How has regional political tension impacted business for DHL? How has this changed market dynamics for the UAE?
UWE-UNGERER: The recent turmoil in the Middle East did not have a serious impact on DHL’s operations. When it started in Egypt, we had a slowdown for two weeks and after that we were back to normal. Looking at the numbers, the impact has been really marginal. The only country where our International door-to-door pick-up and deliveries have been suspended due to security concerns is Libya, yet our DHL office in Tripoli remains opens to support customer shipment enquires. Our major Middle East hub is in Bahrain and there was only one day we could not operate because our staff could not reach the office. On the other side, for Dubai, this can be seen as a benefit because Dubai is considered the safe haven for the Middle East and we can see companies moving more of their operations into Dubai.
What kinds of growth is DHL seeing in the region today? What are your projections for the future?
UWE-UNGERER: The growth in the region is coming back. It is not what we were seeing in 2008 where we had high double-digit growth. When the global crisis came, it did not skip over us. In 2009, we saw a slowdown in Q2, and Q3 with no decline, followed by growth again in Q4. Now as DHL Express in the UAE, we are back into double-digit growth. So I am very positive on what is going on, but at the same time we will not see the boom numbers again. Looking into the future, Dubai is a great place to do business especially as a transit and logistics hub. As a logistics company, we are facilitators of trade, so we are in the right place. We have the infrastructure, processes and procedures, a government open to any idea that works with the private sector to move forward. Looking at the Middle East, Dubai is far ahead of other country trying to copy this model. Looking forward, other countries will find their niches. We also see developments in Abu Dhabi. We see the new airport coming soon and the new port being developed. There are also developments in other emirates. Sharjah has its free zone and there is an airline evolving in Ras Al Khaimah. Abu Dhabi will attract business, not necessarily business that Dubai will loose, but additional transit business. We are still seeing growth in Dubai. There is a new free trade zone close to Jebal Ali, Dubai Logistics City. We have Dubai World with all of its potential and the expansion of the Maktoum International Airport. So I am very optimistic that this is the right place to be for us. I am seeing more customers moving into Dubai. Maybe before Dubai was the hub for the Middle East, but now I see that expanding into MENA as a whole. I am very positive about the future of Dubai as a place to do business.
Are new infrastructure developments and upgrades enhancing logistic and transportation operations in the UAE? What new infrastructure projects are going to have the greatest impact on the industry?
UWE-UNGERER: Infrastructure is not only buildings and assets. Dubai Customs just introduced Mirsal 2, which is a new customs application that brings Dubai Customs and processes up to world standards. This is a very sophisticated application that will increase the speed of doing business and releasing goods and keeping track and control of what is coming in and what is going out. On the development side, we have the new airport at Dubai World. I believe now step by step, it will get busy. We have a huge airport development in Abu Dhabi, the port in Abu Dhabi, free zones in Abu Dhabi, and free trade zones in other areas. To move goods, the proper infrastructure is needed in the road networks. The government has invested AED 55bn ($15bn) over the last 5 years in transportation infrastructure. Half of that went into roads.
How would you describe the level of competition amongst logistics and transportation companies in the region? Will Dubai retain the title of the hub of logistics and transportation for the region?
UWE-UNGERER: Dubai is and will be the logistics hub for the region. But, Dubai is not only competing within the region. Dubai is also competing with Singapore and the ports in Europe. Looking at what the government is doing and their plans and what they are doing to include the private sector in their developments, it will remain in that position. The growth rates are big; far above GDP. I think what they are doing is correct. The most important thing about living here is that you can talk to the government. If your arguments make sense, they will follow that. That is not happening in many other places in the world.
Dubai is and will be the logistics hub for the region. But, Dubai is not only competing within the region. Dubai is also competing with Singapore and the ports in Europe. Looking at what the government is doing and their plans and what they are doing to include the private sector in their developments, it will remain in that position.
What kind of investment is made into security and counter terrorism for transportation and logistics companies in the region today?
UWE-UNGERER: Security and safety are two of the most important topics in DHL and they come above revenue and profits. Looking at how we can assure our customers goods, our assets, and most important, our people, you need three things; proper technology, proper processes, and instructing people on how to follow those processes and implement them day by day. On top of that we also show our customers by giving them written proof that we work on security through certification. Wherever we can, we certify our facilities and wherever we can we certify our processes. That again comes back to technology, cameras, detection systems, sniffer dogs, etc… to ensure that goods, people and assets are safe and will remain safe. It is also very important of course that we work with the authorities.