Rockwell on a Roll
Drake & Scull Rail
Unleashing new automation technologies
Laying out the tracks to greater connectivity
Noor Bank provides financial resources for mega projects
Connecting trade professionals with industry intelligence
New frontman Christian Juul-Nyholm on the history, growth, challenges and vision for Maersk Line in the region
ISSUE NUMBER ONE october 2014
DESIGNING SUCCESS UNDERSTANDING YOUR BUSINESS GUARANTEES AN INSPIRED SOLUTION
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Contents october 2014
Start 8 | News Scan: Roundup of regional & international news 14 | Spotlight: Grand connectivity plans for Sohar 16 | Maritime Focus: ME, Africa ports gearing up for growth 18 | Overseas Report: Rockwell rendezvous direct from Dammam
features 22 | Maersk Might:
Insider insights from new point-man Christian JuulNyholm
44 | My Take: Forging closer customer-LSP partnership
28 | Rail Man: Tracking Drake & Scull milestones
48 | Profile: Talk is CHEP when it comes to pallets
34 | Golden Slice:
Getting the bite out of Aramex
38 | Oman Overview: Logistics forecast for the Sultanate 39 | Listening Post: Mark Millarâ€™s expert take 42 | Capital Star:
Perspectives from the 4PL Camp
50 | Power Players: Movers & Shakers in the SC&L top brass 52 | Industry Insights: UPS taking stock of healthcare sector 54 | Last Page-First Person: Swisslog solutions for the Middle East
Logistics News me | october 2014 | 3
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Editor’s note Leveraging the Logistics Largesse A star has risen in the Supply Chain & Logistics constellation in the Middle East! A star has risen in the Supply Chain & Logistics (SC&L) constellation in the Middle East! As the industry’s media loadstar, Logistics News Middle East will be indelibly and indistinguishably identified with the trade, as it documents and chronicles the burgeoning supply chain and logistics businesses and successes in the region and globally. We endeavour to be the industry’s vital, indispensable mouthpiece that serves not only to interface with the diverse constituents within the SC&L domain, but also serve as a platform to better inform, provide market intelligence, vent grievances, protect interests and integrate the trade’s multi-faceted activities. To that end, we will strive to uphold high, excellent multi-media reporting standards and professional benchmarks. At Logistics News Middle East, we will assimilate a miscellany of high-value interest editorial features intended to inform, stimulate, reflect and at times even provoke. True to form, we will report from the grassroots as we go down to the trenches in what is now an increasingly competitive, yet buoyant, but also a rapidly progressing industry globally, in the Middle East and the GCC in particular. In our inaugural issue, we talk to insiders about the state of their industry, their plans, perspectives and opinions on the wider issues from their professional prism. The Maersk Line, the world’s largest container shipping company, is the subject of our cover story as we met Christian Juul-Nyholm, the company’s newly appointed Managing Director for the
Editor Malcolm Dias email@example.com Managing Director Walid Zok Walid@bncpublishing.net Director Rabih Najm Rabih@bncpublishing.net Director Wissam Younane Wissam@bncpublishing.net
UAE / Oman / Qatar / Iran. As he takes the helm, he has his work to steer the maritime leviathan in the region clearly cut out. Logistics News Middle East was also invited, by the Rockwell Automation team to Dammam, in Saudi Arabia, as part of a carefully selected media team, to meet the top company brass, witness developments and see a display of the latest state-of-the-art, cutting-edge technologies at the two-day Automation University Classic. We also reveal what the term ‘Golden Slice’ means (no, it’s not a culinary term) in an exclusive conversation with Mohammad Alkhas, CEO, GCC, Aramex. We also journey with Darko Macura, Operations Director, Drake & Scull Rail, as he waxes eloquent about the company’s forays in the region’s flourishing rail sector and his ambitious plans for the future. Elsewhere, we also go to the head offices of Noor Bank to confer with Ehsaan Uddin Ahmed, the Head of Global Transaction Services (GTS) & Corporate Strategy on aspects of project financing for the SC&L segment. At Logistics News Middle East, we pledge to keep you better informed. We hope you enjoy reading our maiden issue. We are keen and eager to hear from you. Welcome into our logistics loop!
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Logistics News me | october 2014 | 7
The News Emirates SkyCargo warms up to cold chain with new container Emirates SkyCargo has launched an internally developed and cost effective LD3 container that keeps temperature sensitive cargo cool when transported on the ground and in the air. Called the ‘White Container’, it’s the latest addition to Emirates SkyCargo’s Cool Chain portfolio. The inside of the White Container is coated with thermal insulators, which prevents the transfer of outside heat into the container. It can be used for shipments requiring temperatures between 2°C -
8°C and 5°C - 25°C and is a reliable solution for time and temperature sensitive cargo. “After intensive research and development, we are introducing the White Container as an affordable option and offer an intermediate solution that is cost effective for commodities, healthcare products and food perishables. It is also environmentally friendly and meets all regulatory requirements,” affirmed Moaza Al Falahi, Emirates VP, Cargo Product Development & Local Affairs.
80 ADPC Job Opportunities
As part of their ongoing commitment towards Emiratisation, Abu Dhabi Ports Company (ADPC) and Abu Dhabi Terminals (ADT) recently held a recruitment event in Abu Dhabi in
conjunction with the Abu Dhabi Tawteen Council, the government employment agency for Emirati job seekers interested in pursuing a promising career in the UAE’s growing ports industry. ADPC and ADT are looking to fill around 80 new job openings. The company is working to create job opportunities for 300 unemployed Emirati’s over the next five years.
Sweet prospects for Mondelez in Bahrain Mondelēz International, the world’s leading maker of chocolate, biscuits, gum and candy, recently announced plans to invest $90 million in building a biscuit plant in the Kingdom of Bahrain to meet rising demand in the Middle East and Africa for renowned company brands such as Oreo, Ritz and TUC biscuits. With full commercial production scheduled to start in early 2016, the planned facility will be Mondelēz International’s most advanced manufacturing site in the Middle East and Africa, where demand for its biscuits has been growing at double-digit rates. In the initial two- to three-year phase, the new plant will operate four biscuitmanufacturing lines with a total capacity of nearly 90,000 tons annually. “This investment in Bahrain is part of our ongoing supply-chain reinvention plan,” said Daniel Myers, Mondelēz International Executive Vice President and Integrated Supply Chain. “We are investing for the future and the Government of Bahrain has been very supportive of investments here,” Vishal Tikku, Mondelēz International’s Area Vice President for the Middle East, said at a recent joint ceremony with Bahrain’s Minister of Industry & Commerce, Dr. Hassan Fakhro.
$90 million investment
Qatar Airways Cargo expands freighter network Qatar Airways Cargo is set to continue its expansion with the launch of two new freighter destinations for its network, which has added Brussels in Belgium and Shanghai in China. “We are delighted to launch freighter services to these two important cities. The 8 | Logistics News me | october 2014
new Qatar Airways Cargo services will create exciting opportunities for businesses. Importers and exporters can also benefit from the increased capacity introduced on both these trade lanes,” remarked Ulrich Ogiermann, Qatar Airways Chief Officer Cargo.
Qatar Airways Cargo strengthened its product portfolio with the launch earlier this year of two new premium services, QR Pharma and QR Fresh that optimise the transportation of time – and temperaturesensitive goods, including high-value pharmaceutical products and perishables.
Kewill boosts its ‘Green’ credentials with CO2 measuring advances Kewill, a leading global provider of innovative software for supply chain execution, has announced enhancements to its Kewill MOVE® multimodal transportation platform that will enable in-depth, accurate measurement of the carbon footprint of shipments. The latest enhancements are designed to meet increasing demand from shippers looking to accurately measure their environmental impact and who are in turn demanding that their
logistics partners have the ability to reliably measure CO2 emissions for goods they move on their behalf. Supply chain businesses are under increasing pressure to disclose metrics around sustainability. The expanded functionality within the Kewill MOVE platform will make collating, analysing and reporting the correct information for CO2 emissions simple for our customers,” asserted Evan Puzey, Chief Marketing Officer at Kewill.
Gulf Warehousing Company wins Logistics Excellence Award To support and encourage excellence in enterprise and the entrepreneurial spirit, Entrepreneur Qatar recently held the inaugural ‘Qatar ’Enterprise Agility Awards’ 2014 in association with Barclays at the Grand Hyatt Doha. Gulf Warehousing Company (GWC) was the recipient for ‘The Logistics Excellence Award’ for 2014. In acknowledgement of Gulf Warehousing Company’s longstanding commitment to developing Qatar’s supply chain infrastructure, the Vice Chairman of the Qatar Chamber of Commerce and Industry, Muhammed Bin Ahmed Bin Towar Al Kuwari handed the award to GWC’s Head of Public Relations Abdulaziz Mohammed Al-Sahlawi. “It is very inspiring to be around so many industry leaders in Qatar and to be recognized by our peers. Gulf Warehousing Company is committed to excellence in providing comprehensive high-quality logistics services,” commented Abdulaziz as he received the award. Gulf Warehousing Company is a fully-fledged logistics provider offering custom-made solutions. It owns and operates a one million sq. m. logistics facility in Logistics Village Qatar among others.
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Logistics News me | october 2014 | 9
Etihad hosts IATA Global Financing Symposium
More than 700 delegates from the global airline industry gathered recently in the UAE capital Abu Dhabi for the twoday International Air Transport Association’s inaugural World Financial Symposium. Delegates were welcomed to the conference by HE Sheikh Nahyan Bin Mubarak Al Nahyan, the UAE Minister for Culture, Youth and Community Development. Etihad Airways, the national airline of the UAE, was host airline for the prestigious event. In his opening presentation, the airline’s President and CEO, James Hogan, said Abu Dhabi was not only one of the world’s fastest-growing commercial centres, but also a growing hub for international aviation.
Agility, Etihad Rail sign MOU Agility recently signed a Memorandum of Understanding (MOU) today with Etihad Rail on an agreement that will enable Agility to use Etihad Rail’s services for distribution in the UAE and the Gulf Cooperation Council (GCC). The agreement is the latest in a series of MOUs completed by Etihad Rail in recent months, highlighting the organisation’s commitment to working with key GCC stakeholders. The MOU was signed by Acting CEO of Etihad Rail, Eng. Faris Saif Al Mazrouei, and Bassel El Dabbagh, CEO of Agility Abu Dhabi. Under the MOU, Etihad Rail and Agility will establish long-term, mutually beneficial cooperation with the aim of developing and enhancing the logistics and transportation network between the UAE and GCC. The network will form a vital part of the planned GCC railway network – linking the UAE to Saudi Arabia via Ghweifat in the west and Oman via Al Ain in the east. Etihad Rail works closely with GCC railways through the GCC Secretariat General to foster comprehensive rail connectivity within the region.
Linking UAE & KSA
ADPC-Topaz seal ship repair deal Abu Dhabi Ports Company (ADPC) recently signed a deal with Topaz Marine Engineering Division (TMED), a leader in providing marine engineering services, for the company to establish the first dedicated ship repair facility at ADPC’s Free Port. TMED has employed a highly skilled ship repair team of over 150 people to operate the 10 | Logistics News me | october 2014
new facility which offers a comprehensive range of world-class services. “The new facility completes our offerings in the Free Port and will significantly facilitate trade,” averred Mohamed Juma Al Shamisi, CEO, ADPC. Geoff Taylor, MD of Topaz Marine added: “We are very proud to fly the flag for ship repair in Abu Dhabi in the ADPC Free Port.”
Renault Trucks Qatar expansion gathers speed As the construction industry in the Qatari capital of Doha experiences unprecedented growth, the exclusive importer of Renault Trucks in Qatar, Al-Attiya Motors & Trading Co (AMTC) has announced the opening of a new custom built and state of the art workshop in the city, representing an investment of QAR 24m. The Qatari Renault Trucks distributor also announced the completion of one their largest tenders, with more than 200 trucks expected to arrive in December 2014.
