Iran’s rail link with Turkey launching next year

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What we're tracking today

TODAY: Iraq to inaugurate rail link to Turkey in 2024 + MENA countries fare well in World Bank Logistics Index

Good morning, friends. We hope you all had a wonderful, restful Eid break and are easing back into the usual flow of the workweek with the caffeinated beverage of your choice. We’ve got everything you may have missed on the logistics front from the past week in the MENA region and beyond — let’s dive in.

We’re sorry to be a few minutes late this morning — we ran into some tech difficulties that have now been fixed.

THE BIG LOGISTICS STORY- Iraq plans to inaugurate its Development Road Project linking its Southern Faw Port to Turkey by rail at the start of 2024, while Kuwait is gearing up to issue an international tender for the building and operation of a cargo village near Kuwait International Airport.

HAPPENING TODAY-

A three-day ceasefire agreed between Sudan’s opposing groups is “partially holding” but the fighting has not entirely stopped, Reuters reports. The Sudanese Armed Forces and the Rapid Support Forces (RSF) had earlier agreed to a three-day ceasefire mediated by the US, the RSF said. At least 427 people have been killed in the fighting lives, and tens of thousands have fled to neighboring countries, including Egypt, Chad, and South Sudan, according to Reuters.

Iran, Syria to discuss boosting ties in banking, transportation: Iran’s Roads and Urban Development Minister Mehrdad Bazrpash arrived in Syria yesterday for a two-day visit to discuss trade ties with his Syrian counterpart Humam Al Jazaeri and Syrian private sector representatives,Iranian news agency Tasnim reports. The talks will include reducing trade tariffs, boosting the Iranian private sector’s role in the reconstruction of Syria’s air transport sector, and the development of an Iran-Iraq-Syria rail link.

G7 leaders are calling for the “extension, full implementation, and expansion” of theagreement to allow Ukraine to export grain through Black Sea ports, according to a joint communiqueafter a two-day meeting in Miyazaki, Japan. The agreement was initially brokered by Turkey and the UN in July of last year and has allowed Ukraine to export 27 mn tonnes of grain to meet global demand despite its ongoing war with Russia. Russia has indicated over the past few weeks that it will not allow the arrangement to continue past the 18 May expiry date for the agreement, citing continued restrictions to its own grain and fertilizer exports.

MENA countries fared well in the World Bank’s latest Logistics Performance Index: The UAE consolidated its position as a global leader in logistics, rising four spots to rank 7th worldwide, according to the World Bank’s Logistics Performance Index 2023 (pdf). The latest result places the UAE as the only country in the MENA region to feature in the world’s top 10 logistical hubs.

There were some big movers: Saudi Arabia jumped 17 spots to claim 38th place in the index, boosted by improvements in logistical categories such as trade, infrastructure, ship tracking, customs and maritime freight boosted the kingdom’s ranking. The last report, which was published in 2018, saw KSA rank 52nd worldwide. Bahrain also saw considerable improvements in the ranking, climbing 15 spots to land at 34th worldwide, while Kuwait rose 12 places to land at 51st.

On the downside: Oman retained its position from the 2018 ranking at 43rd worldwide, while Qatar experienced a modest decline of four spaces to settle at 34th worldwide, tying it with Bahrain.

DATA POINT #1- Jordan’s Queen Alia International Airport recorded 6.2k aircraft movements in March, rising 21.7% y-o-y, according to a press release from Airport International Group. Some 5.6k tons of cargo moved through the airport during the month, marking a 3.2% y-o-y increase.

DATA POINT #2- Dubai International Airport handled 16.7k flights in March, surpassing pre-pandemic levels with a 23.7% y-o-y increase, President of Dubai Civil Aviation Authority Ahmed bin Saeed Al Maktoum said in a tweet. “These figures affirm Dubai’s strong role as a global hub for trade and travel, in the face of economic challenges around the world,” Al Maktoum wrote.

DATA POINT #3- Bahrain exports of national origin dropped 20% y-o-y to BHD 1 bn (USD2.6 bn) in 1Q 2023, while re-exports rose 17% y-o-y to BHD 186 mn (USD 493 mn) during the quarter, according to Bahrain's Information and eGovernment Authority. The UAE, Saudi Arabia, and Singapore were the leading markets for re-exports, with airplane parts, four wheel drive vehicles, and wristwatches being the top re-exported goods.

