BMI's Executive Summary

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A challenge is emerging to Dubai and the wider UAE's role as the region's key transport and logistics hub. In nearby Saudi Arabia, plans have come together to invest upwards of US$8bn in the new Prince Abdul Aziz Bin Mousaed Economic City, designed as a freight transport hub. Construction is expected take 10 years. However, Dubai need not be too worried, as arguably it has had a 20-year head start, and is chasing some fairly aggressive goals of its own. Dubai Logistics City, part of the vast Jebel Ali International Airport, was due to start operations in 2007 and to be fully complete by 2008. Jebel Ali International Airport will have the capacity to handle 12mn tonnes of cargo annually, more than both Chicago O'Hare and London Heathrow, while Jebel Ali port is already one of the world's largest container handlers, and pursuing expansion plans. There, the opening of Dubai Ports World's Terminal Two in August 2007 was expected to lead to a capacity increase of an additional five million TEUs (twenty-foot equivalent units) to the existing nine million TEU capacity, according to a company executive. In fact, in our latest UAE Freight Transport Report, BMI concludes that freight carried growth across all modes, measured in million tonne-km (mntkm), will average 6.2% per annum in the 2007-2011 forecast period.

Various factors support this prediction. Although the current oil price boom is easing, we still expect the UAE economy to grow by an average of 5.4% per annum over the next five years, providing an important level of support for the freight business. Infrastructure investment will also remain high, with the emirates continuing to focus on a variety of ambitious transport projects in aviation and shipping. Overall, BMI believes the UAE freight sector will expand rapidly in the short term but will slow as global conditions eventually deteriorate. The UAE economy is relatively dynamic and is now more diversified and shows evidence of robustness to withstand external shocks. Strong investment in transport infrastructure and the global ambitions of companies like Emirates Airlines and DP World will be strong positive factors.

By transport modes, we expect the fastest-growing sector in the 2007-2011 forecast period to be air, with an annual average of 10.8% growth in freight carried, followed by sea freight with 6.6% and pipeline throughput (6.0%) and road haulage (5.9%), just ahead of GDP. UAE's overall business environment rating is one of the best in the Middle East and Africa (MEA) region (it shares the number one position in our ranking with South Africa). It scores particularly well in terms of its political, economic and infrastructure environments. The UAE has one of the most liberal business environments in the region and foreign investment is actively encouraged in many sectors.

For the 2007-2011 forecast period, we expect the transport and communications sector to continue outpacing the economy as a whole in value terms. It will achieve average annual growth of 5.9%, versus 5.4% for overall GDP. The total value of transport and communications GDP will rise to US$17.7bn in nominal terms by 2011, representing 6.8% of the UAE's GDP.

Contents

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Chapter 1 - Executive Summary

Chapter 2 - SWOT Analysis

UAE Transport Industry SWOT

UAE Political SWOT

UAE Economic SWOT

UAE Business Environment SWOT

Chapter 3 - Business Environment Overview

Regional Overview

Business Environment Ranking

Middle East and Africa (MEA) Countries Freight Business Environment Ranking

Country Overview

Politics – Long-Term Risk

Economics – Long-Term Risk

Freight Transport Growth

Transport Infrastructure Growth

Regulatory Environment

Competitive Environment

Transport Intensity

Business Environment Risk Summary

Political Risk Summary

Economic Risk Summary

Legal Issues

Labour Force

Chapter 4 - Industry Trends And Developments

Road

Air

Sea

Pipelines

Chapter 5 - Industry Forecast Scenario

Macroeconomic Outlook

Table: Economic Indicators

Chapter 6 - Transport Outlook

Table: Industry Forecast Scenario

Freight turnover (domestic and international)

Total value of imports (US$mn)

Total value of exports (US$mn)

Chapter 7 - Country Snapshot: UAE Demographic Data

Section 1: Population

Table: Demographic Indicators (2005)

Table: Rural/Urban Breakdown

Section 2: Education & Healthcare

Table: Education As % Of Total Age Group

Table: Healthcare: Vital Statistics

Table: Healthcare: Expenditure

Section 3: Labour Market And Spending Power

Table: Employment Indicators

Table: Consumption and Stratification

Chapter 8 - Trade Environment

Trade Regulations

Foreign Direct Investment

Chapter 9 - Market Overview

Multimodal

Infrastructure

Competitive Landscape: Multimodal

Road

Infrastructure

Competitive Landscape: Road

Rail

Infrastructure

Competitive Landscape: Rail

Air

Infrastructure

Competitive Landscape: Aviation

Company Profiles

Water

Infrastructure

Competitive Landscape: Maritime

Company Profiles

Pipelines

Infrastructure

Competitive Landscape: Pipelines

Chapter 10 - BMI Forecast Modelling

How We Generate Our Industry Forecasts

Transport Industry

Sources

Chapter 11 - Appendix: Regional Demographic Data

Table: The Long View: Data Over The Economic Cycle (2000-2007)

Table: Population

Table: Household Spending Per Capita, US$

Table: Private Consumption Per Capita, US$ PPP

Table: Market Size, GDP, US$bn

Competitive Landscape for Middle East & Africa Freight Transport Reports: Sample of Companies Ranked

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Analysis of latest projects across the freight transport sector – road, rail, air, sea, logistics – including market overview which provides an outline of the key elements driving development. SWOT analysis of the state’s business environment, transport sector, politics and economics, which carefully evaluates the short- and medium-term issues facing the industry.

Network of Middle Eastern & African Freight Transport Sources

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BMI's Middle Eastern & African Freight Transport Reports are based on an extensive network of multilateral organisations, government departments, freight transport industry associations, chambers of commerce and company reports. Information sources include: