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Wednesday, 20 Mar 2024

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Mawani + Medlog to set up SAR 175 mn logistics hub at Jeddah Islamic Port

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Today at a glance

1

Zones

Mawani + Medlog to set up SAR 175 mn logistics hub at Jeddah Islamic Port.
2

Logistics Handling

Pharmatrade inaugurates Kezad logistics center for storage and distribution.
3

Disruption Watch

Salvage operations for sunken vessels can’t proceed due to safety concerns, IMO says.
4

POLICY

IMO looks to transform its Revised GHG strategy into regulation.
5

What we're tracking today

Kuwait reportedly finalizes plans for Nuwaiseeb Freezone.
6

Around the World

EU preps tariffs for Russian and Belarusian grain.

Wednesday, 20 Mar 2024

What We're Tracking Today
Zones
Logistics Handling
Disruption Watch
Policy
Around The World
Calendar
1

What we're tracking today

TODAY: Mawani + Medlog set up a logistics hub at Jeddah Islamic Port + A new freezone for Kuwait?

Good morning, ladies and gents. We have a meaty issue this morning with lots of new investments in logistics centers and a deep dive into the IMO’s latest moves towards transforming its GHG strategy into regulation.

WATCH THIS SPACE-

Kuwait’s Direct Investment Promotion Authority has reportedly finalized plans for Nuwaiseeb Freezone situated in the country’s southern region, Al Qabas reports, citing a document it had seen. The report did not disclose information regarding the project’s timeline or investment ticket.

What we know so far: The freezone will reportedly host 50 warehouses, 50 light industrial units, two investment spaces for sub-letting and storage yards, the news outlet reports. The new project looks to attract 500 local and international companies by offering amenities including three hotels, restaurants, a medical center, and spaces for upwards of five commercial banks.

MARKET WATCH-

#1– Oil prices were at their highest since late October on Tuesday, as Ukraine’s attacks on Russian refineries spurred prices, Reuters reports. Benchmark Brent gained 0.6% to USD 87.38 a barrel, its highest since 31 October, while West Texas Intermediate (WTI) bumped up 0.9% to USD 83.47 a barrel, its highest since 27 October, the newswire said. Diminished export volumes from KSA and Iraq, as well as indications of more robust demand and economic growth in China and the US also buoyed the market.

#2- Baltic index surges to three-month peak: The Baltic Exchange’s dry bulk sea freight index — which tracks rates for the capesize, panamax, and supramax vessel segments — was up 1.9% to 2,419 points on Monday, reaching a three-month high, Reuters reports. The capesize subindex gained 1.74% at 4,089 points, while panamex increased 2.9% to 2,298 points, the newswire said. Meanwhile, the smaller supramax segment bumped up 12 points to 1,338 points.

DATA POINT-

Bahrain’s trade deficit narrowed 11.8% y-o-y to BHD 75 mn in February, BNA reports, citing trade figures from Bahrain’s Information and eGovernment Authority (iGA). Bahrain’s national exports saw a 17% increase during the period to BHD 336 mn, while re-exports bumped up 0.01% to BHD 63.07 mn, BNA said. Meanwhile imports saw a 9% uptick to BHD 475 mn.

CIRCLE YOUR CALENDAR-

The UAE will host Abu Dhabi Mobility Week from Wednesday, 24 April to Wednesday, 1 May in Abu Dhabi. The event, organized by The Department of Municipalities and Transport – Abu Dhabi (DMT), will feature announcements, forums, and introduce a mobility strategy for the emirate.

Iran will host the second Iran-Africa International Summit from Wednesday, 24 April through to Friday, 26 April in Tehran. The event will see Iran receive trade ministers from more than 40 African countries.

Saudi Arabia will host a special World Economic Forum event from Sunday, 28 April through to Monday, 29 April in Riyadh. The event will focus on global collaboration and energy.

The UAE will host the 23rd edition of the Airport Show from Tuesday, 14 May through to Thursday, 16 May in Dubai. The 23rd Airport Show will see representation from airport suppliers, airport service providers, aviation executives, and regional decision makers. The event will highlight current innovations and new technologies, while emphasizing this year’s “Sustainability and Innovation,” theme.

The UAE will host The Electric Vehicle Innovation Summit from Monday, 20 May to Wednesday, 22 May in Abu Dhabi. The event will see industry leaders come together to discuss sustainable mobility and tapping into groundbreaking advancements in electric vehicles while engaging with key decision-makers.