DATA POINT #4- ADAFZ leased-out space soared in 2022: Abu Dhabi Airports subsidiary Abu Dhabi Airports Freezone (ADAFZ) recorded a 256% increase in annual leases for spaces and properties in 2022, Emirati state-owned news agency Wam reported. The increase is attributed to ADAFZ signing contracts to lease out a total of 163.6k squared meters at Abu Dhabi International, Al Ain International, and Al Bateen Executive Airports for commercial spaces, land development plots, and administrative facilities.

WATCH THIS SPACE- TheSuez Canal Economic Zone (SCZone) is working on finalizing approval procedures for seven new industrial projects at the East Port Said Industrial Zone, according to a statement. The projects are slated to cover 62k square meters and will include facilities for the production of gum arabic and its derivatives, steel pipes, casting, and concrete, in addition to facilities for storage and warehousing.

Turkey is on track to remain the top importer of Russian diesel in the wake of the EU embargo on Russian energy exports, Reuters reports, citing traders and Reinfinitiv data. Turkey has received 0.8 mn tonnes of Russian diesel since the start of April and 1.5 mn tonnes in March, according to the data. The EU placed an embargo on shipments of Russian energy in response to the country’s invasion of Ukraine, which has forced traders to reroute cargoes to Asia, Africa, the Middle East, and ship-to-ship (STS) loadings. Some of the diesel bound for Turkey is slated for STS transfers that will see it re-exported to other countries, according to Reuters.

COME TO OUR NEXT ENTERPRISE FORUM-

The Enterprise Exports & FDI Forum, our latest industry-specific conference, is taking place on Monday, 15 May. The Enterprise Exports & FDI Forum will give insiders and newcomers alike the chance to talk about how to develop an export-centered business and how their companies can help Egypt build an export-led economy that makes us a magnet for foreign direct investment (FDI).

Why exports & FDI? In the wake of successive floats of EGP, exports and FDI have never been more important to our economy — or our businesses. We’re gathering some of the CEOs, top execs from local companies and multinationals, investors, bankers and finance folks to speak on how businesses can adapt their strategies to be export-oriented and what Egypt as a country can do to draw foreign investment and much-needed FX. Expect it to be heavy on lessons learned in Egypt and other global growth markets — and lots of success stories.You can learn more on our conference website here.

And what better place to discuss moving our goods than Egypt’s original logistics zone — the Nile. That’s why we’re looking forward to holding the event by the river’s vistas at the Four Seasons, Nile Plaza.

Some of the biggest names in business and finance are on board — are you? The Enterprise Exports and FDI Forum is taking place with the generous support of our friends, including:

Banking partners: Banque Misr | Al Baraka Bank | Emirates NBD | HSBC

Event partners: Beyti | Concrete | Global Corp | Grant Thornton | Hassan Allam Utilities

WANT TO BECOME A COMMERCIAL PARTNER? Ping a note to Moustafa, our head of commercial, here.

HAVEN’T REQUESTED AN INVITE YET? If you’re a C-suite exec, business owner, DFI staff, export executive, investor or banker, please fill out the form here to signal your interest, letting us know your name, title and where you work.

Iraq to launch rail link project with Turkey in early 2024

Iraq will launch its Development Road Project linking its Southern Faw Port to Turkey by rail at the start of 2024, the Transport Ministry’s Relations and Media Director Maitham Al Safi told Iraqi News Agency. An Italian consulting company has submitted a feasibility study for the project, Al Safi said, though he did not reveal which company will implement the project or how much it will cost.

The details: The freight train will pass through nine Iraqi provinces, the last of which is Nineveh, which will connect to Turkey. Some 60 km of rail between the ports of Faw and Umm Qasr have been built, according to Al Safi. The train will have an initial capacity of 3.5 mn containers and 22 mn tons of bulk cargo per year, which should increase to 7.5 mn containers and 33 mn tons per year. It will also have the capacity to accommodate 13.8 mn passengers per year, Zawya reports, citing Iraqi officials.

Iraq has big rail ambitions: Iraq has been working on developing rail projects on several fronts, including a plan to build a connection with Iran through the Khosravi border crossing.

Kuwait to auction new airport cargo village

Kuwait plans to issue a limited international tender for the building and operation of a cargo village near Kuwait International Airport, Kuwaiti newspaper Al Qabas reports, citing sources it says have knowledge of the matter. Bidding is open to companies with relevant experience, one source told the news outlet.

