MIDDLE EAST TAKES FLIGHT The Middle East is home to five of the 20 countries forecast to achieve the highest air cargo average annual growth rate (AAGR) from 2005-2009.
On top of this encouraging develop- ment, the World Trade Organization’s latest national report lauds the UAE’s progress toward liberalizing trade. “The UAE’s generally liberal and increasingly diversified economy, importance of trade to its economic per- formance, relatively low border barriers to trade, and growing economic power make it an increasingly important supporter of the multilateral trading system,” the report states. The real driver and change agent for the Emirates’ transitioning economy is its converging air and ocean freight capabilities. And if the country’s pres- ent development is any indication of its future promise, global businesses will soon be cashing in on Dubai’s value as a major intermodal transship- ment location.
Middle East. Some of this growth can be attributed to increasing Asia-to- Europe cargo traffic, says Mark Smyth, senior economist for IATA. “Dubai’s growth as a major cargo hub reflects the growth of Middle East airlines in long-haul cargo,” he observes. As further evidence of this trend, Middle East air cargo carriers such as Emirates and Qatar Airways, and Dubai International Airport as a result, are expanding at a heady rate. In April 2007, Emirates SkyCargo announced another record-breaking year ( see sidebar, page 154 ) in overall cargo tonnage, and Qatar Airways leads a list of emerging Middle Eastern cargo carriers that are quickly flying up the ranks of global airlines. In total, the Middle East is home to seven carriers – Emirates, Qatar Airways, Saudi Arabian Airlines, Gulf Air, Etihad Airways, El Al, and EgyptAir – among the world’s top 50 in terms of interna- tional scheduled freight tons carried, according to World Air Transport Statistics, an IATA publication. By comparison, the United States claims five carriers on that list, including global expediters FedEx and UPS. Growing air cargo capabilities are matched by the area’s expanding warehousing and distribution facili- ties, enhancing Dubai’s reputation as a pivotal transshipment location. The gem of its emerging logistics facilities is the Dubai Cargo Village, a hub that comprises 82,000 square feet of ground space, with 27,000 square feet allocated for cargo handling and 26,000 square feet for storage . The cargo facility is adjacent to a staging area where four
AAGR 2005—2009
COUNTRIES*
China
14.4%
Qatar
12.5%
Sri Lanka
12.2%
Macao
11.6%
Korea, Republic of
10.7%
Malaysia
10.0%
Mexico
9.9%
India
9.7%
Czech Republic
9.7%
Oman
8.9%
Turkey
8.6%
Russian Federation
8.5%
AIR CARGO: SOARING WITH DEMAND
Argentina
8.1%
Indonesia
8.0%
Surprisingly the Middle East, not Asia, is currently the fastest-growing air cargo region in the world. Recent year- over-year data from the International Air Transport Association (IATA) reveals that airfreight traffic growth is trun- dling toward the Middle East (up 12.7 percent from last year), not the Far East (up 4.5 percent), as current trade winds might suggest. Dubai International Airport’s cargo volume is growing at a rapid 12.5-per- cent clip, according to Airports Council International’s 2006 top 50 air cargo airports index. It also currently ranks 18th in the world and first in the
Azerbaijan
7.8%
Pakistan
7.3%
UAE
7.3%
Japan
6.9%
Thailand
6.9%
Kuwait
6.6%
*Countries shipping more than 10,000 tons of air freight. Source: International Air Transport Association
Boeing 747 freighters can be loaded or unloaded simultaneously. Since the Dubai Cargo Village debuted in 1991, the facility has regularly expanded – it can now accommodate more than 450,000 tons of cargo annually.
Middle Eastern countries such as the United Arab Emirates (UAE) are working to diversify their economies away from oil; one new focus is logistics and transportation. 3PLs such as Dubai-based GAC Logistics are expanding to keep up with growth and demand.
150 Inbound Logistics • July 2007
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