New ADPC mobile app offers easy access
Dubai Trade visits NAFFCO address the community on their trade and logistics needs. The delegation, comprising senior Dubai Trade officials including Eng. Mahmood Al Bastaki (CEO), Shahab Al Jassmi (Commercial Senior Manager), Salim Khan (Client Relations Senior Manager) accompanied by senior representatives from DP World, Dubai
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Customs and JAFZA, were welcomed by Eng. Khalid Al Khatib, CEO of NAFFCO, who highlighted the importance of open communications. The visiting delegation took a tour within the operation and manufacturing site where the firefighting and rescue trucks and other special custom-built vehicles are assembled.
Unitechnik FZE Dubai Airport Freezone, UAE
A high-power delegation from Dubai Trade, the leading facilitator of trade across borders, recently visited the 1,000,000 sq. ft. global headquarters of National Fire Fighting Manufacturing Company (NAFFCO) in Jebel Ali Free Zone. This visit was a part of the Dubai Trade strategy to evaluate its e-Services and obtain feedback to
Abu Dhabi Ports Company (ADPC) has launched a new mobile application to accelerate access to its ports. The â€˜ADPC Port Passâ€™, available in Arabic and English, allows users to quickly submit an application for an electronic port pass (e-pass) and to track its status at any time of the day. The new mobile app will benefit customers, stakeholders and contractors in the port. It will also ease the process
RAK Free Zone CEO seeks more investments Peter Fort, CEO of Ras Al Khaimah Free Trade Zone (RAK FTZ), was a featured speaker on a panel at the inaugural Financial Times fDi Forum in London, where he encouraged top international investors to choose RAK FTZ as the business-friendly investment destination. “Ras Al Khaimah benefits from easy access to fast-growing markets in Africa, Asia and the Middle East, sound economic policies, a business-friendly regulatory environment and permanent zero tax policy,” Fort, who is also the Senior Economic Adviser to the Government of Ras Al Khaimah, stated. The forum, presented by Financial Times Live and fDi Magazine, was a high-profile leadership summit for corporate decision-makers and cross-border investment professionals from around the world. RAK FTZ allows 100 per cent foreign ownership, full repatriation of capital and profits, and full tax exemption to investors. RAK FTZ has flexible business centre facilities, offices, warehouses and land for lease across four specialised free zone parks. The free zone is home to over 7,500 companies from more than 100 countries, representing more than 50 industry sectors.
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Tristar launches sustainability report
Tristar Transport, the Dubai-based integrated liquid logistics company serving the petroleum and chemicals industries, recently launched its second Sustainability Report at the Dubai Chamber during the Best Practice Seminar on Road Safety. Tristar is committed to road safety and has implemented a campaign with the Roads and Transport Authority (RTA) and the UK-based Royal Society for the Prevention of Accidents (RoSPA) to raise the level of awareness of heavy duty drivers on defensive driving and the causes of road accidents. Tristar’s sustainability report describes the company’s overall sustainability approach and its efforts toward driving health and safety, enhancing employee well-being, reducing environmental impact and contributing to community development. “I am particularly proud of our performance in 2013 when we accomplished another year of operations with zero fatalities and zero spills,” stated Eugene Mayne, Tristar Group CEO.
TNT now connects with Banglalink TNT Express in Bangladesh has recently signed a partnership agreement with Banglalink, the country’s second largest mobile telecom operator and marked the occasion with a special ceremony attended by Rajiv Bhattacharya, Country General Manager for TNT Express in Bangladesh and Mahabubul Alam, Banglalink’s Senior General Manager for Marketing. Under this agreement Banglalink premium customers called “Priyojon Customers”, will benefit from making substantial savings, when using TNT services for the period of the agreement. Tim Frank, TNT Express General Manager Middle East & Subcontinent Associates commented: “We have a longestablished presence in Bangladesh and our association with Banglalink will enable us to provide our services to their premium subscribers.”
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www.drakescull.com Logistics News me | october 2014 | 13
Freight Rail Terminal vital: Top Sohar official sohar rail terminal will boost the sultanate’s economic growth Sohar Port Executive Commercial Manager Edwin Lammers has stressed that the development of a freight rail terminal at Sohar, at an almost midway point between the Omani capital Muscat and Dubai & Abu Dhabi in the UAE, will be vital in accelerating national growth and ensuring that Oman remains competitive in global markets. His remarks came in a keynote address delivered at the recent Rail Projects GCC Exhibition & Summit 2014, held in Muscat, in which he asserted that ongoing rapid expansion and growth that make Sohar an obvious choice for a new terminal. “This is an exciting time for the Middle East rail industry, and even more so here in Oman. Around $250 billion has been committed to building a 67,000 kilometre network in the Gulf and work has also begun on the first phase of Oman’s 2,244 kilometre freight and passenger infrastructure,” Lammers remarked. “As one of the world’s largest port development sites and the cornerstone of Oman’s global trade ambitions, we have seen steady growth in the demand for distribution and freight services. Connecting Sohar to rail networks therefore becomes an obvious choice from a customer service perspective, and will allow us to capitalise on rising trade volumes and drive down the cost of doing business in Oman,” he stressed. Having sustained double-digit growth for more than a decade, Lammers spoke of the need for efficient rail services and highlighted the unique potential to harness global expertise on offer at Europe’s leading logistics hub.
“Sohar has grown at a tremendous rate, and we owe much of that success to the vision of the government in Oman. We have also benefitted from access to global best practices in Rotterdam, which have guided our progress. I am confident that this relationship will prove valuable once more, as Oman seeks to tap into a global rail freight industry that was valued at around $210 billion only last year,” Lammers affirmed. Sohar’s presence at the summit came as it applies the finishing touches to the relocation of commercial traffic from Muscat, which will see the number of containers passing through the port more than double. Two-hundred thousand tonnes of freight cargo and 70,000 cars will also make the move from the capital and Lammers discussed the wider implications and benefits of rail transport for local roads and the environment.
“ Sohar has grown at a tremendous rate...”
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vastly experienced in logistics and port-related businesses, joined Sohar Industrial Port Company (SIPC) as the Executive Commercial Manager in December 2008.
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Logistics News me | october 2014 | 15
Bright future forecast for the Dark Continent
The Port of Dakar, Senegal
DP World operated Port of Dakar is a major gateway and entrepot for West Africa covering Senegal, Guinea-Bissau, Mauritania, the Gambia and Mali.
Powerhouse Africa to take centre stage at Mid-East maritime event A long-established conduit for Africa-Asia trade development, operational challenges and new opportunities for the Gulf’s maritime sector across the African continent will once again be a key focus at Seatrade Middle East Maritime conference, which takes place in Dubai from 28-30 October 2014. The dedicated Africa ‘Power Hour’ session, which will be held on day one of the three-day event, part of Dubai Maritime Week, will feature a panel of regional specialists and address a broad range of topics, including logistics complexities and the potential of government partnerships, as well as pinpointing those markets primed for maritime growth and development, plus those with specific sector investment opportunities. “According to the Emirates Centre for Strategic Studies and Research, the value of trade alone between the UAE and Africa was expected to reach more than $50 billion last year, a 27% increase over the previous year. Africa’s potential has even been highlighted as part of the Dubai Expo 2020 programme, describing it as a gateway to Africa,” exclaimed Emma Howell, Head of Marketing Middle East, Seatrade, organizers of Seatrade Middle East Maritime. Africa has been the world’s second-fastest growing region in economic terms over the past decade, growing at an average rate of 5.1%. Home to seven of the world’s 10 fastest-growing economies, according to a McKinsey & Company report, accelerated growth in consumer spending is forecast to touch $1.4 trillion by 2020. “A base for multinationals doing business with Africa, the UAE is the maritime axis around which the extended trade relationship between Africa, Asia and new potential in the rapidly developing ‘SouthSouth’ economies revolves; and with gov-
region, where oil exportation is being supported by large-scale investment into infrastructure and mining, as well as positive commodity-led export performance. Drewry Shipping Consultants also reports strong growth prospects for container trade, particularly in North Africa, and new potential for operators on the South and East coasts where PPP models are being touted by countries such as Kenya and South Africa. Senegal, Nigeria and Angola are also mooted as destinations to watch with port utilisation in the region predicted to grow from 70 to 80% over the next 10 years as consumer growth escalates, especially in West Africa, and as global operators develop their operations and boost efficiency levels. Seatrade Middle East Maritime is in its 7th edition and recognised as the maritime meeting place in the Middle East. More than 7,000 participants from 67 countries are expected to attend the 2014 on conference and exhibition.
“ A base for multinationals doing business with Africa”
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ernment entities like the Dubai Chamber of Commerce putting the figure for GCC investment into Africa at $61 billion per annum, trade volume forecasts are only set to grow as we head towards 2020 and beyond,” she added. Dubai’s DP World has significant Africa presence as owner and/or operator of five ports located in Algeria, Djibouti, Egypt, Mozambique and Senegal; and Dutch maritime giant APM Terminals relocated its Africa HQ from Cape Town to Dubai, recognising the benefits of combined dual regional oversight from the Middle East’s maritime epicentre. Sub-Saharan Africa is projected to see economic growth rise from 4.9% in 2013 to 5.5% this year, according to an IMF Q2 2014 report, which reflects the improved prospects of a large number of countries in the
THE NEW GATEWAY TO THE GULF
Logistics News me | october 2014 | 17
rockwell: saudi arabia
Rockwell Automation-hosted first industrial mega event in the Middle East attracts remarkable response
Hedwig Maes joined Rockwell Automation in 2007 as Regional Sales Director for Central Europe. Since December 2008, he has held the position of President - Europe, Middle East and Africa.
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rockwell: saudi arabia
“Saudi Arabia is one of the world’s fastest growing countries and economies.”
ilwaukee-headquartered Rockwell Automation, the world’s largest company dedicated exclusively, 100%, to industrial automation and information, recently sponsored a two-day Automation University Classic to showcase its latest innovations, products, solutions and services at the Sheraton Hotel Exhibition & Convention Centre in Dammam, the capital of the Kingdom of Saudi Arabia’s oil-rich Eastern Province. It was a bold move for, a maiden foray and the first of its kind for the US company in the Middle East, a reinforcement of the company’s growing confidence in the region. Logistics News Middle East, was one of an elite group of carefully-selected industry publications especially invited to witness and report on the jumbo event. The response was indeed overwhelming. Over 800 registered delegates, from some of the biggest names in the industrial automation and instrumentation sector, representing a cross section of industry verticals in the region, gravitated to this super event that called for substantial investment on the part of the company and took all of ten months to plan and execute. It was attended by the top brass and a 90 member-strong delegation of officials from Rockwell Automation’s EMEA’s (Europe, Middle East & Africa) regional headquarters in Diegem, Belgium and offices across Europe and the GCC. Over 60 real-time, state-of-the-art training, technical, automation, instrumentation,
laboratory and presentation sessions were held in separate venues across the Dammam Sheraton which was transformed into a virtual ‘Rockwell’ Centre for the duration of the symposium. At a press conference held on the sidelines of the Automation University Classic, Hedwig Maes, President, EMEA Region, Rockwell Automation, set the tone for the conference in a keynote address. He affirmed that the twoday event, open to everyone interested in leading-edge automation solutions, from
engineers to business managers, was packed with the latest technology and information, where participants were offered the opportunity to witness, harness and experience Rockwell Automation products and solutions first-hand. Furthermore, Maes identified Saudi Arabia as a strategic and fast growing market in the EMEA region and asserted that an event such as the Automation University Classic was key to communicate a strong message about Rockwell Automation as a trusted, dependable company, as well as the strength of its multi-faceted and growing portfolio.