Check out our full calendar at the bottom of this email for a comprehensive listing of upcoming news events and news triggers.

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2

Zones

Mawani + Medlog to set up SAR 175 mn logistics hub at Jeddah Islamic Port

Mawani + Medlog partner to establish logistics center at Jeddah Islamic Port: Saudi Ports Authority (Mawani) has inked an agreement with MSC logistics arm Medlog to establish a SAR 175 mn integrated logistics park at Jeddah Islamic Port for the handling and storage of empty containers, it said in a press release. No timeline for the project was disclosed in the statement.

The details: The 100k sqm hub will increase the volume of containers handled at the port to 2 mn TEUs over a ten-year period and introduce the use of alternative energy to curb emissions, the statement notes. The new park will also feature an integrated service site for the upkeep and inspection of full and empty containers.

Trade links boosted: The move aims to increase trade links inside the kingdom by connecting western regions of Saudi Arabia to southern parts and enabling the export of goods from these regions via King Abdullah Port in Rabigh province, the statement added. The hub will also provide a range of logistics services to local players including the handling and transportation of goods.

Mawani is keeping up the momentum: The port authority inked a string of agreements in 2023 totalling SAR 6 bn to establish nine logistics hubs at Jeddah Islamic Port, King AbdulAziz Port in Dammam, and King Fahd Industrial Port in Yanbu, the statement notes.

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3

Logistics Handling

Pharmatrade inaugurates Kezad logistics center for storage and distribution

Pharmatrade launches new logistics center in Kezad: UAE-based pharma distribution company Pharmatrade inaugurated its Abu Dhabi Logistics Center, located in AD Ports subsidiary Khalifa Economic Zones Abu Dhabi (Kezad) Group, to boost the storage and distribution of its products, according to a press release. No details regarding the investment ticket were disclosed in the statement.

Details: Pharmatrade’s Abu Dhabi Logistics Center is located within Kezad Logistics Park Phase 5, a cluster of temperature controlled Grade A industrial warehousing facilities. The new storage and distribution hub is positioned to meet private and public sector demand for pharma and medical devices in Abu Dhabi and Al Ain, Pharmatrade Managing Partner Konstantinos Petridis said in the statement.

Supply chain enhancement: The strategic location for Pharma’s new logistics center allows easy access to Khalifa Port and Abu Dhabi International Airport to the efficient transport and sourcing of raw inputs and supplies from global markets, Kezad CEO Mohamed Al Khadar Al Ahmed said in the statement.

About Pharmatrade: Founded in 1977 by Hussain Al Nowais and Konstantios Petridis, Pharma is the leading distributor of pharma and medical devices in the UAE supplying over 30 multinational companies. Apart from the newly opened distribution hub in Kezad, the company also operates a logistics center at Dubai Investment Park 1.

ICYMI- Kezad kicked off a new phase of warehousing developments earlier this year as it looks to invest AED 621 mn (USD 169 mn) to develop an additional 250k square meters (sqm) of warehousing space. The move is slated to expand Kezad’s pre-built industrial and logistics warehousing capacity by 43% by the end of 2025.

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4

Disruption Watch

Salvage operations for sunken vessels can’t proceed due to safety concerns, IMO says

Houthis have targeted a Marshall-Islands flagged LPG tanker, dubbed Mado, in the Red Sea with naval missiles, Reuters reports, citing a Tuesday statement by the group’s military spokesperson Yahya Sarea. The Houthis described the tanker as American, but shipping data sourced by Reuters shows the vessel is owned by Greece’s Naftomar Shipping & Trading. Mado was en route to Singapore from Saudi Arabia, the newswire writes.

Switch off your transponders, Marad says:The US Department of TransportationMaritime Administration (Marad) has issued an advisory to American-flagged vessels to turn off their Automatic Identification Systems (AIS) transponders when transiting the Southern Red Sea, the Bab el Mandeb Strait, and the Gulf of Aden, according to a statement. Switching off AIS transponders makes it more difficult for the group to track and score hits on vessels, the statement said.

Salvage operations for the Houthi-targeted Rubmyar and True Confidence are critical to preventing environmental damage, but can’t be carried out because the area is too unsafe, Reuters reports, citing statements from the UN’s International Maritime Organization (IMO). “We’re limited in what we can do in an area that is not safe and secure,” IMO secretary general Arsenio Dominguez said at a press conference in London. The Rubymar’s wreck carries some 21k tons of fertilizer in its hold, which can devastate marine ecosystems if released, with the stricken vessel’s 18-mile oil slick already causing considerable damage, the newswire said. Meanwhile, a salvage contract for the True Confidence was inked earlier this month, a spokesperson for the vessel’s operators told the newswire, but declined to provide further details citing security concerns.