Details: Companies will be bidding to design the cargo village’s buildings; construct its facilities and equip them with the necessary technologies; manage, operate, and maintain the cargo village for 20 years; and train Kuwaiti nationals to manage and operate the village, according to the news outlet. The awarded company will also need to identify investment possibilities for the construction of the airport’s repair and maintenance zone, as well as the building of rail networks serving the village and facilities for support services, according to the newspaper.

Phases: The cargo village’s first phase will involve constructing the cargo building, government facilities, offices, and parking. The second phase will consist of building a railway, buildings for support services, and a multi-storey parking facility. The third phase will involve “future expansion,” according to the news outlet. No timeline has been revealed for when these phases should be completed.

AD Ports’ Maqta Gateway acquires digital border control solutions provider TTEK

AD Ports Group’s digital trade and logistics arm Maqta Gateway has acquired 100% of Barbados-based digital customs solutions outfit TTEK in a USD 26.7 mn transaction, according to a press release (pdf). The acquisition saw USD 17.1 mn paid upfront, the press release said. The acquisition should be completed by 8 June, and is pending the completion of conditions precedent. TTEK’s current management will stay on board for two years following the acquisition, according to the press release.

The acquisition could help Maqta expand globally: The acquisition is intended to bolster Maqta Gateway’s digital trade and Single Window customs solutions by introducing technologies like AI, machine learning, and advanced rich analytics to its digital trade and border control operations, according to the release. Maqta will also benefit from TTEK’s Vietnam-based research hub, which has expertise in customs and border modernization solutions across Africa, Middle East, North America and Australia, to help it expand globally.

SOUND SMART- The World Customs Organization (WCO) defines a Single Window solution as a framework that allows international traders to meet all import, export, and transit-related regulatory requirements through use of a standardized information format lodged at a single point of entry, saving traders time that would go towards receiving approvals from different authorities at different offices.

What they said: “The acquisition of TTEK will bring near-term and sustained synergistic benefits to AD Ports Group, including fast time-to-market delivery and significant sector expertise,” said AD Ports Group Managing Director and Group CEO Mohamed Juma Al Shamisim. “The comprehensive custom Single Window solution provided through this acquisition has high demand in international markets, including Central Asia,” he added.

Jordan’s new national exports strategy looks to unlock USD 4.4 bn worth of potential exports

Jordan’s new national exports strategy aims to tap USD 4.4 bn worth of investments in untapped sectors such as livestock, clothing, pharma products, jewelry, ornaments, and fertilizer to reduce its trade balance deficit, according to Jordan News Agency. The strategy could help Jordan’s exports reach some USD 10.5 bn, according to a study by the International Trade Center cited by the news agency.

Refresher: The country launched the export strategy for 2023-2025 in March in hopes of increasing the competitiveness of Jordanian exports in regional and global markets, increasing and diversifying commodity and service exports, and improving sustainability. The strategy comes as a response to the industrial, commercial and service challenges Jordan faces, such as expensive shipping costs, competition, and ineffective marketing, and high production costs.

More trade partners: The strategy also identifies countries like the neighboring Arab Gulf states, as well as countries in North America, the EU, Africa and Northern Asia for trade opportunities, the news agency reported.

Milaha’s revenues take a hit amid slowdown in container shipping

Qatari maritime transport and logistics company Milaha saw its net income rise 0.83% y-o-y to QAR 363 mn in 1Q 2023, according to their financials (pdf). The company’s revenues fell 16% y-o-y to QAR 766 mn. Earnings per share remained stable y-o-y at QAR 0.32. The company managed to keep costs under control, with operating expenses falling 22.6% y-o-y during the quarter to QAR 556 mn.

The company’s maritime and logistics division took the biggest bottom line hit, falling 73% y-o-y to QAR 24 mn, while the segment’s revenues dropped 33% y-o-y to QAR 246 mn. This was attributed to the decline in container shipping rates and container volumes during the quarter, especially in comparison to the record rates of early 2022, according to the earnings release. The company’s gas and petroleum division saw its net income fall 5% y-o-y to QAR 156 mn, mainly due to lower income from associate firms.

