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December 2017 Issue 43



CARGO CARRIER Emirates SkyCargo Tristar

Adopts blockchain

Transforming the supply chain Is blockchain the answer?

The pharma chain

Hellmann identifies today’s trends

                                                                  

         

Bespoke Logistics Project of the Year 2017

Domestic Logistics Service Provider of the Year KSA 2017

GCC Supplier Of The Year 2017 KSA Supplier Of The Year 2017

The e-commerce hustle SIGNATURE MEDIA FZ LLE P. O. Box 49784, Dubai, UAE Tel: 04 3978847/3795678 Email: Exclusive Sales Agent Signature Media LLC P.O. Box 49784, Dubai, UAE Publisher: Jason Verhoven Manager: Brian Cordeiro Managing Editor: Munawar Shariff Art Director: B Raveendran Production Manager: Roy Varghese

Printed by United Printing Press (UPP) – Abu Dhabi Distributed by Tawseel Distribution & Logistics – Dubai

Contributor’s opinions do not necessarily reflect those of the publisher or editor and while every precaution has been taken to ensure that the information contained in this handbook is accurate and timely, no liability is accepted by them for errors or omissions, however caused. Articles and information contained in this publication are the copyright of Signature Media FZ LLE & SIGNATURE MEDIA LLC and cannot be reproduced in any form without written permission.

The talk of e-commerce is the focus of all businesses in the supply chain and logistics industry. For each of the articles I worked on, I realised that whether we focused on air cargo, warehouse management, logistics operations or fleet management, technology was integral to all aspects of the business and industry. As they say, you can love it or hate it but you cannot ignore it. Let me tell you about our cover story, the request for a face-to-face interview with the Emirates SkyCargo chief, Nabil Sultan, was put in by us way back in 2014. And here we are finally with our interview on page 22. It’s full of insights on the air cargo industry and how this year has been better for business that the last eight years. Blockchain, the technology that is so safe, secure and fast that all the hiccups in the supply chain will vanish with the common adoption of it by industry businesses. A blockchain is a distributed, digital ledger. The ledger records transactions in a series of blocks. It exists in multiple copies spread over multiple computers, which are also called nodes. The ledger is secure because each new block of transactions is linked back to previous blocks in a way that makes tampering practically impossible. As it is decentralised, it does not depend on any single entity (like a bank) for safekeeping. The nodes connected to the blockchain network get updated versions of the ledger as new transactions are made. The multiple copies of the ledger are the“truth”about every transaction made so far in the blockchain. Trying to falsify the ledger would mean having to falsify the copies at precisely the same moment. The chances of being able to do this in blockchain networks of any useful size are negligible. So are we ready for this? This isn’t really the question anymore. It is when will your business comply with it. Have a peaceful holiday season and Happy New Year! See you in 2018, InshaAllah.

Munawar Shariff Managing Editor


December 2017 Issue 43


22 06 News 16 Country report Africa Giving growth a chance The continent battles with its economic potential being subdued due to power struggles in many countries

22 Cover View from the top Nabil Sultan, Divisional Senior Vice President - Cargo, Emirates SkyCargo, shares his thoughts on the air cargo industry

30 Pharmaceutical logistics - the status quo Cindy Engelbart, GM - Healthcare, Hellmann Calipar Healthcare Logistics DWC-LLC, on the current state of affairs of the pharmaceuticals logistics industry in the country and region


36 Guest column Sprouting green jobs Ivano Iannelli, CEO, Dubai Carbon, writes about the transition to a resource efficient, low carbon and inclusive green economy

38 The truck for all drivers UD Trucks recently launched it’s heavy duty Quon truck at the Tokyo Motor Show

40 The big data era Bahri Logistics followed up its inaugural big data forum held last year with this year’s edition

42 Blockchain revolutionises Tristar Tristar Group recently deployed blockchain technology in order to move its logistics business into the future

48 How blockchain can transform the supply chain Blockchain could be the answer to many blockages in the current supply chain. Blockchain is what drives bitcoin and other so-called cryptocurrencies

55 Digital logistics DB Schenker wants to shape the future of digital logistics and is investing millions to strengthen its strategic collaboration with uShip

58 DHL’s new airport facility DHL Express’s new facility at Dubai International’s Cargo Terminal is poised to boost regional e-commerce operations

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SANY signs a US$ 86 million contract in Kuwait SANY Heavy Industry signed a US$ 86 million purchasing agreement with a Kuwaiti engineering construction contractor. This is SANY’s largest international order in Middle East. SANY will provide a full range of its products to its Kuwaiti customer, including more than 600 truck cranes, excavators and rotary drilling rigs. The 600 machines will be used in Kuwait’s


national infrastructure projects, which are expected to promote the implementation of “Belt and Road Initiative” in the Middle East. Xiang Wenbo, President, SANY Heavy Industry, said that SANY developed specific products to suit the tough working conditions in the region. Since its first entry into the Middle East market in 2006, SANY’s machines have participated in a number of mega projects’

construction, including Burj Khalifa Tower, Jazan Economic City in Saudi Arabia and the world’s largest airport - King Abdulaziz International Airport. SANY has gained high appraisal in Middle East market by its quality products’ excellent construction performances and perfect service system. The Middle East market has always been a focus of the fierce competition of global construction machinery manufacturers.

DEWA’s water reservoirs to be powered by solar photovoltaic systems Etihad Energy Services Company (Etihad ESCO) has been awarded the development, and installation of solar photovoltaic (PV) systems to be installed at Dubai Electricity and Water Authority (DEWA) water reservoirs. The installation of solar PV systems on DEWA’s water reservoirs will reduce the Emirate’s carbon footprint and increase the proportion of solar power in Dubai’s energy mix. “The solar PV systems will promote sustainable development, which will reinforce the UAE’s position as one of the most advanced countries for alternative energy,”said Ali Al Jassim, CEO of Etihad ESCO. Etihad ESCO will design the solar PV systems and install them on DEWA’s water reservoirs. “The installation of solar PV systems on DEWA’s water reservoirs is another breakthrough, which drives us closer to achieving the Dubai Clean Energy Strategy 2050, that aims to provide seven per cent of Dubai’s total power output from clean energy by 2020, 25 per cent by 2030 and 75 per cent by 2050,” said Christos Mimikopoulos, Executive Director of Solar – Etihad ESCO. The company stated that the total installed capacity of solar PV systems on water reservoirs could reach up to 60 MWp. According to a report by Frost and Sullivan, the GCC’s installed solar capacity is expected to reach 76 GW by 2020. Egypt is hoping to interconnect 2,650 MW of PV capacity by 2020, Morocco is aiming for 600 MW, while Jordan has 540 MW of PV projects under construction with more expected before the end of 2017. With a wave of solar projects already underway across Dubai, the Emirate is set for a green revolution with alternative energy.

Sustainable waste treatment in Abu Dhabi by Ennesys French award-winning biotechnology company, announced with its venture partner OriginClear Inc., a leading provider of water treatment solutions, that it recently completed a one year demonstration of its FREEWATERBOX™ technology in Abu Dhabi, United Arab Emirates (UAE). The containerised, self-sufficient waste water processing system recycles solid organic food waste and sewage into valuable byproducts including fertilizer, algae-based soil conditioner and irrigation-grade water. Since its installation a year ago, the FREEWATERBOX has operated continuously in the desert climate of Abu Dhabi where, as Ennesys states, it processes up to 45 metric tons (about 16,000 gallons) of organic wastewater daily into irrigation water, while turning 500 kg of solid kitchen waste every day into 150 cubic meters of biogas for onsite electricity – rendering the system completely self-sufficient. “Poor recycling of solid food waste is a major world problem that Ennesys helps to solve while showing the potential to reverse desertification,” said Riggs Eckelberry, CEO of OriginClear. In addition to the irrigation water and biogas, the system produces daily 80 kg of high-grade compost and 300 liters of algae-concentrate soil conditioner, branded as Alphybios™. According to Ennesys, Alphybios is a stimulant rich in vitamins and minerals that strengthen plants’ immune systems and reduce their need for water and fertilizer. In fact, a study co-

sponsored by OriginClear showed that algae concentrates may reduce conventional fertilizer expense by up to 40 percent. The Alphybios algae-concentrate soil conditioner is added to the irrigation water from FREEWATERBOX to grow test crops near the pilot system. Even though the test plot ground is primarily desert sand, sugar cane, tomatoes and other plants flourish there. In 2011, OriginClear helped launch Ennesys to target France’s sustainable energy law, RT 2020, which will require that buildings achieve a positive energy balance by the year 2020. Over the past few years, OriginClear has also provided Ennesys with algae harvesting, water sanitizing equipment, and technical expertise. OriginClear also transferred three algae-related patents to Ennesys on preferential payment terms to enhance its technology portfolio. Over the past few years, OriginClear has also provided Ennesys with algae harvesting, water sanitizing equipment, and technical expertise. OriginClear also transferred three algae-related patents to Ennesys on preferential payment terms to enhance its technology portfolio. “The support provided by OriginClear over the years has been invaluable,”said Pierre Tauzinat, CEO of Ennesys.“We look forward to commercializing the FREEWATERBOX and are confident the technology will contribute to the world’s struggle toward water and food security.”


Carbon credits drive green funding in Dubai Dubai Carbon announced its first carbon credit transaction, with the sale of the resulting Certified Emission Reductions (CERs) from DEWA Chiller Station L Project through adopting the Clean Development Mechanism (CDM) to Farnek Total Facility Management. This initial sale paves the way for expansion of the green economy in Dubai, inviting further investment in Clean Development Mechanism (CDM) Projects in the Emirate. This inaugural sale of locally issued CERs contributes to the growth of green projects, and is a breakthrough in Dubai Carbon’s efforts as a green economy enabler. The sale which depends on locally produced CERs, enhances the development of Green Projects in Dubai, since it is considered as a major achievement in investing in CDM in the Emirate. The sale will also aid the efforts of Carbon Dubai in reducing the greenhouse gas emission footprint, and augment Dubai’s green economy ambition, as it reflects the growing demand for CERs in a diligent pursuit of sustainable development. The project contributes to the isolation of 1,000 CERs (equal to 1,000 tonnes of CO2) achieving Farnek Total Facility Management’s emission reduction targets, highlighting the organisation’s commitment to social and environmental projects in Dubai.


HE Saeed Mohammed Al Tayer, MD and CEO of DEWA said:“DEWA is committed to support the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, and the Dubai Clean Energy 2050 strategy, and Dubai 2021 plan, to make Dubai a smart environmentally clean sustainably healthy city, and for that, we support CDM projects”. “Our environmental strategy focuses on reducing carbon emissions based on the best integrated green practices at all levels of our operations to ensure protection of natural resources, and creating a sustainable carbon market is an important part of our vision, which is to build sustainable financing for green projects, and bring best practices into the market. We are pleased that Farnek was able to offset their CO2 emissions through our Chiller Station L Project and wish them success for further adoption of clean and and renewable energy sources in the future. We are confident that Farnek will benefit from these units to reduce the effects of global warming on our planet for future generations,”he said. Dubai Electricity and Water Authority (DEWA) is a key supporter of carbon reduction programs and is constantly

recording new CDM projects with Dubai Carbon to reduce carbon emissions. The Chiller Station L Project , which is the source of the sale of recently sold CERs, also records high rates of reduction of 26,800 tonnes of carbon dioxide per year, one of the few CDM projects in the Gulf region producing carbon credit units, where 95,197 carbon credit units have been issued so far. “Farnek chose to invest in the local economy in line with their corporate culture and expertise, thus aligning themselves to the country vision and ambition.”commented Eng. Waleed Salman, Chairman of Dubai Carbon.“We hope this will inspire other organisations in the Emirates to follow suit to mitigate the negative impacts on the environment,”he added. Markus Oberlin, CEO, Farnek, commented: “Being a leader in providing innovative and bespoke solutions in the facility management sector, we are keen to invest in offsetting our emission footprint and reducing the impact of our businesses on the environment. We are proud to be the first to purchase CERs from the maiden project generating carbon credits in the GCC. It also gives us the opportunity to support the efforts of the Dubai Government in creating an environmentally responsible economy.” launches electric cars for AED 5 per hour in Dubai, UAE announced the launch of a new segment of all electric cars (E-Cars) to its online fleet of Self Drive car rental in Dubai. In a unique initiative to promote E-Cars; has become the first online self drive rent a car portal in the UAE to host E-Cars on the company’s“Smart Mass Mobility Technology”(SMMT) Platform. As part of this initiative the company offers Renault Zoe All Electric Car at an introductory price of 5 AED an hour with a min billing cycle of 24 hrs with a range of 250 kms per day. These vehicles can be rented on demand and can be reserved via web and pwa. This offer is applicable for residents and tourists and can be reserved for a day, week or for a monthly lease. Clients renting this car would have the option to charge the car free of cost at more than 90+ Dubai Electricity and Water Authority (DEWA) locations. Speaking about the introduction of electric cars to its fleet, Soham Shah, Founder and Director Pinewoods Technology Services Dubai (holding company of, said,“We are thankful to Road Transport Authority (RTA) and Dubai Electricity and Water Authority (DEWA) for collaborating to incentivize electric cars by allowing free charging across all DEWA Car charging stations, free parking and Salik Tag.”

