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Kuwait Freight Transport Report Q1 2009Published by: Business Monitor International Published: Dec. 30, 2008 - 54 Pages Table of Contents
AbstractStart-up Wataniya Airways (also known as National Airways) said in late August that it had signed anagreement to lease three Airbus A320s from the Dutch company AerCap. The planes would be leasedfor nine years starting in 2010, Wataniya said, while not revealing the price it would pay. The newagreement meant that Wataniya was effectively doubling the size of its planned fleet from three to sixaircraft. The company said it planned to launch its services in January 2009. In May, Reuters newsagency had reported that the company’s intention was to build the fleet to at least 12 wide-bodied planesby 2012. Wataniya, backed by Kuwait Projects Company (KIPCO) and other corporate investors, wasset up to compete with state-owned Kuwait Airways Corporation (KAC) and the private sector low costcarrier, Jazeera Airways. Earlier in August, Wataniya denied a report by Al-Qabas newspaper that it wasinterested in buying a stake in the loss-making KAC, which is being prepared for privatisation. In ourlatest Kuwait Freight Transport Report, BMI concludes that airfreight traffic is likely to grow at anannual average rate of 6.7% in the 2008-2012 forecast period.Various factors support this prediction. Although the recent global economy will cool and the oil priceboom will ease over the next couple of years, we still see Kuwaiti GDP rising by an annual average of5.3% over the next five years. Growing capacity and trade in high-value or low-bulk goods will allcontribute to airfreight growth. Kuwait is a relatively small country and its trading sector - and thereforetransport network - has a vibrant re-export component. Kuwait has evolved as a trade hub for its largerneighbours, particularly Iran and Iraq, which have had limitations on their direct links with theinternational community. BMI also forecasts 3.0% average annual growth for road haulage and 6.3% for maritime cargo in the fiveyears to 2012. We estimate an annual average pipeline throughput growth of 7.2%. We expect that thebulk of transport will continue to be waterborne and consist largely of oil and related goods. Transit trade,particularly that involving Iraq, will comprise raw materials involved in that country’s eventual rebuilding(aggregates, basic metals and the like) and machinery related to building and construction work. At 64.9 on a scale of zero to 100, Kuwait’s overall freight rating is now above the average for the MiddleEast and Africa (MEA) region. It scores well in terms of its economic risk and its record of investment ininfrastructure. However, it is below the average for freight growth, the regulatory environment and for thetransport intensity index (a measure of the dynamism of foreign trade). For the 2008-2012 forecast period, we expect the transport and communications sector to continueoutpacing the economy as a whole. It will achieve average annual growth of 6.1%, versus 5.3% foroverall GDP. The total value of transport and communications GDP will rise to US$8.26bn in nominalterms by 2012, representing 5.2% of Kuwait’s GDP. Get Full Details About This Report >> |
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