Speakers also included Dominic Molloy, Director, EMEA Marketing; Neil Enright, Director Regional Sales, Middle East; Yahya Darwish, Country Director—Sales, Saudi Arabia; Neil Steve Quadros, Field Marketing Specialist, Middle East and Talal S. Al Shammari, Gas Power Plant Manager, Eastern Province, Saudi Electricity Company (SEC). “Saudi Arabia is one of the world’s fastest growing countries and economies. A vast number of factories and industrial, logistics, supply chain and transportation facilities, including government-initiated and funded desalination plants, seaports, airports, refineries, infrastructure projects and manufacturing companies make up the Kingdom’s non-oil industry” said Yahya Darwish in his address. “KSA is keen in diversifying its economy. Seeing the robust growth of the country and its potential, the Automation University Classic is a great platform for private companies and government to discuss topical industry issues and at same time exchange fresh and stimulating ideas,” he said. Global leaders Prosoft Technology, Molex, Stratus Technologies, Cisco, Endress+Hauser, Ewon, Fluke, Oldi, Panduit, Spectrul Control, Avanceon, all Rockwell Automation strategic alliance partners and Abdul Rehman Ali Al Turki Group of Companies (ATCO) LLC, the company’s long-time partners in Saudi Arabia, were among the exhibitors at the event. Logistics News me | october 2014 | 19
rockwell: saudi arabia
“ The response has been well and truly overwhelming.” Logistics News Middle East spoke exclusively and jointly to a company roundtable comprising Hedwig Maes, Dominic Molloy, Neil Enright, Yahya Darwish and Guido Conio, Regional Channel Manager, Middle East & Turkey, at the Rockwell Automation University Classic. Logistics News Middle East (LNME): Rockwell Automation organized the Automation University Classic for the first time in the Middle East. Why at this juncture, why in the Kingdom of Saudi Arabia and what are the thinking digits behind the decision to host this landmark event in the region?
Hedwig Maes: Clearly, with its size and financial prowess, the Kingdom of Saudi Arabia is an economic powerhouse in the region with considerable investment plans in infrastructural, industrial and technological development. Together with our partners, Rockwell Automation has enjoyed a strong and time-tested presence in the region and in Saudi Arabia in particular. We are bullish about the Kingdom and the wider GCC & the Middle East and our now is the time to leverage our capabilities, expertise, experience and insights in the region for the opportunities that present themselves.
LNME: Who is the audience being targeted and briefly what do you propose to discuss at this event? 20 | Logistics News me | october 2014
Hedwig Maes: As you have witnessed, we have dozens of training and presentation sessions occurring simultaneously and in tandem, with distinct customer interest in specific aspects of what Rockwell Automation can offer. This helps in establishing and reinforcing a close interface with our clients and end users, as we bond together in our common endeavours, as we present the technologies of integrated information and automation solutions to key industry experts. LNME: What does Rockwell Automation hope accomplish at this major twoday event?
Hedwig Maes: Our mission is two-fold. Firstly, to present Rockwell Automation as the global pioneer and leader in automation solutions by virtue of our capabilities and technical know-how and secondly, to cohere with our growing customer base and partners in the region to provide further opportunities and boost growth potential.
LNME: What has been the response to this event?
Hedwig Maes: The response has been well and truly overwhelming. We were looking to host around 600 delegates but the turnout has surpassed our expectations and we have almost 800 delegates, representatives and attendees on hand at this venue.
LNME: What is your broad assessment of the region’s Supply Chain & Logis-
Hedwig Maes joined Rockwell Automation in 2007 as Regional Sales Director for Central Europe and was later named Regional Sales Director for the CEEMS Region (Central Europe, Eastern Europe, Middle East and South Africa). Since December 2008, he has held the position of President- Europe, Middle East and Africa. A Belgian citizen, Hedwig Maes brings senior leadership and international management experience from positions in the electronics industry with GE Infrastructure and GE Power Controls, both a part of GE Industrial Systems, and at ABB. Maes holds degrees in industrial electronics from the Industriële Hogeschool AntwerpMechelen (Belgium) and in business economics from the UFSIA University Antwerp (Belgium).
tics industry vis-à-vis automation and how can this interface be further strengthened?
Neil Enright: The Supply Chain & Logistics industry is a very important sector for Rockwell Automation and offers tremendous opportunities for growth. Currently, our involvement with this industry segment revolves around three major divisions— Automotive, Tyres and Material Handling. We are constantly exploring areas we can make our contribution and offer customized automation solutions.
LNME: How significant is the Middle East market for Rockwell Automation and what is your sales growth forecast for the region for the coming years?
Neil Enright: Interestingly, the EMEA region is second only to North America and one of the fastest growing for Rockwell Automation. Our growth is in the double digits and we are on course to accomplish our sales goals in the region. The two dominant economies Saudi Arabia and the UAE hold much promise for growth. The remainder of the GCC countries — Qatar, Kuwait, Oman and Bahrain — are also all in growth mode and given the resolve by these countries to broaden their economies from being oil, gas and energy centric, to more diversified industrial and manufacturing base, we are very optimistic we will continue to develop in the region.
rockwell: saudi arabia
Dominic Molloy, in his role as Director Marketing EMEA, has been responsible for Commercial Marketing, Process Initiative and Pricing strategy in the region since May 2011. Before holding this position, Dominic Molloy was Managing Director UK and Ireland at Rockwell Automation, from December 2007 until May 2011. In this role, he was responsible for sales leadership and profitable sales growth within EMEA. Dominic has been with Rockwell for over 20 years and has held positions within Sales, Marketing, Supply Chain and various Product and Services Divisions within the UK and EMEA Region. He has an extensive career spanning over 35 years in the Automation and Process Control Industry.
Neil Enright joined Rockwell Automation in 2011 as Regional Sales Director for the Middle East Region. As the Regional Sales Director, Neil is responsible for all Rockwell Automation sales, marketing, technical support and operations in the Middle East. Neil started his career at ABB in Ireland and has spent most of his career on international assignments. He brings senior leadership and international management experience from the positions he has undertaken in both Power and Process Automation Business in Ireland, Thailand, Switzerland, China and the Middle East. An Irish citizen, Neil holds a degree in Electrical Engineering from Dublin Institute of Technology.
Rockwell Automation Trivia: Fiscal 2013 Sales: USD
$ 6.3 billion. Total Employee Force: 22,000 including 4,000 in the EMEA Region.
Serves customers in over 20 industry segments in over 80 countries worldwide. Operating Segments: Technology; Ethernet Automation Integrated Architecture & Software; Smart, Safe, Sustainable Manufacturing; Control Products & Solutions; People & Process Optimization. Corporate Tagline
Listen. Think. Solve.® Quote: “We believe that we
are at an inflection point drawn by the integration of the Internet of Things and the Connected Enterprise,”
Keith Nosbusch, Chairman & CEO, Rockwell Automation
“ Growth, growth and more sustained growth ...” LNME: How is the Middle East responding to industrial automation and comparatively what industry verticals hold the most promise?
Dominic Molloy: Automation is impacting every facet of every industry globally and this region is no exception. Business is gaining momentum in the GCC and the region is responding to automation in a very big way and is important to us. More and more companies are coming into the automation fold and we hope to grow phenomenally. Growth is forecast in the supply chain & logistics, life sciences (pharmaceutical), utilities — power, water; mining & metals and food & beverage sectors, all of which are getting increasingly automation oriented.
LNME: Specifically, how can Small & Medium Enterprises (SMEs) benefit from industrial automation, the kind of which Rockwell Automation excels in?
Guido Conio: It is a misconception that automation is applicable only for large multinationals and big corporations. SMEs are going the automation route and espousing automation with great benefits. SMEs, like the other users of automation, can profit from these industrial applications.
LNME: Talk to us about the role of ATCO in organizing this event?
Yahya Darwish: The Abdul Rehman Ali Al Turki Group of Companies (ATCO) is a leading, 3,000-employee strong conglomerate with offices across the Kingdom has successfully operated since the mid-1950’s in Saudi Arabia’s governmental, industrial and consumer sectors. As our local partner, ATCO has been an integral and valuable part of the Automation University Classic’s organisation process.
LNME: What is your vision for Rockwell automation in the region?
Hedwig Maes: Growth, growth and more sustained growth—that is our mantra for the region. We will continue to maintain a strong presence and high profile in the region. We will continue to invest, strive to enlarge our market share through our competence, involvement, superior products and higher service standards. Logistics News me | october 2014 | 21
O u t t o S e a : M a e rs k L i n e E x c l u s i v e
Christian Juul-Nyholm, Maersk Lineâ€™s newly appointed managing director.
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O u t t o S e a : M a e rs k L i n e E x c l u s i v e
new man at the helm Strong moorings for Maersk Line in the region By malcolm dias photography by jovana obradovic
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O u t t o S e a : M a e rs k L i n e E x c l u s i v e
“ The UAE, Qatar, Oman and Iran is a priority region and very important for Maersk Line”
Juul-Nyholm, now the Maersk front-man, is at once articulate, amicable and intense as he conversed animatedly on his current and return tour of duty in the region in an exclusive interview. as the supremo for maersk line in the uae, qatar, oman & iran, what have you been tasked with and what are your immediate priorities for the region? Christian Juul-Nyholm: clearly my mandate is to reinforce Maersk’s continued suche 1928-established Maersk Line, the most reliable (seaintel maritime analysis-Q1 2014, and the largest container shipping company in the world by revenue, occupies a place of pride in the highly volatile and fiercely competitive world of global container shipping. The mega monolith of the maritime world, Maersk Line is the largest operating unit of the Maersk Group, a Danish business conglomerate. With strong roots in the region’s shipping community, Maersk has enjoyed a long and growing presence in the Middle East and its association with Kanoo Shipping as its sole agent in the UAE dates back to 1959. Despite the slump, which continues to dog the global shipping industry, Maersk line has successfully navigated these tempestuous, choppy waters and continues to steam ahead as evidenced by the encouraging H1-2014 results. There has been a recent change of guard in Maersk Line’s UAE, Qatar, Oman & Iran organisation, with a new captain at the helm since July 2014. Logistics News Middle East went to meet Christian Juul-Nyholm, the company’s newly appointed managing director. He took over from his predecessor Lars Oestergaard Nielsen, who has since been relocated to the company’s Black Sea operations, based in Turkey. The youthful-looking Juul-Nyholm, a 23year Maersk veteran, who has his work clearly cut out for him, as he hits the ground running to steer the firm through a momentous phase in its corporate history in the region. 24 | Logistics News me | october 2014
cess in this domain comprising the southern Gulf — the UAE, Qatar and Oman. Iran is inert for now for reasons outside our control because of the continuing un-sponsored sanctions. Maersk has an extensive and strong presence with a long history of accomplishments in the region. We continue to focus on maintaining the momentum and traction, whilst building on our solid, premium-brand reputation and a burgeoning business portfolio that has been growing rapidly in these three countries. The economic fundamentals in this region
O u t t o S e a : M a e rs k L i n e E x c l u s i v e
Maersk Lineâ€™s business grew by 7% in H1-2014, the global average for the industry.
are good and we hope to be able to leverage our inherent strengths to further boost business across the board on the import and export sides as well as cross trades. The UAE, Qatar and Oman economies have been buoyant and booming. The logistics and transportation sectors are growing thanks to massive investments in several big-ticket infrastructure, industrial, housing, transportation, construction and development projects, as well as prestigious projects, such as the Expo 2020 to be hosted by Dubai and the Qatar 2022 FIFA World Cup. Development of ports such as Sohar, Salalah and Duqm in Oman, as elsewhere in the GCC also holds promise for Maersk Line. So there is potential for growth and expanding our portfolio. I am excited to be here in this part of the world at a point of inflexion in the regionâ€™s economic growth and prosperity. Reliability, trust, excellence in customer service standards coupled with our capabilities, the weight of our institution, experience, a can-do attitude, human resources and other assets make Maersk a force to reckon with and a preferred choice for shipping services in this region. In tandem we will also endeavour to strengthen customer relationships, forge new partnerships, lessen and mitigate inefficiencies and upgrade available and related technologies to maintain our leadership position in the industry. As a global company we are fully mindful of the changing industry dynamics in the region as well as internationally and strive to stay nimble, adaptable, flexible and resilient.
how significant is the lower gulf for maersk in the international context? Christian Juul-Nyholm: The lower Gulf is a priority and very important region for Maersk and ranks among the top ten of our worldwide divisions. As is evident, the region fares well and is placed high up in the pecking order. However, we will not be resting on our laurels and my goal is to see that we continue to move up a few notches. how has maersk fared during h1-2014 compared to H1-2013 and what is your prognosis for h2-2014? Christian Juul-Nyholm: Internationally we grew 7% during H1-2014 which was also the global average. I am a little bearish on H22014, largely because most of the re-stocking in Europe was done in the first half of the year. The Asia to Europe trade has also slowed down but were are optimistic about this region and believe we have sufficient fire power to pull us through. what challenges do you foresee for the region going forward? Christian Juul-Nyholm: With growth also comes challenges and we are certainly not immune from developments on the trade and political fronts. We are always sensitive to over capacity, pricing, competition and other market and economic fluctuations, but this region has traditionally been import oriented. We also have to juggle with aspects of Logistics News me | october 2014 | 25
O u t t o S e a : M a e rs k L i n e E x c l u s i v e planning and forecasting and make available the right number of containers to customers on a timely basis. Add to that the Ebola virus scare that is causing concern in West Africa, which is one of our core trades. We continue to monitor this and other emerging political situations and business developments very carefully. All these come at a cost and can have an adverse impact.