New orders at Dubai Airshow US companies were big winners at the 2017 Dubai Airshow as UAE customers placed more than $44 billion in new orders for commercial aircraft and defense-related equipment and services. “US companies remain the preferred supplier for UAE commercial and military aviation requirements,” said Ambassador Yousef Al Otaiba. “US exports of commercial and military aircraft, services and equipment to the UAE make up the largest share of America’s $19 billion trade surplus with the UAE.” At the Airshow, Emirates Airline placed firm orders for 40 Boeing 787-10 Dreamliner aircraft valued at $15.1 billion. According to the US Department of Commerce jobs multiplier, this order alone will support 78,000 US jobs – both at Boeing and at its suppliers across the US. Also at the Airshow, UAE-based regional airline flydubai announced a separate $27 billion order for 225 Boeing 737 MAX Airplanes, the largest-ever single-aisle jet order by a Middle East carrier. flydubai operates an all-Boeing fleet of planes. “The UAE’s airlines rely on Boeing airplanes to meet the growing demand for air travel in the region, and between the region and Asia, Africa, Europe and North America,”said Ambassador Yousef Al Otaiba.“Over the last decade, UAE customers have purchased over $150 billion in Boeing aircraft, supporting hundreds of thousands of American jobs.” The 787-10 aircraft will be assembled at the Boeing facility in North Charleston, South

Carolina and the 737s will be manufactured in Renton, Washington. Emirates is also the world’s largest operator of Boeing 777 aircraft, and was the launch customer for the 777X. In 2013, Emirates announced the largest commercial airplane order in the history of US commercial aviation with commitments and purchase rights for a total of 200 Boeing 777X aircraft. According to Boeing data, it has delivered or has on order a total of 329 aircraft for Emirates. flydubai has a total of 361 Boeing 737s on its order books, with 63 planes already having been delivered. Abu-Dhabi-based Etihad currently flies 24 777 aircraft with 25 more on order, along with an $8.7 billion order for 78710 aircraft first announced in 2013. Including the latest agreements, UAE airlines have received or have on order more than 800 Boeing aircraft, according to Boeing data. In the defense sector, the UAE agreed to a $1.6 billion deal with Lockheed Martin to upgrade the UAE Air Force’s fleet of 80 F-16 fighter jets. The F-16“Block 60”is regarded as the most advanced version of that aircraft ever produced, and it forms the backbone of the UAE Air Force’s fleet. The UAE also announced a $684 million deal with Raytheon for precision-guided munitions. “The deals between UAE customers and US companies will support American jobs and help grow the US economy,” said Ambassador Yousef Al Otaiba. “The UAE is proud to partner with US manufacturers to create shared prosperity and advance our mutual security interests.”


GCC chemical industry to sustain region’s non-oil economic growth Data released in a new report by the Gulf Petrochemicals and Chemicals Association (GPCA) has highlighted the role of the chemical industry in diversifying the regional economy and accelerating non-oil economic growth. According to the report, in 2016 the GCC chemical industry contributed around $43.8 billion to the GCC economy, equal to almost one third of manufacturing value added and 29 per cent of manufacturing revenue. The UAE chemical industry’s contribution was the highest among all GCC states, accounting for 52 per cent of manufacturing revenue. Off the back of significant investments over the past decade, the UAE almost doubled its share in overall regional capacity from 4.7 per cent in 2006 to 8.5 per cent in 2016. Dr Abdulwahab Al-Sadoun, Secretary General, GPCA, who met with key regional media during a roundtable, commented, “The past year has been a very positive

time for the regional chemicals industry. The UAE industry’s growth has thrived post 2009 outpacing the overall GCC production index. This indicates the country’s aspirations to position the UAE as a key regional manufacturer of petrochemicals and fertilizers, while maintaining a healthy environment to sustain such aspirations. The following days of the Annual GPCA Forum will bring the entire sector together in unity and multiply our successes and learnings.” “The sector’s contribution to economic growth has also been exemplary, which highlights the role of the industry as a key enabler in the journey towards economic diversification. For every job created in the industry, there are about three jobs created in other sectors. To sustain this growth, chemical output from the region has had to grow by 9.2 per cent over the past decade,”he continued. GCC chemicals output grew at the fastest pace in five years, with chemical production

growing 8.5 per cent from 2015 levels, reaching 158.8 million tons. In 2016, the GCC chemical industry reported $77 billion in sales revenue, down 3 per cent from the previous year as a result of changes in global petrochemical prices. The chemicals industry directly employs 152,100 people in the GCC, while investing $584 million in research and development.

SAI Global expands Middle East presence with Dubai office SAI Global recently opened an office in Dubai to help organisations throughout the Middle East enhance their risk management programs. The new office addresses increasing demand and growth the company has experienced since it first entered the region in 2015. SAI Global will build upon a solid customer base established across the region’s banking, energy and oil sectors, including Kuwait Petroleum Corporation (KPC). These businesses rely on the company’s integrated risk software and learning solutions to mitigate risk through practices that bring transparency, consistency, and accountability.

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“The market for risk management solutions and compliance training is rapidly growing throughout the Middle East,”said Peter Granat, CEO of SAI Global.“There’s strong demand among companies in the region for our leading environmental health and safety (EHS) and IT risk software solutions. These companies are ambitious in their goals to be among the best managed companies in the world and our enhanced presence here better enables our commitment to these customers.” According to a representative of Agility, a logistics leader in Kuwait“To protect our hardearned brand reputation and

build public trust, it’s essential for us to cultivate an ethical culture across our organization. SAI Global has really helped us to create awareness, increase transparency and reduce risk. This has enabled us to align our employee conduct with our company values, as well as establish an effective, defensible compliance program with measurable results.” SAI Global’s Dubai office will be headed up by a locally appointed team of risk management experts responsible for evolving the company’s business in the region. As referenced in Gartner’s ‘Magic Quadrant for IT Risk

Management Solutions’ (June 2017),“according to 200 inquiries in 2016 and 2017, bringing efficiencies in managing compliance and regulatory reporting for ITrelated risks continues to be the primary driver to evaluate IT risk management (ITRM) solutions. We also continue to see more interest among buyers trying to answer inquiries from their boards or customers about ITRM’s close link to cybersecurity initiatives. This is especially true in North America and Europe; however, the Middle East, Brazil and India are also showing signs of increased interest in ITRM solutions’ capabilities.”

Seven per cent growth of oil and gas companies in Jafza Jafza, one of the world’s largest free zones, has seen seven per cent growth in the number of oil and gas companies during 2016. DP World Group Chairman and CEO, Sultan Ahmed Bin Sulayem said,“Jafza’s prime location as a gateway to the Middle East, Africa and South Asia attracts oil and gas companies looking to enhance their presence

Novasep supplies MENA sugar industry leader, Al Nouran Egypt-based Al Nouran has signed a contract with Novasep to provide process units for the largest sugar production facility in the MENA region. The plant is a greenfield project for producing more than 270,000 tonnes per annum of white beet sugar and an additional 315,000 tonnes per annum of refined white cane sugar. The Novasep team provides two process solutions: • A decalcification plant for the beet sugar factory allowing an effluent-free softening process • A decolorization plant with a brine

recovery system for the refinery part “The plant will be one of the largest in the MENA region and will benefit from our latest design and optimization for sugar decolorization and proven robustness of our juice decalcification.” Nadège Laborde, President of Novasep Industrial Biotech Business Unit, said. According to the report,“World Sugar production, supply and distribution”, Egypt imports one third of the country’s sugar supply. This project is aimed at addressing local supply needs as well as exportation opportunities.

KERUI Petroleum, aggressively targets ME growth

in these markets and serve their customers more efficiently through our flagship Jebel Ali Port.”Bin Sulayem revealed that 28 per cent of oil and gas companies in Jafza originate from the Middle East, followed by 26 per cent from the Asia Pacific region, 25 per cent from Europe, 18 per cent from North America and three per cent from Africa. He also said that Jafza had strengthened its strategic position as a regional oil, gas and petrochemicals platform thanks to its growing customer base which includes leadings brands with growing interest from other multinational companies looking to establish their regional presence. In April, China’s CNBC announced the establishment of its 55,000 sq metre regional headquarters in Jafza. It will consolidate all of CNBC’s 16 listed entities under one roof.

KERUI Petroleum, a Chinese oilfield service and equipment manufacturing firm, showcased some of its star products and technologies like oilfield stimulation and well control equipment, fast moving drilling rigs and natural gas compressors, as well as oilfield stimulation technologies, drilling and work-over services and engineering modularization solutions at recently held ADIPEC in Abu Dhabi. “Since our first display at ADIPEC in 2006, we have established our marketing network across the Middle East,”said Andy Leng, Vice president of KERUI Petroleum.“Going back more than a decade, and having set up subsidiaries in several countries, including Iraq, Kuwait, Oman, Saudi Arabia, Turkey, the UAE etc. In the region, we have now a marketing team of more than 200 employees, 50 per cent of whom are native and multi-

national. By enhancing our localised efforts to benefit our regional customers, we are building out a business model combining product and technology marketing together with one-stop maintenance services. In the oilfield services segment, the company has expanded its drilling, work-over, as well as integrated oil and gas field stimulation services in Iraq, Kuwait, Oman etc.”

DECEMBER 2017 11

country counting amongst Italy’s primary trade partners in the Arab region. The UAE Ministry of Economy revealed that non-oil trade between the two countries reached about US$8.2 billion in 2016, up from US$7.8 billion in 2015. Biesse Group is the 39th Italian company to choose Dubai Silicon Oasis as its regional operations base, and we are confident the latest addition to our hi-tech park will significantly benefit from available offerings at our Light Industrial Units complex.” Biesse’s decision to establish a regional Operations and Client Affairs, at Dubai Silicon base was influenced by a highly favourable Oasis Authority (DSOA), along with Federico trend in the performance of the Middle Broccoli, Biesse Group Subsidiaries Division East branch, which recorded a 50 per Director, Juma Al Kait, Assistant Undersecretary cent increase in orders in September for the UAE Ministry of Economy’s Foreign 2017 compared to the same period of the Trade Affairs, Valentina Setta, Consul General of previous year. In addition, the new premises Italy to the UAE, and Renato Manganelli, Biesse in Dubai Silicon Oasis is part of Biesse Middle East Managing Director, inaugurated Group’s three-year strategic plan and a the new facility in the presence of local partners, natural result of a significant organic growth stakeholders and customers. in sales (+16.9 per cent in the first half of Speaking on the new facility, Al Matrooshi 2017 compared to 2016) accompanied by said: “Growing bilateral trade shows that Italy is one of the most important trading partners of an increase in market shares across the the UAE in the European Union today, with the company’s business divisions.

