul Airport, its new hub Turkish Cargo recently stated its cargo transportation operations via passenger flights at the temporary satellite facility at Istanbul Airport

T

urkish Cargo is relocating its freight hub to Istanbul International Airport to a new venue.

The freighter flights will continue from the existing cargo terminal at Ataturk Airport (Istanbul) until the construction of the new and expanded Mega Cargo Facility is completed at Istanbul Airport.

No time line was indicated for completing the project. Gearing to maintain its operations from Ataturk and Istanbul airports as the ‘Dual

Hub’, Turkish Cargo will have a capacity to handle 4 million tons of cargo annually in its new modern cargo terminal.

The terminal will have an indoor area of 300,000sq. metres when construction in all phases at Istanbul Airport is completed.

With its investments and continually expanding fleet, Turkish Cargo has taken concrete measures towards its target to become one of the top-five brands of the air cargo industry.

Turkish Cargo sponsors the carriage of historical artifacts to Japan Turkish Cargo carried 186 priceless historical artifacts, owned by Dolmabahçe and Topkapı Palaces in Turkey to Tokyo as the sponsor carrier for an exhibition organised as part of the ‘Year of Turkish Culture’ in Japan.

Turkish Cargo carried the artifacts in order to be displayed at the exhibition entitled ‘The Ottoman Empire and Tulip Culture’ held across Japan.

Before the carriage operation through Istanbul – Narita route, the artifacts in Topkapı and Dolmabahçe Palaces were packaged with protective materials that shielded their texture and structure before they were put into 56 high-security wooden cases.

Using a wide-body B777F type air freighter belonging to Turkish Cargo, the flight carried no other cargo due to the significant nature of the operation.

The extensive flight network of Turkish Airlines currently spans 306 destinations. Turkish Cargo opeartes to 85 destinations.

APRIL 2019 51

Seamless integration and bespoke in-store fulfillment centres vital for

E-commerce success Order fulfillment strategy covers a broad range of

steps and every effort must be made to ensure that all auxiliary systems work in tandem and nothing slips through the net.

The exponential growth of E-commerce has put the spotlight on convenience and shipping. While the two go in tandem, shipping has become a critical component in successful E-businesses.

The ability to order online and receive the product in a timely manner can influence buyers, drive sales, and create return visitors.

In this contributory article, Tom Craig, President LTD Management, Pennsylvania, USA, thought leader, a top authority and professional consultant on logistics & supply chain management and a regular contributor to Global Supply Chain examines this issue form a supply chain management perspective.

Craig puts the E-commerce fulfillment issue under the scanner and carefully examines the subject to offer counsel which if appropriately implemented will separate the men from the boys and make the operation a stand out.

I

n-store fulfillment for E-commerce has gotten stories done about it. Details as to what is done and how are sketchy.

They are written about retailers and from the retailer point of view. They are not written about from the supply chain management perspective. What is missing too is the cost-to-serve and order-delivery performance metric.

52 APRIL 2019

Some discussion points and to create comments for supply chain management side: Retailers may be assuming store employees as no-cost workers to do this. They are already there. Otherwise, this seems to be an expensive order picking approach. There is no technology used for picking and moving products. Plus, factor in the poor store layout

and the picking waste of employee add time and cost.

Online is about the customer expectation for order-delivery velocity. That is the sum of order picking, preparation, and shipping delivery. And, stores are close to customers?

So, how does this method satisfy that customer centric metric?

How does it compare with shipping from warehouses? Better yet, how many retailers know their performance against this customer centric KPI? Given where dominate E-commerce growth is, this is a valid question.

Store fulfillment is also to achieve cheaper delivery? Much parcel shipping is essentially flat rate. If employees make deliveries, how are they compensated with this Grubhublike retail service and how does that compare to parcel delivery pricing?

How does the supply chain handle the velocity at and to all the stores? This can be part of an extensive end-to-end network. This means total velocity, not just downstream. Supply chains may have limited velocity because of the pressure to keep transport costs down, which is often at the sacrifice of speed of inventory movement.

Add to this the unreliability of ocean carrier service.

How are stores restocked to keep the order performance going? This is really about the end-to-end movement of inventory. Outof-stocks are a no-no for customer orders.

Fulfillment success depends on the upstream supply chain, where supply begins. This issue may be masked with building inventories to avoid higher tariffs with trade wars.

What is the total inventory and working capital impact of using stores for this?

