Transport Taking Off

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Sharjah has long identified the transport industry as being a potentially major component of its development, as well as being a foundation stone for growth in the broader economy.

Improving Sharjah's transport industries and its supporting infrastructure is central to the emirate's plans. As the centre for manufacturing in the UAE, accounting for almost half of the country's industrial GDP, Sharjah has made it a priority to put in place road and maritime facilities required to meet the cargo-handling needs of this growing industrial base.

Another key segment of the emirate's economy and one that the government has targeted for expansion is tourism. By 2011 there will be a 50% increase on the 8500 hotel rooms currently available, and Sharjah is also looking to build on the 1.5m overseas arrivals it recorded last year. In order to assist in this process, Sharjah International Airport has undergone a series of upgrades and expansions, increasing its passenger and cargo-handling capacity. These improvements have been reflected in higher levels of productivity to the point where Sharjah International is now the leading air-freight handler in the Middle East, with 586,000 tonnes of cargo passing through the facility last year.

This total seems likely to be matched in 2009, with more than 200,000 tonnes of freight having been moved in the first five months of the year. Passenger numbers should eclipse those of 2008 too, being well up in the January-to-May period this year compared to the same five months in the last.

One of the reasons behind the growing number of passengers using the airport is the increasing success of Air Arabia, the Sharjah-based low-cost carrier (LCC). Recently named as the world's best LCC by industry magazine Aviation Week, Air Arabia carried 1.9m passengers in the first half of the year, up 20% on its results for the same period in 2008. The company posted a 21% rise in first-half profits, garnering $43.5m, according to figures released in early September.

Despite the global recession, Air Arabia not only added to its routes in the second quarter but also launched Air Arabia (Maroc), a joint-venture company that operates from the carrier's second hub in Casablanca and now serves nine destinations in Europe.

The company's expansion programme gained further altitude in early September when it announced plans to take to the skies with a new joint-venture LCC based out of Egypt. The new carrier, Air Arabia Egypt, which will be a partnership between the Sharjah airline and Egypt's Travco Group, could start flights to Europe before the end of the year, said Adel Ali, Air Arabia's chief executive, on September 9.

Closer to home, Sharjah still has some challenges to surmount in its efforts to reinforce itself as a major transport centre for the region. Though it has made great strides in providing the transport infrastructure needed to support its economic development, Sharjah has struggled to match this progress in one crucial area, that of utilities services, particularly electricity generation and distribution. Power cuts throughout the summer disrupted industrial production, which in turn impacted the freight-handling segment of the transport sector, with cargo movements at times delayed.

Blackouts also resulted in traffic signals going down, adding to congestion on the roads, and restricting activity in Sharjah International Airport's free trade zone.

These problems were acknowledged by Sharjah's ruler Sheikh Sultan bin Mohammed Al Qasimi, who said on September 8 that while the efforts of the emirate's government and the UAE had helped soften the impact of the global financial crisis, there were still obstacles to be overcome. In order to do so, Sheikh Sultan said no efforts would be spared to develop and modernise Sharjah's infrastructure and services projects in order to meet the requirements of the economic sectors.

"The government will spare no effort to push forward its development programmes to enhance the country's investment climate in order to attract feasible economic projects that will create job opportunities and meet the local market demand for core services and products," he said.

Another challenge that Sharjah's transport sector faces is the rising tide of competition across the region. While the emirate is working hard and investing heavily to boost its credentials as a major transport centre, so too are its neighbours, most particularly Dubai, which is pouring billions of dollars into massive port and aviation infrastructure developments.

Although Sharjah may not be able to match the high levels of transport investment being made by its larger or more affluent Gulf Cooperation Council neighbours, as Air Arabia has shown, low cost and efficiency can at times win out over big spending.

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