BIESSE group debut regional HQ at DSOA Biesse Group Dubai Campus, the regional subsidiary of the global leader in wood, glass, stone, plastic, and metal processing technology, inaugurated its regional headquarters for the Middle East – a Dubai Campus that features a state-of-the-art showroom and training centre in Dubai Silicon Oasis, the integrated free zone technology park. A three-day event marked the launch of the new facility showcasing Made-in-Biesse technology solutions and offering visitors a chance to interact with experts in the field. Dr Juma Al Matrooshi, Deputy CEO,

Ford Trucks presence in Kuwait Ford Trucks recently announced that it has appointed Alghanim Auto as the official dealer for Ford Trucks Heavy Commercial Vehicles in Kuwait. Alghanim Auto is part of the Alghanim Industries automotive group, which includes Ford Motor Company and Lincoln Motor Company. This new partnership was announced and celebrated during a press event at the Dar Hamad

12 DECEMBER 2017

Restaurant. The event was attended by CEO of Alghanim Industries, Omar K. Alghanim, Director of International Markets at Ford Trucks, Ercan Emrah Duman, the Ambassador of the United States, H.E. Lawrence Silverman, the First Counselor of the Republic of Turkey, Ali Bozçalışkan, executives from Ford Trucks and Alghanim Auto and other prominent guests.

The new Ford Trucks facilities for sales, service and parts will be open soon in Ahmadi. Furthermore, Alghanim Auto will offer various transportation solutions ranging from international extended warranty programs backed by the manufacturer, customized maintenance packages for up to five years, a mobile workshop service to provide repairs and maintenance to increase vehicle

uptime, 24/7 roadside assistance, technician and driver training for customers, as well as fleet management systems with built-in connectivity as a standard on all truck models. This partnership allows Ford Trucks to presents a wide range of vehicles in Kuwait distinguished with their power, efficiency, fuel economy and technology, including tractors, construction trucks and road trucks with a high capacity payload. During the event, the guests had the chance to be the first to discover the Ford Trucks line-up displayed for the first time in Kuwait: The Tractor, Construction, and Road series. The three series were presented in an interactive way showcasing their features and their competitive edge.

AirBridge Cargo’s third weekly service from Munich Airport Since the start of September, AirBridgeCargo has strengthened its position at Munich Airport by adding a third weekly flight. Responding to the rising demand for export and import cargo connections to and from Southern Germany, this cargo carrier, which already operates a service on Fridays and Saturdays, now also deploys a Boeing 747-8F on Sundays. This links the Bavarian capital with 12 destinations in Asia via the airline’s hub in Moscow. Says Sergey Lazarev, the General Director

of AirBridgeCargo Airlines:“We are optimizing our route network in Europe and worldwide based on the market sentiments and customer demands. ABC continues structuring relations with cargo friendly airports with the highest

technical capabilities, which offer fast, flexible and cost-effective services, on a 24/7 basis, to the interest of our customers. There is no doubt that Munich is ideally positioned to play this role.”

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Web: DECEMBER 2017 13

(Left to right) Lukas Eigenmann, COO, Farnek, Sandrine Le Biavant, Director Consultancy, Farnek, Ahmad Zaher Sabbagh, Deputy General Manager for Arabian Automobiles Company Renault and Markus Oberlin, CEO, Farnek

Farnek first to pick-up ZOE UAE-based sustainability leader and total FM company Farnek, has taken delivery of its first electric vehicle – the all-new Renault ZOE 40 from Arabian Automobiles Company the flagship company of the AW Rostamani Group and the exclusive dealer for Renault in Dubai, Sharjah and the Northern Emirates, as it endeavours to reduce its impact on the environment still further, by operating its business more sustainably. Renault’s ZOE 40 fully electric model will help Farnek to reduce its carbon footprint by saving 17 tonnes (78 per cent) of carbon emissions annually, compared

with any of the existing saloon cars in its fleet, that travel approximately 72,000 kilometres per year. The delivery is certainly timely, as Farnek’s headcount climbs above 5,000 employees, putting added pressure on its transportation, which currently comprises of over 200 vehicles. Markus Oberlin, CEO, Farnek, said,“It is part of our business strategy to have a more energy efficient fleet in line with the UAE government’s recommendation that 10 per cent of our transportation fleet should be electric by 2030. We also hope that once our customers see our

branded Renault ZOE 40, it might inspire them to consider lowering their own carbon emissions.” The ZOE 40 is the flagship of Renault’s Z.E. (Zero Emissions in use) vehicle range, is an all-electric, multi-award winning, five-door supermini. With the new Z.E.40 battery, ZOE’s range is 400 KM (NEDC) – Renault estimates that in real-world driving conditions this equates to around 300 km. The ZOE 40 can charge from zero to 80 per cent full in as little as 60 minutes thanks to its patented Chameleon Charger™ that allows it to make the most of the widest range of power supplies and also keep charging times to a minimum. Renault’s Range OptimiZer technology ensures the ZOE 40 is highly efficient with its heat pump, a bi-modal braking system and Michelin ENERGY E-V tyres all as standard. Farnek was the first organisation in the GCC to introduce carbon neutral buses in 2010, for which Farnek now offsets 88 tonnes of carbon emissions every year at a cost of almost $3,000 annually. Over the past two years the company has also reduced the amount of carbon emissions per employee transported by almost half (44 per cent) reaching 118 kilos for each member of staff transported.

(Left to right) Markus Oberlin, CEO, Farnek, Joanna Spruce, Director of Business Development and Marketing, Farnek, Sandrine Le Biavant, Director Consultancy, Farnek, Lukas Eigenmann, COO, Farnek

14 DECEMBER 2017

Takhzeen logistics announces its first logistics platform Takhzeen Logistics Company (TLC) recently announced the launch of its first logistics platform in UAE a state-of-the-art temperature controlled warehousing facility in Dubai, UAE. The opening comes as part of the company’s regional expansion plans across borders with the aim of connecting the Middle East markets. TLC Dubai is Located at Dubai World Central over 6,000 sq m, the warehouse is air conditioned with a capacity of over 8,500 pallets position. The company will provide its customers with seamless and integrated third party logistics solutions through innovative technology, skillful team, and operational efficiency customized to their logistics needs and challenges, while maintaining the highest level of social responsibility, security and compliance. The aim is to fluidify the connection of UAE and KSA markets facilitated through a remarkable fleet of reefer and ambient trucks along with specialized Customs Clearance Agents at borders. Al Muthana Al Kaid, Executive Director and Board Member, Takhzeen Logistics Company commented:“Our most advanced Warehousing Management System drives the process of offloading, sorting, put away, picking, packing, shipping and inventory control. Our warehouses are equipped with temperature monitored devices to track deviations and provide alarms. We, along with our 4PL business partner, Integral DMCC, are committed to continuously improve our business processes in order not only to meet but exceed the expectations of our existing and potential customers. We do hold a high commitment to quality and innovation towards our clients and our organization.� Services offered by TLC Dubai include but not limited to warehousing, value added services, customs clearance, cross docking/ shipments consolidation and transport by road within the region.

Al Naboodah leads discussion on supply chain management and sustainability Al Naboodah Group Enterprises (ANGE) took a leadership role on supply chain best practices by hosting its first Supply Chain Stakeholder Conference. With a strong theme of sustainability, the event was one in a series of measures that ANGE is undertaking to emphasise its commitment to adopt socially responsible practices throughout the supply chain. The conference brought together ANGE executive management, strategic partners and stakeholders at the Meydan Hotel, with the aim to create a platform for constructive dialogue on supply chain governance, opportunities, challenges, and sustainable best practices. Through a series of presentations by industry leaders, starting off with ANGE and followed by insights from OBO Betterman, FK Construction, Knauf, Ernst and Young and a prominent government body,

the prevailing message was one of collaboration and change. Over the past year, ANGE has taken significant strides in implementing a supply chain governance framework, which included the introduction of a Supply Chain Code of Practice and a Supply Chain Charter, a set of strategic guidelines for good practice amongst supply chain partners. The Code covers responsible practices in international labour and human rights, health and safety, environmental awareness, zero tolerance of corruption, local community development and timeliness. As a measure of accountability, the Charter represents a commitment by ANGE suppliers to adhere to the practices set out in the Code of Practice. To-date, 63 per cent of ANGE suppliers approached have signed the Charter, committing to the guidelines for their own supply chain operations.

DECEMBER 2017 15



growth a chance Even though there are multiple factors at play when it comes to moving ahead economically for Africa, the fact that political parties are jostling for power really sets the entire equation of growth on the backburner. Focus Economics economists and panellists provide a brief look at the major players in the continent

T Aerial view of Durban, South Africa

16 DECEMBER 2017

he economic turnaround of the Sub-Saharan Africa (SSA) economy continued in the second quarter, with growth accelerating for a third consecutive period. Comprehensive data showed that regional GDP increased 2.6 per cent annually, notably above Q1’s 1.9 per cent expansion. Recoveries in the region’s largest two economies - Nigeria and South Africa drove the improvement, while several

smaller economies also experienced faster growth. Incoming data suggests that momentum waned slightly in Q3, and FocusEconomics analysts project that GDP increased 2.5 per cent annually. Low confidence, high unemployment and falling real incomes likely kept growth constrained in South Africa. Ghana’s economy is also projected to have slowed notably after a stellar Q2. In recent weeks, policymakers across


the region have eyed different measures to spur economic activity. The government of Nigeria unveiled a record NGN 8.6 trillion budget (approximately US$ 28.2 billion), centered on ambitious capital spending. While large expenditure spending could ramp up growth, doubts persist as to whether the government will meet ambitious expenditure and revenue targets. Political wrangling could delay implementation, as the budget still needs

DECEMBER 2017 17


Biking on the coast South Africa

to pass both house of parliament - a process that could take months. Meanwhile, Angola’s new President, João Lourenço, has vowed to dismantle state monopolies, although it is still uncertain if bold reforms will be pushed through. In October, Uganda entered talks with the IMF for a macroeconomic programme to develop the economy, however, discussions are likely to be lengthy and little is known about the programme’s details.

Outlook Growth prospects sour for 2018 Improved confidence, higher commodities prices and stronger performances in the region’s largest economies should drive firmer growth next year. FocusEconomics analysts see GDP growing 3.3 per cent in 2018, down 0.1 percentage points from last month’s forecast. In 2019, growth is projected to accelerate to 3.7 per cent. This month’s 2018 GDP forecast was downgraded, on the back of cut projections for Angola, Côte d’Ivoire, DR Congo, Kenya, Mozambique and Uganda.

18 DECEMBER 2017

Mozambique’s GDP projection was slashed 0.5 percentage points as FocusEconomics analysts see the country’s large debt burden, ongoing standoff with lender and austerity measures keeping a lid on growth. Forecasts were raised for Botswana and Zambia, while five countries saw no changes to their outlooks. Ethiopia is expected to be the fastest-growing economy next year, expanding 7.3 per cent. On the flip side, the region’s heavyweights will grow most slowly: South Africa is expected to grow 1.3 per cent, followed by Angola with 2.5 per cent growth and Nigeria with a 2.6 per cent expansion.

Nigeria Government unveils record budget amid stronger economic activity Incoming data suggests that activity firmed up in recent months, after the economy returned to growth in Q2. The PMI rose to the highest level since December 2014 in October. Higher oil prices along with a return to normal oil production after the completion of repair work

earlier in the year should give a boost to export revenues. In early November, the government presented its 2018 budget, which focuses on stoking growth in the battered economy. The record NGN 8.6 trillion (approximately US$ 28.2 billion) budget focuses on capital spending and targets a deficit of NGN 2.0 trillion, slightly down from the deficit in the 2017 budget. To fund the ambitious spending plans, President Muhammadu Buhari stated that the government would borrow over NGN 1.5 trillion, increasing the country’s debt burden. While developing badly-needed infrastructure could boost economic activity, the government has previously fallen short on both revenue and expenditure targets, generating uncertainty as to whether they will meet the 2018 goals. Moreover, the budget must still pass through both chambers of parliaments, a process that can take months and could delay implementation. The 2017 budget was not passed until the middle of the year. Higher oil prices and output, combined with largescale infrastructure projects, should boost


growth next year. FocusEconomics panelists see the economy growing 2.6 per cent, unchanged from last month’s forecasts. In 2019, GDP is seen expanding 2.9 per cent.

