18 November 2019 - DWC, Dubai Airshow Site, Dubai, UAE
Vice President of FedEx Express Middle East and North Africa Operations
How would you describe the cargo sector in the Middle East?
Growth in the Gulf Cooperation Council (GCC) region is expected to increase from 2% last year to 2.1 percent in 2019, before accelerating to 3.2 percent in 2020 and stabilizing at 2.7 percent in 2021. Mirroring this, the cargo sector in the region is witnessing considerable development, especially with the growth of the non-oil economy. The regional logistics and transport industry is serving the diverse needs of the SME sector, the rise of international e-commerce and the burgeoning manufacturing industry.
The sector is being driven by reforms and regulations that are encouraging foreign investments through market liberalization and ease of business – including contributing to growth prospects with specific partners such as China. For example, a recent agreement between UAE and China will see bilateral trade grow to US$70 billion next year.
Infrastructure development within airports, rail, roads, free zones, warehousing and the maritime sector is ensuring that the region is well-positioned for import-export activity.
Can you tell us about FedEx?
FedEx Express is the world’s largest express transportation company, providing fast and reliable delivery to more than 220 countries and territories through our global air and ground networks.
The FedEx Express Dubai Hub commenced operations in 1998, and Dubai serves as the regional hub for the Middle East, Indian Subcontinent and Africa (MEISA) region with 60 weekly FedEx Express flights.
Through the hub, FedEx connects the region’s businesses with possibilities to trade within the GCC, and around the world, providing access to over 99 percent of the world’s GDP.
Recently, FedEx was once again recognized as the world’s busiest air cargo carrier by IATA, growing 3.8% year–on-year in freight ton kilometres. Our air network is supported locally by the extensive Middle East road network, which connects the UAE directly to Saudi Arabia, Bahrain, Kuwait, Oman, and Jordan.
FedEx offers specialized services that cater to a wide range of industry requirements, such as petrochemical equipment for the oil and gas industry, clinical samples for the healthcare industry, aircraft parts for the aviation industry, and e-commerce.
FedEx is driven by a People-Service-Profit philosophy, with the belief that when we put our people first, they will provide the highest possible service, which in turn delivers profit which we then reinvest back into our people, and back into our business.
What do you consider to be the main opportunities and challenges currently facing the cargo industry in the Middle East?
Challenges remain with complex or inconsistent trade regulations. However, regional government initiatives including the Dubai Silk Road strategy, the National Industrial Development and Logistics Program (NIDLP) in Saudi Arabia, and Oman’s National Air Cargo Strategy is driving targeted investment within the sector.
Backed by positive reforms, sector-specific infrastructure developments, and government policies that have reduced the cost of doing business, the logistics industry is increasingly a key driver of the non-oil economy in the region.
Continued growth opportunities for the logistics sector lie in hyper-personalization for both SMEs and industry-specific requirements, ensuring not only retention and growth of customers, but also presenting the opportunity to access new markets and new customers through specialized services. E-commerce and the growth of specialized supply chains will continue to support industry growth.
In the near term, the industry will see increased digitization, transparency, data sharing and analysis, contributing to reduced complexities. Technologies such as blockchain will provide new options to authorize the data coming from goods that move from place to place, similarly artificial intelligence presents opportunities within factoring package arrival. Robots will eliminate human tasks that are repetitive, tedious, or which may be dangerous to humans.
How is FedEx in particular preparing to meet these opportunities and challenges?
With a broad portfolio of transportation, e-commerce, and business services, FedEx is providing tailored solutions that are able to meet the demands of customers and businesses within the last mile delivery of their goods.
Going one step further, to meet sector-specific needs, for example pharmaceuticals and perishables, we are providing scalable options and cold chain solutions to support these industries.
FedEx is also supporting more streamlined movement of trade through services such as the Electronic Trade Documentation, with the aim of expediting clearing processes through modernized, consistent and unified customs regulations at all ports of entry, benefitting customers and economies.
To address any security challenges, risk-based measures must be applied across the entire supply chain. In line with this, FedEx has a comprehensive risk management framework in place.
In order to connect the world in responsible, sustainable and resourceful ways whilst minimizing the environmental impact, FedEx has developed fleet modernization and fuel conservation programs. These programs helped save more than 200 million gallons of jet fuel and avoided almost two million metric tons of CO2e emissions in Fiscal Year 2018.
Why is it important for FedEx to be part of Cargo Connect?
The future of air cargo is characterized by increased standardization, sustainability, digitization, and automation. It is important to address their adoption, application and impact at the industry level and to have open conversations with other industry players at Cargo Connect to enable a cross-sector integrated approach to transport planning and regulation.