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned Marshall Islands-registered shipping outfit Vishnu, which operates a crude oil tanker, dubbed Lady Sofia, according to a statement. OFAC asserts that the Lady Sofia was involved in “illicit shipments”, involving a covert ship-to-ship transfer with a sanctioned vessel, in support of Iran’s Islamic Revolutionary Guard Corps-Qods Force, and a Houthi financier, with both entities being previously sanctioned. The move sees Vishnu’s US-based assets blocked, while placing severe limits on US companies and entities engaging with Vishnu, the statement said.

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5

POLICY

IMO looks to transform its Revised GHG strategy into regulation

The IMO is taking steps to implement its Revised GHG Strategy: The IMO finalized some of its mid-term measures including adopting both a GHG Fuel Standard — a mandate on GHG intensity of fuel and energy — as well as a GHG pricing regulation, according to a press release by maritime shipping consultancy outfit UMAS. The measures were finalized at the IMO’s first working group meeting since the adoption of a Revised GHG Strategy in July 2023 and explicitly linking 2030 and 2040 GHG reduction standards with momentum also building on a universal GHG levy, the statement notes.

The IMO is determined to iron out a binding regulatory framework within a year, with a decision due by a future IMO’s upcoming MEPC 83 in Spring 2025, UMAS said. Despite broad agreement in the Revised GHG Strategy for a need for both a fuel standard and a carbon levy, the IMO’s secretariat and members have the “unenviable” task of converting these goals into regulation. One significant outcome from ISWG-GHG 16 working group meeting was an agreement to bind the GHG intensity limits of the GHG fuel standard, now dubbed goal-based marine fuel standard, to GHG reduction goals and ‘indicative checkpoints,’ a term which some members had previously considered too ambiguous. Differences remain however in terms of how a fuel standard and carbon levy can be combined, UMAS explained.

What options are on the table? 14 member states, primarily representing middle income economies, have voiced a preference for a flexible fuel standard, referred to as a credit trading mechanism or Emission Trading System (ETS), with no carbon levy, UMAS said. 18 countries, mostly representing small island developing states (SIDS) and least developed countries (LDCs) expressed a preference for a more rigid fuel standard in combination with a carbon levy. 16 countries, mostly representing developed economies, indicated a preference for a fuel standard with some flexibility (such as credit trading system or ETS), in unison with a universal carbon levy. All of the preferences discussed would generate revenues, but members also differ on how those proceeds should be disbursed, UMAS said.

What did opponents of a carbon levy say? Proposals for a carbon levy saw pushback from countries including China and Brazil, which maintain that such a move would place an unfair burden on emerging economies that are trade dependent, Reuters reported. Advocates for the policy, which include the EU, Canada, Japan, and climate-exposed SIDS, maintain that it could garner upwards of USD 80 bn a year, which can be redirected towards the development of low emissions shipping fuels and to fund the energy transition of poorer states, the newswire said.

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6

Around the World

Eurozone trade surplus hits record + EU preps tariffs for Russian and Belarusian grain

The eurozone’s monthly trade surplus rose to a record high of EUR 28 bn in January due to a dip in the price of energy imports and a spike in exports, The Financial Times reports. The eurozone can expect a “significant increase in net trade” in the first quarter, Pantheon Macroeconomics consultant Claus Vistesen told FT. Exports rose 2.1% m-o-m due to a rise in shipments to major markets, not including the US. The bloc recorded the largest growth in its exports to Japan, seeing a 10% rise, followed by the US at 8.5% and the UK at 2.5%. Imports into the bloc dipped 4% m-o-m, with a fall in shipments from most markets, including OPEC, Asia, and the US. The eurozone’s trade balance with China saw improvement, falling to its lowest in three years at EUR 10.6 bn, as monthly shipments from China dropped and exports from the bloc marginally grew.

Background: The bloc witnessed a trade surplus of EUR 64 bn last year, a positive jump from the record breaking EUR 335 bn trade deficit it recorded in 2022, due to a spike in natural gas and oil prices, the newswire says.

ALSO- The EU is preparing to impose tariffs on grain imported from Russia and Belarus, the FT reports, citing people with knowledge of the matter. The EU commission is expected to institute a EUR 95 per tonne duty on cereals from the two countries, with 50% tariffs likely to also be enforced on oil seeds and derived products, says the newswire. Russia’s exports to the EU of the affected produce account for 1% of overall EU consumption, reaching 4 mn tonnes last year.