South Africa

Statue of the three Nigerian Tribes lifting the Nigerian Map

Economic woes take a toll on government finances The most recent data suggests that the economy continues to struggle after coming out of a technical recession in the second quarter. In the government’s mediumterm budget policy statement released in October, the government confirmed that the fiscal deficit for the 2017/2018 fiscal year is expected to reach 4.3 per cent, widening from the 3.1 per cent fiscal shortfall observed in the previous fiscal year and the largest fiscal shortfall since 2009. The unemployment rate in Q3 remained extremely elevated at 27.7 per cent, the same print observed in the previous quarter, a bad sign for private consumption. Manufacturing production contracted in September, and the latest PMI data from October point to another month of falling output. The latest batch of economic data and the somber outlook given by the government in the budget policy statement have raised the alarm of a possible credit rating downgrade in late November by Moody’s and S&P Global Ratings, which could set the tone for the key ANC leadership contest in December. The economy is expected to recover in 2018 and 2019 on higher prices for commodities. Growth, however, remains constrained as incessant political noise has stalled implementation of reforms and is weighing on consumer and business confidence. Further credit downgrades or lower prices for commodities could also dent growth. FocusEconomics panelists

expect the economy to grow 1.3 per cent in 2018, and 1.8 per cent in 2019.

Angola New president shakes up government, eyes dismantling monopolies The speed at which the new president has been initiating measures to jumpstart growth in the economy has caught analysts by surprise. Following his inauguration in late September, President João Lourenço has vowed to dismantle state monopolies and has reshuffled key government positions including the Central Bank governor and the secretary of state for oil. While it is uncertain if the president will succeed in pushing through deep-seated reforms, the changes were promising. They coincided, however, with a credit rating downgrade from B2 to B1 by Moody’s on 20 October. The agency noted that the country’s growth outlook remains constrained, despite higher oil prices. Furthermore, persistent weaknesses and imbalances in the economy such as a foreign currency shortage and a weak banking sector have been exacerbated by an increasing debt burden, which has nearly doubled in four years and could rise even further if the kwanza is devalued. The Angolan economy is set to recover moderately in 2018 and 2019 amid higher oil prices. Nevertheless, growth is set to remain constrained as the non-oil sector remains plagued by market distortions, namely FX shortages. FocusEconomics panelists expect GDP to expand 2.5 per cent in 2018, which is down 0.1 percentage points from last month’s forecast. For 2019, growth is expected to reach 2.8 per cent. The Angolan economy is set to recover moderately in 2018 and 2019 amid higher oil prices. Nevertheless, growth is set to remain constrained as the non-oil sector remains plagued by market distortions, namely FX shortages. FocusEconomics panelists expect GDP to expand 2.5 per cent in 2018, which is down 0.1 percentage points from last month’s forecast. For 2019, growth is expected to reach 2.8 per cent. Inflation picked up from 27.5 per cent in September to 29.0 per cent in October. At its most recent policy meeting on 1 November, the Central Bank left interest rates unchanged at their current rate of 16.0 per cent due to lower persistently high inflation. FocusEconomics panelists expect inflation to average 18.6 per cent in 2018 and 13.4 per cent in 2019.

DECEMBER 2017 19


disrupted maize drying. Prolonged political deadlock, combined with the continuation of the government’s interest rate cap on commercial bank lending rates - which may take more time than anticipated to scrap - will weigh on growth. FocusEconomics panelists forecast GDP growth of 5.3 per cent in 2018, which is up 0.1 percentage points from last month’s forecast, and projects it rising to 5.8 per cent in 2019.

Monetary Sector

Durban City, South Africa

Cabinda crude oil continues to climb higher in October The average price of Angola’s Cabinda crude oil increased from US$ 56.8 in September to US$ 58.2 in October. October’s print was 19.3 per cent higher year-on-year and 2.5 per cent above the average price observed in September. The monthly reading marks the highest price since June 2015. Oil prices have been supported by tightening supply and indications of higher demand. Oilproducing countries are reaping the benefits of the OPEC output cut deal implemented last year. Stronger-than-expected compliance in October and expectations that the deal will be extended beyond March 2018 helped push prices higher. Positive economic data from developed and developing economies and expectations that demand for oil will firm up next year also contributed in the price rise. More recently, on 8 November, the price of Cabinda oil price reached US$ 62.3 per barrel. The most recent increase in prices reflects growing geopolitical tensions in the Middle East as Saudi Arabia and Lebanon are embroiled in a diplomatic spat. FocusEconomics Consensus Forecast panelists expect oil production to reach 1.78 mbpd in 2018. In 2019, the panel sees crude output inching up to 1.83 mbpd.

20 DECEMBER 2017

Kenya Political chaos continues to disrupt economic momentum Economic conditions have continued to deteriorate as the nation remains in the grips of the worst political crisis in a decade. Private sector activity contracted at a record pace in October, reflected by a sharp drop in the PMI to an all-time low. Asserting an improper electoral process that breached Kenya’s constitution, former MP Harun Mwau launched a legal challenge to Uhuru Kenyatta’s victory in the 26 October election re-run, leading to a political standoff. The main opposition, led by Raila Odinga, withdrew from the race over insufficient electoral reforms, paving the way for Kenyatta to secure more than 98 per cent of votes amid a low turnout. Odinga’s supporters boycotted the election. The Supreme Court has until 14 November to declare a verdict on the petition, which calls for the result to be nullified. Rising economic adversities from protracted uncertainty prompted the government to trim its growth forecast for this year to 5.0 per cent–5.1 per cent, down from 5.5 per cent, on 7 November. Heavy rains are expected to offer respite to agricultural output and help bolster growth, although the sudden rains have inflicted damage to infrastructure and

Inflation stabilizes in September Comprehensive data revealed that price pressures steadied in September, with inflation resting at August’s 12.7 per cent. The result was due to diverging inflationary trends in the region. Seven of the 13 economies experienced higher price pressures, while inflation stabilised in Nigeria. The remaining countries saw lower inflation. A preliminary estimate for October suggests that regional inflation inched up to 12.8 per cent. The Consensus forecast for inflation rose by 0.1 percentage points this month and now see inflation averaging 10.1 per cent in 2018. Behind the result was a large increase in consumer price projections for the DRC, which is suffering from soaring inflation due to a drastic weakening of the currency. In addition, Angola, Ethiopia and Ghana all had their inflation projections upgraded. In 2019, our panel expects regional inflation to average 8.5 per cent. -Angela Bouzanis Senior Economist

rovider of leading p a is s ic nom sis on the FocusEco and analy ts s a ators c re fo omic indic economic acroecon m t ast, n E a rt le o d the Mid most imp the untries in d o c n a y e a k ic 7 for 12 haran Afr a -S b s u S ie , n pe compa Asia, Euro -thinking rd ation a rm rw o fo F . timely in d Americas n a le b a ess ch reli right busin require su make the sive m n e te th x e lp to he nomics’ o c E s d u c o .F ts, couple decisions economis f are o r, rk e o d a tw ustry le global ne as an ind tation u n p io re it s d o li p o s with its pany’s m o c ence e ig th ll f so ess inte indication e for busin rc u o s l le b ncia as a relia major fina d e world’s panies an m o c l a among th n o ti a in lt u s, m institution s. nt agencie e m rn e gov


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View from the

Confident and with all its bases covered to face whatever the future throws at it, Emirates SkyCargo, is at the top and intends to stay there. Munawar Shariff chatted with Nabil Sultan, Divisional Senior Vice President - Cargo, Emirates SkyCargo, for his take on the status of the industry, business at Emirates SkyCargo and trends and disruptors to watch out for


mirates SkyCargo currently connects more than 155 destinations over 80 countries using a young and fuel efficient fleet of 255 modern wide bodied aircrafts which include 14 dedicated freighters to more than 45 scheduled global destinations 16 of which are freighter only. With the world’s most modern and fuel efficient fleet. The carrier is on the number two spot on the top 25 cargo carriers list compiled by Air Cargo News. It has been

22 DECEMBER 2017


Nabil Sultan

DECEMBER 2017 23


on this position for a couple of years now. Nabil Sultan, Divisional Senior Vice President - Cargo, Emirates SkyCargo is upbeat and confident as we sit in his office and talk about the industry outlook and overview. “Every year is a new challenge, but we can’t complain, honestly,”he says.“This year has been a lot better than the last eight years. We have witnessed demand improve and increase. Business outlook looks very good, we have seen a huge improvement in the uplift and quality of cargo.” And they are raring to go into 2018.“There are a lot of things on the agenda for the coming year. With the US economy doing so well, a lot of the Asian carriers have shifted their capacities across the Pacific, leaving a vacuum in capacity to Europe, Middle East and Africa. And we made good use of this opportunity to operate on these routes and manage this reduction simultaneously improving the quality of our business. The outlook for 2018 definitely covers this, as I see a strong US economy on the horizon. If that continues, we’re likely to see more of the same trend over 2018 and 2019 with probably some adjustments and shifts taking place.

We see new regions and new markets emerging for next year mainly around South America where we see the economy shaping up and rebounding. There will be lots of opportunities there for which we will need to assess, evaluate and make the decision

Our job will be to manage this demand and then spread it over our network of Europe, Africa and Middle East.” IATA has published a very strong demand for air cargo from five to six per cent across Asia, US and Europe.“The forecast for Europe is to a lesser extent, but we see demand growth into these key production markets and of course because of the shift in a lot of that capacity as we discussed earlier, we have to be prepared and align our capacity to ensure that we are able to meet this growing demand in these new parts of the world.” In this year, as the airline continues to expand with new destinations and higher frequencies to existing destinations, Emirates SkyCargo has noticed an ongoing growth from Hong Kong, one of the world’s key production markets and instantly increased their capacity from 22 freighters a week to 28 freighters a week.“The big improvement we see is in how Hong Kong continues to remain a key production market for us, demand has been very consistent throughout this year which is interesting to see therefore we have added more capacity we have almost

DECEMBER 2017 25

eight more flights (six additional) in addition to our 28 passenger flights per week, this I feel is a substantial capacity for one market. In China we have adjusted our frequency for our passenger belly capacity that we are currently offering. For Europe, we’re looking at different cargo hubs to launch operations to. We started this year by launching Luxembourg as one of our key destinations through our partnership with Cargolux which has helped us to enhance our frequency. It is critical for us to ensure that we move cargo across the network as there is somewhat of a repositioning taking place deep in Europe.” The partnership with Cargolux allows both carriers to enhance their networks and bring in new streams of cargo without any additions to their existing fleets.“The basic fundamentals of our partnership with Cargolux is very simple. They recognise the importance of aligning themselves with a networked airline which gives them

26 DECEMBER 2017

The region is catching up and soon it’s going to be widespread, countries such as Saudi Arabia, Pakistan, Africa are huge markets. There is so much opportunity in this part of the world

a reach and destinations which we offer and we realise the importance with regard to positioning substantial capacity in key production markets with their freighter operation which is quite critical for us. It therefore gives us the ability to use their key production markets to bring in cargo.”Win win for both, really.“This also means that Cargolux positions one of its 747 freighters at Dubai World Central for our exclusive use, this has been great from our perspective as we have been able to return one of our leased 747 freighters. As we continue to progress, we have a working group that looks at various opportunities across the globe whether they be at optimising our fleet across the networks and their network looking for opportunities where we can support each other. Commercially, however, we continue to remain completely apart we still market and sell our product individually and they do the same. But other than that, for operation