Additional stocking locations mean additional safety stock. Are transport costs being traded for higher spending for inventory? Is there the potential for being inventory rich?

Cost and order performance analyses It would be good to understand the analyses used by retailers as to cost and order performance for stores versus warehouses.

How does it compare to the maximum twoday order delivery?

What about an updated warehouse network built around omni-channel, not stores, with strong inventory positioning?

Also, the real issue is the total supply chain, not just one part, fulfillment. How

E-COMMERCE FULFILLMENT

does forcing this at the end of the supply chain affect the total chain. What changes were required upstream? Or are there hidden problems if this is to be more than a Christmas time service?

Re-looking design Design the new supply chain’s warehouse/ fulfillment recognising the different service

requirements of the channels. The solution may be a combination of approaches. One way may not answer all needs, both cost and service.

That may require data analytics, such as regression analysis, to understand order size, number of SKUs per order, which products are likely to be ordered together, and other questions. With that, construct the network for what is the best way to meet customer

demands – warehouses – how many, located where, size; or warehouses of different sizes depending on order volume; or a mix of warehouses and stores.

Segmentation has to be based on common supply chain or other significant issues. In the present context, the monolithic purpose, onesize-fits-all supply chain is counterproductive to creating velocity.

APRIL 2019 53

GULFTAINER

Gulftainer’ KCT handles first Gateway Cargo through newly launched SPOT Service The GALEX service (GLX) is offered collaboratively

by Emirates Shipping Line (ESL) and Korea Marine Transport Co. (KMTC)

G

ulftainer the world’s largest privately owned independent port operator based in the UAE, celebrated the signing of its first customers for the newly introduced sea cargo clearance service, Sharjah Port of Trade, SPOT. Within a month of the launch, the company has secured four customers for SPOT that serves as an inland extension of the Gulftainer-operated Khorfakkan Container Terminal (KCT). The unique SPOT facility is located at the crossroads of the E311 highway and Maliha Road, providing convenient connectivity between Sharjah and Dubai with substantial cost and time savings for customers.

The GALEX service (GLX), offered in conjunction with Emirates Shipping Line (ESL) and Korea Marine Transport Co. (KMTC), was the first to benefit from SPOT’s value-added offering and successfully completed the first direct call at KCT in a record 3.4 hours.

To mark the launch of the service, Peter Richards, Group CEO, Gulftainer, presented commemorative tokens to the new customers of SPOT at a gala event in Dubai in the presence of over 300 representatives of the maritime sector as well as senior company officials.

SPOT offers the fastest transit times to deliver cargo north of Al Barsha area, as well

Gulftainer honours customers of SPOT, ESL, KMTC, RHS and MCL

KCT Receives Maiden Call from GALEX Service

54 APRIL 2019

Khorfakkan Container Terminal receives maiden call from GALEX Service

Gulftainer announced the successful completion of the first direct call by GALEX Service at its Khorfakkan Container Terminal in a record 3.4 hours. The GALEX Service (GLX), a premier service linking the rapidly growing markets in North/South Asia, India and the Middle East with weekly sailing and competitive transit times.

This service will enable end users to benefit from direct weekly calls at Khorfakkan Container Terminal with the following port rotation schedule: Pusan / Shanghai / Ningbo / Xiamen / Da Chan Bay / Singapore / Port Klang / Cochin / Nhava Sheva / Mundra / Sohar / Khorfakkan / Jebel Ali / Port Klang / Da Chan Bay / Pusan.

We are delighted that customers of the Galex Service will be the first to benefit from SPOT’s convenient location within the UAE’s commercial district with optimum inland connectivity,” observed Fred Castonguay, Group Chief Operating Officer, Gulftainer.

“Trade between the UAE and China alone has grown substantially, with industrial hubs such as Sharjah witnessing unprecedented expansion.

SPOT offers a unique value proposition for traders to benefit from the growing market opportunity,” he noted.

as end-to-end connectivity across the UAE. Its strategic location enables a reduction of delivery costs from port to door by as much as 80%.

Several shipping lines have expressed their interest in securing vessel calls at KCT and using the SPOT service.

In addition to the service at KCT, Gulftainer has started two new direct services at Sharjah’s premier gateway terminal, Sharjah Container Terminal (SCT). The first connects Sharjah to India within three days’ transit time, the shortest in the market, in partnership with RHS Group, while the second links the emirate with upper Gulf countries in partnership with MAG Container Lines (MCL).

