The transport sector in Abu Dhabi is gearing up for further progression, with a new strategy taking the emirate towards a smarter future for its airports, highways and harbours. Developments in the region are linking the emirate ever closer to its neighbours, with transport systems transforming the Gulf into a more integrated, multi-modal corridor, and Abu Dhabi into an increasingly vital hub in the global transport, warehousing and trans-shipment web.
Plans & Agencies
Abu Dhabi is both the capital of the UAE and the largest emirate in the federation, accounting for 86.7% of the country’s area, 34% of its population and 60% of its GDP, according to Statistics Centre – Abu Dhabi (SCAD). These factors give it a special place in the UAE’s transport and logistics networks, and make it home to a number of key federal bodies.
The Federal Transport Authority – Land and Maritime (FTA) falls under the Ministry of Infrastructure Development, reports to the Cabinet, and has the task of proposing general policies, laws and regulations for the land and marine elements of the sector across the UAE. It also oversees implementation of international maritime treaties, handles road and rail connectivity between emirates and with the UAE’s neighbours, issues licences, and organises the collection of land and marine transport taxes and fees. In early 2017 the FTA was working on an updated transport plan, which aims to harmonise regulations between emirates. Progress is expected in 2017 on the transportation of hazardous goods, with each emirate currently setting its own rules. It is also aiming to introduce the international Customs transit system Transports Internationaux Routiers across the UAE, with Abu Dhabi having signed up in 2014. Other emirates have followed suit, with work well advanced on implementation and bringing Saudi Arabia into the system – an important step for facilitating cross-border road traffic.
The composition of the FTA board demonstrates its links with other federal and local authorities. There are members from the federal Ministry of Infrastructure Development, the Federal Customs Authority, the Dubai Road Transport Authority, the RAK Public Works and Services Authority, and the Abu Dhabi Department of Transport (DoT), which is now part of the emirate’s merged Department of Municipal Affairs and Transport (DMAT). DMAT functions as the local level regulator and planning body for all issues pertaining to municipal affairs and transport.
The merger between two separate local bodies, each with wide mandates, was part of the government’s efforts to achieve efficiencies and integration across their respective dockets. Many of DMAT’s major transport projects are also now contracted and overseen by Abu Dhabi General Services Company (Musanada), which has a wider infrastructure and facilities management role in the emirate. “From the very inception of the idea for a project, DMAT is seeking to be involved by marshalling planning resources from Musanada,” Awaidha Murshed Al Marar, chairman of DMAT, told OBG. “As the project takes form, the engineering talents and management resources residing within the transport division can be authorised to manage the project.” In this way, DMAT envisions more projects being properly designed and more speedily constructed, generating cost and time savings.
Master Plan
DMAT divides into aviation, maritime and surface transport subdivisions, and authored the Surface Transport Master Plan in 2008. This is built on the Plan Abu Dhabi 2030 Urban Structure Framework Plan, which was published in September 2007 by the Abu Dhabi Urban Planning Council. The Abu Dhabi Economic Vision 2030 plan, along with the recently updated 2016 Abu Dhabi Plan, have formed the basis of the emirate’s transport strategy for the last decade.
This strategy is now being updated, with Abu Dhabi’s Capital Surface Transport Master Plan (STMP) reaching draft stage in late 2016 and likely to be publicly unveiled in 2017. The STMP plans a shift from private to public multi-model transport, signalling both Abu Dhabi City’s high-tech global status, and the importance of the emirate’s commitments to sustainable and environmentally friendly development.
Facts & Figures
In 1975, four years after the establishment of the UAE, Abu Dhabi had 591 km of roads and 49,104 licensed vehicles. Commercial vessel movements in the emirate’s ports totalled 763 that year, while 442,118 passengers arrived by air. By the year 2000 highway length had nearly tripled to 1653 km, spurred by 276,495 vehicles, while 1813 commercial vessels called at the emirate’s ports and 2.9m passengers at its airports. Expansion has continued since. According to SCAD, 23.3m passengers used the emirate’s airports in 2015, while the most recent statistics for vehicles show 785,076 on the roads in 2011. In 2012 Khalifa Port opened, and by 2013 the total length of Abu Dhabi’s highways had reached 2700 km.