The cool chain We also chatted with Julian Sutch, Manager Cargo Global Accounts, Emirates about the carriers pharmaceutical business. What capacities are you handling at SkyPharma since opening last year? In the year since the opening of our dedicated pharma facility in Dubai in September 2016, we have transported over 51,000 tonnes of pharmaceutical cargo across our network valued at an estimated US$ 11.5 billion. The volume of pharmaceuticals that we transport across our global network has witnessed very strong growth. In the first nine months of 2017, we saw our pharma volumes higher by about 25 per cent compared to the same period in 2016. Tell us more about Emirates Pharma, Emirates Pharma Active and Emirates Pharma Plus. Emirates Pharma is Emirates SkyCargo’s complete solution to customers who would like to transport their temperature sensitive pharmaceutical shipments. We have developed three levels of innovative transport solutions based on a requirement mix that includes the temperature sensitivity of the product, the packing solution used by the pharmaceutical manufacturer and the origin/ destination of the shipment. Emirates Pharma has been designed for pharmaceuticals with a high tolerance to temperature fluctuations and those in passive packaging solutions, Emirates Pharma Active is ideal for high value pharmaceuticals with a thermal cover that can withstand minor temperature fluctuations during handling and transportation and Emirates Pharma Plus is ideal for high value pharmaceuticals that are extremely temperature and time sensitive, and need to be transported in active containers. How have partnerships with SkyCell and va-Q-tec enhanced the services SkyPharma can provide and hence improve business? Its giving new options to our customers. All pharma manufactures go into great detail when validating equipment for their products to be carried in, these

containers have different benefits to the other containers currently on the market. Our partnership means customers can take the lease of the container through Emirates. The benefit of the SkyCell partner shipment is that Emirates have our own stock of SkyCell containers in Dubai preconditioned and ready to be positioned across our network. Tell us more about SkyCell. The technology used by SkyCell is different to the other container suppliers, they do not require electricity or dry ice to keep the temperature. They work on very specialised insulation and phase change material to keep the temperature. So where there are airports with limited infrastructure eg no electrical plug points or dry ice availability, these container continue to operate without compromising integrity of contents. What is in store for 2018 and beyond in terms of the enhancement in the pharmaceutical transportation solution by Emirates Sky Cargo? Emirates SkyCargo believes in constant innovation keeping in focus the requirements from our customers. The pharmaceutical industry continues to evolve rapidly in terms of product and transportation needs and we are working closely with our customers to develop solutions that add value to our customers.

DECEMBER 2017 27


and network optimisation aspects we are working very closely together.” While continuing its commitments and partnerships, the carrier continues to identify new source markets and regions. “We see new regions and new markets emerging for next year mainly around South America where we see the economy shaping up and rebounding. There will be lots of opportunities there for which we will need to assess, evaluate and make the decision on those routes later on in this coming year. There are many opportunities across Africa where we are almost like a national carrier considering the number of flights we do. Especially key areas such as South Africa, Nairobi, there is a consistent production of perishables originating from there. So a lot more could be done within a year or so.” Emirates SkyCargo realises that traditional business formats are changing and that the biggest disruptor - e-commerce - is changing the landscape completely with regard to cargo.“We see it happening,” says Sultan. A lot of retailers across the globe are downsizing or shutting down brick and mortar stores, or have a smaller physical presence with the bulk of the collection available online.“The region is catching up and soon it’s going to be widespread, countries such as Saudi Arabia, Pakistan, Africa are huge markets. There is so much

28 DECEMBER 2017

opportunity in this part of the world. All the big global online players, we are working with and each one is in the process of consolidating their position to have a presence in the emerging markets. Because the question really is are we still going to be transporting big boxes of cargo to retail stores or are we going to be carrying smaller shipments to individuals. So the whole dynamic changes and businesses have to realign themselves. But Emirates is definitely poised to cater for this massive e-commerce business that we’re seeing emerging. Our whole concept of design is the hub and spoke and our whole network is dependent on conducting traffic West to East and East to West and therefore if we just take the model and replicate it on e-commerce of moving and delivering shipments in the shortest elapsed time simply because our network is designed such with immediate connectivity we probably are the fastest in the world today and be able to deliver. For a successful e-commerce business all the fundamentals exist within our airline today. And getting this (fundamentals of network connectivity) right is probably the most difficult and most expensive component - creating the right product and then plugging it into the e-commerce model.” Sultan gets it right again when he says, “Every company’s vertical works with the

factories of the world - China, Vietnam, Bangladesh, Sri Lanka - the locations of which will not change. So this is where our already established network and connections will come in handy. For instance in the case of pharmaceuticals, India is the biggest manufacturing market for pharmaceuticals, we carry huge pharma quantities from Bangalore, Chennai, all the way to Chicago. A lot of the pharma manufacturing companies in Europe are closing down or downsizing. So the whole dynamic is changing, it’s extremely competitive. Also, the political situation in the US seems to imply that the manufacturing industry is gaining a revival, let’s see what actually happens eventually.” Sultan feels the biggest advantage of the air cargo industry is the ability to make and implement decisions as things change in the global market.“Unlike the hoteliers who are stuck with big properties in a destination and if the demand of the consumer shifts they’re still stuck there! We have the flexibility of moving our asset to where the demand is I think that’s probably one of the success factors that Emirates has that we can act on our decisions immediately, we can shift capacity as per demand immediately where it needs to be. I don’t even need to get involved, the guys on the floor manage to make that decision and move on with that agility and flexibility.”

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the status quo Pharmaceutical logistics -

Munawar Shariff chats with Cindy

Engelbart, General

Manager - Healthcare, Hellmann Calipar

Healthcare Logistics

DWC-LLC, about the

current state of affairs of the pharmaceuticals logistics industry in the country and region 30 DECEMBER 2017


he GCC countries continue to be one of the fastest growing markets for pharmaceutical and medical products as a result of population growth and high levels of lifestyle diseases.“Going forward however, the pharmaceutical and healthcare sectors in the Middle East region, will be affected by numerous factors, including a slowdown in public sector growth as a result of low oil prices, price pressure and pressure of generic manufacturing,”says Cindy Engelbart, General Manager - Healthcare, Hellmann Calipar Healthcare Logistics DWC-LLC.“Challenges in the current macroeconomic environment will likely result in a continued slowdown in pharmaceutical expenditure. In logistics, these developments result in a stronger cost focus and a need for more efficient and expert local operations with a stronger emphasis on supporting pharmaceutical manufacturers on their non-core activities, continues Engelbart. Logistics service providers are transforming into logistics consultants and playing a greater role in customer’s manufacturing activities, rather than just delivering a transport or warehousing service. Additionally, a growth in biological, cold chain pipeline product pushes manufacturers and logistics service providers to rethink


DECEMBER 2017 31

and reshape their supply chain and logistics activities, taking a much stronger focus on specialised logistics products and risk mitigation strategies in logistics and supply chain security.

Challenges in the near future The expectation all round is that the challenges in the GCC pharmaceutical market will endure and therefore the strategies of logistics service providers operating in this industry should remain to be aimed at supporting manufacturers as logistics consultants, as well as playing a more predominant role in their outsourcing strategies.“With the continued support of the local UAE Ministry of Health, it is our belief and strategy that we are in a

32 DECEMBER 2017

position to work with manufacturers on contract manufacturing activities, allowing the pharmaceutical companies to be more flexible to serve the market’s ever changing and challenging needs and be more cost efficient in the process,”she says. The need of the hour is for pharmaceutical companies to be clearly looking at service providers to help them prepare their supply chains through involvement in network studies, development and qualification of specialised logistics products and playing a stronger role in facilitating end-to-end accountability, by acting as the linking pin pushing cooperation between all parties in the logistics net work (carriers, agents, regulators). Additionally, the increasingly specific and stringent product requirements


result in a growing demand for visibility and data. Logistics service providers are required to be able to support these needs, as well as have the backup support to be able to work with this visibility.“We should not only be able to offer visibility, we should also be able to respond, mitigate and be proactive towards security risk and potential threats to product quality en route, says Engelbart. Clients expect the ideal 3PL service provider working in this Industry to be proactive, agile and flexible to develop solutions around customer requirements and treat the products as though they were their own. A personalised and tailor made approach towards the pharmaceutical industry drives service providers to better understand their customers’ requirements and through that, be

Challenges in the current macroeconomic environment will likely result in a continued slowdown in pharmaceutical expenditure. In logistics, these developments result in a stronger cost focus and a need for more efficient and expert local operations

able to be a better fit, whether working with companies focusing on specialist therapies or for companies focusing on generic, more mass market medicines. The requirements are simply different and require a different approach. “At the same time, innovation, strong IT solutions and quality and speed to market are becoming more important for our customers and therefore for us,”she says. And it goes without saying that the warehouse and transportation solutions offered to this industry need to be state of the art, high quality and GDP compliant. Hellmann, with its long term joint venture partner, Calipar Integrated Logistics (part of the Indian bases Parekh Group) has invested heavily in its local footprint, with at present 27,500 pallet positions of +15 to +25 degrees

DECEMBER 2017 33


Centigrade storage and 1,200 pallet positions for +2 to +8 degees Centigrade products over three warehouses. “Hellmann’s focus and strategy is to continue a personalised approach to serving our customers, whilst at the same time having a continued emphasis on developing and offering new (IT) solutions such as SMART POD (an APP developed by Hellmann to scan POD’s at delivery and having these communicated to customers in real time) and SMART Visibility (a GPS device which can be used throughout all transport modes, providing location and temperature visibility, with an alarm and alert function). The culture

34 DECEMBER 2017

of continuous improvement is very strong within Hellmann and through this we we pro-actively work with strong players in the field of passive/active transport and packaging solutions on new and tailored product developments. Serving a multitude of multinational pharmaceutical manufacturers out of our Dubai South Life science hub gives us the needed experience, knowledge and understanding of best practices to be able to support our client’s changing needs in the best possible way,” says Engelbart. She continues,“Our strategy is and should be tailored around what our customers

require. At the moment, we strongly focus on development of contract manufacturing activities, such as secondary packing and redressing activities. With the support of our customers and the local regulators, Hellmann have developed a multitude of local manufacturing solutions. We possess the knowledge, infrastructure and quality systems to further build on our GMP activities and are emphasizing that continued investments will be made in this direction. The Hellmann Worldwide corporate board of directors have nominated our Healthcare Vertical solution to be one of the strategic verticals of the future with continued focus and investment.”

6-7 February 2018 Abu Dhabi National Exhibition Centre Abu Dhabi, UAE

THERE’S ONLY ONE PLACE IN THE MIDDLE EAST where project cargo professionals from around the world meet for new business.

It’s an important opportunity to meet our customers, show our commitment to the region and use it as a building platform for our presence in India, the Red Sea and beyond.”

