Why the MENA Region Could Be The Future of Global Logistics?

  • The region’s potential continues to attract global investors into trade and logistics
  • The region as a whole continues to move up the Logistics Performance Index with the UAE taking the regional lead and ranks 11th globally, followed by Oman, KSA, Bahrain and Egypt
  • Trade statistics reveal exports from the Middle East grew by 21% in 2018, totalling USD 1.13 trillion
  • The size and capacity of deep-sea container ships on the Asia-Middle East route doubled from 9,000 containers in 2010 to 18,000 containers in 2020

Savills, the leading global real estate advisors, hosted its second in-depth Middle East webinar following the recent launch of its global Impacts study in the region. The panel dedicated to ‘Transportation and Innovation’ brought together regional real estate and logistics experts including Scott Fennelly, Director at Surface Mobility Consultants, Edwin Lammers, Vice President of Commercial at KIZAD and Sulaiman Al Riyami, Vice President Real Estate at Oman Aviation Group. The session was moderated by Ihsan Kharouf, Head of Savills Oman who discussed with the panellists the role technology has on the way goods are distributed and stored, and its impact on real estate decisions. The session also shed light on the large-scale ME infrastructure projects under construction or under planning and whether these developments are future proof to such changes.

To enable a more seamless interaction with the global and regional economies, countries in the region are investing significantly to modernise their existing infrastructure and building futuristic projects to deliver best-in-class efficiency and sustainability.  Countries in the region continue to progress up the rankings in the Logistics Performance Index (LPI), the interactive benchmarking too created by the World Bank. The UAE is taking the lead and is ranked 11th globally, followed by Oman, KSA, Bahrain and Egypt respectively. “This only proves that the region is growing in popularity and superiority when it comes to trade and logistics. Trade statistics reveals exports from the Middle East have grew by 21% in 2018, totalling USD 1.13 trillion. The size and capacity of deep-sea container ships on the Asia-Middle East route has also doubled from 9,000 containers in 2010 to 18,000 containers in 2020, indicating a significant improvement in capacity”, said Ihsan Kharouf, Head of Savills Oman.

A more specific example in the region is the program of Saudi Railway Company (SAR) which aims to build rail links into neighbouring countries to support the diversification and integration of regional economies. This will be complemented by country levels programs such as the Etihad Rail in the UAE, the Oman National Railway Network and the Bahrain Integrated Public Transport Network Program. The futuristic hyperloop project could also connect all GCC cities within an hour and operate completely unplugged from the grid with zero-direct emissions. It will be one of the most-energy efficient means of transportation. 

Electric cars are gaining traction in the region due to significant improvements in battery efficiency, charging infrastructure development and increasing range of products available for different customer segments. As many cities around the globe decide to go car free and increase the number of existing and future communities in the region plan to embrace this change, it will be interesting to see how the future of mobility will look like.

Commenting on smart mobility and emerging technologies, Scott Fennelly, Director at Surface Mobility Consultants,said: “When it comes to sustainable transport solutions, we need to incorporate sustainability at the concept / design stage, while in-terms of  existing developments, we need to retrofit them with intelligent solutions to  gather  data and information. As for smart cities in the region, modes of transport should be integrated and linked to each other seamlessly.”

Sulaiman Al Riyami, Vice President Real Estate at Oman Aviation Group added: “Geographic locations play a vital role for the logistics accessibility.  For instance, air cargo is key in the Sultanate’s logistics landscape; Muscat Airport is located in the middle of the city which grants access to various local industrial parks as well as access markets within the four-hour flight radius. We are also establishing a seamless access between sea and air transport which allows us to place Oman as an attractive location for operators and investors in the international market.”


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