These facilities serve a population that has grown from 197,000 in 1975 to 2.79m today. The majority of these are urban dwellers, with the capital and the city of Al Ain, to the east on the border with Oman, the main population centres. The city is also a two-hour drive from the UAE’s second-largest emirate, Dubai, and has an important land border with Saudi Arabia. The economy has also grown beyond recognition. In 1970 GDP stood at Dh3.27bn ($889.5m), while SCAD figures for 2015 show an estimated GDP of Dh780bn ($212.4bn), at constant prices.
Strengths
The transportation and storage sector accounted for Dh25.45bn ($6.93bn) of the emirate’s GDP in 2015, or 3.2% of the total. This was 6.8% up from Dh23.82bn ($6.49bn) the year before. The sector also showed strong growth over the first five years of this decade, with contribution to GDP at Dh18.74bn ($5.1bn) in 2011, equating to 35.8% growth over 2011-16, while the economy overall grew by 21.5%. Transport and logistics are therefore major growth sectors in the emirate’s non-oil economy, which Abu Dhabi’s leadership is keen to see make up more of the emirate’s output. Indeed, the long-term economic policy, Abu Dhabi Economic Vision 2030, sees the creation of an “efficient and safe transport infrastructure” as vital to its success.
Ports
All the commercial and community ports in the emirate of Abu Dhabi are managed and operated by Abu Dhabi Ports. Established by Emiri decree in 2006, the organisation also manages Khalifa Industrial Zone Abu Dhabi (KIZAD), a major trade, logistics and industrial hub adjacent to Abu Dhabi Ports’ latest facility, Khalifa Port (see Industry chapter). Khalifa Port has seen large increases in traffic since it began operations in 2012, converting container traffic from Zayed Port to Khalifa Port Container Terminal (KPCT), which now handles it on a reclaimed island between Abu Dhabi and Dubai. The first semi-automated port in the region, it has a 16-metre-deep container and Ro-Ro berth and an 18-metre-deep Emal berth, 12 Super Post-Panamax STS quay cranes, 52 automatic stacking cranes and 33 straddle carriers. In the port’s current first phase, annual capacity sits at 2.5m twenty-foot equivalent units (TEUs) and 12m tonnes of general cargo. These numbers are set to rise again during future expansion periods. In August 2016 a new expansion was announced by Abu Dhabi Ports to cater to short- and medium-term growth, adding 1000 metres of quay wall and deepening the port’s main channel from 16.5 to 18.5 metres. The new quay wall adds an additional 600,000 sq metres designated for cargo handling.
In late 2016 KPCT announced that it had handled more than 5m TEUs since it began operations, while in 2015 it became the world’s second-fastest-growing container port, after annual volume jumped to 1.5m TEUs, a 32% increase over the 2014 total.
The first half of 2016 saw volumes rise 11% over H1 2015, with a general slowdown continuing through the rest of the year in line with global trends. “2016 figures were much tempered from the double-digit numbers we saw in recent years,” Abdulkareem Al Masabi, executive vice-president of the ports unit at Abu Dhabi Ports and chairman of Abu Dhabi Terminals, told OBG. “But it is still much better than most in the region, with many ports seeing contraction and delaying expansion plans. We expect 2017 to continue to be driven by steel, aluminium and polymers.”
Abu Dhabi Terminals is Khalifa Port’s sole operator under a 30-year concession arrangement with Abu Dhabi Ports, and is owned jointly by Abu Dhabi Ports and Mubadala Investment Company. Khalifa Port as a whole is set to get an added boost in the coming years following the September 2016 announcement of Abu Dhabi Port’s 35-year concession agreement with COSCO Shipping Ports Limited, the largest shipping company in China. The second terminal operator will build out infrastructure equating to a depth of 18 metres with 1200 metres of quay wall and adjacent land. The first 800 metres of quay length is expected to be in operation by the end of 2018, with the remaining 400 metres commencing operations in 2020.
Once fully operational, the new expansion will add 2.4m TEUs of capacity to the existing 2.5m TEUs. Globally, COSCO Shipping Ports Limited operates 46 container terminals and 169 berths.
Overhaul
One of the primary new developments at Khalifa Port in previous years has been its Port Community System, Maqta Gateway. The digital platform connects all stakeholders in Abu Dhabi Ports with real-time information, speeding up processing times. Maqta Gateway pushed ahead in late 2016 with the launch of its digital Vessel Management System, which provides customers with complete automation of all vessel management processes, including vehicle registration, voyage declaration, call requests and port clearance requests, as well as marine services. “Over the next two years we expect to have finalised both automated truck landing and shuttle carriers for horizontal transport at Khalifa Port. This will really put us a leg up on competition in the region, becoming a full-fledged, semi-automated port,” Al Masabi told OBG. “We are also looking to develop new products that will allow our customers to deal with a single party for all logistics through ADT,” he added.