BAHRI

Bahri reaches shipping agreement with SWCC

Bahri’s partnership with SWCC will facilitate the shipment of desalination plants spare parts to the Kingdom’s East and West coasts

B

ahri, a global leader in logistics and transportation, and Saline Water Conversion Corporation (SWCC), a Saudi Government Corporation responsible for the desalination of seawater, producing electric power, and supplying various regions in Saudi Arabia with desalinated water, have signed an agreement that sets a fixed price on a five-year term for the shipment of spare parts needed at desalination plants on the Kingdom’s East and West coasts.

Highlighting the significance of the partnership, Abdullah Aldubaikhi, CEO of Bahri, emphasized that the partnership will enable Bahri to contribute towards improving the quality and efficiency of desalination facilities in the Kingdom.

Aldubaikhi also noted that as part of Bahri’s continuous efforts to promoting Saudization, every aspect of the agreement will be managed and led by national competencies.

“The signing of this agreement comes as part of our commitment to working closely with key government entities to achieve the objectives of the Saudi Vision 2030, especially those outlined in the National Industrial Development and Logistics Program (NIDLP) announced by HRH Mohammad Bin Salman Bin Abdulaziz Al-Saud, Crown Prince, Deputy Prime Minister and Minister of Defense, to position the Kingdom as a global logistics hub and create new jobs and training opportunities for Saudis to support local content,”said Aldubaikhi.

“We are pleased to sign this agreement with Bahri and will continue to support and strengthen partnerships between the private and public sectors in the Kingdom.

This agreement is consistent with SWCC’s efforts to effectively contribute towards the achievement of Saudi Vision 2030 goals by continuously expanding and developing its services, as well as enhancing the Kingdom’s water resources with the highest levels of reliability, efficiency and cost optimization,” remarked Ali Bin Abdulrahman Al-Hazmi, Governor, SWCC. Bahri is one of the world’s leading logistics and transportation companies, and plays an important role in the growth and development of the global maritime industry by leveraging advanced technologies to offer innovative and value-added door-to-door services by sea, land and air.

Bahri’s business strategy is firmly aligned with the Saudi Vision 2030 as part of its overarching efforts to support the ambitious economic diversification objectives of the Kingdom. The company also plays a key role in enhancing the participation of the private sector in economic growth and increasing the contribution of non-oil exports to national GDP.

Abdullah Aldubaikhi and Ali Bin Abdulrahman Al-Hazmi signing the deal

APRIL 2019 55

SAUDI ARABIA SEA-LAND TRANSSHIPMENT INITIATIVE

A

new, far-reaching initiative by LogiPoint has hit the ground running and is already having a strong impact on delivery times on GCC bound shipments originating from Europe.

A long and well-established provider of logistics services, Saudi Arabia-based LogiPoint has an impressive track record spanning two decades of proven capabilities in the Kingdom.

“The company’s signature CBG (Cross Border Gulf) Service commenced a bold pilot project to reduce lead time for our customers and minimise uncertainties and delays due to limited carrier options for their shipments from Europe to the upper Northern Gulf,” affirmed Farooq Shaikh, CEO, LogiPoint.

The average transit time by sea from major European ports to the GCC is between 25 to 30 days with multiple transshipments. Given the high volumes involved, airfreight is not

a cost effective option, and the journey is not long enough to warrant sea-air combination as an alternative.

Key Saudi Port Jeddah Islamic Port is Saudi Arabia’s busiest maritime hub owing to its strategic location on the Red Sea coast, at the centre of the Europe-Middle East- Asia international shipping routes.

It is estimated that over 30% of the world’s container volume passes through the Red Sea Basin annually.

“With the support from Jeddah Islamic Port and Saudi Customs Authority, and working closely with clients and their suppliers, the LogiPoint CBG team was able to craft an effective multimodal solution that made this land-bridge an operational reality,” asserted Shaikh.

LogiPoint’s radical Cross Border Gulf Service billed a boon for the

GCC region A new ground-breaking proposal to use Saudi Arabia as a springboard for cost-effective and speedy Europe-GCC transportation is creating waves in the Kingdom

Link Corridor The aim is to establish a bonded corridor linking the Red Sea ports in the West of the Kingdom and the Arabian Gulf in the East.