The lower Gulf is a priority and very important region for Maersk Line and ranks among the top ten of its worldwide divisions.
there has been a lull in piracy in the region lately but how much of a concern is this for maersk line? Christian Juul-Nyholm: Piracy is a concern for us across the coasts of East Africa, the Horn of Africa and other susceptible parts of the Indian Ocean. We continue to stay vigilant. In such scenarios we have to contend with is increased insurance costs and higher fuel and operational costs because we have to maintain higher, or close to top speeds, as we navigate these areas. We are constantly monitoring the situation to ensure that we have the right policies and procedures in place to mitigate the risk of piracy. However, this is not a problem the shipping industry can solve by itself. It must be addressed by the international community and the authorities. We are contributing to and supporting these measures ashore through the UN and other international organisations. Until these changes are imple-
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mented and effective, Maersk Line is acting in an appropriate and responsible way to protect its seafarers. what is the composition for inbound, outbound & cross trade cargoes for maersk line in the region? Christian Juul-Nyholm: As I indicated earlier, the region is import heavy, but the gap is narrowing steadily to reach more equitable levels across imports and exports. Project cargo from industrial clients is on the rise as the region witnesses increased economic activity and infrastructure development. what in your opinion are maerskâ€™s usps? Christian Juul-Nyholm: Shipping is our core business and apart from our fundamentals, what sets us apart are differentiators in terms of superb quality of customer service. At Maersk, we have the global reach, capacity, experience and reliability, which is not just about moving containers, but also moving them efficiently, safely, quickly and making the required number of containers available on time. At Maersk we have also invested heavily in our human resources, high-calibre employees, training, as well as sophisticated on-line technologies to make it convenient and easy for our customers. That can only work to our advantage.
O u t t o S e a : M a e rs k L i n e E x c l u s i v e
“ We have also invested heavily in our human resources, high-calibre employees, training as well as sophisticated on-line technologies” please bring us to speed on the recently announced 2m alliance between maersk and msc? How will it work? Christian Juul-Nyholm: The 2M alliance is the outcome of a re-evaluation and reassessment of the earlier P3 agreement Maersk reached with Mediterranean Shipping Company (MSC) and CMA CGM, which was not accepted by Chinese regulators. Accordingly, as part of a vessel sharing agreement (VSA) across 21 services, there will be no joint operations, but there will be the sharing of space and slots. Maersk Line and MSC will operate our own vessel fleets. Jointly, we will deploy 185 vessels with a total capacity of 2.1M teus and a new schedule has already been announced. does maersk line have any plans for further mergers and acquisitions in the near future? Christian Juul-Nyholm: These are decisions
taken at the corporate level but for now I am not aware of any consideration in this space. Shipping companies, like other businesses are becoming increasingly cost-conscious. There is a lot of old, excess tonnage and we now incline more towards fuel-efficient ships as reflected with the acquisition of our new triple-e fleet. in july 2013, maersk line took delivery of its first triple-e mega ship, the 18,000 teu capacity mærsk mc-kinney møller at a ceremony held at the daewoo shipyard in south korea. Is there a likelihood of the triple-e coming to a port near us in the middle east anytime soon? Christian Juul-Nyholm: Well I certainly hope so in the near future, although there is nothing on the cards for now. The port of Jebel Ali is equipped to dock triple-e vessels, but other ports in the region are not enabled for this purpose.
Maersk Line fares well in Q22014, trounces Q2-2013 performance According to the latest Maersk A/S Interim Report for Q2-2014, Maersk Line made a profit of $547m ($439m) and a ROIC (Return on Invested Capital) of 10.8% (8.5%). The improvements were achieved through 4.4% lower unit costs supported by higher bunker efficiency and a volume increase of 6.6% to 2,396K FFE (Forty Foot Equivalent). Cash flow from operating activities was $870m ($790m) and cash flow used for capital expenditure was $488m ($311m). (All figures in parenthesis refer to the corresponding figures for the period Q2-2013)
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Gr e a t Tr a c k R e c o rd
n o s e k a r b e h t g n i t t u No p i International a b u D t a r e v o senger M s a P t r o p r talls Ai s n i R S D
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Gr e a t Tr a c k R e c o rd
Drake & Scul l
Logistics News Middle East: How has the Middle East and specifically the GCC rail market developed during the past 12 months? Darko Macura: According to a MEED report, rail projects accounted for an outlay of $30 billion, nearly 30% in value of all projects awarded in 2013, representing only 8% by number of planned projects. MEED Projects estimates that the value of currently planned or yet un-awarded or un-announced GCC transport projects will exceed $150 billion. There are 24 major rail projects planned or underway across the MENA region, with a combined value of $194 billion. Since March 2014, we’ve seen some healthy developments for the region’s rail sector. Qatar took the lead with nearly $6 billion worth of rail projects awarded, including the Gold line for the Doha Metro and the Lusail Light Rail Transit. Oman recently issued a tender for the multibillion Sohar-Buraimi rail link, which will eventually also connect Sala-
lah in the Sultanate’s Southern Dhofar province and Duqm in the Central-Eastern Al Wusta governorate with all major GCC ports. The Road Transport Authority of Dubai too announced Dubai Metro’s expansions plans, which will extend the metro to more than 421 km, covering 197 stations eventually. The Saudi Arabian Government has already started the groundwork for the Riyadh Metro and the Saudi Railway Organisation (SRO) also announced, in August, its plans to link various parts of the Kingdom, including a 660 km stretch between Jeddah and Jazan and a 700 km stretch between Taif and Asir. There was also a $185 Million rail link awarded by the Saudi Public Investment Fund (SPIF) for a 132 km mineral rail line in the North Eastern region. The industry is waiting for more announcements for the upcoming metro systems in Jeddah, Abu Dhabi and the
Darko Macura leads Drake & Scull Rail with more than a decade of experience in important Large Fast Track Railway/Metro as well as residential and commercial projects in Europe and the Middle East.
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Gr e a t Tr a c k R e c o rd
Drake & Scull Rail worked on St Pancras station in London. The company also picked up its first rail project in the Middle East and is currently installing an Airport Passenger Mover (APM) at Dubai Airport.
“There are 24 major rail projects planned or underway across the MENA region.” Makkah Rail has moved from conceptual to pre-planning stages. The $20 Billion Kuwait Metro project is expected to commence in 201, spanning 61 stations on 3 railway lines. Drake & Scull Rail also picked up its first rail project in the Middle East and is currently installing an Airport Passenger Mover (APM) at Dubai Airport. Logistics News ME: What do you see as the key growth areas for D&S Rail over the next 12 months? Darko Macura: The Kingdom of Saudi Arabia remains the biggest market, with about $93 billion worth of rail projects planned. This includes the Riyadh Metro ($22 Billion), Jeddah Metro ($11 Billion) and the Haramain high speed rail network ($13 Billion) and we also expect the Makkah Metro to be a multibillion project as well. There is also potential in Qatar, the second biggest market with $40 billion worth of planned rail networks in place, followed by the UAE which has around $35 billion worth of rail projects underway, including the $11 billion Etihad Rail project. Logistics News ME: What are the key areas in which D&S stands out above its competitors? Darko Macura: Drake & Scull Rail’s integrated engineering solutions are designed to respond to the sophisticated technical requirements of complex railway and metro networks. We 30 | Logistics News me | october 2014
are an internationally recognised enterprise with a proven record of over 40 years in delivering turn-key rail installation and maintenance projects in Europe and East Asia. Safety and quality are the hallmarks of DSR and we are distinguished by the quality of services offered. Drake & Scull possess the relevant UK accreditation for Health & Safety, Quality Assurance and Environmental Management. Drake & Scull’s integrated quality management systems have been certified to ISO 9001:2008, ISO 14001: 2004 and OHSAS 18001:2007 standards. Logistics News ME: Tell us about the range of contractual arrangements and PPPs (Public Private Partnerships) that DSR offers? Darko Macura: Drake & Scull Rail offers complete EPC solutions for all systems and services for stations, depots and tunnels, catering to industry, governmental and railroad clients in MENA and South Asia. Drake & Scull Rail has the capability to follow a range of contractual arrangements, from turn-key to EPC, joint ventures with other companies, packaged works and subcontract works. We have a division within the group called Drake & Scull Development. Its sole purpose is to initiate and develop projects that are PPP-structured, so the funding would be from the company as well as external sources. We believe in being part of a turnkey project from the design stage, delivery, testing,
Gr e a t Tr a c k R e c o rd
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Gr e a t Tr a c k R e c o rd commissioning, operation, maintenance so the client gets better value over the long haul. Logistics News ME: Please provide us the backdrop to D&S Rail? When was it set up, why and its relationship with D&S International? Darko Macura: Drake & Scull Rail was first established in the UK in 1993. It was set up as an EPC division to cater for all the metro and rail projects in the UK. Subsequently it has re-established the rail capabilities in the GCC region as part of Drake & Scull International. Logistics News ME: What specific areas are you targeting and what success have you had to date? Darko Macura: We offer the full MEP fitout of stations, both over ground, as well as underground. We are familiar with and knowledgeable of the standards applicable to the underground stations and we have a lot of experience with the logistics and installation requirements involved in rail projects. We also have experience with customer information systems and customer security systems, which are specific to rail and to underground stations as well as depots for the maintenance of rolling stock. In partnership with specialist manufacturers, we are able to perform and deliver full turnkey projects for depots, MEP fit-out, construction, as well as supply and installation of specialist heavy equipment. We also have a lot of experience with tunnel ventilation and smoke control for metro tunnels. We do this in partnership with specialist designers such as ARUP. We have gained a lot of experience from the Jubilee Line Extension and Channel Tunnel Rail Link Phase 2 in the UK, and so we are able to offer that here in the GCC region as well. Logistics News ME: Logistics News ME: Being sustainable is increasingly important in the Middle East. What policies does D&S Rail operate? Darko Macura: DS Rail complies with and is guided by the strictly defined Environment policies governing DSI. We are aware that our market has a delicate and vulnerable ecosystem, so we strive to ensure that we have minimal impact on the environment while delivering projects. Our operations have been certified to be OHSAS 18001:2007 compliant. We have clear guidelines on the choice of material and equipment that can be deployed on site. We have a honed recycling system where we ensure that material wastage is reduced as much as possible, which in turn makes our purchase process more efficient. Through our LEED experience on our engineering and civil projects, we are also famil32 | Logistics News me | october 2014
iar with energy efficient practises and have the capability to run power and cooling analysis simulations on project designs, to identify areas of concern quickly. Logistics News ME: Do you think sustainable construction implies more expensive construction? Darko Macura: Sustainable construction doesn’t need to be more expensive as long as proper planning is done prior to moving resources on site. While standard building practices are guided by short term economic considerations, sustainable construction is based on best practices which emphasise long term affordability, quality and efficiency. At each stage of the life cycle of the building, it increases comfort and quality of life, while decreasing negative environmental impacts and increasing the economic sustainability of the project. A building designed and constructed in a sustainable way minimizes the use of water, raw materials, energy and land over the whole life cycle of the building. Logistics News ME: How important is sustainability to DSR? Darko Macura: DSI and DSR are responsible and conscious participants in our markets. We are highly concerned with ensuring that we protect and sustain the environment of our areas, and are operated by a well-defined integrated management system manual that specifies our environmental responsibilities. We have invested heavily into adding “green” methods in our processes, right from design and planning, to post-operation maintenance. All of these are examples of our unwavering commitment to ensure that we make a positive impact on the environment, while achieving our goals and targets. This vision is shared by everyone at DSI.
