ESTABLISHING LOGISTICAL SUPREMACY

Dubai 2018 | TRANSPORT & LOGISTICS | B2B

As digitalization takes the center stage, logistics companies, especially in the UAE, are on the forefront to adopt everything digital.

Abdulla Mohammed Alashram
ABDULLA MOHAMMED ALASHRAM
Acting Group CEO
Emirates Post Group (EPG)
Jack Muhs
JACK MUHS
President Middle East, Indian Subcontinent, and Africa (MEISA)
FedEx Express

What have been the main accomplishments and milestones in the past year?

ABDULLA MOHAMMED ALASHRAM EPG is going through a transformational journey. The entire postal world is revolutionizing to keep up with the digitalized world. In 2016, Emirates Post developed a strategic roadmap for the next five years, which has cascaded down from the UAE's 2021 Vision. In the last two to three years, the service level of our products has been enhanced, and many gaps have been identified. We are the only post office in the country, though we operate in a highly competitive courier market that consists of more than 120 companies. The main drivers for the post industry, PO boxes and letter mail, are fading away from the core post business; hence, the industry needs to look at new opportunities. There are three main revenue streams and drivers for success going forward. First, we need to be a natural partner for smart government initiatives and the first choice when it comes to delivery. We have 129 branches across the UAE, and the government can use our infrastructure to deploy any product or service. Second, we need to capitalize on e-commerce by being the number-one choice for e-commerce players. In this part of the world, e-commerce consists of just 2% of the general commerce at the moment compared to between 15 and 20% in mature markets. Forecasts for e-commerce in the UAE for 2018 indicate that it will reach approximately USD10 billion; estimating the UAE e-commerce market to be worth up to USD27-30 billion by 2020. Third, we need to work on financial services; more than 40-50% of the blue-collar workers are unbanked in the UAE, and EPG can serve them best by deploying the best practices of the government's happiness initiatives and working on innovation.

JACK MUHS FedEx in 2017 saw continued progress on its integration with TNT. Since the acquisition of TNT in 2016, we have been working on bringing the two companies together to bring more value to customers. Integrations take time but we have made substantial progress. For example, our couriers have started to collect both FedEx and TNT shipments. FedEx also charters flights, and recently it managed a charter of Egyptian artifacts from Egypt to the US. The service also offers airside deliveries to take critical shipments directly to our customers' facility. This service was showcased at the Dubai Airshow, of which FedEx has been the Official Courier Sponsor since 2005. We are also celebrating another exciting milestone with seven years of our Boeing 777 flight from Memphis to Dubai. Since April 2011, this flight has enhanced the access we provide, supporting the growth and development of trade. Over the past decade, trade between the UAE and US has doubled, and since 2009, the UAE has been the top export market for US goods in the region. Total trade totaled USD24.3 billion in 2017, with the US exporting goods worth USD20 billion to the UAE.

What is your outlook for the coming year?

AMA The UAE ranked eighth worldwide and first in the region for its International Express Mail Services, and our aim is to continue to raise our ranking and enhance our postal, express, and financial operations. Part of our transformation is to digitize and automate our products, services and processes. We hope to introduce new digital systems and solutions across our offerings that will provide greater convenience to businesses and customers. We have an optimistic outlook and believe in the growth of the economy, especially with Expo 2020 coming up. We consider the ambitions of Saudi Arabia as an opportunity rather than a threat. The more the region collaborates, the more the region will prosper. With the vision and optimism of our leadership, we are determined to succeed, grow, and develop. We are assured that this region will grow and have a future across political, economic, and social agendas.

How do you view the mid-term growth prospects of the logistics market in the MENA region?

JM The air cargo industry in the MENA region is strong. According to the latest IATA statistics, in 2017 international freight ton kilometers registered by airlines in the Middle East recorded growth of 8.1%. Governments around the region are also investing in the development of the logistics and transportation industries. The UAE's Vision 2021 and Saudi Arabia's Vision 2030 will see investment in developing infrastructure, which in turn will support the growth of the local logistics industry. In addition, airport expansion projects in several GCC countries will support the region's growing aviation sector by providing facilities for the increasing numbers of flights. Today, the UAE, and Dubai in particular, is a vibrant hub for the region's air cargo industry. In 2016 alone, Dubai International Airport handled nearly 2.6 million tons of cargo, and Dubai World Central handled close to 900,000 tons.