UAE’s logistics industry benefiting the whole region
Middle East ‘shines’ as global freight logistics hub
500 delegates attending the two-day event
Industry veterans debates future growth roadmap
World’s biggest cargo facility when DWC is fully complete
Dubai, April 19, 2015: The Region Africa and Middle East (RAME-2015) conference of the Switzerland-headquartered International Federation of Freight Forwarders Associations (FIATA) got underway at the InterContinental Dubai Festival City on Sunday with its formal opening by His Highness Sheikh Ahmed bin Saeed Al Maktoum, President of Dubai Civil Aviation Authority, Chairman of Dubai Airports and Chairman and Chief Executive of Emirates Airline and Group.
He said Dubai will have the world’s biggest cargo facility when the Dubai World Central (DWC) – the world’s first fully-integrated aerotropolis – gets fully completed, offering 12 million tonnes of cargo capacity. Al Maktoum International Airport, the key element of the DWC, has seen growth in cargo operations since opening in 2010.
Dubai, he said, already has one of the best infrastructures in the world, including excellent and extensive facilities for the cargo and logistics industry, and had proved to be an ideal trade corridor between the East and West and benefitting the MENASA in particular.
Sheikh Ahmed received a plaque as a token of appreciation for his support to FIATA and the logistics industry.
Hosted by UAE’s National Association of Freight & Logistics (NAFL), a FIATA affiliate, the two-day conference has attracted over 500 delegates from the Africa and Middle East, India, Pakistan, Sri Lanka and Bangladesh, including the head honchos of leading freight logistics companies and organisations.
Founded in 1926, FIATA is a non-governmental organization that today represents an industry covering approximately 40000 forwarding and logistics firms, employing around up to 10 million people in 160 countries.
FIATA has consultative status with the UN Economic and Social Council (ECOSOC), United Nations Conference on Trade and Development (UNCTAD), and UN Commission on International Trade Law (UNCITRAL).
The global body of freight and logistics industry reviewed the current status of the industry globally in general and the Middle East and Africa regions in particular and chalked out the future road map.
DP World, Emirates, Dubai World Central, Jebel Ali Free Zone Authority (Jafza), Dubai Chambers, Etihad Airways, Freight Systems, TT Club and Newage are among the sponsors.
David Phillips, President of NAFL, said: “The conference is based upon the Trade Corridor that exists between the Indian Subcontinent and Africa, via the Middle East, and in particular Dubai and the UAE. This Trade Corridor is vibrant and exciting. RAME is by itself a very vibrant business corridor, and the UAE and Dubai has been the traditional hub that bridges these regions and facilitates trade. India is now a trade power house, and when included in this ‘Trade Corridor’ makes the region, possibly the most exciting area globally. Africa is the fastest growing economy and this conference provides delegates with the opportunity to meet potential partners.
Basil L. Pietersen, Chairman RAME, said: “ RAME-2015 is a lot different than the others regional meetings as all logistics players and freight forwarders in the South Asian subcontinent, with a focus on India, Pakistan, Bangladesh and Sri Lanka, have been invited. The business environment between these regions is vibrant and full of opportunities. NAFL has worked tirelessly to put together a well-balanced debate agenda which is sure to highlight clear actions for the industry.”
Francesco Parisi, President of FIATA, said: “RAME is one of the fastest developing areas in the world in terms of trade growth and logistics, consequently our industry in this area is faced with challenges connected with growth. FIATA being a dynamic federation it has to hear what our members need directly from the local practitioners: the regional field meetings are the best opportunity for us to listen and understand and, as it happens, to promote the image of FIATA and its knowledge base within our constituents.”
His Excellency Sultan Ahmed bin Sulayem, Chairman of DP World and Ports, Customs and Free Zone Corporation, delivered the keynote address, highlighting the strengths of Dubai as a cargo and logistics hub and the growth opportunities that it has opened for the region to improve and enhance global trade flows.
He said India, the world’s second most populous country, and the vast Africa region lacks the needed infrastructure and hence offers immense investment opportunities in the infrastructure domain.
A stellar line-up of speakers utilized the first day of the conference to highlight the synergies and business potential that exists in the Africa and Middle East regions and how countries in other regions in near and far could benefit from them, from the freight logistics perspective.
Themed UAE-Dubai- The gateway between South Asia and Africa, the first session of the conference was addressed by Hassan Al Hashemi, Vice President of International Relations at Dubai Chamber of Commerce and Industry, who highlighted the growing importance of Dubai as the global business and logistics hub.
Mahmood Al Bastaki, CEO of Dubai Trade, a subsidiary of Dubai World that offers integrated electronic services from various trade and logistics service providers under a single window, said the UAE was considered as a safe haven because of a proactive pro-business government with the most transparent business regulations in the region. Dubai, he said, was ideally placed to serve the Middle East, North Africa and South Asia (MENASA) region whose combined GDP in 2013 was more than $5.8 trillion.
He said the World Economic Forum Global Competitive Report 2014 has attributed the high quality of roads, air transport and ports infrastructure as the factors behind Dubai emerging as the Trade and Logistics hub. The UAE has been ranked eighth in the world and best in GCC for Trading across Borders and Best place in the MENA region to start a business.
He remarked: “There is a greater demand for Dubai’s logistics sector. The World Expo that the UAE will host in Dubai in 2020 offers great opportunity for the entire region. There is a shift of distribution centers from Europe to Dubai to serve the MENASA economies.”
Yousef Al Hashemi, Senior Manager of Dubai Customs, spoke about trade facilitation through innovation and listed out the initiatives and policy measures taken by the government towards this end.