In the Vanguard Darko Macura leads Drake & Scull Rail with more than a decade of experience in important Large Fast Track Railway/Metro as well as residential and commercial projects in Europe and the Middle East. Darko is a seasoned veteran of the Railway industry, having started as a Commissioning Engineer for the Jubilee Line Extension project, in London, before working on the Fulham Broadway Underground Station in the capacity of a Project Engineer. He then successfully led the completion of the Bedford Depot which was part of the Thameslink 2000 project as a Project Manager. He then naturally progressed into a Senior Project Manager’s role aspects of the London Underground Ltd (LUL) where he was responsible to oversee a large number of PPP projects for LUL’s Clients such as Tubelines and Metronet. Darko has worked with respected Rail EPC contractors such EMCOR Rail Ltd (formerly known as Drake & Scull Rail Ltd) as Senior Project Manager, overseeing Network Rail projects such as Ashford and Ramsgate Depots for the Hitachi High Speed Trains and was also involved in the Northern Line Control Centre during his stint as Operations Director for NG Bailey Rail. Darko has also worked with Dean & Dyball Rail (part of Balfour Beatty Rail Group) as Network Rail.
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aramex endeavours to get a big bite of the ‘golden slice’ Aramex GCC CEO upbeat on company’s continued remarkable performance
ramex, one of the leading global logistics and transportation solutions providers, has come a long way from its humble establishment in 1982. Started in the Jordanian capital Amman by its legendary founder (and now also its Vice Chairman) Fadi Ghandour, it has become an acknowledged global brand with customized and ingenious multi-product offerings. Mohammad Alkhas, GCC CEO, Aramex recently published an extensive report entitled ‘75K, the Golden Slice’ documenting the evolution and growth of the supply chain & logistics industry across the GCC expanse — his analysis of prevailing market conditions and recommendations for both sustained and sustainable growth for the future. 75K, the Golden Slice, refers to a 75,000 sq. km. rectangular area of land straddling leading industrial cities across the ‘Rich GCC Trinity’, comprising three of the most powerful economies in the GCC— Saudi Arabia’s energy-laden Eastern province, Qatar and the UAE. In an exclusive, candid interview with Logistics News Middle East in the 23rd floor offices of Aramex located in the Central Business Towers in Dubai Media City, the outspoken and forthright Mohammad Alkhas offered a macro, expansive, helicopter view of the state of the supply chain & logistics industry both from a generic and Aramex perspective. “The Golden Slice countries dominate the GCC’s economic landscape and collectively account for 80% of the GCC’s GDP, which reached $ 4.5 trillion in 2013,” stated the 17-year Aramex veteran who has worked with the company in different GCC, Middle East and Mediterranean postings in 34 | Logistics News me | october 2014
Amman, Cyprus, Qatar, Saudi Arabia and now in the UAE. Mohammad Alkhas, with his vast experience in the field of providing solutions for the logistics & supply chain industry in the region oversees Aramex’s GCC markets, which make the largest contribution to the company’s financial performance. “The GCC nations in general and specifically the Golden Slice have been witnessing rapid economic growth, the region has been attracting billions of dollars of investments in its logistics sector and mega infrastructure projects across all industry verticals. There will clearly be an increase in demand for logistics services to meet the needs of new companies starting up, as well as those expanding in the region and Aramex is one of the companies is well-positioned to meet the region’s rising demand for logistics services,” he asserted. Alkhas, an inveterate advocate of reforms, minced no words as he held forth on the need to further streamline, improve and increase improvements across the supply chain and logistics industry in the GCC. “Improvements in infrastructure, services, consistency with interpretation of existing rules and regulations, uniformity with customs and streamlining border procedures and supply chain reliability are urgently required to ensure that trade, and the flow of goods and services through the ‘Golden Slice’, remains a principal driver of regional economic growth,” he averred. “While the ‘Golden Slice’ remains the powerhouse and premier driver for the regional economy, sharing a common language and socio-economic history and ambitions, there is currently a material deficit in the uniformity, interpretation and appli-
Aramex, founded in 1982, has developed into a global logistics business.
cation of its customs policies, procedures and regulations, an issue which continues to impact its potential,” he added. Alkhas also highlighted some practical problems faced by both consigners and consignees and on a day-to-day basis that takes a toll on the efficient and seamless working of the logistics industry. “Substantial and persistent delays at border crossings, due to hold-ups at customs clearance increase costs, impact service levels and frustrate efforts to improve supply chain efficiency and reliability. Furthermore, customs policies and procedures must consequently evolve in line with changing global trade patterns. With an increasingly globalized market, the environment in which customs administrations are operating will also need to evolve
in response to these trends, as the scale and volume of international trade and the criticality of these trade lanes in the GCC increases commensurately,” he insisted. Alkhas also called for remodelling the system to unify and reform the policies, procedures and regulations for the logistics industry: the key for catalyzing future economic growth. “With the rapidly increasing demand for global trade, future consolidation and integration across the Golden Slice is now crucial to the region’s continuing ambition and status as a truly global trade hub. This implies we need to implement single point clearance, eliminate double taxation and eliminate vagaries and irregularities within the system that might adversely affect the flow of streamline. “All the Governments institutions, regulatory authorities, logistics services providers and related stakeholders in the region must come together and introduce mega, holistic efficiencies to the system and lessen superfluous paperwork and unnecessary documentation, to facilitate quicker clearances at border checkpoints. This will also substantially reduce both time and costs in the logistics and supply chain system,” he noted. With his sights clearly set on the booming e-commerce trade coming up to almost $15 billion at the present time in the region, Alkhas affirmed that Aramex’s top priority is to focus and consolidate on ecommerce in the region. He opined that as
About Aramex Founded in
as an express operator, Aramex rapidly grew into a global brand recognised for its customized services and innovative multi-product offerings. In June 2005, Aramex went public on
the Dubai Financial Market (DFM). Today, Aramex offers full logistic services which include freight, courier services, warehousing and oil and gas. The company employs more than people in over 354 locations across 60 coun-
tries, and has a strong alliance network providing worldwide presence. Mohammad Alkhas is the CEO GCC. Alkhas joined Aramex in 1997, and he has since risen through the ranks from his early days in customer account management to senior management positions in Jordan
and Qatar. More recently he served as General Manager for Saudi Arabia in 2007. In Saudi Arabia, he went on to play a crucial role in accelerating growth in one of the company’s most important markets and in 2011, his extensive Middle East experience led him to his current position as CEO for the GCC region.
Alkhas holds a degree in Chemical Engineering from the University of Jordan. He has completed a number of executive development and management programs, including an advanced strategic management program at the International Institute for Management Development in Lausanne, Switzerland. Logistics News me | october 2014 | 35
Mohammad Alkhas, GCC CEO, Aramex (far left) has been with the company since 1997. He acquired his current role in 2011.
business abounds, both government and business needs to adapt to a new e-commerce world order that entails new thinking digits and the introduction of new measures to replace outdated and antiquated systems. Clearly there are issues confronting ecommerce operators, related to cross border deliveries and ensuing customs fees, surcharges and cash on delivery payment options, which are prevalent in the region. “At Aramex we have taken steps to set up online systems to facilitate this growing segment and we believe that streamlining procedures will result in growing sales volumes. We have put several technological innovations on online payment methods to wean people away from cash on delivery. The MyAddress initiative makes it more convenient and more reliable for existing customers to pay online each and every single time a delivery is made, regardless of 36 | Logistics News me | october 2014
the different online retailers they purchase goods from. This focus on e-commerce and payment gateways is part of our strategic approach to facilitate cross-border trade and better connect markets around the world,” the Aramex CEO GCC added. According to Alkhas, Aramex’s ‘Shop and Ship’ delivery has been expanded globally to enable consumers in 52 major cities worldwide to purchase from any online store around the world. The service sets up postal addresses to receive orders in the US, UK, UAE, Australia, China, India, Turkey, Hong Kong, Germany, France, South Africa and Italy and then forwards the packages to the consumer’s home address. Alkhas is also bullish about Aramex’s expansion plans in the GCC. “We are growing very well and registered double digit growth year-on-year and are optimistic about the future. We are growing both organically and through joint ventures and
acquisitions. In June this year we acquired Mail Call Couriers, an Australian domestic courier company. Aramex has recently signed a joint venture with Polish company InPost to setup a parcel locker network across the region. We have opened our new 20,000 sq. m. facility in Muscat following our MOU with Zubair Corporation to collaborate and partner with owners of businesses in the Sultanate of Oman for a range of logistics services. “We will be expanding our footprint in Qatar and doubling our capacity in the UAE and at our facility in King Abdullah Economic City (KAEC), around 100 km north of Jeddah, the commercial hub of the Kingdom of Saudi Arabia. Both Bahrain and Kuwait are also performing very well. The e-commerce business is thriving in Kuwait, a strong economy, a mature market and a population with sizeable disposable incomes,” explained Alkhas.
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Om a n O v e r v i e w
frost & sullivan: oman logistics market in growth Nascent market holds potential, as opportunities for logistics companies may arise in key sectors
The nascent transportation and
logistics market in Oman will witness steady growth over the next five to seven years, due to planned investments in logistics infrastructure and industrial development in the country. Widespread opportunities for integrated logistics service providers, which offer end-to-end logistics solutions, will arise in certain industries, such as chemicals. New analysis from Frost & Sullivan, Strategic Analysis of Oman’s Transportation and Logistics Market, finds that the market earned revenues of $7.87 billion in 2013 and estimates this to reach $12.02 billion in 2017. The study covers transportation, warehousing, freight forwarding, and valueadded logistics services. Being a highly import-dependent economy, Oman will be particularly attractive for logistics providers that have a significant presence in the global freight forwarding business. “Oman’s strong transportation and logistics requirements stem from its centralised location in the Gulf, which makes it
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a trans-shipment centre and an ideal gateway for goods moving to the interior parts of Saudi Arabia, United Arab Emirates and Yemen,” stated Frost & Sullivan Automotive & Transportation Program Manager, Srinath Manda. “To fulfil the needs of the logistics industry and consolidate the nation’s position as a premier logistics and transshipment hub, large-scale infrastructure projects, including Al Mazyounah Free Zone, Sohar Free Zone, Salalah Port, Muscat Knowledge IT City, and Duqm Special Economic Zone, have been initiated by the Government. These special economic zones are also expected to encourage foreign businesses to set up operations in the country,” he observed. However, there is a lack of skilled labour to support transportation and logistics businesses. Low domestic manufacturing activity for many industries is also limiting the opportunities for domestic logistics services. Further, the existing infrastructure is inefficient, especially in the suburban areas of Oman, re-
ducing the time and cost-efficiency of logistic operations and, in turn, adversely impacting service providers’ bottom lines. “Recognizing these limiting factors, the Government of Oman has designed industrial expansion plans to diversify the economy of Oman and create manufacturing clusters to reduce the economy’s dependence on the oil and gas industry,” noted Manda. “These initiatives will lead to the much-needed growth of the domestic manufacturing sector and, thus, necessitate a host of logistics services to carry raw materials and finished products for domestic and international consumption,” he concluded. Srinath Manda manages the Transportation and Logistics research and consulting practice of Frost & Sullivan for Middle East, North Africa and South Asia region. He is responsible for planning, executing and delivering client-defined consulting engagements and strategic market reports. He has worked on various market consulting projects in the
transportation and logistics sector involving, market analysis, competitive benchmarking, market mapping, and end-user analysis. Some of the key assignments include market entry strategy, market penetration and expansion strategy, new product acceptance assessments, location analysis and recommendation, industry benchmarking along with customer needs and satisfaction studies. He has closely worked with leading domestic and international clients like APL, FedEx, IFC, Allcargo, Infosys, Hitachi, CEVA Logistics, NEC Corp and Yanmar, 20 Cube, and MJ Logistics among others covering the transportation and logistics markets. In addition to the MENASA transportation and logistics market, Srinath has also worked on research and consulting assignments for regions like ASEAN, China, Japan and Australia. Prior to joining Frost & Sullivan, Srinath was a Project Manager with a management-consulting firm. With over 13 years of industry experience, Srinath brings a strong understanding of market, economic and business dynamics.
