Abu Dhabi’s Transportation Sector

The capital’s status as a transport and logistics hub is well established. As Abu Dhabi maintains its rapid course of growth, the requirement for an expanded freight and civilian transport system is becoming ever clearer. The Abu Dhabi of 2030 is predicted to have three-times the population of that of 2008. The STMP states that the Vision “calls for no less than a world-class, sustainable transport system,” and identifies economic, social, and environmental objectives to be implemented in coming years. Key initiatives for the metropolitan area include improved connectivity via the Abu Dhabi Metro, a project worth $7 billion. The provision of an enhanced pedestrian experience for citizens is another key element, and a general shifting away from a culture of car use is hoped to be beneficial for both the environment and society.

ROAD TO EL DORADO

The UAE ranks 55th in the world for car ownership, and traffic congestion has been specifically identified by the STMP as a major potential economic issue if there are no improvements to infrastructure. Traffic jams lead to longer commutes and decreased efficiency so authorities are preemptively dealing with this issue.

Similarly, as Abu Dhabi bolsters its cargoinfrastructure, highways are being focused on as key elements of the economy’s success. Three major road projects are in progress at present. Chief among these is the vital Abu Dhabi-Dubai main road (E311), aimed at reducing traffic on the current connecting road (E11) and one of the most ambitious of the Department of Transport’s infrastructure projects. The roadway will also serve Khalifa Port, Kizad, and the Wathba, Baniyas, and South Shamka neighborhoods. The estimated completion date is late 2014.

Due to the heavy truck and freight traffic to Khalifa Port via the Sheikh Khalifa Interchange on the Abu Dhabi-Dubai main road, 4.5 kilometers will be expanded to six lanes rather than four, and a main bridge will be constructed. The project, awarded to Larsen & Toubro and worth AED592 million is expected to be completed within two years. Additionally, construction on the Ras Ghmeis-Ghaghah Island Road project was officially completed in 2011, improving communications in the west of the Abu Dhabi Emirate by creating a causeway and bridge to link the two districts.

The Department of Transport’s measures are progressive, with Abu Dhabi planning to construct the Middle East’s first Green Road in 1Q2015. It will link the E11 and the E311, utilizing revolutionary techniques for reducing carbon emissions, as well as environmentally friendly products. The move is part of the Emirate’s broader sustainability strategies and if successful, could be replicated throughout the GCC.

ETIHAD ENOUGH?

Etihad Airways, Abu Dhabi’s full-frills air service, achieved record-breaking passenger figures in 2013, with almost 12 million travellers enjoying its considerable services. Bangkok was the airline’s busiest route with 742,759 passengers, and Manila, London, Jeddah, and Paris followed as the other top destinations. The airline signed code-sharing partnerships with Kenya Airways, Air Serbia, South African Airways, and Air Canada, among others. New destinations included Washington DC, Amsterdam, São Paulo, Belgrade, Sana’a, and Ho Chi Minh City.

In total, over 16.4 million passengers passed through Abu Dhabi International Airport in 2013. The steady rise in numbers has led to the expansion of the airport and the development of facilities in Al Ain. “As passenger numbers rise, infrastructure must be able to support this growth, to ensure Abu Dhabi continues to grow as an important strategic hub. The new terminals will increase capacity to 27 million by 2017,” explains John Borghetti, CEO & Managing Director of Virgin Australia Group of Airlines, a network, which is closely linked to the Emirate through its partnership with Etihad. Al Ain’s potential as a center of aerospace technology will be a major factor in its own airport’s growth, and it is destined to become an important secondary commercial airport for the region. One of the major advances the air segment saw in 2013 was in its cargo services. Commercial cargo is increasing in parallel with passenger growth. Etihad Cargo, the logistics component of the airline, managed to transport 486,753 tons of freight and mail over the course of the year. This represents a full 32% growth on 2012, made possible by the acquisition of a new Airbus and Boeing freighters. On the ground assets will also be expanded in response to this improving service. Speaking to this topic, Tony Douglas, CEO of Abu Dhabi Airports Company (ADAC), remarked that “the Abu Dhabi Airport Free Zone has been deliberately created for businesses that connect freight from one place to many others.” The free zone will be necessary to deal with this unprecedented expansion, and will be yet another indication of the capital’s strengths as a transport hub.

TAKING THE FREIGHT

The Emirate’s status as a logistics hub is not linked solely to its airport infrastructure, but its established maritime and promising rail potential, too. In 2013, it was announced that logistics contributes 14% to the GDP of the country, a figure that is rising year by year. The Khalifa Industrial Zone Abu Dhabi, opened three years ago, has been a significant driving force in the Emirate’s industrial transport sector. It currently houses the world’s largest aluminium smelter, owned by Emirates Aluminium, and is expected to become one of the world’s largest industrial zones within 20 years. “As a hub, we can provide a consolidation and distribution function for the region,” stated Martijn Van de Linde, CEO of Abu Dhabi Terminals (ADT), in conversation with TBY. “Whether you are going to Saudi Arabia or Oman, you will only have to stop in Abu Dhabi, discharge your containers here, and do the rest by rail.” The development of Etihad Rail will radically improve the efficiency of the capital’s services. To unite the various modes of freight transport, the Abu Dhabi Multimodal Freight Master Plan has been drawn up. The plan outlines the importance of logistics within the diversification strategy of the UAE, and defines a coherent strategy for the sector up to 2030. The integration of Abu Dhabi’s freight networks will be brought about by efficient investment and asset acquisition, rigorous regulation and fiscal measures, and improving servicing activities. As Khalifa Port and the Industrial Zone continue to attract outside investment, a balanced mix of foreign and national capital and companies will continue to transform Abu Dhabi.