Over the past few weeks, trade and port activity have gathered renewed interest amid concerns of economic stagnation in the Eurozone, geopolitical strife in Iran and Southwest Asia and piracy in international waters. While there is no denying that these will impact the flow of international freight and commodities in 2012, the GCC is rapidly emerging as one of the most important transport and logistics hubs in the world.
As a percentage of world trade, the GCC today represents about 3% of imports and 5% of exports. Middle East seaports are expanding vigorously, in line with this trend. Over the past few years, a total of USD 46.5 billion has been committed to develop the 35 ports in the region.
There are two major reasons driving this growth. On the one hand, the favourable geographic location of the GCC countries provides them with a strong opportunity to serve as hubs not only along the Europe–Asia shipping lanes, but also for northern and central Africa. On the other hand, the region’s ongoing economic diversification has meant the upgrade of existing infrastructure across all transport modes. On both these counts, the benefits accruing to the region are long-term in nature.
The emergence of India and China has presented the GCC with substantial opportunities as hubs. As a result, GCC ports need to ramp up capacity, not only to cater to their own increasing needs, but also to develop a hub strategy. Most of them are ideally placed as a trade platform between Asia and the Far East on one hand and the West, Central Europe, and Africa on the other.
The top 10 infrastructure projects currently underway in the Gulf alone account for over USD 400 billion. Five of these projects are located in the UAE. These include the Saadiyat development, the Capital District, Yas Island and Business Bay developments. Such major infrastructure investments have led to a major growth in population as employment and business opportunities are on the rise.
Since the turn of the millennium, the UAE’s total population has more than doubled, to over eight million, while per capita GDP has increased by more than 100%, to over USD 40,000. Meanwhile, the USD one trillion economy of the wider Gulf region, which has expanded three-fold in the past five years alone, is set to emerge as the fifth-largest in the world by 2020. In this period, the UAE has emerged as the most vibrant distribution and consumption hub within the Middle East. In fact, seaports in the UAE account for 61% of the GCC trade volume and this share is expected to rise with new capacity being added
To continue this growth, the UAE and the region at large will need significant modernisation of its infrastructure. Ports and sea freight are critical to this modernisation.
All the above factors point towards the importance of focusing attention and taking stock of the critical issues facing this part of the infrastructure and the challenges to sea trade. The World Ports & Trade Summit is one such platform, which has been conceived with the goal of addressing all the key issues and themes relating to ports and sea trade besides acting as the leading platform for exhibiting the latest products and services within the sector. It is only fitting that such an event be held in the emerging hub of global trade – here in the UAE.
The first World Ports and Trade Summit hosted in Abu Dhabi in 2011 drew over 3,000 delegates from 52 countries, including board presidents and chief executives from sectors ranging from ports, cargo and logistics operations, infrastructure development to investment finance.
By bringing together key decision-makers and solutions providers across a series of brainstorming and networking sessions, the summit will offer the latest project updates and the opportunity to influence investment and purchase decisions in the fast-expanding ports and sea trade sector in the Middle East. To highlight the industry outlook and latest trends in maritime trade and investment the summit will have three dedicated forums, featuring cargo owners, shipping companies, third-party logistics providers, freight forwarders, port authorities and business consultants.
The substantial investment being made in developing the ports and logistics infrastructure in the UAE and the Middle East will be under the spotlight in the Summit, including ADPC which is developing the ambitious Khalifa Port, the only automated facility in the region and the adjoining Khalifa Industrial Zone Abu Dhabi (KIZAD).
The first phase of Khalifa Port and KIZAD will be operational by Q4 2012 offering a unique business and industrial environment with world class technology, multi-modal transport and distribution facilities and easy access to international markets.
The World Ports & Trade Summit 2012 will be hosted in Abu Dhabi from April 2nd to 4th. Jointly organised by Turret Media and Seatrade, the Summit is sponsored by Bechtel, DNV, Emirates Aluminium (emal) and supported by: Abu Dhabi Terminals, Department of Economic Development, Abu Dhabi Chamber, UNIDO and The International Association of Ports and Harbors (IAPH).
Rushika Bhatia Editor
Rushika Bhatia is one of the region’s leading commentators on business and current affairs issues. She is the Editor of SME Advisor magazine - the flagship title of CPI Business. She is passionate about infographics – with special emphasis on data, research and statistics. Rushika has a Bachelor’s Degree from Indiana University, USA and is also CIMA qualified.