SERVING THE FULL PROJECT CARGO VALUE CHAIN: Shipper or beneficial cargo owner (BCO) | Ocean carriers Inland carriers (road/rail/inland waterway) | Stevedores Ship agents | Freight forwarders | 3PLs Port/terminal operators | Lashing/packing | Customs Equipment providers | Government entities Financial services

– Matthew Luckhurst, Liner Director, Bahri Breakbulk Middle East 2015, 2016, 2018

To exhibit, sponsor and sign up for event alerts, visit







Sprouting green jobs Ivano Iannelli, CEO, Dubai Carbon, writes about the transition to a resource efficient, low carbon and inclusive green economy, where a new range of green jobs are being created and new skills are being sought, as businesses are forced to transform the way they operate to respond to growing changes in the population and condition of the climate

36 DECEMBER 2017


n a legacy economy, the annual growth would allow predictions on the number of jobs created. The conventional labour market, especially in mature economies of the“western world�would allow for little uptake of jobs in the market, either as staff turnover or from the population qualifying for retirement. Altogether, growth and job opportunities would allow for a limited opportunity of youth entering the job market due to the lack of experience and adversity to risk. However, the job outlook is changing. And change is gold. Actually, change is green. As the world transitions to a resource efficient, low carbon and inclusive green economy, a new range of green jobs are being created and new skills are being sought, as businesses are forced to transform the way they operate to respond to growing changes in the population and condition of the climate. The World Green Economy Summit (WGES) 2017 has underlined and outlined strategic plans for a green economy, which help reduce pressure on natural resources and spur economic growth through the creation of green jobs. A report from the International Renewable Energy Agency( IRENA) indicates that the global renewable energy sector employed 9.8 million people in 2016. Solar photovoltaic (PV) represents the largest employer with 3.1 million jobs, up 12 per cent from 2015, clearly demonstrating the growth in the green energy sector. Green economy promotes a triple bottom line: sustaining and advancing economic, environmental and social well-being. It facilitates green jobs which are central to enabling sustainable development and responding to global challenges for this generation, as well as future ones. Furthermore, green economy allows for youth to take the lead in many technology-centric platforms Green collar jobs, which would be jobs that include the expected solar panel or wind turbine worker and engineer, will be matched

by additional new roles to be created across a far more diverse range of businesses. As part of the Dubai Industrial Strategy 2030, an initiative which aims to make the city a global platform for knowledge-based and sustainable businesses, 277,000 jobs are planned in the coming period, from which a large proportion are expected to be green jobs. In principle, green jobs can be found in all sectors of an economy and all sectors and jobs can potentially become greener. Whether in a call centre, a hospital, retail or engineering, the transition to an inclusive green economy will present numerous opportunities to assess and address the impact economic activities have on the environment and call for


transformation of the behaviour of individuals, institutions and society at large. The creation of inclusive economies is at the core of promoting green economies that are low-carbon, resilient and sustainable. While significant progress has been achieved over the past two decades, poverty remains a world-wide challenge and enhancing minorities and women’s participation in the green economy will be key in ensuring all can contribute to and benefit from this transition. As the world adopts a wide range of policies that aim at encouraging the creation of green jobs, Dubai demonstrates leadership by adopting national “green growth”and “low carbon” strategies. These support the

Dubai Plan 2021 and the Dubai Clean Energy Strategy 2050, for Dubai to have the lowest carbon footprint in the world by 2050, and the Dubai Carbon Abatement Strategy to cut carbon emissions by 16 per cent by 2021. At WGES 2017, participants not only had information about the varied opportunities available regarding green jobs, but also had direct access to explore sector specific jobs. Clean energy expansion is generating thousands of new jobs while meeting climate and economic goals. With this tremendous opportunity, the UAE, and Dubai in particular, is demonstrating the region’s leadership position in generating employment in this field for both men and

women alike. The expanding green energy job sector is a result of the country scaling up renewables to enhance access in the face of rising energy demands. With countries of the world redefining and setting the universal sustainable development agenda, WGES 2017 has presented economic models that promote inclusive and sustainable economic growth. In addition, the Summit presented how green jobs provide multiple benefits to the region by attracting and scaling up green local and foreign investment and technologies, decreasing waste and emissions, encouraging resource efficiency and ultimately improving the quality of life and ensuring sustainable societies.

DECEMBER 2017 37


The truck

for all drivers

UD Trucks recently launched it’s heavy duty Quon truck. It flew down a number of partners and journalists from around the MEENA and the Asia Pacific region for its annual UD Extra Mile Challenge and its presentations at the Tokyo Motor Show 38 DECEMBER 2017


D Trucks, at the Tokyo Motor Show, last month, unveiled its heavy duty Quon truck. The company is focussed on one goal; creating the ‘best truck for all drivers’. The company which is a part of the Volvo Group, is on a growth trajectory what with the launch of five trucks ranges this year. Keeping a close ear on the needs of it customer, the UD trucks team live by the words of the company’s founder, Kenzo Adachi who said in 1937 that he wanted to make ‘the truck the world needs today’. Adapting these words to today means technology, safety, fuel efficiency as well as driver comfort and keenness on driving these intelligent trucks. Innovation has been an very important aspect of the trucks’ development for the last 80 years.


And the technology advantage that UD Trucks gets from Volvo is helping with the company’s ability to create sophisticated trucks for multiple industries, terrains and regions. The trucks are cost effective hence popular with a lot of buyers from the region. The Quester range is what is most popular in the Middle East region and UD Trucks have set up an efficient regional competence centre and telematics department in Oman. There are service workshops in Bahrain and Saudi Arabia to serve the region. This range - the Quester - is aimed at growth markets. The feedback from the region is positive and different. Each customer has a different need and the company is working towards fine tuning their product for the perfect truck for each customer.

DECEMBER 2017 39


The big data era Bahri Logistics followed up its inaugural big data forum held last year with this year’s edition which was all about the current big data advancements in the maritime industry

40 DECEMBER 2017


uilding on the success of the inaugural edition of its big data forum last year, Bahri Logistics, hosted industry leaders and technology experts at the second edition of the annual event, in Dubai. Held under the theme ‘Sailing the Big Data Era 2017,’ the Bahri Big Data Forum was organized by Bahri to focus on providing industry players with a platform to push data-driven advancements in the maritime industry ecosystem. The event draw more than 200 guests including CEOs and senior executives from prominent companies around the world. “Big data applications have helped public and private sector entities better understand and serve customers, offer value-added services, optimize their processes, providing the maritime industry stakeholders with a platform that allows them to achieve sustainable development. Hosting the second edition of the Bahri Big Data Forum aims at converging and discussing the potential, need and importance of collaborating to create a maritime industry ecosystem that


aims to push data-driven advancements and enable their application,”said Mohammed Al-Sarhan, Vice Chairman of Bahri. “This year’s edition of the Big Data Forum proved to be a remarkable engagement and knowledge-sharing opportunity for industry leaders and executives – allowing us to focus on closely assess the full potential of big data technologies in the maritime sector. The forum focused on maximizing business value for the industry’s long-term growth, and how big data is disrupting the transportation and logistics sector,”said Ali Al-Harbi, Acting CEO of Bahri.

The Bahri Big Data Forum kicked off with a welcome address by Mohammed Al-Sarhan, Vice-Chairman of Bahri, and featured presentations and talks by a host of company heads and industry professionals including Remi Eriksen, Group President and CEO of DNV GL; Dr. Patrick Briest, Computer Scientist at McKinsey & Company; Giovanni Moscatelli, Partner and Managing Director at BCG Middle East; and Anwar Siddiqui, President of Bahri Data. The presentations were followed by a CEO panel group discussion that

highlighted the value and challenges of big data in shipping, and included Jonathan Lee, CEO of Tankers International; Cameron MacKay, COO of Scorpio; John Schmidt, CEO of McQuilling Partners, Inc.; Scott Bergeron, CEO of Liberian International Ship & Corporate Registry (LISCR); Dr. Deema M. Alsekait, Assistant Professor in CS and IT at Princess Nourah Bin Abdulrahman University; and Dr. Peter Grindrod of the Oxford University and Chairman of Oxonomy Limited. The Bahri Big Data Forum also featured a second panel that saw technologists from a number of well-known companies come together to discuss big data solutions for the shipping industry. The panel discussion included Albrecht Grell, EVP – Digital Solutions and Innovation at DNV GL – Maritime; Rolf Stiefel, Head of Sales and Marketing at Wartsila; Oliver Cadet, EVP at Kongsberg Maritime AS; Mikko Lepisto, SVP at ABB; Nick Pinkney, VP – Integrated Solutions at Eniram; Marco Cristoforo Camporeale, GM of Health Management Solutions at Rolls Royce; and Jens Lorens Poulsen, Founder and Group CEO of The Marcura Group. The event also attracted prominent exhibitors including Eniram, ABB, DNV GL, Rolls Royce and Saudi Aviation Information Technology Company (SAVIT).

DECEMBER 2017 41


Blockchain revolutionises Tristar Tristar Group recently deployed blockchain technology in order to move its logistics business into the future

42 DECEMBER 2017


ristar Group recently announced a milestone in its digital transformation strategy as it unveiled a groundbreaking Proof of Concept (POC) using blockchain technology. Transparency in the supply chain has always been difficult to achieve, with blockchain, Tristar is going to be able to achieve exactly that. The platform that Tristar uses is one of the first of its kind in the world and is currently operational. “Blockchain technology gives us the ability to provide irrevocable verification and oversight

to complex processes and movements of products to our customers. Records stored in the blockchain are computationally almost impossible to alter, leading to unprecedented verification and transparency to all stakeholders involved in a particular transaction,”said Eugene Mayne, Tristar’s Group CEO. “We are proud to once again place Tristar at the forefront of our industry. Blockchain technology has the potential to disrupt the logistics industry in the same way that the internet disrupted traditional business


models around 20 years ago,” he added. Tristar’s blockchain implementation is underpinned by IBM’s Hyperledger technology and runs on Amazon Web Services cloud platform. Complete endto-end warehousing and transportation processes will be captured in Tristar’s private blockchain, providing real time oversight and analysis. Additional benefits include the reduction in usage of paper, elimination of human error, and the ability to optimise

warehousing manpower, scheduling, and deliveries. The project also enables Tristar to seamlessly tie together its Warehouse Management System and transportation platforms, allowing key customers to access a single secure platform protected by military grade encryption with irrefutable records of events and interactions between the parties. Tristar’s blockchain implementation was done by Dubai based Block Gemini Technologies. Founder and CEO, Christopher Fernandez, Block Gemini Technologies, says,“Whilst

many organisations have discussed the potential applications of blockchain technology to their business and in some cases, developed limited POCs, the platform that we developed for Tristar is one of the first of its kind in the world and it is currently operational.” “Several large companies and Dubai Government entities have initiated blockchain POCs of their own, so we are very proud to be amongst such esteemed companies,”says Mayne.

DECEMBER 2017 43

D Dubai Police, MAN Truck & Bus Middle East and RoadSafetyUAE call for safer UAE roads Highlight the need for regular training, stricter enforcement of laws and deployment of technology-driven safety solutions

ubai - UAE, November 12, 2017: Aimed at emphasizing the role of heavy vehicles in ensuring safety on UAE roads, Dubai Police, in partnership with MAN Truck & Bus Middle East and RoadSafetyUAE, today hosted an event for fleet owners and other stakeholders of the public and private sectors, showcasing various road safety initiatives and solutions to reduce heavy commercial traffic incidents in the country. The event explored ways to boost road safety, in line with the targets outlined in ‘UAE Vision 2021’, which aim to reduce road traffic fatalities from about 6/100,000 residents (end 2016) to 3/100,000 by 2021. Citing dangerous road habits of drivers and the need to constantly educate and train them, Captain Salem Mesfer Rashid Alamimi, Dubai Police said,“Our various campaigns and initiatives in partnership with industry stakeholders in the past have resulted in a significant drop in the number of accidents involving heavy vehicles over the years. To ensure road safety for all, it is critical to engage with truck drivers, the owners and fleet operators as well. Such workshops play an important role in achieving the targets, and I express our sincere gratitude to MAN Truck & Bus Middle East and RoadSafetyUAE

for their strong commitment to making the country’s roads safer.” The event highlighted the ongoing efforts by MAN to increase road safety, both by building safety into its trucks and fostering a culture of safe driving. “We are pleased to partner with Dubai Police to further enhance road safety awareness among various stakeholders of the commercial vehicles industry in the UAE,”said Mr. Franz von Redwitz, Managing Director, MAN Truck & Bus Middle East FZE.“The importance of stricter enforcement of laws and continuous education and training is paramount, but it is also critical to equip commercial vehicles with new technologies to ensure complete and absolute safety on the roads in the country.” Participants gained insights into how proper safety measures, best tyre and load practices, technology-driven solutions and driver training support programs can lead to a significant drop in road incidents. Mr. Franz von Redwitz added: “Adopting best practices in vehicle safety not only helps in driving down the number of traffic incidents and enhancing road safety but also results in reducing fuel consumption and optimizing loads thereby maximizing the economy of the fleet operating companies. As the leading provider of commercial vehicles and buses, we remain dedicated to introducing efficient and safety solutions for our loyal customers in this region.”