Other Ports
Abu Dhabi’s oldest commercial port facility is Zayed Port, located adjacent to the city and serving as the capital’s main port for more than 40 years. Zayed Port consists of three basins over 5.1 sq km, with one for deep-water vessels, such as cruise liners and general cargo ships. The first of these basins has a quay length of 3450 metres, along with 21 berths, while the approach channel width is 259 metres, with a 15-metre depth in the basin. Port facilities also include 143,000 sq metres of covered warehousing, with cold storage for 20,000 tonnes, and a Ro-Ro berth. In addition, Abu Dhabi Ports operates the free ports for smaller vessels, mainly oil and gas support vessels.
At the end of 2015 the port of Mina Zayed saw the opening of Abu Dhabi Cruise Terminal, which is aimed at further boosting a growing industry in the emirate. The 2015-16 season saw records broken, with more than 100 ship calls and 231,148 passengers using the terminal and another new venture, a cruise stop on Sir Bani Yas Island. Abu Dhabi Ports and the Abu Dhabi Tourism & Culture Authority (TCA Abu Dhabi) expect numbers to be even higher for the 2016-17 season. By 2025 TCA Abu Dhabi estimates that this number will be around 800,000. Zayed Port is also still expanding, with Abu Dhabi Ports and Abu Dhabi Ship Building (ADSB) having signed a long-term contract to set up a new ship-repair facility there, including a floating dry dock. ADSB is the emirate’s principal ship construction, repair and refit company for the UAE navy, as well as for commercial vessels. The ship repair and refit project at Zayed Port also saw the construction of a dedicated berth, with a 430-metre quay wall and 12,000 sq metres of yard facilities. The floating dock received its first vessel in November 2016. Abu Dhabi Ports also runs Musaffah Port, to the south-west of the capital. Emirates Steel and several other industrial companies have their own dedicated terminals at the port, while Abu Dhabi Ports operates a general cargo facility, and provides harbour pilotage and berthing assistance tugs.
ADSB also has yards there for its shipbuilding, repair and refit activities. Musaffah has a quay length of 340 metres, a nine-metre channel depth and an alongside depth of 11 metres. Abu Dhabi Ports’ smaller ports in the emirate’s Al Dhafra Region include island harbours, such as Delma and Sir Bani Yas – which saw the launch of Sir Bani Yas Cruise Beach in December 2016 – as well as mainland coastal ports, such as Sila, Mugharaq and Al Mirfa. Mugharaq is the departure point for ferries to the islands, has a Ro-Ro berth and has been undergoing expansion in recent years. Fishing is a major industry for all of these ports, while recreational activities are a growing business pillar. In this regard, Abu Dhabi Ports has been developing Shahama Port, located between Abu Dhabi and Dubai, as a water sports and recreation centre. The project also serves as an anchor for local tourism and residential development.
Rail
Rail has an important role under the transport master plans of both Abu Dhabi and the UAE through a 1200-km network known as Etihad Rail. Etihad Rail is a federal project, although the 264-km first stage of its development – the only phase that is currently operational – is wholly within Abu Dhabi. Completed in 2013, this freight-only link runs from Shah and Habshan to Ruwais, and transports up to 11,000 tonnes of granulated sulphur a day for Abu Dhabi National Oil Company via two trains. The company reached a significant milestone in early 2017 when it stated that it has transported more than 10m tonnes of granulated sulphur since its launch. A 628-km second stage, linking Khalifa Port with Jebel Ali in Dubai and to the Saudi border at Ghweifat and the Omani border at Al Ain, was suspended in early 2016 due to a reassessment of priorities resulting from budget constraints. A 279-km third phase, which will extend the project northwards to Fujairah Ras Al Khaimah and Sharjah, is also in the pipeline. Likewise, deadlines for a planned 2117-km pan-GCC rail link were also pushed back in 2016, with a new ceiling of 2021 for the project’s completion.
Hyperloop
Meanwhile, the DMAT is researching a possible hyperloop between Abu Dhabi City and Al Ain. This revolutionary new transport system would propel passengers at speeds of around 1200 km per hour in pod-like vehicles through a reduced-pressure tube. The system has the potential to cut journey times between the two cities from the current two hours by road to 8-12 minutes. Studies are under way into the possibility of another hyperloop between Dubai and Abu Dhabi, in association with US firm Hyperloop One. In late 2016 the company said that it had been in negotiations with Abu Dhabi’s transport authorities.