Other divisions fared better: The company’s offshore marine division reported a 627% y-o-y increase to QAR 61 mn in net income and a 6.6% y-o-y revenue growth to 309 mn, as it managed to land higher margin contracts and cut costs. Although revenues for Milaha’s trading division fell 13% y-o-y to QAR 58 mn, it achieved a 232% y-o-y bottom line increase to QAR 3 mn, as it expanded its ship chandlering services and cut costs. The company’s capital division reported a 17% y-o-y increase in net income to QAR 120 mn.

Looking ahead: Milaha expects that warehousing and freight forwards will continue to slow in 2Q 2023 before picking up in 2H 2023. The company also sees shipping rates remaining “fairly stable” following their slump in the first quarter of the year.

UAE + South Africa, Iran + Syria look to bolster trade ties

UAE + South Africa talk bumping up trade: UAE Foreign Trade Minister Thani bin Ahmed Al Zeyoudi discussed ways to boost cooperation and develop key sectors, including logistics, with South African Trade, Industry and Competition MinisterEbrahim Patel, and Public Enterprises Minister Pravin Jamnadas Gordhan, UAE state news agency Wamreports. The ministers talked about setting up new joint ventures and streamlining private sector dialogue.

We might soon see a wave of M&As in the logistics sector - Gartner analyst

OPEC’s oil production cuts could prompt a surge in mergers and acquisitions in the logistics sector, Supply Chain Digital quotes former Gartner analyst Frank Kenney as saying. A hike in crude prices on the back of production cuts “will impact the supply chain from the top down,” Kenney says. Even if manufacturers and shippers can absorb some of the increased cost resulting from higher fuel prices, the remaining costs could eventually trickle down to smaller freight brokerage companies, and it's there where we might see a spike in M&A.

Saudia Cargo expands cold chain offerings, while Qatar Airways relaunches pharma offerings + Shipsy sets up shop in Riyadh. PLUS: Updates from Thuraya and Dubai Police

AVIATION-

Qatar Airways Cargo has relaunched and expanded its pharma transportation offerings, the company said in a statement.The cargo carrier now has five product subcategories to diversify its solutions to customers and optimize its pharma transport solutions, the statement said. Clients will also be sent active container milestones, along with temperature and battery readings of each unit, ensuring they are kept up to date with the status of their shipments. The project has been rolled out to a few, select locations and will be rolled out globally over the course of the year.

MARITIME-

UAE’s Thuraya updates software for its MarineStar device:Thuraya — a satellite operator offering communications solutions to several sectors, including maritime — has launched a multi-language software for its maritime voice, tracking, and monitoring system, MarineStar, the company said in a statement. The new software “upgrades the terminal’s geofencing and air programme capabilities, enhancing its tracking, monitoring, fish catch reporting and integration capabilities,” according to the statement The software should improve productivity on vessels and reinforce compliance with international maritime regulations, the company said.

The Dubai Police has launched an initiative to bolster communications with the maritime sector, according to a statement. The initiative will involve efforts to strengthen communication links with fishermen, residents, and strategic partners involved in the maritime sector, as well as with private and public officials in Dubai, according to the announcement.

STARTUPS-

India’sShipsy launches second Middle East HQ in Riyadh: Logistics startup Shipsy has opened a second regional headquarters in Riyadh after setting up its first regional HQ in Dubai in 2021, as the company looks to “aggressively onboard local talent,” according to a statement. The expansion comes as the startup aims to boost its regional presence and customer support, the statement said. Shipsy recently pledged investments of USD 10 mn over the next five years to develop technology innovation and R&D.

STORAGE-

Saudia Cargo expands cold chain solutions with Tower Cold Chain partnership: Saudia Cargo has signed an agreement withTower Cold Chain — which provides temperature-controlled transportation containers — to transport pharma, biotech, and life science products, according to a statement by Tower Cold Chain. “The breadth of the Tower range means we can extend our network and provide customers with greater choice, including the ability to ship [pharma products] on narrow-bodied as well as wide-bodied aircrafts,” Saudia Cargo Global Product Manager Adel Elshazly stated.

MEF countries agree shipping + transport decarbonization goals + Malaysia Aviation Group makes operating net income turnaround

Increased global cooperation on decarbonizing shipping + transport: Several countries supported the adoption of the 1.5°C-aligned goals for the shipping sector to be presented next July at the International Maritime Organization during a meeting of the Major Economies Forum on Energy and Climate (MEF), according to a statement. Australia, Canada, the EU, France, Germany, Japan, Korea, the UK, and the US all supported the goal. A few countries — including Canada, the EU, France, Germany, Indonesia, the UK, the US and Norway — also made a collective zero-emissions vehicles goal to have 50% of light-duty vehicles and at least 30% of medium and heavy-duty vehicles powered by carbon neutral e-fuels by 2030.

