Jun. 30, 2019
Located in the southernmost part of Jordan on the coast of the Red Sea, Aqaba is the country's only port city, and it has become a key driver of the Kingdom's tourism and transportation sectors, particularly after the establishment of Aqaba Special Economic Zone Authority in 2001.
Aqaba is hardly a new name on the world map. In relatively recent memory, the port city was the scene of historic events such as the Battle of Aqaba, as featured in David Lean's 1962 hit, Lawrence of Arabia. The city's role as a well-positioned access point to the Red Sea goes further back in history. Archaeological findings from the area support the theory that Aqaba has been functioning as a maritime hub since as early as 1500 BC, when it was referred to as Elath, and later on Ayla.
As Aqaba makes its comeback as a maritime gateway, Jordan is by no means the only country to benefit from it. The port's development has created a number of golden sea routes from Asia, Africa, and Americas to the Levant.
Although Levantine nations such as Lebanon and Syria are accessible from Europe and North Africa via the Mediterranean Sea, the area remains difficult-to-reach for cargo ships coming from the Far East, India, large parts of Eastern and Southern Africa, and also the Gulf.
Aqaba Port, however, has established itself as the preferred port of call for cargo vessels coming from major Asian ports bound for not only Jordan itself but also elsewhere in the Levant, saving ships the trouble of going around Africa.
The reopening of Jordan's borders with Iraq and Syria in 2017-2018 and the relative return of peace to the region have also been promising developments, adding to the cross-border flow of good and the port's throughput.
As the second-busiest container port along the Red Sea's coasts, Aqaba's 12 terminals are busy around the clock, handling not only well over half of Jordan's exports and imports, but also cargo bound for or coming from other countries in the region.
To keep up with the growing demand, the port was relocated to the south of the city in 2006 to allow the berthing of larger vessels. Between 2009 and 2013, the container terminal underwent a development program to increase its ship-to-shore cranes and its berthing capacity. With a final bill exceeding USD140 million, the terminal was upgraded to handle 1.3-1.5 million TEUs per year.
As such, the number of containers handled by the port jumped from approximately 400,000 standard units in 2006 to over 870,000 in 2013, while over the exact same period, the number of in-transit containers headed for countries other than Jordan more than tripled to over 90,000 standard units.
The container terminal is currently jointly managed and operated by Aqaba Development Corporation (ADC) and APM Terminals, a Dutch logistics company, using the build-operate-transfer (BOT) financing model. Aqaba's rise as a maritime hub after the turn of the millennium roughly coincided with the decade-long economic boom that the Kingdom enjoyed between 1999 and 2008, which gave the country better infrastructure and an altogether more modern feel. According to some estimates, Aqaba has received over USD20 billion worth of investment since 2001.
The Marsa Zayed megaproject is arguably the grandest of the lot. The USD10-billion initiative involves large-scale construction of residential and touristic waterfront buildings as well as yachting facilities and a cruise ship terminal, which will undoubtedly enhance Aqaba's image as a notable port city. Aqaba has also made a name for itself as Jordan's new tourist magnet, overshadowing Petra and Wadi Rum. With the rise of tourism, Aqaba's atmosphere has become considerably more accommodating of foreign travelers and their nightlife culture, with numerous hotels and food and beverage establishments opening up.
The hand-in-hand progress of the tourism sector and the maritime transportation industry in Aqaba has arguably created a certain synergy. The benefits that Aqaba enjoys thanks to its status as a special economic zone port, including low taxes, have undoubtedly attracted investment by the private sector.
At the same time the port city's rebranded image might have been a motivating factor for global logistics giants to set up shop in the city, thus affirming its viability as a well-positioned gateway to Jordan and the greater region.