Highway Infrastructure
The DMAT has also been pursuing a major strategy of road construction in recent years. A highlight of this in 2016 was the opening of Sheikh Mohammad bin Rashid Al Maktoum Road, which comprises four lanes in each direction and links to Sheikh Mohammad bin Zayed Road on route E311, providing a further connection between Abu Dhabi and Dubai. The Dh2.1bn ($571.7m) road was constructed by Musanada, and can carry up to 8000 vehicles per hour, with six interchanges and six underpasses. Musanada is also constructing the Dh5.3bn ($1.4bn) Mafraq-Ghweifat highway project, which is nearing completion. It includes 16 new interchanges along with improvements to four existing ones, and will upgrade 246 km of roads stretching from Mafraq to the Saudi Arabian border and the Ruwais industrial estate. As the road passes through areas with many camel farms, underpasses for the animals have been installed in the Sila and Ghweifat areas. The highway has strategic significance as it is the only one to connect the UAE as a whole through Abu Dhabi’s Al Dhafra Region to the Gulf countries beyond, via the Saudi border. The expected completion date is mid-2017. A third major scheme currently being brought to completion by Musanada is the Abu Dhabi Airport Road Project. This Dh677m ($184.3m) scheme involves the construction of an interchange to Abu Dhabi International Airport (AUH) via four bridges, the building of an underpass to Yas Island – an offshore entertainment, tourism, commercial and residential development adjacent to AUH – and an overpass connecting the island back to the Airport City A development.
Other work includes widening the E10 from four lanes to five in each direction, along with construction of a secondary 3.7-km road between Interchange Number 6 and the E12. A further bridge and the addition of an extra lane each way between the E10 and the Presidential Flight Building – which operates VIP and VVIP air services – is also covered by the project, along with other infrastructure work and ancillary services, such as drainage and pumping stations. In November 2016 Musanada reported that the project was 57% complete, with 2017 expected to see it concluded.
Additional Works
The emirate is also seeing many smaller schemes as the city expands and creates new transport needs (see analysis). In July 2016, for example, the Executive Council announced Dh544m ($148.1m) of funding for new infrastructure projects, including 7.7 km of road, along with lighting and traffic control systems. The package also included improvements at the Ghweifat border crossing and Dh36m ($9.8m) for the manufacture, installation and maintenance of new road signs – the latter part of the Unified Geonames and addressing system project being rolled out.
Infrastructure Development
The following month Musanada announced Dh4bn ($1.1bn) of new infrastructure development projects, all of which are expected to be completed by the end of 2019. Five of the projects are centred on residential, business and commercial districts for Madinat Zayed, in the Western Region. New housing neighbourhoods there all require internal roads, while a Dh599.9m ($163.3m) project will build a road from Madinat Zayed to the town of Al Mirfa. Roads will also take a major slice of the budget for the development of the Al Dhafra Region town of Ghayathi, and of the Al Nahdha Military Area on the outskirts of Abu Dhabi City. In October 2016 the Executive Council also approved Dh6bn ($1.6bn) of infrastructure works in Madinat Zayed and Al Hayer, a new residential district of Al Ain. At Madinat Zayed, Dh1bn ($272.3m) was approved to be spent on roads and utility networks for what will be the development’s business district. The area is also to include a multi-modal transport hub. At Al Hayer, a new 300-house district is being constructed, with associated road works and connecting infrastructure. The Executive Council also approved Dh377m ($102.6m) for widening the road between Al Fayah and Razeen and through to Al Quaa. The capital’s Al Zahiyah area is also receiving Dh249m ($67.8m) of infrastructure investment, partly to improve traffic flow, while a residential development at Al Shawamekh, south of the airport and south-east of Abu Dhabi City’s downtown, will see 28 km of internal roads constructed, as well as parking spots for 5472 vehicles.
Meanwhile, Musanada is developing its asset and facility management arm. This is a relatively new field in the emirate, with the whole life cycle of projects coming under closer scrutiny when contracts are issued and budgets drawn up. In Abu Dhabi City, the local authority’s Municipal Infrastructure and Assets Sector includes the Municipal Roads and Infrastructure Division, which is responsible for planning and implementation of road maintenance and repair within the municipal boundaries, including contracts for lighting and signalling. Musanada itself looks after 3867 facilities in the emirate, including infrastructure and buildings.