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Calendar

MARCH

20 March (Wednesday): Construction work scheduled to begin on the 162 km Rasht-Astara Railway in Iran.

APRIL

24 April- 1 May ( Wednesday-Wednesday): Abu Dhabi Mobility Week, Abu Dhabi.

24 April- 26 April (Wednesday-Friday): The second Iran-Africa International Summit, Tehran, Iran.

27 April- 1 May (Saturday-Wednesday): Iran Expo 2024, Tehran International Permanent Fairground, Iran.

28 April – 29 April (Sunday – Monday): World Economic Forum, Riyadh, Saudi Arabia.

29 April- 2 May(Monday-Thursday): GLA Global Logistics Conference, Dubai, UAE.

30 April- 2 May(Tuesday-Thursday): Autonomous E-mobility Forum, Doha, Qatar.

April: Driftx. Abu Dhabi, UAE.

MAY

2-3 May (Thursday-Friday): Geneva Dry, Hotel President Wilson, Geneva, Switzerland.

2-4 May(Thursday-Saturday): The International Conference on Logistics Operations Management: smart, sustainable and green logistics (GOL), Marrakesh, Morocco.

3-5 May (Friday-Sunday):2024 IEEE 15th international conference on Logistics and Supply Chain Management, University of Sousse, Tunisia, Tunis.

7-9 May (Tuesday-Thursday): Annual Investment Meeting (AIM) Congress, Abu Dhabi, UAE.

14-15 May (Tuesday-Wednesday): Seamless Middle East, Dubai World Trade Centre, UAE.

14-16 May (Tuesday-Thursday): Airport Show, DWTC, Dubai, UAE.

20-22 May (Monday-Wednesday): The Electric Vehicle Innovation Summit (EVIS), Abu Dhabi, UAE.

21-23 May (Tuesday-Thursday): WAGA 2024, Riyadh, Saudi Arabia.

JUNE

2-4 June (Sunday-Tuesday):IATA Annual General Meeting (AGM) and World Air Transport Summit, Dubai, UAE.

19-21 June (Wednesday-Friday): World Freezones Organization’s Annual International Conference and Exhibition, Bari, Italy.

OCTOBER

6-8 October (Sunday-Tuesday): Routes World 2024, Bahrain.

8-10 October (Tuesday-Thursday): The Global Rail Transport Infrastructure Exhibition and Conference(Global Rail), Abu Dhabi.

7-9 October (Monday-Wednesday): AFSIC – Investing in Africa, London, UK.

22-24 October (Tuesday-Thursday): Asean Ports and Logistics 2024, Johor, Malaysia.

NOVEMBER

11-14 November (Sunday-Thursday): ADIPEC Maritime and Logistics Exhibition and Conference, Abu Dhabi.

13-15 November (Wednesday-Friday): The Bahrain International Airshow, Sakhir Airbase, Bahrain.

18-20 November (Monday-Wednesday): The Heavy Equipment and Truck (HEAT) Show, Dhahran Expo, Damman, Saudi Arabia.

DECEMBER

10-12 December (Tuesday-Thursday): Middle East Business Aviation, Dubai World Central, Dubai, UAE.

20 December (Wednesday): The 5th Iran-Senegal Joint Economic Cooperation Commission, Dakar, Senegal.

EVENTS WITH NO SET DATE

1Q 2024: Construction of phase 3 of Agility’s logistic park in Abidjan, Côte d’Ivoire to be completed.

1Q 2024: Egypt’s Transport Ministry to launch pre-qualification tender for Cairo-Alex freight railway.

1H 2024: Civil Construction subcontracts for construction firms in Oman for implementation of the Abu Dhabi – Suhar rail link to be announced.

2H 2024: Bahri’s barges for Saline Water Conversion Corporation (SWCC) to begin initial and commercial operation.

King Salman Energy Park is set to become operational.

The Cross-Border Digital Trade Forum, Dubai.

2025

Mid-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.

AD Ports-operated Safaga Port’s multi-purpose terminal will become operational.

Phase 3 of APM Terminals Tangier MedPort to be complete and operational.

1Q 2025: Sadr Park’s Logistics Center in Riyadh to be completed.

1Q 2025: Phase twoof Jafza Logistics Park to be completed.

2027

4Q 2027: Oman’s Musandam Airport construction to be completed.

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