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Asian supply chain insights Ports as enablers of Global Supply Chain Ecosystems
(From his perch in Hong Kong, our resident expert and regular contributor Mark Millar, a seasoned and experienced industry insider and professional, examines and analyses various facets of the Asia Pacific Far East supply chain and logistics sector, for this thriving region. In the first of a series of articles Mark studies the pesky and chronic issue of port congestion that continues to bedevil ports virtually all over the world. He also zeroes in on the Cikarang Dry Port, near the Indonesian capital Jakarta, as a case study in innovative solutions that perhaps could be replicated elsewhere—Editor)
here is no question that containerised ocean freight is at the heart of the majority of 21st century global supply chain ecosystems. However, infrastructure, regulatory and operational challenges, both within and outside the port frequently result in congestion problems that adversely impact cross-border and multi-modal trade flows, causing delays and additional costs for all the supply chain stake holders. The container shipping industry has continued to develop and expand across multiple dimensions – including traffic volumes, technologies, vessel design, container handling equipment and scale of operations. Today over 90% of all global trade travels on the water – the majority in containers – so any obstacles or developments that impede the timely and cost effective movement of millions and millions of containers could have a profound effect on the health of the world’s economies. Container port infrastructure is therefore an essential and critical component that empowers and enables global supply chain ecosystems. Container ports have developed their infrastructure to become pivotal points in
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the global supply chain ecosystem, with extensive land-side capabilities including container yards (CY), advanced handling equipment, container freight station (CFS) warehouse facilities and multi-modal transportation linkages. Although they are often referred to as points of origin and destination, within a supply chain ecosystem, ports are a critical point of transit, rather than a final destination. Goods travel from their origin point of production (typically a factory) – transit through various container ports – to the point of consumption at their final destination, for example a retail store. Therefore, in the context of the Container Port – above and beyond pure capacity within the port itself, network connectivity and overall throughput efficiency are equally important as critical enablers of the supply chain ecosystem. An innovative and exciting port solution for ocean freight supply chains has been implemented in Indonesia. This country has the largest economy in South East Asia, which is growing at 5 per cent-plus, and it is a G20 member with a population of more than 260 million people and a one trillion dollar economy.
Innovative Case Study in Indonesia – Cikarang Dry Port
Cikarang Dry Port is an inland dry port model that is providing an efficient and effective solution to chronic congestion and delays at the major import export gateway of Tanjung Priok. Located on Java island, just 50 km from Jakarta, Cikarang Dry Port serves as an extension of the major Tanjung Priok gateway sea port and provides integrated port and logistic facilities with on-site customs and quarantine inspection services, operating 24/7. Strategically located in the heart of the largest manufacturing zone of Indonesia along the Bekasi-Cikampek industrial corridor, on the east side of greater Jakarta, Cikarang Dry Port is surrounded by some 12 industrial estates containing over 3,000 manufacturing companies, many of them importers and exporters.
“An innovative and exciting port solution for ocean freight supply chains has been implemented in Indonesia.” The first and only Integrated Customs Services Zone in Indonesia, Cikarang Dry Port occupies 200 hectares of land, including capacity for an extensive logistics park, and enjoys multi-modal hinterland connectivity through its direct access to highway and railway networks. Using the international port code IDJBK to designate Cikarang Dry Port as port-oforigin or port-of-destination, cargo owners can use any of the seventeen shipping line partners and more than thirty logistics providers servicing the dry port. Containers thereby bypass all the congestion at Tanjung Priok and transit directly toand-from the inland port, which provides one-stop-shop cargo handling, customs clearance and logistics solutions – for both international and domestic cargoes. With all forecasts indicating continuing growth of the Indonesian economy, which
of course will result in increased container flows, this innovative Cikarang Dry Port solution is enabling and empowering efficiencies in the flow of goods that save money and time for stakeholders throughout their supply chain ecosystems. Conclusion
Shipping lines and container ports have been at the epicentre of the exponential growth of international trade in an increasingly globalised world. Despite the many and varied constraints, continuing innovation and investments in hardware and software by port community stakeholders have ensured the ongoing development of infrastructure and related services to optimise port operations and their role as transit gateways – through which cargo travels on its journey through the supply chain ecosystem to the final customer.
Mark Millar — MBA, FCILT, FCIM, FHKLA, GAICD Mark Millar leverages 25 years of global business experience to provide value for clients with informed and independent perspectives on their supply chain strategies in Asia. His ‘Asia Supply Chain Insights’ series of corporate briefings, consultations and seminars help companies navigate the complex landscapes in China and ASEAN, improve the efficiency of their supply chain ecosystems and make better informed business decisions. Acknowledged as an engaging and energetic presenter, clients have engaged Mark as speaker, moderator, MC or conference chairman at over 350 events in more than 20 countries. Mark is a Visiting Lecturer at Hong Kong Polytechnic University and has delivered Guest Lectures at Georgia Tech (Atlanta and Hong Kong), RMIT (Ho Chi Minh City) and SP Jain (Dubai and Singapore) and HKU SPACE in Hong Kong. He serves on the advisory board of several leading organisations and his industry contributions have been recognized with a number of accolades. London based business book publisher, Kogan Page have commissioned Mark to write the book “Global Supply Chain Ecosystems”, due for publication in 2015.
Cikarang Dry Port occupies 200 hectares of land and is the first and only Integrated Customs Services Zone in Indonesia. It includes capacity for an extensive logistics park, and enjoys multi-modal hinterland connectivity through its direct access to highway and railway networks.
Logistics News me | october 2014 | 41
Capital Star: A rising star in logistics New opportunities for trail-blazing company on the horizon
bu Dhabi, UAE-headquartered and 2009-established Capital Star Global Logistics Group is an established provider of comprehensive logistics services and innovative solutions for companies in the Middle East and around the world in the 4PL arena. With a network of distinguished partners, vendors and an experienced professional team, ISO 9001: 2008 certified Capital Star is well positioned and equipped to offer all-inclusive services. In an interview with Logistics News Middle East, Isa Broderick, CEO and the inspiration behind Capital Starâ€™s growth, talks expansively about companyâ€™s strengths, accomplishments, challenges and his vision and approach for the future.
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Logistics news ME: The area of 4P logistics is a rarefied and demanding sector in the supply chain & logistics field. Very broadly where do you see logistical deficiencies in the Middle East / GCC and what might these be?
Isa Broderick: The 4PL sector is actually not that rare; however, it does face unique challenges in this region. The Middle East is a rapidly emerging economy and what makes it particularly challenging is that each country is changing in its own unique way. Whether we speak of the rate of change or even governing laws, the Middle East is a region made up of competing nations each having their own identity and agenda. Having said that; however, the region is still viewed as an overall collective and the need for an efficient supply chain still exists. Matching the demand of the supply chain with varying capabilities of
3PL providers, varying import procedures and restrictions and even varying cultural business practices is still a real challenge. Logistics news ME: Capital Star counts Cross Border Transportation & Saudi Customs Consultation Services among its special service offerings and USPs â€Ś could you please elaborate on these and the other line services that set you apart?
Isa Broderick: As a new company in the region, we experimented with a great deal of logistics services in the early days. We quickly realised that there was a major gap in understanding when it came to sending cargo to the Kingdom of Saudi Arabia. Shippers, transporters, forwarders and even KSA based importers are often not clear on the actual requirements of Saudi customs procedures. There are many fac-
“ 2014 has been a record breaking year for Capital Star. We expect to close the year with about 20% growth. ”
The volume of trade between the Kingdom of Saudi Arabia and the UAE means that the two markets are an essential part of any logistics company’s business.
tors to consider when shipping to KSA and Capital Star considers it a moral responsibility to educate all parties involved. Issues like duty exemption, Saudi Arabian Certification of Conformity authorisation requirements, cargo markings, origin declarations and even translation into Arabic are all very important in the Saudi Arabia. It is necessary to understand exactly what you are sending and how to get it there. Logistics news ME: How significant is the KSA and the UAE for Capital Star and where do you see growth opportunities going forward?
Isa Broderick: The sheer volume of trade between KSA and UAE is enough to validate the importance of these two countries for any logistics company. As both countries continue to develop, innovative supply chain solutions continue to push further into the forefront. The introduction of the Etihad Rail and SAR (the Saudi Rail Company), for example, is going to have a profound impact on transportation, warehousing and even customs clearance. The opportunities going forward are endless; but, now is the time to prepare. Logistics news ME: What challenges confront Capital Star in a highly volatile and competitive industry?
Isa Broderick: Challenges are always there and; in fact, if there weren’t any, it wouldn’t be worth doing business. Communication, both internal and external, is chief amongst all challenges we face. In this industry, there is a lot of cooperation between companies and even competitors in certain cases. The problem is, as the market saturates, it becomes increasingly difficult to identify truly reliable partners. International freight forwarders have always struggled to find reliable agents abroad; so in that way, the challenge is not anything new. On the other hand, what makes this challenge particularly difficult is that our
partners are meant to have similar capabilities and practices; but, that isn’t always the case. Logistics news ME: ‘Graphics and Animation’ feature in the provision of logistics services, please amplify.
Isa Broderick: As logistics solutions continue to evolve, methods of delivering ideas are evolving as well. In order to remain competitive, logistics companies seek to utilise every cubic centimetre of space, every litre of diesel and any other quantifiable integer they can measure. Cargo owners are also evolving and often want to be convinced. Graphics and animation is an exciting field in that it can better illustrate a more coherent presentation.
Logistics news ME: How has Capital Star performed thus far in 2014 and how do you hope to close the year?
Isa Broderick: 2014 has been a record breaking year for Capital Star. We expect to close the year with about 20% growth. We included warehousing and distribution to our portfolio and even expanded into the F&B sector which has been good for the group. Overall, we saw a very positive year. Logistics news ME: What is your corporate message and wider vision for Capital Star going forward?
Isa Broderick: Build upon your strengths and leave your mark before venturing into uncharted territory. Only then can you take the risk of getting lost. Logistics News me | october 2014 | 43
client expectations from a logistics service provider Juergen Hirsch, General Manager, Tranzone FZCO on the need for LSPs to offer composite, multiple services; the good synergy in the LSPclient relationship and proper planning—the indispensable industry prerequisite In the past, traditional logistics service providers (LSPs) worked in neatly-divided segments and specialised sectors. These included air freight, sea freight, storage and warehousing, customs brokerage and other related and specific niche areas. Now, in a changing industry environment, where situations are chronically hectic and frantic, we observe a tendency and an increasing demand for ‘one-stop-shop’ solution providers. Thus today’s service providers must offer total, multiple and comprehensive services under one roof, or at least have the ability to organize all relevant tasks and requirements on behalf of their clients. The advantages of the one-stop-shop approach cannot be over-emphasised. This drastically reduces the number of service providers to be managed, minimizes bottlenecks, eliminates duplications, decreases the number of personnel involved, increases transparency along the supply chain and lessens the need for coordination between the different service providers involved. Where there are less interfaces to be managed and coordinated, there is less information to be distributed, received and processed. This results in streamlining and introducing efficiencies into the system. It is also self-explanatory that the risk of errors, misunderstandings; the need for correspondences and follow-ups and delays is drastically reduced, which leads eventually to improved service quality, shorter processing times and in most cases also to significant cost reductions. Additionally the blaming game, in case something goes wrong — an all too familiar situation between the different parties involved, will diminish or hopefully be eliminated. The relationship between LSPs and clients has also evolved on other fronts: Clarity: In a modern managed relationship, transparency and
trust play a key, vital role. Confidential planning and forecasting data are exchanged to ensure capacity is available when and where required. Regular KPI meetings are a great forum to review past performance, as well to discuss present and future improvements. Claims and complaints can also prove to be the trigger, the opportunity to review and improve processes and efficiencies for both LSP’s and clients. This can, if taken in an open-minded and the right spirit, be advantageous to both parties. 44 | Logistics News me | october 2014
Quality Control: Additionally the quality control depart-
ments of LSPs and clients must work closely together and in tandem to ensure that clients as well as the LSPs constantly strive to maintain theirs and each other’s brand reputations. They are after all partners in mutual business processes and should both reflect and uphold each other’s values. That professionalism has to be maintained with continued high-level work output and avoiding risks and activities that may tarnish brand sanctity. Brand reputation in any business is of course sacrosanct.
