UAE and Saudi $70bn investment signals buoyant maritime sector
The Middle East maritime sector has a buoyant future, with both Abu Dhabi and Saudi Arabia investing heavily in port and logistics infrastructure.
With the rising regional demand for freight handling, logistics, and other sub-services, Saudi Arabia and the UAE particularly are becoming undisputable shipping hubs for their seafaring expertise. The UAE alone handles more than 15 million 20-foot equivalent units (TEUs) a year, and these numbers are steadily increasing as the region caters to about two billion people in China, India and the GCC as well as Russia and Eastern Europe.
According to recent reports, the UAE has invested around $65 billion into the development of ports across the country. Saudi Arabia’s maritime sector is set to receive a boost with $8.8billion set aside for industries including logistics in the Kingdom’s recently announced budget for 2019.
At the inaugural International Offshore Development Congress in Abu Dhabi in April 2019, a special panel discussion and a technical session on the maritime sector was held to discuss prevailing challenges and opportunities in the maritime sector.
Experts from shipping, carriers, freight forwarders, and the transport sector discussed issues ranging from increased regulations and overcapacity, to port investment, infrastructure requirements, and improving sustainability.
Also under discussion were evolving technologies that will soon affect the sector, including artificial intelligence, industrial internet of things (IoT), autonomous surface vessels, block-chain, augmented reality, virtual reality, drones and robotics.
Under the Saudi Vision 2030, the logistics sector is one of the key economic pillars which will pave the way for further economic diversification in the Kingdom, unlocking huge potential valued at US$18 billion.
The latest major initiatives that aim to boost the sector include the development of a foreign investment program which would allow shipping agents to own and operate independently through a foreign investment license. Previously a shipping agency could only provide services if it was a 100 per cent Saudi-owned company. Other measures being undertaken by the government to facilitate trade include 24-hour customs clearance for incoming cargo, which previously took 10 to 14 days to clear. It is also investing heavily in the construction of transportation infrastructure such as the Saudi Rail-Roads Expansion, the East-to-West Land Bridge, and key investments from the private sector to upgrade the ports of Jeddah Islamic Port and Dammam Port.
As well as its industrial maritime aspirations, Abu Dhabi has been testing the waters as a major player in the world’s marine tourism sector.
Published Date: 02/05/2019