‘Saudi Arabia is an emerging logistics hub’

MENA countries also lead in sea and air trade routes with the UAE and Saudi Arabia recognized as among the “top 10 air freight lanes” globally. (Reuters)
Updated 04 February 2017

‘Saudi Arabia is an emerging logistics hub’

JEDDAH: With the global logistics market growing rapidly and is expected to generate $15.5 trillion in revenues by 2024, the Middle East and North Africa (MENA) region is fast emerging as the hub of logistics industry, said a report issued by Al-Masah Capital.
In the region, Saudi Arabia and the United Arab Emirates (UAE) are the most attractive targets for logistics investments and easiest markets to operate in.
Other MENA countries, particularly those in the Gulf Cooperation Council (GCC), such as Qatar, Oman, Kuwait and Bahrain, along with Morocco, Jordan are also emerging as potential investment destinations.
The growth of transportation and logistics (T&L) in the region is being driven by government initiatives toward economic diversification from energy-based industries to expansion into other commercial sectors such as trade, export, import and tourism, the report said.
“This renewed focus on commercial sectors is paving the way for investments in transport infrastructure, including seaports, airports and major rail initiatives across the region,” the report added.
The MENA region, the report said, has trade relations with almost every country/region across the globe.
The region exports hydrocarbons and hydrocarbon-related products that are in great demand and meets a large part of its food requirement through imports.
Data from the World Trade Organization (WTO) suggests that MENA engages in maximum merchandise trade with Asia (55 percent of all exports and imports), followed by Europe (31 percent) and North America (8 percent).
MENA countries also lead in sea and air trade routes with the UAE and Saudi Arabia recognized as among the “top 10 air freight lanes” globally. The region has 134 seaports handling a total of 48.3 million 20-foot equivalent container units (TEU) of container traffic. The GCC countries alone have nearly 41 ports, which together handle 68 percent of MENA’s container port traffic.
Besides sea transport, the region has 114 international and domestic airports of which 43 airports are located in the GCC.
According to the report, 34 free-trade zones, non-existent corporate tax and full ownership rights coupled with unlimited repatriation of profits, makes the UAE an appealing business environment for producers and manufacturers alike, as well as to logistics service providers.
In terms of volume, the global T&L industry is expected to reach 92.1 billion tons by 2024. The report also mentioned that the global Third-Party Logistics (3PL) market is expected to grow at a compound annual growth rate (CAGR) of more than 5 percent by 2020. Factors such as the rapid globalization, increasing trade volume, and the revival of the global economy are some of the major contributing factors to the growth of the 3PL market, the report said.
Highlighting the sector’s role in international trade, the report said that robust trade, economic growth and liberalization policies followed by many countries worldwide have resulted in increased trade volumes, thus boosting transportation, handling and warehousing needs, which has led to a demand for integrated logistics solutions.

Bank jobs go as HSBC and Emirates NBD reduce costs

Updated 15 November 2019

Bank jobs go as HSBC and Emirates NBD reduce costs

  • Others have also reduced headcount amid economic downturn and property market weakness

DUBAI: HSBC Holdings has laid off about 40 bankers in the UAE and Emirates NBD is cutting around 100 jobs, as banks in the Arab world’s second-biggest economy reduce costs.

The cuts come amid weak economic growth, especially in Dubai, which is suffering from a property downturn.

HSBC’s redundancies came after the London-based bank reported a sharp fall in earnings and warned of a costly restructuring, as interim CEO Noel Quinn seeks to tackle its problems head-on.

HSBC has about 3,000 staff in the UAE, part of a nearly 10,000-strong workforce in the Middle East, North Africa and Turkey.

The cuts at Dubai’s largest lender Emirates NBD came in consumer sales and liabilities, one source said, while a second played down the significance of the move.

HSBC and Emirates NBD declined to comment.

“The cuts are part of cost cutting and rationalizing to drive efficiencies in a challenging market,” the second source said.

Other banks have also reduced staff this year. UAE central bank data shows local banks laid off 446 people in the 12 months until the end of September. Foreign banks added staff in the same period.

Staff at local banks account for over 80 percent of the 35,518 banking employees in the country.

The merger between Abu Dhabi Commercial Bank, Union Commercial Bank and Al Hilal Bank saw hundreds of redundancies.

Commercial Bank International (CBI) said it would offer voluntary retirement to employees in September, which sources said saw over 100 departures. Standard Chartered, too, cut over 100 jobs in the UAE in September.

Rating agency Fitch warned in September a weakening property market would put more pressure on the UAE’s banking sector.