There is no doubt about the fact that the GCC region has emerged as an integral link between the East and the West for maritime movements. Most governments across GCC countries are moving towards developing their logistics companies and overall logistics infrastructure to achieve greater independence from the oil-based economy. By aggressively and strategically investing in several other growth-intensive sectors, the GCC countries have made their intentions clear. And leading the charge amongst then all is Oman which has emerged as the logistics hub in the region, thanks to its strategic geographical location, efficient and well-supported logistics companies in Oman, and the efforts of the Sultanate.
Oman is not only leading the way to become the logistic hub in the region, but it also seems to be taking other countries along toward a better logistics infrastructural future. And Qatar has emerged as one of its closest partners in creating an integrated logistics space by connecting maritime ports, airports, rail, and road infrastructure. This is being looked at as a strategic developmental initiative by the experts, a step that will help both countries create a solid logistics environment in the region. It is also interesting to see that Qatar has been in the middle of a geo-political crisis since 2017 due to its disturbed relations with the neighboring countries. The situation has had a far-reaching impact on its economic and developmental plans. However, its partnership to create an integrated logistics space has already started showing results, something that both countries joined hands for. This is being seen as a perfect opportunity for shipping companies in Oman to up their ante and become part of a revolution that is on the brink of making a humungous change in this region.
Connecting maritime ports, airports, rail, and roads for stronger business ties
The logistics industry operates in such a way that it requires comprehensive operational efficiency. And this can only be achieved if a country has friendly ties with the neighboring countries and international trade bodies. It is no secret that the GCC region is politically unstable and there have been several upheavals in the past making it difficult for these countries to operate seamlessly. Qatar had been facing similar political challenges before Oman extended support to take Qatar out of challenging waters. Qatar’s under-developed maritime routes and over-reliance on Dubai’s Jebel Ali Port had always been a challenge crippling its logistics sector. However, the two countries are now preparing a long-term plan integrated logistics system that will bring their seaports, airports, and road and rail network together for seamless maritime business opportunities.
Various operational deficiencies like a large degree of duplication in port infrastructure, improper logistics development, and increasing competition within the region have cumulatively meant that Qatar needs external support for a better logistics environment.
When it comes to the worldwide circulation of commodities, the GCC has emerged as the central node, thanks to its strategic geographical location along the Asia-Europe trade route. This has propelled massive amounts of investments in the logistics sectors by the governments in this region. And Qatar and Oman are no exceptions. It is believed that more than 60 percent of all investments in the Middle East have been made in the GCC region alone, which is a huge chunk of money to develop a logistics infrastructure that will drive the future of these countries.
Similarly, Qatar and Oman are developing an integrated infrastructural network for faster, more efficient, and cost-effective logistics business. These include freight and passenger railway network, airports, special economic zones, and logistics hubs. Both these countries are currently concentrating on economic diversification and stand to benefit from a seamless partnership. This is what has further fueled the emergence of such strong and integrated logistics spaces. Qatar, which is home to the world’s biggest gas reserve after Russia and Iran, has long relied on the transportation of gas for its economic development. However, now that the country is looking at diversifying its economy, an integrated logistics space is what it needs to expedite the growth and development of other sectors. Oman is in a pretty similar economic situation where the Sultanate is looking at other sectors and industries to reduce its overdependence on oil.
Both these countries find themselves in similar waters and thus a partnership is a natural progression. While Oman has outpaced Qatar’s port development plans, a partnership is sure to bring a lot of benefits to both these countries. Oman’s Sohar Port, Duqm Port, and New Hamad Port are expected to play a significant role in the development of both these countries. One of the most important parts of this partnership and the development of integrated corridors is the creation of free zones. These zones will help them assemble, label, and repackage commodities that are due for re-export, helping these countries get firmly embedded into the international supply chains.
Integrated logistics hubs are being seen as the future of this industry. In the future, more such partnerships are sure to emerge as various countries plan to develop stronger ownership of trade routes and efficient operational systems. At the moment, Qatar and Oman are looking to create a seamless network of maritime ports, airports, rail, and roads by 2030 so that they can fast-pace their plans for economic diversification and development.