Malaysia Aviation Group makes a strong comeback: Malaysia Aviation Group (MAG) reported a 173% y-o-y increase in their net operating income to MYR 556 mn in 2022, making a turnaround from a loss of MYR 767 mn, the company said in a statement. The company’s cargo unit contributed to the success by achieving a 17% higher cargo ton-kilometers (CTK) than the company had planned, while maintaining yield y-o-y.

Calendar

APRIL

25-27 April (Saturday-Monday): World Cargo Symposium, Hilton Istanbul Bomonti Hotel and Conference Centre, Istanbul, Turkey.

MAY

May: The Suez Canal Economic Zone (SCZone) plans to handover a new 1k-meter container berth to the East Port Said Port.

1-4 May (Monday - Thursday): Select USA Investment Summit, National Harbor, Maryland, USA.

4 May (Thursday): Deadline to submit proposals for the design, construction, finance, operation, and maintenance of the Salalah-Thamrait trucking road in Oman.

9-11 May (Tuesday-Thursday): Airport Show, Sheikh Saeed Halls 1-2, DWTC, Dubai.

9-12 May (Tuesday-Friday): Transport Logistic, Trade Fair Center Messe München, Munich, Germany.

10-12 May (Wednesday-Friday): The African Aviation Summit: Air Finance Africa Conference & Exhibition, Sandton Convention Centre, Johannesburg, South Africa.

15 May (Monday): Exports + FDI Forum, Four Seasons Hotel Cairo at Nile Plaza, Cairo, Egypt.

15-16 May (Monday-Tuesday): Middle East Rail, Abu Dhabi National Exhibition Centre, Abu Dhabi.

15-16 May (Monday-Tuesday): Mobility Live Middle East, Abu Dhabi National Exhibition Centre, Abu Dhabi.

15-17 May (Monday-Wednesday): Global Fleet Conference, Cascais, Portugal.

16-17 May (Tuesday-Wednesday): Africa Forum of Investment and Commerce, Sheraton Hotel, Algiers, Algeria.

16-18 May (Saturday-Monday): Baltic and Black Sea Ports & Shipping, Radisson Hotel & Suites, Gdansk, Poland.

16-18 May (Saturday-Monday): Seatrade Maritime Logistics Middle East, Dubai, UAE.

16-18 May (Saturday-Monday): IATA Ground Handling Conference, Abu Dhabi National Exhibition Center, Abu Dhabi.

18 May (Monday): UN-Turkey-Russia Black Sea grain agreement extension expires.

24 May (Friday): Fleet and Mobility Summit, Dubai.

29-31 May (Monday-Wednesday): Translogistica Libya 2023, Misurata, Libya.

JUNE

June: Suez Canal Economic Zone holds a roadshow in Delhi.

6-7 June (Tuesday-Wednesday): Ports and Customs Week, Cape Town, South Africa.

JULY

1 July (Saturday): A new greenfield liquid bulk terminal in Khalifa Port Abu Dhabi will kick off operations.

16-17 July (Thursday-Friday): The Levitate Conference and Exhibition, St. Regis Amman Hotel.

24-25 July (Monday-Tuesday): ICSG Istanbul, Istanbul Lutfi Kirdar Convention & Exhibition Centre, Istanbul.

SEPTEMBER

20-22 September (Wednesday-Friday): Transport Evolution Africa Forum and Expo, Inkosi Albert Luthuli ICC Complex (Durban ICC), South Africa.

OCTOBER

3-5 October (Tuesday-Thursday): Smarter Mobility Africa Summit, South Africa.

EVENTS WITH NO SET DATE

2H2023: Construction of Neom’s first hydrogen fueling station will kick off.

2024

12-13 February (Monday-Tuesday): Breakbulk Middle East conference, Dubai Trade Centre.

12-15 February (Monday-Thursday): African Air Expo, Cape Town.

2025

Iraq will complete phase one of the construction of the Grand Faw Port.

DHL and Aramco’s logistics and procurement hub in Saudi Arabia will commence operations.

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