It is being publicised as the project of the future, a turning point in the Kingdom’s logistics and supply chain network that would transform the East-West trade corridors in both directions. The LogiPoint pilot has now proven to be an effective and sustainable solution for Middle East companies.

“The transit time for sea consignments from major European ports to Jeddah is between 12 to16 days.

The trucking time from Jeddah to GCC nations is a mere 2 to 3 days. LogiPoint CBG has thus managed to reduce the lead-time by almost 10 days and at the same time increased the carrier choice for the client since most carriers offer direct sailing from all major ports to Jeddah Islamic Port,” observed Shaikh.

The GCC-bound cross-border solution Since its introduction, LogiPoint CBG has already caused waves in the UAE-KSA logistics trade when it provided an alternative to timeconsuming and cumbersome border clearance at the ever-busy and heavily congested Sila-Batha border with the UAE. “Instead of enduring the long queues of laden trucks at the border and trying to resolve the inspection and customs clearance challenges more than a thousand miles away, clients now have the option to process their customs clearance at the LogiPoint Bonded and Re-Export Zone,” explained Shaikh.

“On that all-important, Jebel Ali-Jeddah corridor, this translates to a valuable 24 hour reduction in the transit time with an added advantage of expedited and much streamlined clearance process, which also minimises cargo damage in handling and pilferage,” he continued.

56 APRIL 2019

SAUDI ARABIA SEA-LAND TRANSSHIPMENT INITIATIVE

LogiPoint operates the largest Bonded and Re-Export Zone in the Kingdom of Saudi Arabia, with a sprawling one million square meters area located within Jeddah Islamic Port.

LogiPoint have been pioneering innovative logistics solutions in the Kingdom for almost 20 years, and have played an important role in transforming the logistics experience in the Kingdom.

Indeed, over the years, they have grown from being a service provider in the logistics industry to an enabler of the industry.

Multiple benefits Traditionally, clients have enjoyed such facilities as duty deferment, duty-free storage in open yards or LogiPoint warehouses, and convenient re-export from the Bonded Zone.

Clients can import their goods into the Kingdom saving on major handling and freight charges, with LogiPoint providing value added services including relabeling, bundling, and re-packaging prior to custom inspection process thereby offering a streamlined and hassle-free cargo inspection and customs clearance.

According to Shaikh, LogiPoint also offers distribution and delivery to all parts of the Kingdom.

LogiPoint is a subsidiary of Saudi Industrial Services Company (SISCO), a Saudi Joint Stock company listed on the Saudi Tadawul (Stock Exchange), and was previously known as Tusdeer before it was rebranded in 2017 as LogiPoint.

APRIL 2019 57

EXPERT OPINION: RISK MITIGATION

Managing Global Supply Chains through vicissitudes and challenges

‘O

n-shoring’, localisation, Trump’s tariffs, and now of course the indeterminate Brexit – pay attention to the media, and it’s all too easy to imagine that global trade is contracting. In fact, of course, it’s doing anything but contracting, as World Trade Organisation statistics make clear. In 2019, for instance, global trade growth of 4% is expected, well above the 3% annual growth rate typical of the early years of the decade.

If global trade remains in robust health, the same cannot be said for global supply chains.

It may appear to be the proverbial doomsday scenario as projected by the media given the current extent and evidence of protectionism, trade wars, conflict of commercial interests, a breakdown of trade pacts and partnerships and as a spin-off, a slowdown of industrial activity, consumption and contracting national economies.

These are among several ‘hot button’ issues that proponents of globalization have been grappling with. Add to that the shortening of global supply chains thanks to the advent of E-commerce and the digital economy.

However, all is not lost as Professor Omera Khan, accomplished academician, researcher and professor points out in her introductory contribution to Global Supply Chain.

Global trade is on the upswing but global supply chains are vulnerable and coming under increasing pressure.

The key she says is to engage and involve with global trade, not detach from it. That way supply chains will continue to facilitate, shore up and buttress world trade for the benefit and advantage of all stakeholders involved.

We welcome Prof. Omera Khan to our Elite Club of expert writers, thought leaders and opinion makers—Editor 58 APRIL 2019

Earthquakes, tsunamis, floods, volcanic eruptions, hurricanes – all repeatedly take their toll. Global warming or not, weather scientists say extreme weather events are becoming more common.

Hurricane Harvey, for instance – the 2017 storm that devastated the Caribbean together with parts of the south-eastern United States – was followed just a year later by 2018’s Hurricane Florence, yet another so-called ‘storm of a lifetime’.

EXPERT OPINION: RISK MITIGATION

Supply chain susceptibilities Man-made supply chain risk is just as prevalent.

Strikes, wars, port and road congestion, civil unrest, piracy: for importers and exporters alike, faraway events have an unhappy knack for leaving warehouse shelves unfilled, and production lines stopped. The result- disappointed customers, frustrated suppliers, and a hit to earnings.

What to do about these various risks? Once, the question didn’t arise. Adverse events simply had to be coped with, generally through such means as holding extra inventory, or doublesourcing. Neither option is cost-free, of course.

So too with ‘near-shoring’ and localisation, both of them conscious trade-offs between shorter (and therefore less risky) supply chains, and the foregone economies of scale and access to lowcost labour markets.

Businesses today, though, have other options.

Some of the world’s very largest companies have invested in dedicated supply chain risk ‘control towers’, providing them with end-toend visibility of goods in transit. Car maker BMW, to choose another example, goes further, and harnesses real-time data from a variety of publicly-available sources, super-imposing it on a global map of suppliers’ factories, ports, and other supply chain-related infrastructure. Like a number of other manufacturers, it acknowledges that the 2011 Japanese earthquake and tsunami served as a wake-up call, highlighting a lack of visibility into its supply chains.

Bold initiatives What of other businesses, though? Undeniably, most of the world’s importers and exporters are much smaller, and would struggle to fund initiatives of this nature. Are they to be disenfranchised, when it comes to risk reduction?

The good news: no – at least not for those businesses prepared to invest in buying-in supply chain risk reduction as a service, from one of a number of emerging specialist supply chain risk intelligence providers.

Leveraging a variety of proprietary and publicly-available data sources and intelligence feeds, they provide unprecedented real-time visibility into businesses’ supply chains, and the real-time risks that they face. Increasingly, too, such providers are adding AI and machine learning to their armouries, providing clients with forward-looking predictive abilities, as well.

The bottom line: global supply chains aren’t without risk – but the correct response is to take steps to mitigate that risk, rather than stepping back from global trade.

Omera Khan is a Professor of Supply Chain Management at Royal Holloway University of London (UK) and Executive Strategy Advisor for Risk Intelligence, a dynamic world leader in risk assessment and planning.

She is a sought-after speaker and has published widely on supply chain risk management and resilience. Read more on www.omerakhan.co.uk

APRIL 2019 59

ROAD FEEDER SERVICES

Etihad Cargo boosts Road Feeder Services for seamless UAE connectivity with GCC In a move that reinforces the synergy between the two logistics entities, Etihad Cargo has reappointed MICCO to provide Road feeder Services

E

tihad Cargo has re-appointed MICCO, a freight management and integrated supply chain solutions provider, as its road feeder services (RFS) provider in a multi-year agreement, reaffirming a decadelong partnership between the two major Abu Dhabi-based logistics players.

60 APRIL 2019

The RFS network connects major air and sea gateways in the Emirates of Dubai, Abu Dhabi and Sharjah, as well as key GCC countries including Oman, Kuwait and Bahrain. Under the renewed partnership, MICCO will continue to provide Etihad Cargo with customs-sealed and bonded container vehicles, as well as refrigerated and non-refrigerated reefer trucks to support Etihad’s FreshForward perishable products through door services across the UAE. “It is a pleasure to once more extend this partnership with MICCO whose excellent service quality and operational flexibility perfectly complements our air cargo offering from our hub in Abu Dhabi,”remarked Andre Blech, Head of Operations & Service Delivery, Etihad Cargo.

Advantage MICCO MICCO is focused on freight management, travel services, and specialised supply chain activities, particularly within fast moving consumer goods (FMCG). Under the new agreement with Etihad, its vehicles will be branded with Etihad Cargo’s new ‘Choose Well’ proposition.

“MICCO is proud to partner with the cargo and logistics arm of the national airline of the UAE. Our RFS partnership will play an important role in connecting major air and sea gateways across the GCC,”commented Captain A. M. Simreen, CEO, MICCO. The agreement is also another step in Etihad’s evolving value proposition to continue its growth in its home market, and through its major investments in digital infrastructure can offer customers a differentiated value offering only matched by a few select carriers globally.

Following the new digital technology platform launched in October 2018, these RFS services are now available for customers to book directly online through the Etihad Cargo web booking portal, according to Blech.

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