Time Frames: If I could have one wish, it would be for clients
to realise that every month has a finite number of days. Time is limited and a luxury in the present fast-paced and frenetic business environment. Deadlines have to be constantly met and LSPs, reasonably and rationally, must also be provided an acceptable time frame to successfully complete the assignments and execute responsibilities. There is a tendency to rush and work into a frenzy for example, five days before the month end. It is extremely difficult to work at such a short notice and because it puts intense pressure on LSPs to execute activities, say for a complete month’s sales within this limited time frame, it can result in shoddy work.
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pr o j e c t f i n a n c i n g
project financing for the sc&l industry Noor Bank shines in offering financial solutions for the SC&L Industry
n the crowded and highly competitive UAE banking sector, the January 2008-established and Dubai-headquartered Noor Bank (formerly Noor Islamic Bank) has muscled itself into the top league and grown rapidly since its inception. It has carved a niche for itself both in personal and corporate banking through the offering of a comprehensive array of cutting-edge, transparent Shari’a-compliant professional financial services in line with the vision of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President & Prime Minister of the UAE and Ruler of Dubai, to create a forward thinking, progressive Islamic bank. Ehsaan Uddin Ahmed, the experienced, professional Head of Global Transaction Services (GTS) & Corporate Strategy, at Noor Bank, was specially invited to address the recently concluded 7th Supply Chain & Logistics Summit, the annual gathering of leading industry professionals, a glowing testimony to the bank’s commitment and involvement in this swiftly-growing sector. The two day high-profile summit, organized by the 200-corporate member strong Supply Chain and Logistics Group (SCLG), was held in Dubai’s Conrad Hotel. Noor Bank has made extensive inroads into providing financial solutions for the UAE’s burgeoning SC&L segment, as was outlined by Ahmed during the panel discussions with industry peers on the theme of ‘Current trends in Supply Chain Finance and impact on SMEs’ at the assembly. Logistics News Middle East conducted an exclusive interview with Ehsaan Uddin Ahmed at Noor Bank’s Head office located in Emaar Square, Downtown Dubai, to ascertain the degree of the Bank’s involvement with this blossoming industry and what it holds for the future.
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Logistics news ME: what in your estimation is the extent of the interface between the generic banking sector in general and Noor Bank in particular with the wider Supply Chain & Logistics (SC&L) industry in the UAE? Ehsaan Uddin Ahmed: Generally speaking, there is considerable interest from the banks to support the supply chain and logistics industry in Dubai and across the UAE The country is a major logistics hub and there are several ongoing and planned mega infrastructure projects, in both the private and public sectors, that will accelerate the expansion of the logistics sector — from investments in airports and seaports, developing the transportation sector (including establishing the rail network and building new highways), as well as the general trade and commerce. All of these are inextricably linked and support in growing the nation’s economy. Specifically, at Noor Bank we are focused on building our trade customer base. From that perspective, we enjoy a close association with several of the institutions involved in the supply chain and logistics sector. Logistics news ME: How significant is the SC&L sector for Noor Bank? Ehsaan Uddin Ahmed: We have a broadbased approach towards servicing clients across diverse industry segments. The supply chain and logistics space is growing and gaining momentum. It is a dynamic industry division which we will continue to be closely involved with and one which offers much potential in the future. Noor Bank has a strong banking footprint in the logistics segment and has been involved in bigticket financing and transactions related to large corporations including DP World, Emirates and JAFZA.
Logistics news ME: Specifically, what financial services does Noor Bank offer the SC&L industry and what sets you apart? Ehsaan Uddin Ahmed: At Noor Bank we offer a bouquet of robust and holistic services to the SC&L sector, as we do for other industry verticals. These range from large ticket syndicated facilities to commercial banking geared towards optimising working capital cycle through a variety of value added cash management and trade finance solutions. Clients not only benefit from ease of maintenance of operating accounts; efficient payments, receivables and liquidity management; high level of flexibility and visibility on transaction handling through online banking platforms; but also have
pr o j e c t f i n a n c i n g
Ehsaan Uddin Ahmed: SMEs, by some estimates, contribute at least 60% to the nation’s economy and significantly towards the non-oil trade of UAE. They are certainly a force to reckon with in most industry segments including SC&L. At Noor Bank, over the past few years we have developed the capacity, appetite and control mechanisms to service this base. Under the ‘Noor Trade’ brand launched last year, we have committed to deliver over AED 5 billion financing to the small and mid-sized entities. This will be achieved by providing a single window to the customers in this segment for all their banking needs.
“ Specifically, at Noor Bank we are focused on building our trade customer base.” dedicated relationship and customer service team to address their day to day requirements. We also provide customised packages for corporates. At Noor Bank we have the muscle, resources, capabilities, experience and expertise to successfully deliver customised financial solutions that differentiate us in the market. To this end, Noor Bank has been a pioneer in delivering innovative solutions that have benefitted not only the cli-
ents, but also the wider Islamic banking industry. For example, we were the first to partner with Dubai Multi Commodities Centre (DMCC) to conduct online commodity murabaha settlements on their Tradeflow platform, in relation to financing extended to Corporate and SME clients. Logistics news ME: How do SMEs feature in Noor Bank’s scheme of business priorities?
Logistics news ME: You were the keynote speaker at the recent 7th Global Supply Chain & Logistics Summit in Dubai. Why were you invited to this event and what was your message to the industry? Ehsaan Uddin Ahmed: Clearly for optimization of the supply chain, one of the parameters the corporates need to examine is their partnership with the banks. How can banks add value to their operations to manage their cash flows more effectively, unlock liquidity, and overall improve the working capital cycle? To this end the level of awareness is gradually growing and corporates are increasingly coming to the realization that a progressive, client centric banking partner can turn things around for them. The crux of my message to the summit was for the supply chain and logistics industry to leverage the banking sector more to their advantage, by harnessing the suite of banking solutions that are available and which banks have the appetite to deliver to the interested parties. Logistics news ME: Finally, looking into your crystal ball, what do you foresee in terms of Noor Bank’s growing involvement with the SC&L industry? Ehsaan Uddin Ahmed: I predict greater commitment and association with the supply chain and logistics industry. We have invested considerably in terms of developing systems, mechanisms and procedures to facilitate increased trade and we expect to have a larger foot print in this industry segment in the coming years. Logistics News me | october 2014 | 47
chep mena poised to take on a bigger load Paul Kinsella takes over the reins at CHEP MENA
stablished in Australia in 1945, Sydney-headquartered CHEP is the global leader in pallet and container pooling services for a wide spectrum of industries, including aerospace, automotive, chemical, oil & gas, consumer goods, fresh food, consumables and manufacturing industries. CHEP offers its trademark blue-coloured product range comprising wooden and plastic pallets, small display pallets, crates, and a wide selection of assorted containers. CHEP’s three main divisions — pallets, containers and RPCs — collectively employ 11,000-plus people in almost 1100 service centres and locations worldwide. 300 million pallets and containers support more than 500,000 customer touch-points from owner-operators to multinational corporations in more than 50 countries. CHEP is a member of the Brambles Group, an Australian-based supply-chain logistics company. 48 | Logistics News me | october 2014
Paul Kinsella, who has had a long career with CHEP across three continents, was recently appointed Director, for the company’s Middle East & North Africa region operations in April 2014. Paul started his career with CHEP in Australia in 1999 and left the company for two years when he moved to the Middle East in 2004, to work at the third-party logistics division of Gulf Agency Company in Dubai. Paul re-joined CHEP in 2006 as Regional Operations Manager for the Middle East, where he was responsible for CHEP’s supply chain strategy within the GCC region. For the last two years, Paul has been based in Warsaw, Poland, working for CHEP as Director of Supply Chain for Central & Eastern European pallets operation. In a recent exclusive interview after taking over, Paul Kinsella spoke to Logistics News Middle East about his recent relocation, his return to the region, career, plus his goals and corporate objectives.
Logistics news ME: You were recently appointed to your current position with CHEP Middle East. Tell us about your association with CHEP?
Paul Kinsella: I have been fortunate enough to work for CHEP in Australia, Eastern Europe and the Middle East for over 13 years. My previous roles have included health and safety management, plant management and regional supply chain roles. I moved to Eastern Europe from the Middle East in 2012. Coming back to the UAE in April this year was an exciting challenge with the move into a general management role. From September our region was extended to include North Africa, so my team and I are now responsible for growing CHEP’s business in the Middle East and the Northern African countries, which is a unique challenge. I am extremely happy to be back in the region as it’s such a dynamic place to live and work.
“ The written word, as one, is all that standemory and oblivion.” Paul Kinsella is a veteran of Sydney-headquartered CHEP. The company has grown to have a global reach and Kinsella has been appointed Director for its Middle East and North Africa operations, having begun his career with the company as far back as 1999..
Logistics news ME: How did working in your native Australia and Poland compare to the UAE?
Paul Kinsella: CHEP in Australia is an extremely mature business as it’s CHEP’s oldest market, which started in the mid 1950’s. The challenge in Australia was how CHEP could continue to add more value to our customers and their supply chains, through innovative service offerings. We are doing this through innovative last-mile solutions, which improve the retailers on-shelf product availability and at the same time assist manufacturers/distributors with improved brand awareness, due to the way packaging can be customised to suit the fractional sized pallets. The challenges in Eastern Europe and the Middle East are quite similar. The speed at which the supply chain is evolving means that we are always looking for opportunities to work with manufacturers, distributors and retailers on how our products can reduce cost and add value to their supply chains. We find ourselves in the Middle East helping customers understand how standardisation drives value for all participants in the supply chain. We see an enormous opportunity in the Middle East to help customers drive waste out of their supply chains by adopting standardised platforms. Our solutions help customers accelerate their supply chains.
Logistics news ME: Please tell us about CHEP’s green & CSR initiatives?
Logistics news ME: What are your professional goals?
Paul Kinsella: One of our core values is to reduce waste in the supply chain, and in the Middle East we are particularly keen to identify how we can help the supply chain reduce food waste. One of the amazing parts of working here is how fast the supply chain progresses, and how best practice can be implemented extremely quickly. We see an enormous opportunity in assisting customers in this area by leveraging our experiencing from other markets. CHEP is an award-winning, extremely green-centric company and we are very sensitive about the ecology and environment in the countries in which we operate in. At CHEP we pride in our culture of ‘reducing, reusing and recycling’ resources. Pooling, by its nature, shares resources and is an inherently sustainable business model and has been proven to significantly reduce energy consumption, environmental waste and CO2 emissions. We also help our customers improve overall supply chain efficiency and sustainability through our product and service offerings. From an environment perspective we work towards Zero Harm by minimizing CHEP’s environmental footprint. CHEP is committed to supporting the communities we operate in and provides financial and other forms of support to a broad range of charitable and community organizations around the world.
Paul Kinsella: I have three main goals for our business: firstly, to expand our business into Northern Africa, and to double our business in the next 3 years. Secondly to work with customers, industry and government to adopt standardised solutions, which positively impact the whole supply chains’ efficiency, and thirdly, to reduce waste (and in particular food waste) in the supply chain, through our sustainable solutions and to be seen by the wider community to be a socially responsible organisation.
Logistics news ME: How would you characterise yourself?
Paul Kinsella: At CHEP we look for people who are passionate, that demonstrate initiative and that are accountable for what they do. Our team is quite small and as such we need everyone aligned and pulling in the same direction. The future is very bright for our team locally and it’s a pleasure working with them.
Paul Kinsella: I would characterise myself as a pragmatist, which comes from my supply chain background. I’m passionate and persistent – all of which I think makes me a great fit for a market such as the Middle East.
Logistics news ME: What are your leisure activities?
Paul Kinsella: I have a wide range of interests, from computers to technology in general. Now that my two-year old daughter is getting a bit older I’m looking forward to getting out and about and exploring what’s changed in the UAE in the past two years, while we were in Eastern Europe Logistics news ME: In your own estimation, what kind of a boss are you?
