The UAE is the third best logistics centre out of 50 emerging markets thanks to its investment in infrastructure and ease of doing business, according to a survey by Agility.
The UAE’s rank slipped one place as India sped past with reforms to take the No 2 position after emerging markets leader China.
“Given the market size and given the latest reforms that we are seeing this is why India has improved that much and was able to take the No2 position ahead of UAE,” said Bassel El Dabbagh, the chief executive of Agility Abu Dhabi.
The latest Emerging Markets Logistics Index was gleaned from responses from 800 logistics and supply chain executives in a survey conducted last year.
Size and growth attractiveness constitutes 50 per cent of the overall assessment. Compatibility and connectedness each account for 25 per cent of the overall score.
“The UAE is still on a path of continuous diversification of its revenue base and investments in different sectors of the economy, so this is driving the growth but also the major investments that continue in the infrastructure and logistics in particular,” said Mr El Dabbagh.
UAE was ranked first in terms of market compatibility which measures ease of doing business, business climate, market risks and other metrics.
It was also ranked No 1 in terms of market connectedness, thanks to its highly developed infrastructure.
All six Arabian Gulf countries were included in the top 10 of market compatibility. All six countries, except Kuwait, were in the top 10 of connectedness.
“These results are still positive for the GCC countries despite delays in some projects and some spending,” said Mr El Dabbagh. “This is the result of several years now of diversification and spending. So in the last year if they delayed certain projects it doesn’t affect the overall result compared to other countries.”
Meanwhile, the slower economic growth in the Gulf is not deterring Agility from forging ahead with investments.
In Abu Dhabi, it plans to spend Dh100 million this year to construct a 31,000 square metres distribution centre, acquire a plot of land in the Kizad free zone and expand its transportation fleet.
“The UAE and GCC is a core market for us,” said Mr El Dabbagh. “We are confident there will be growth [in logistics].”
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