Thomas Edelmann, Managing Director of RoadSafetyUAE states: “MAN is setting a great example as a pro-active thoughtleader in the commercial vehicle industry by committing resources to arrange such an impact-strong event, which educates the involved stakeholders and also provides a great networking platform to connect delegates and to foster new ideas of how to tackle road safety”. Taking the event to a new level, the senior representatives from MAN presented an

interactive ‘Truck Safety Walk-Around’, which examined various factors leading to fatal accidents, Mr. Redwitz added. MAN representatives encouraged fleet owners to establish a framework in their companies for continuous education for drivers. They introduced the MAN ProfiDrive® program which improves driver knowledge and skills and promotes rational driving behavior to make every day driving safer and more economic. They also demonstrated a number of technological

solutions developed by MAN such as Electronic Stability Program (ESP), Anti-Spin Regulator (ASR), Constant Damping Control (CDC), and MAN TeleMatics®, an intelligent technology solution that provides drivers and fleet managers with essential data to optimize vehicle usage and plan services well in advance, and comprising a MAN Tachograph which automatically records the vehicle’s speed, distance travelled, and time spent on the road, helping keep tired drivers off the roads.

NOVEMBER 2017 41

MAN Lion’s Coach set to redefine mobility • “Inspired by the lion”, the Lion’s coach marks the beginning of new MAN bus design language at the front, rear, and sides • A higher level of economy with several assistance systems, as well as a 20% improvement in aerodynamics • Main headlights and rear lights now for the first time available as all LED • The new MAN Lion’s Coach can absorb 50% more energy in the event of a crash


n its pursuit of excellence and efforts to champion innovation and technology to match its fleet offering with the latest market trends, MAN Truck & Bus strives continuously to enhance not only the design element but also economic efficiency and safety features of its new line-up. The recently launched MAN Lion’s Coach, which is already available for pre-orders in the Middle East, is a best-in-class coach and longdistance bus, and the embodiment of the company’s endeavour to offer consumers a whole new experience. The new addition to the MAN Truck

& Bus Middle East’s impressive line-up of highly efficient, safe, economic and innovative commercial vehicles, the MAN Lion’s Coach is set to take over the coach market in the region with its distinct safety, comfort and performance-driven features. The MAN Lion’s Coach is available in GCC Euro engine standards to suit a complete range of fleet requirements in the region. “We are a technology innovator and the new MAN Lion’s Coach demonstrates MAN Truck & Bus’ commitment to providing world-class transportation solutions,”said Franz von Redwitz, Managing Director, MAN Truck & Bus Middle East.“This is a new


generation of coach that raises the bar when it comes to safety, economy and design.” “Inspired by the lion”, the MAN Lion’s Coach, with its modern yet timeless design, marks the beginning of the new MAN bus design language at the front, rear and sides, and sets a new benchmark in luxury, attractiveness and efficiency. The new coach’s LED main headlights and taillights reflect the leading German commercial vehicles manufacturer’s quest for technological and innovative enhancements in its fleets. The first of its kind on coaches, the LED lights make the Lion’s Coach more appealing to the eye and better in efficiency

and durability. A particularly distinctive feature of the new headlight is the strip-form brand-specific daytime running light which also functions as a turn indicator. Among new safety features of the MAN Lion’s Coach includes its ability to absorb 50% more impact energy in the event of a crash. In addition, it has an array of assistance systems such as Emergency Brake Assist (EBA), Adaptive Cruise Control (ACC) and Lane Guard System (LGS) accident prevention technology. Furthermore, the new coach offers enhanced comfort and safety while travelling thanks to new generation shock absorbers and optimized vehicle

configuration. In addition to providing greater driving comfort and improved handling, the new features also contribute to further increase in fuel efficiency as well as a 20% improvement in aerodynamics. “The new MAN Lion’s Coach doesn’t just win people over with its modern yet timeless design; it’s also thanks to its economic efficiency,” said Pedro Teixeira, Head of Bus Sales, MAN Truck & Bus Middle East.“This is a vehicle that provides excellent total cost of ownership and will also place fleets at the centre of a transformation towards modern, cleaner and safer transportation in the Middle East.”

NOVEMBER 2017 41



How blockchain can transform

the supply chain Supply chain has become complicated. Some would say cumbersome. It takes days to make a payment between a manufacturer and a supplier, or a customer and a vendor. Friction in supply chain is a big problem. There are too many go-betweens. There is too much to-ing and fro-ing. Blockchain could be the answer to many of these issues. This recent technology is what drives bitcoin and other so-called cryptocurrencies. Rob O’Byrne of explains the concept’s connection with the industry


upply chain has become complicated. Some would say cumbersome. It takes days to make a payment between a manufacturer and a supplier, or a customer and a vendor. Contracts must be handled by lawyers and bankers, which means extra cost and delay. Products and parts are often hard to trace back to suppliers, making defects difficult to eliminate. Whether for industrial equipment, consumer goods, food products, or digital offerings, supply chains have headaches a-plenty. Friction in supply chain is a big problem. There are too many gobetweens. There is too much to-ing and fro-ing. The rise in uncertainty stops supply chains from working well. Suppliers, providers and clients must deal via central third-party entities, instead of directly with each other. What should be simple transactions turn into lengthy procedures with many steps.

DECEMBER 2017 49


Blockchain could be the answer to many of these issues. This recent technology is what drives bitcoin and other so-called cryptocurrencies. However, it goes much further than a hackproof way of holding and exchanging money. Blockchain can be used for any kind of exchange, agreements or tracking. In a supply chain, it can apply to anything from self-executing supply contracts to automated cold chain management.

A blockchain primer for supply chain What is blockchain? Here’s a simple explanation. A blockchain is a distributed, digital ledger. The ledger records transactions

50 DECEMBER 2017

in a series of blocks. It exists in multiple copies spread over multiple computers, which are also called nodes. The ledger is secure because each new block of transactions is linked back to previous blocks in a way that makes tampering practically impossible. As it is decentralised, it does not depend on any single entity (like a bank) for safekeeping. The nodes connected to the blockchain network get updated versions of the ledger as new transactions are made. The multiple copies of the ledger are the“truth” about every transaction made so far in the blockchain. Trying to falsify the ledger would mean having to falsify the copies at precisely the same moment. The chances of being

able to do this in blockchain networks of any useful size are negligible. That’s all a bit abstract. Let’s look closer at the real-life example of bitcoin. It is important to recognise bitcoin as just one way of using blockchain. However, it also happens to be one of the best-known examples. Bitcoin is a recently invented currency that is separate from any state-controlled currency. Entirely digital, it exists thanks to the distributed ledger of transactions on computers across the world. You can buy bitcoin from bitcoin exchanges. You can then use bitcoin over the Internet to make and receive payments. Each payment transaction is added to the ledger, which can be consulted by anyone at


any time. Details like the amount, time and date of each payment are visible, although your personal identity is not. Bitcoin holders therefore usually do not know each other. To deal with this anonymity, bitcoin uses another distributed mechanism called mining to add blocks of transactions to the ledger in a secure, tamper proof way. Now, let’s compare with supply chain. The same key features of blockchain being used by bitcoin map onto the basic needs for reliability and integrity for a supply chain. Consensus All the entities in the chain agree that each transaction is valid. For bitcoin, that means a transfer of an amount of bitcoin. For supply

chain, it could be payment, warehousing, transport or delivery. Provenance The entities in the chain know where each asset came from. They also know who owned it before and at what time. For bitcoin, the asset is money. For supply chain, assets can be anything from iron ore and wheat to money, machines and copyrights. Immutability No entity can tamper with an entry in the distributed ledger. Bitcoin transactions cannot be erased. Only a new bitcoin transaction can reverse the effect of a previous one. Similarly, supply chain payments cannot be falsified. Neither can records of inventory, warehousing conditions, delivery times and dates, and so on. Finality The copies of the shared ledger all hold the same version of the truth. What works for the bitcoin network also works for any other blockchain network, supply chain included.

and extend the ledger. Mining takes large amounts of computer power. It also involves many mining teams over the Internet, each competing to be the one to add the next block to the ledger. Blockchain for business and specifically for supply chain is not obliged to use mining. There are other options for securely updating a business blockchain. Second, the applications for blockchain in supply chain are far more diverse than making or receiving payments. A large part of this diversity comes from the use of smart contracts. A smart contract is a software program that uses blockchain to carry out the contract. The program is stored on the blockchain.

Beyond bitcoin to business blockchain Bitcoin is a useful way of getting to grips with the blockchain concept. It is also just one (special) example. Blockchain for supply chain uses the same four basic principles. However, there can be significant differences in the way these principles are applied. First, bitcoin uses “mining”as the way to update

DECEMBER 2017 51


blockchain to track sales of pork meat in The smart contract will therefore function China. Its system lets the company see where exactly as it has been programmed. No fraud each piece of meat comes from, its processing or other interference is possible. A smart and storage, and sell-by date. In the event contract can take input from a ledger and of product recall, the company can also trigger an event. For example, if a payment see which batches are concerned and who has been received, the smart contract can bought them. trigger a delivery. Or if a condition has not been respected (for example, timely delivery Electric power microgrids or proper storage), the smart contract can This example shows how entities of any trigger a penalty or another action. Thirdsize can use blockchain. In other words, party go-betweens are not necessary. blockchain is not just for the big players. Manual checking of conditions and events Smart contracts are being used for can be avoided. Costs and redistributing excess power from time can be saved with solar panels. The Transactive All the entities a software program that Grid is an application running runs automatically, using on blockchain to monitor in the chain information guaranteed by and redistribute energy in a agree that each neighbourhood microgrid. The the blockchain to be correct. program automates the buying transaction and selling of green energy Applications of is valid. For to save costs and pollution. blockchain in supply The technology for running chain bitcoin, that the program is the Ethereum The following examples means a transfer platform, designed for building are now in use or can be smart contracts of any kind. implemented today using of an amount existing technology. RFID-driven contract bids and execution Automotive supplier of bitcoin. RFID tags are commonly payments For supply used in supply chain to store Blockchain allows the information about products. transfer of funds anywhere chain, it could The tags can be read easily and in the world. Traditional be payment, automatically, then processed banking methods are by IT systems. So, the logic not needed. Transfer is warehousing, goes, why not use them for direct between payer and transport or smart contracts for logistics? payee. It is also secure The practical setup could be as and rapid – in minutes, delivery follows. RFID tags for cartons compared to days for or pallets store information on automated clearing house delivery location and date. Logistics partners payments, for example. Bitcoin transfers run applications to look for these tags specifically also offer lower fees. Australian and bid for delivery contract. The partner vehicle manufacturer Tomcar uses bitcoin offering optimal price and service gets the to pay suppliers. Currently, three partners business. A smart contract then tracks status in Israel and Taiwan accept this. Tomcar’s and final delivery performance. supplier agreements use standard terms. The advantage is in the cost savings. On Cold chain monitoring the other hand, the firm is careful to avoid Food and pharmaceutical products often hanging onto too much bitcoin. While bitcoin need special storage. Also, enterprises also is international by nature, some national see the value in sharing warehouses and governments see it as a way for companies to distribution centres, instead of each one make an investment. Companies with bitcoin paying for its own. Sensors on sensitive holdings may therefore be taxed accordingly. products can record temperature, humidity, vibration, and other items of interest. These Meat traceability readings can then be stored on blockchain. Product status at each stage of production They are permanent and tamperproof. If can be recorded using blockchain. The a storage condition deviates from what records are permanent and inalterable. has been agreed, each member of the They also allow the tracing of each product blockchain will see it. A smart contract can to its source. Global retailer Walmart uses

52 DECEMBER 2017

trigger an action to correct the situation. Depending on the size of the deviation, this action may be to simply adjust the storage. However, it could also extend to changing “use-by” dates, declaring products unfit, or applying penalties. Blockchain and Internet of Things Other ambitious ideas come from using blockchain and IoT. One suggestion is for smart contracts to manage rentals of driverless cars. A smart contract could check for rental payments. If payment has not been made or simply at the end of the rental contract, the smart contract could lock the car and tell it to drive itself back to the renter.