Standardisation of road maintenance practices is well advanced. With the assistance of the Transport Research Laboratory UAE – the Emirates’ branch of the UK transport specialist – along with the Abu Dhabi, Al Ain and Western Region municipalities, plus the Abu Dhabi Police, a work zone manual has been completed for Abu Dhabi and is now being implemented.
The reasoning behind such manuals is to improve safety and ensure best practices in infrastructure maintenance. The DMAT conducts regular road safety education and awareness campaigns, in association with the Abu Dhabi Police, the Health Authority – Abu Dhabi and Emirates Driving Company. The latter is a part-private, part publicly owned driver training and safety institute, which administers driving theory tests and lessons for Abu Dhabi’s practical driving test. Using the latest technology, the Abu Dhabi Police’s Smart Traffic Centre has also ramped up monitoring of behaviour in recent times, helping to crack down on aggressive drivers. Abu Dhabi Police data for 2015 shows road deaths in the emirate down 8%, year-on-year, and the number of accidents down 3%, from 1864 to 1803.
Logistical Chains
Tying its road, air and maritime links together, Abu Dhabi now represents a hub for the regional transport industry. When this is tied to its range of industrial parks, the emirate also emerges as a growing global logistics hub. Integrated air, land and sea businesses can take advantage of parks such as KIZAD, as well as the Industrial City of Abu Dhabi, Musaffah Industrial Area, Abu Dhabi Airport Business City and Al Ain Industrial City to base their warehousing, refrigeration, cold storage, packing and repacking facilities (see Industry chapter). With shippers worldwide also turning increasingly to third-party logistics providers, companies are seeing their subsector grow faster than GDP, according to the Council of Supply Chain Management Professionals. In Abu Dhabi logistics is becoming more regulated and integrated. The DMAT is currently rolling out its Abu Dhabi Freight Transport Master Plan, which has grown out of Abu Dhabi Economic Vision 2030. It takes a multi-modal approach, with 13 priority actions, including tightening the licensing and administrative procedures for logistics companies. Phase 1 saw freight companies obliged to provide the DMAT with driver and transport manager details. The private sector is also playing a more active role in bringing sophisticated systems to logistics. UAE-based Aramex has grown into one of the more recognisable global brands since its founding in 1982, with an integrated supply chain spanning 66 countries and 567 cities. Acquisitions in recent years, including Fastway in 2016 and Australia’s Mail Call Couriers in 2015, have helped cement its global footprint. Companies like Dubai-headquartered MiX Telematics and Abu Dhabi-based FMS Tech are bringing tech-savvy solutions to supply chains across a number of sectors, offering cost savings on everything from vehicle maintenance to road safety. Dovetailing with Abu Dhabi Economic Vision 2030 was the emirate’s hosting of Climate Expo Abu Dhabi 2016, which focused on the cold chain, looking at more environmentally friendly ways to secure warehousing and freight air conditioning, refrigeration and cold storage. Abu Dhabi Economic Vision 2030 and the Abu Dhabi Plan both put sustainability centre stage in the emirate’s future development strategy.
Outlook
Oil and gas prices were creeping up in early 2017, securing increased revenues and a potentially larger budget for transport infrastructure, although doubts remain as to what the impact of political uncertainties and protectionism in the US, UK and Europe might be. However, local dynamics continue to back up sector growth. “After a period of budgetary tightening, we are now seeing things stabilising and some projects that had been suspended starting again,” Chris Venemore, director of civil infrastructure for AECOM, told OBG. The government remains committed to rolling out a fully integrated transport policy. Crucial to this is the development of the metro and light rail systems, with hopes increasing that these might take a step forward in 2017, along with wider use of municipal buses. “The slump in oil prices will not deflect us from carrying out our infrastructure projects, which are in fact crucial to future development,” Al Marar told OBG. “On the contrary, the drop in oil prices serves as an incentive for us to continue these projects in various sectors and support economic diversification, development and the modernisation drive.” The growth of regulation looks set to continue, while efforts to improve implementation come more into focus. Continued strength of markets in Asia and new market development in Africa should also keep the logistics sector buoyant. Yet transport and logistics are highly competitive businesses, particularly in the Gulf, and companies are likely to make efforts to reduce costs and improve efficiencies, using the latest technologies.
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