Mohsen Ahmad, Vice President of Logistics District at Dubai World Central (DWC), the world’s first fully-integrated aerotropolis with Logistics City as its key component, listed out the importance of MENASA region in the global trade flows and how this vast region holds the key to the future growth of global business in various domains, especially logistics and aviation.
Adil Al Zarooni, Senior Vice President –Sales at Jebel Ali Free Zone Authority (Jafza), provided insights into the facilities offered by Jafza for global trade flows and how it has made a meaningful impact in the global logistics and trade domains.
In the second session titled, Africa’s Economic Lion Awakes, Joseph Atonga, CEO of Kenya Ports Authority, highlighted how logistics is becoming an important growth industry in Africa with potentially lucrative opportunities for the logistics providers despite significant infrastructure challenges.
Growth in Africa’s logistics market is being driven by higher trade volumes as economies diversify and expand, domestic consumer demand skyrockets, global demand for natural resources escalates, boosting intra-African trade.
Zunaid Pochee from Trans Kalahari Corridor (TKC) Secretariat in Namibia, spoke about the public-private partnership to promote the Walvis Bay Corridors, a network which effectively serves as a facilitation centre and one-stop shop coordinating Trade along the Walvis Bay Corridors and linking Namibia and its ports to the rest of the southern African region.
He said the project has made several achievements including adoption of streamlined legislations and harmonized Customs procedures, adoption of common transit procedures, harmonization of borders operating hours and Axle Load Limits at the Trans Kalahari Border Posts and reduction of Border clearance (dwell time) maximum of one hour and a minimum of 30 minutes and completion of fencing along TKC. The commercial and passenger traffic has increased from less than five per cent in 2000 to nearly 50 per cent (commercial) and over 60 per cent (passenger) till date.
Philip Wyllie, Consultant, South African Association of Freight Forwarders (SAAFF), addressed about the infrastructure and growth in the Southern African Development Community (SADC) region. He said reducing travel times in Africa by a single day would on average increase exports by seven per cent. He said Foreign Direct Investment (FDI) for Sub Saharan Africa (SSA) has been steadily growing with sources originating from EU, US and China. About 23 per cent of FDI in 2013 was intra African, mainly from South Africa, Egypt, Mauritius, Nigeria and Kenya.
He said nearly three-fourth of infrastructure projects are not getting off the ground with as many as 141 of 196 projects, according to a study, being still in conceptual stages. Stating that multiple and inefficient border crossings make trade very costly, he said the cost of logistics was double than the EU. He said there has been massive duplication of effort among the three FTAs and that a Tripartite FTA will create a combined market of 26 member-states worth $1 trillion.
Issa Baluch, Honorary Board Member, FIATA, gave a presentation about the Yamoussoukro Declaration (YD) on the liberalization of African skies for African airlines and establishing a single African air transport market by avoiding market restrictions imposed by bilateral air service agreements. At present, YD, signed in 1999, has yet to be fully implemented, although it became effective from 2002. ICAO has stated that the YD remains the single most important air transport reform policy by African Governments to date. IATA and AFRAA asserted that Member-States could see their annual GDP grow by the millions annually and thousands of jobs created with the adaption of an Open Skies policy, a liberal market between signatory states allowing airlines unlimited rights to fly.
He added: “Forty four countries had signed and 10 had not signed so far. Majority of governments in Africa have not yet implemented the YD. It remains a paper lion.” Two non-signatory countries that are not members implemented the YD by means of their Regional Economic Communities (REC). YD was designed to benefit 54 African countries, including 16 land-locked countries.
Stephen Karingi, Director of Regional Integration and Trade Division at UN Economic Commission for Africa (UNECA), said Africa’s share of world exports was still low. The share of Africa’s export in global merchandise exports was 3.3 per cent in 2013 compared to 17.8 per cent for East Asia and intra-African trade was 16.3 per cent of the continent’s total trade in 2013. He said landlocked countries have disproportionately high trade-related costs, mostly due to high inland transport costs – as high as 70 per cent.
Establishment of a Continental Free Trade Area (CFTA) by 2017 with Trade Facilitation (TF) measures could increase Africa’s total trade by over 10 per cent and the share of intra-African trade to about 22 per cent by 2022, he said, quoting a study by ECA.
In the third session titled, South Asia Emerging Giants of Trade, Tushar Jani, Chairman SCA Group, spoke about the logistics industry’s growth trajectory. Babar Badat, Senior Vice President of FIATA and CEO Transfreight Pakistan, offered insights into Pakistan logistics landscape.
He said Pakistan, Afghanistan, Central Asia and Western China, have a combined population of around 300 million people and this whole region was still not connected by adequate transport infrastructure and services. Pakistan has a geographical advantage in the region and its ports can provide the closest access to the logistics requirements in this region and Karachi’s gateway potential can be optimized by creating a vertical connect between Karachi’s wharfs and the markets of Central Asia and Western China.
About a possible Indo-Pak Transport Corridor, he said: “If the political issues between India and Pakistan are settled the economic rewards can be staggering.” He said the logistic industry in the region must connect and create common synergies for cooperation and growth. SAARC Freight Forwarders forum was already in existence. A regional Freight Forwarders forum needs to be activated and the region’s Freight Forwarding associations should set up a federation.Christian Juul-Nyholm, Managing Director of Maersk Kanoo (UAE), and Anshuman Singh, CEO of Futuregroup India, spelled out the logistics business scenarios and what lies ahead in the future.