Challenges to be met Blockchain has its challenges too. Enterprises that want to harness blockchain power for their supply chain will need to watch out for the following.


Ecosystem still in progress The first telephone was useless until the second one arrived. In time the phone spread all over the world and now we can’t do without it. The situation is similar for blockchain and companies that want to do business with specific partners. Those partners will need to buy into blockchain as well. For example, Tomcar mentioned above only uses bitcoin payments for about two per cent of the parts it buys. However, niche uses of blockchain are on the rise. It may be just a matter of time until businesses“join the dots” for widespread acceptance. Currency volatility Bitcoin is an easy way to start using blockchain. The problem is that bitcoin exchange rates with other currencies can change rapidly. Payment terms must be short enough or flexible enough to be able to cash in bitcoin and recover the value expected.

Bitcoin and other cryptocurrencies (Ether for example for the Ethereum platform) are also volatile in another sense. If you lose the digital key (passcode) to your cryptocurrency reserve, there is no other way of getting it back. Technology and knowhow Blockchain programming takes a mix of software skills. It also helps to understand economies and businesses, especially your business. You may have to train staff or hire new people with these skills. You could also outsource your blockchain development to a third party. The best choice for you will depend on your current situation and future aspirations. Mindset Blockchain was started by people who wanted to decentralise applications and operations. They wanted to make dependency on centralised entities like banks optional instead of obligatory. This is a new

way of thinking. Don’t be surprised if it takes you or your colleagues a little time to shed your mental shackles and get into the swing of the blockchain movement.

Conclusion Blockchain can transform supply chains, industries and ecosystems. Interestingly, even organisations like banks, who would seem to be losing out, can see opportunities to use blockchain to streamline their own business. In-depth transformation of supply chains will not happen overnight. However, supply chains can already start using blockchain for small portions of their operations. Smart contracts can help eliminate costly delays and waste currently due to manual handling of paperwork. From there, the door is then open to smarter, faster, more secure supply chain from one end to the other.

DECEMBER 2017 53

Subscribe today December 2017 Issue 43

November 2017 Issue 42

October 2017 Issue 41





BALANCING CARBON AND CASH Greenhouse gases and the supply chain


Disrupting and improving



CARGO CARRIER Emirates SkyCargo

DP World


The talent shortage From gap to crisis

Shared mobility

Identification and practice

Partnership goals

Freezone special

Emirates Sky Cargo and Cargolux

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11/1/17 4:31


Adopts blockchain

Hajj 2017

Regional uodate

Logistics at its best

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Transforming the supply chain


Sohar Port

The perfect supply chain Myth or reality?

10/3/17 11:44

The pharma chain

Is blockchain the answer?

Hellmann identifies today’s trends

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12/6/17 16:10


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Digital logistics DB Schenker wants to shape the future of digital logistics and is investing millions to strengthen its strategic collaboration with uShip and its online shipping, transport, and freight marketplace solutions. Patrick Burnson, Executive Editor, Logistics Management and Supply Chain Management Review magazines and web sites has more


B Schenker views itself as an integrated logistics service provider that oversees the entire logistics supply chain. It has over 2,000 locations in more than 130 different countries, employing 66,000+ people. DB Schenker is worldwide number three in air and ocean freight, and number five in international contract logistics. DB Schenker is the market leader in land transport in Europe, moving over 100 million consignments by land in 2015 (the equivalent of three consignments per second). Its ocean freight services see almost two million TEUs transported on the world’s shipping routes. If these containers were placed end to end, they would stretch from Frankfurt to Hawaii. It handles approx. 1.1 million tonnes of air freight and commissions 1,200 chartered flights every year for the fast, international exchange of wares. It operates over seven million sq metres of ultramodern logistics space around the world. In an exclusive interview with Supply Chain Management Review, Jochen Thewes, Chairman of the Board of Management Schenker AG, and Philippe Gilbert Chief Executive Officer, Region Americas expanded upon the findings.

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DB Schenker sees growth in the Americas. What is the economic forecast for the region? Our business forecasts for the Americas is very positive. In 2016, we increased our EBIT in Americas by more than 40 per cent and in 2017 we are seeing further growth. We are investing in a number of areas, with the opening of our new regional headquarters in Miami-Dade earlier this year, the opening of a number of new support offices across the Americas, continuous investment into contract logistics with a special focus on

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Mexico, Argentina and Brazil, and new Free Trade Zones and cross-border facilities. Can this growth be sustained? This growth is not expected to slow down, with a number of the DB Schenker countries across the Americas as the fastest growing countries across our global footprint. How will you manage this trend? All this growth is customer demand generated. We’ve built a lean business model allowing us to expand as customers demand our logistic

services. While we actively monitor global and local economic indicators, our business model is driven by customer demand. What are the “worst case scenarios” for global economic growth? As a company that has a 140+ years history, we’ve seen a few things. We’ve seen global growth and recession. We’ve seen the formation and liberation of countries. We’ve seen radical geopolitical change. Throughout these times we learn and grow. We focus on our customer’s needs, and


that’s what allows us to prosper whatever is going on in the economy. Can you describe in greater detail its plans for “digital logistics?” Digitalisation has many opportunities for the logistics industry. Let me highlight a few areas where we believe we are using innovation to provide greater value to our customers: First of all, digitalisation and big data. Clearly, our markets are currently undergoing an evolution in digitalisation. As our CIO

Richard Ebach DB Schenker Americas says, “The supply chain is easy to predict if it runs as expected. But we live in a world of exceptions.”Presently DB Schenker is investing in data analytics and prediction to bring efficiencies to all our customers. Secondly - digital platforms. DB Schenker is investing millions to strengthen its strategic collaboration with uShip – to shape the future of digital logistics. In February of this year, we acquired an equity interest in global internet marketplace uShip. The uShip platform, which connects shippers and

carriers in over 19 countries, is the industry leader in organising freight transport using mobile devices. For now, DB Schenker will use the platform for land transport through an online platform called Drive4Schenker, which will use uShip technology to connect some 30,000 transport partners in the European land transport network to their freight. The new service launched in Germany earlier this year and is gradually being expanded to other countries. Third - innovative warehouse software. We have an innovative partnership with a global electronics company to develop and test new warehouse-technologies. At our Dortmund lab (Germany), we have created a software prototype that can forecast delays in freight deliveries at logistics warehouses and then automatically make suggestions for preventing bottlenecks, i.e. by updating the shift schedules used by warehouse staff. We have warehouses that use both innovative software and automated technology. Fourth - autonomous driving. DB Schenker and truck manufacturer MAN are working together on developing networked truck convoys and testing the system in real life. A truck platoon will take to the digital testing ground of a German freeway between Nuremberg and Munich. The second stage will see self-driving trucks tested on the premises of a DB Schenker site in Nuremberg. DB Schenker is also interested in learning how to draw up the optimum platooning deployment plan within our own logistics processes. For instance, we are investigating how logistics centers have to be designed and equipped in the future to load and unload networked truck convoys as quickly as possible. Lastly - blockchain technology. DB Schenker participated in trials of new blockchain security benchmarking for global supply chains earlier this year. One of the largest and most comprehensive trials of blockchain technology for global supply chains successfully ended with a new Australian developed blockchain security architecture. TBSx3 has the potential to raise the global supply chain security from today’s standard to military grade. About the author: Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at

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new airport facility The e-commerce explosion in the region is visible everywhere you look. This new facility at Dubai International’s Cargo Terminal is poised to boost DHL Express’s regional operations

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HL Express has opened the doors to its newly expanded US$18million state-of-theart facility at Terminal 2 in Dubai International Airport. It will significantly increase the capacity of shipments managed every hour and strengthen DHL’s regional hub operations from Dubai. The 13,100 sq metre facility, which is located in the Cargo Terminal at Dubai International, will have the capacity to manage up to 5,000 shipments per hour. That will double its current capacity of 2,500 and serve nearly 70,000 customers across the Middle East and North Africa (MENA) region. Ken Allen, Member of the Board of Management Deutsche Post AG, Division EXPRESS, adds,“The expansion of our facility at Terminal 2 in Dubai is the latest investment by DHL to support economic growth in the country and wider region by facilitating global trade to and from our growing hub

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in the UAE. We are confident that the new facility will be able to adequately meet increasing demand for faster shipment deliveries, especially with the boom in eCommerce in region.” Nour Suliman, CEO of DHL Express MENA says,“We continue to see sustained growth in the Middle East region, which is why we are strengthening our regional hub in Dubai and successfully increasing capacity. The new state-of-the-art facility incorporates the very latest technology that ensures we can sort and ship over 120,000 shipments a day. DHL is continuing to set new standards for the logistics industry across the region and we will continue to work closely with our key partners and customs officials to ensure that our customers in the UAE receive the highest levels of service.” “Dubai Airports’partnership with DHL goes back many years, and we are delighted with their continued investment in people, infrastructure and systems. This confidence is testament to Dubai’s global position as a well-positioned aviation and logistics hub, and highlights the significance of Dubai International’s key role as a gateway to the Emirate and the region,”said Eugene Barry, Executive Vice President of Dubai Airports Commercial Group. The new facility will enable consolidated export, transit and import operations with

a customs’ clearance and hold area that will feed inter-continental and region-wide air-and land-network distribution. An automated conveyor system with dual-view x-ray screening of parcels, image-capture technology and an automatic bar-code parcel sorting system will enable the delivery of more than 120,000 shipments a day. DHL currently has more than 200 service centres and service points across 19

countries in the region and employs over 5,100 employees across the Middle East. Through its innovation, service excellence and commitment, DHL continues to offer customers superior and market-leading logistics solutions. Between 2015 and 2019 DHL Express will have invested nearly US$200 million into the MENA region, as well as having updated 12 of its major facilities.

DP DHL hints at major expansion in e-retail Deutsche Post DHL Group is becoming both brave and ambitious in its aspirations for growth in the e-retail logistics space. The Bonn-based giant is hinting that it is about to seriously expand its presence in the grocery e-retail market in Germany. Speaking at an investment conference around the release of its latest quarterly numbers, CEO Frank Appel commented that DP DHL was “getting more and more traction there”, although he did not elaborate. The company already operates a modest-sized grocery retailing operation in Germany called ‘Allyouneed Fresh’.

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The wider vision that Mr Appel outlined was such a service complementing its other operations in e-retail related logistics, notably last-mile consolidation and delivery. The company has introduced a series of new innovations in an attempt to strengthen its ‘last mile’ operations, including an electrically powered truck and a sort of electric trolley. Whilst these are interesting they are unlikely to transform what is often the difficult economics of such activities. What is probably more pertinent is DP DHL’s strong market share that appears to make the company think that it

can expand into difficult areas such as grocery e-retailing. If this strategic direction continues, DP DHL will become a quite different company. Already e-commerce related parcel activity is growing at 15.5 per cent in contrast to traditional postal activities which shrank by 0.8 per cent. An expansion into retailing would imply a huge investment in fulfilment centres, although DP DHL implies that it aims to use its existing infrastructure – including that within DHL Supply Chain – as much as possible. It also asserts that it is developing new warehouse automation and data

analytics capabilities. Even so, the necessary investment would be enormous. Much of the rest of the Group is also growing reasonably, with DHL Express seeing profits climb by 11.4 per cent in the first nine months of 2017, although EBIT in the Global Forwarding/ Freight division fell. However, if only part of the apparent aspiration of DP DHL to enter e-retailing is realised these other businesses will be dwarfed by what would have to be an Amazon-sized operation, at least within Germany. Author: Thomas Cullen www.

Global Supply Chain December 2017 Issue  
Global Supply Chain December 2017 Issue  

Supply Chain, Supply chain management , logistics and supply chain segmentation, warehousing, RFID, healthcare logistics, 3PL, 4PL, six sigm...