Paul Kinsella: I believe I’m a fair person, who will only ask his staff to do something that I would do myself. I believe that treating people as you would like to be treated yourself is fundamental to being a good manager. Logistics news ME: What do you look for in your employees?
Logistics News me | october 2014 | 49
a pp o i n t m e n t s
adt appoints new technical director for kpct
industry insider appointed ceo, maximus air Mohamed Ebrahim Al Qassimi has recently taken over as CEO, Maximus Air. The 2005-established, award-wining UAE-based air cargo specialist is experiencing strong growth and foresees a bright future ahead. As the largest all-freight airline in the emirates, and one of the biggest specialist cargo operators in the Middle East, the former advisor to the top management of GE Aviation, who was responsible for the setup of Air Arabia, also revealed that the company is actively looking to expand into new areas. “We are delighted about recent progress. Our aircraft are receiving more bookings right across the fleet and we are firming up plans for expansion in 2015. Our core business remains the same but we are looking at exciting new growth opportunities,” he assured. “These opportunities include catering to increasing demand for VIP air cargo, and we are currently applying the finishing touches to a new freight forwarding business that will capitalise on the strong logistics industry in UAE. On top of this, we have received interest from key growth markets in Europe and Africa, and are looking at ways to expand our business in these regions,” he added. Operating across the UAE’s main airports since 2005, Maximus Air specialises in moving outsized and specialist air cargo including the transportation of dangerous goods, live animals, VIPs, rapid response and humanitarian flights. “Having historically deployed our aircraft on humanitarian missions for organisations including the United Nations and the UAE Red Crescent, the fact that our aircraft are able to land at both major airports and less established landing strips will continue to be a vital part of our disaster relief activation plans,” he added. 50 | Logistics News me | october 2014
Abu Dhabi Terminals (ADT) has announced the appointment of Mohamed Al Afeefi as Technical Director. Al Afeefi, who has been working in the oil and gas, aviation and energy intensive industries for the past 15 years, will be a key member of the corporate management team, with overall responsibility for overseeing technical, facility and workshop activities at ADT’s Khalifa Port Container Terminal (KPCT). Bringing a wealth of industry experience to the terminal operator, Al Afeefi comes with a robust technical background as he led preventive maintenance programmes and major technical projects within ADNOC’s operations and played a senior role in developing leadership and national talent in Abu Dhabi’s aviation arena including aircraft maintenance and aerospace manufacturing. Commenting on his appointment, Martijn van de Linde, CEO, ADT, remarked: “We are very pleased to welcome Mohamed to our team. His appointment comes at a very important time for ADT as we continue to grow our operations significantly.” Al Afeefi holds a Bachelor degree in Electronics & Electrical Engineering from the University of Colorado, USA and obtained various technical and competency development certifications. Abu Dhabi Terminals’ (ADT) core business is to operate and manage Khalifa Port Container Terminal (KPCT), the region’s first semi-automated and most technologically advanced container terminal. Since the official inauguration on 12/12/12, KPCT has grown to support the local market with around 20 weekly container line services to more than 50 international destinations connecting Khalifa Industrial Zone Abu Dhabi (KIZAD), Abu Dhabi and the wider UAE with the world markets.
Ad v e r t o r i a l
cantec reinforces a â€˜can doâ€™ approach with concrete solutions Warehouse floor expansion joints have long been a source for concern for warehouse managers and logistics operators. Expansion joints, which in many cases have been designed and specified incorrectly at the time of construction, have traditionally opened further than they should which subjects them to greater load impacts at the exposed joint face (arris). Continual wheel traffic impacts on joints result in a breakdown of the joint arris, resulting in damage to warehouse vehicles, massive losses in production and very unhygienic catchments for waste and or bacteria. For new build or greenfield facilities, joint armoring systems have had a hugely positive impact on protecting joint areas but in some cases, due to construction standards, have not been enough. Recently the development of deformed face steel joint designs such as the Permaban Signature joint have all but eliminated issues with expansion joint degradation due to the fact they severely limit any wheel impacts as a result of their shape. The Permaban Signature shape is now becoming the benchmark for all joint systems and has the potential to make linear armored joint systems obsolete on new build sites moving forward. For operators dealing with older facilities with expansion joint issues there is a solution that is practical, permanent and guaranteed. The FloorBridge is a pre-fabricated joint which is placed into the slab to replace failed joints. Concrete is removed to a depth of 25mm x 250mm wide to accommodate the placement of the FloorBridge. FloorBridge can be installed in any lengths required and at any location required, traditionally in aisles, marshaling areas and door openings. FloorBridge is perfectly suited to installation in aisles with VNA wire guidance as well. FloorBridge allows the expansion joints to function as nor-
mal, allowing for all movement which may occur both expansion and contraction. Also due to its sinusoidal design the joint essentially eliminates wheel impacts at the arris leaving a perfectly flat impact free transition over the joint, all backed by a full warranty. Cantec welcomes the opportunity to show customers the system installed at several facilities in the UAE and to demonstrate firsthand the benefits of the FloorBridge system.
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UPS Survey Opportunities in the Healthcare Industry An environment of increasing risks, complex regulations and continuing cost pressures is impeding healthcare executives from moving quickly to seize untapped industry opportunities, according to the recently released 7th annual UPS “Pain in the (Supply) Chain” survey. Globally, healthcare executives are planning for strategic partnerships and technology investment to mitigate risks and capitalize on growth opportunities.
he 2014 UPS Pain in the (Supply) Chain survey conducted with more than 530 healthcare executives in the US and Canada, Western Europe, Asia and Latin America. The most significant factors contributing to uncertainty in the healthcare supply chain are more stringent regulations and increased product protection challenges. For the third consecutive year, regulatory compliance is the top supply chain pain point, cited by 60 percent of respondents. Further, 78 percent cite regulatory compliance and increasing regulations as a top trend driving business and supply chain changes. Product protection also is increasingly challenging, in a highly global marketplace, with 46 percent citing product security as a top challenge and 40 percent citing product damage and spoilage as a top concern. Economic factors are also at play, with 49 percent of those surveyed still feeling an impact from the economic downturn six years later. The highest percentage of respondents to express this are located in the US, where 60 percent of healthcare logistics decision makers cite economic concerns. In this global economic environment, cost management remains top-ofmind, with 44 percent citing it as a top supply chain concern. Despite operating in a risk-inherent environment, only 26 percent of healthcare executives cite contingency planning as a top supply chain concern. Meanwhile, 34 percent of those surveyed in Asia and 22 percent in Latin America say that more than one-quarter of their companies’ sup-
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ply chains were impacted by unplanned events in the past three to five years. Specific challenges to addressing business continuity include events being too unlikely or infrequent (61 percent), back-up infrastructure being too expensive to deploy (46 percent) and little to no prioritisation being given to this area (42 percent) versus other more urgent matters. “Companies that embrace new technologies and transformative supply chain strategies to mitigate risks will be more likely to capitalize on new growth opportunities in the healthcare marketplace of tomorrow,” said John Menna, UPS vice president, global healthcare strategy. Successful strategies for risk mitigation and increasing competitiveness
Of those companies that are successful in mitigating risk and increasing competitiveness, the majority are leveraging partnerships along with ongoing technology investments. Of logistics decision makers surveyed worldwide: • 78 percent cite logistics and distribution partnerships as a top strategy to manage supply chain costs • 65 percent use logistics and distribution partnerships to successfully access global markets • 61 percent use collaboration, including vested logistics and distribution partnerships, to successfully embrace new distribution and go-to-market channels, while 23 percent use mergers and acquisitions to do so
• 59 percent are working with a 3PL as a top strategy to increase efficiencies and improve competitiveness Again this year, investing in new technologies is a top strategy to increase efficiencies and competitiveness for the next five years. Globally, over the next three to five years, 80 percent of respondents say they will invest in new technologies. Untapped opportunities in the healthcare supply chain
Despite progress in addressing industry challenges, opportunities remain. One of these areas is in leveraging new distribution channels and models to meet changing customer demands as e-commerce, urbanization and home healthcare grow. Over the past two years, 70 percent or more of those surveyed both years have indicated that they plan to increase their usage of
“ Companies that embrace new technologies and transformative supply chain strategies to mitigate risks will be more likely to capitalize on new growth opportunities”
new distribution channels, yet over this same time period their channel mix remains nearly identical. This demonstrates that while the intention to take advantage of untapped opportunities is apparent, actual change is slow. Among the reasons for the slow shift, 68 percent say they are still building their direct channel strategies. The rise of home healthcare is taking off with growth surges expected over the next decade. Globally, 21 percent of survey respondents cite the shift to home healthcare as a key trend driving business and supply chain changes. Respondents report that 30 percent of products will support the home healthcare channel in the next seven to 10 years. Another area with untapped
potential is collaborative partnerships. In 2011, 62 percent of decision makers surveyed cited working with or increased reliance on a third party logistics provider as a top strategy for the next few years, with 60 percent citing it as a successful strategy over the past 18 months. According to this year’s findings, 59 percent cite it as a strategy over the past 18 months and also over the next few years, indicating that while the healthcare industry recognizes the importance of implementing these strategies to increase competitiveness, companies are slow to act. Global market expansion is another area in which healthcare companies are heavily investing that continues to hold new opportunities. Over the past 18 months, 65 percent have tapped into new global markets to expand their customer base in order to drive new revenue growth. Looking ahead, 78 percent will expand to new global markets over the next three to five years. These responses closely mirror 2011 survey data, when 81 percent of executives reported they plan to expand to new global markets over the next few years.
Dirk Van Peteghem, UPS vice president, healthcare logistics (below) was part of the team behind the 2014 UPS Pain in the (Supply) Chain survey, conducted by UPS with more than 530 healthcare executives in the US and Canada, Western Europe, Asia and Latin America.
“More change is coming in the healthcare supply chain,” said Dirk Van Peteghem, UPS vice president, healthcare logistics. “At UPS, we work to stay ahead of evolving industry trends and develop innovative solutions for our customers based on our extensive expertise, infrastructure and best-in-class technology.”
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l a s t p a g e - f i rs t p e rs o n
Boost throughput, lower costs, with automated logistics Swisslog offers ways to help automate logistics for cold chain products
utomation in warehouses and distribution centers is growing in importance and is increasingly being used in the Middle East region. Market dynamics are changing at an ever increasing rate and complexity. Technological innovation has led to disruptive change within society. Most notably, the adoption of the internet across the world and the evolution of e-commerce, channel management and insatiable consumer thirst for all things new have influenced shopping behavior and business models like never before. Companies in other industries are also under pressure and are facing significant throughput increase. The cold chain logistics segment where fresh or frozen food, or pharmaceutical products, vulnerable to temperature variations need to be transported, as well as stores and storage areas that are required to comply with strict regulations and related sectors, also face many challenges across the region. The flow-on effects of these developments have a major impact on modern warehouses, with many existing operating models no longer fitting their intended purpose. The trend toward automation has gathered pace, as investment in technology is viewed as a long-term benefit in uncertain times. The flexibility of scalable systems provides greater scope for adaptation in changing environments that feature: • More orders/order lines • Smaller orders/order lines • Short shipping frequency • Short lead times • Accurate order fulfilment • Less product damage • Improved stock accuracy and control
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Swisslog is a leading global provider of automated logistics solutions in hospitals and distribution centres in over 50 countries worldwide. With years of experience in design and implementation, Swisslog delivers everything companies need to optimise their logistics – from planning through implementation and customer service. Swisslog’s order fulfilment and inventory solutions enable companies to achieve the highest throughput at the lowest cost, efficiently handle large catalogues of SKUs and accurately meet customers’ delivery demands and specific requirements. Swisslog Warehouse & Distribution Solutions (WDS) designs, develops and delivers intra-logistics solutions for a wide range of industries including food, retail, e-commerce, pharmaceuticals, banking as well as thirdparty warehouses and distribution centers.
Frédéric Zielinski, a 10-year company veteran, is the WDS Middle East representative for Swisslog in the Middle East. He joined the firm in 2004 and has held several positions, including project manager for large-scale general contractor projects and head of the AGV group, during his tenure with the company.
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