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Kuwait Freight Transport Report Q4 2009Published by: Business Monitor International Published: Oct. 28, 2009 - 59 Pages Table of Contents
AbstractIn early September, the US-German company, Excelerate Energy, said it had completed its firstdeliveries of gas to the Kuwaiti market from imported liquefied natural gas (LNG). Excelerate, asubsidiary of Germany’s RWE, had installed a floating regasification facility, known as GasPort, in Minaal-Ahmadi port. Its LNG tanker Express had delivered a shipment of 130,000 cubic metres of LNG fromAustralia to the facility on August 31, under the terms of a supply agreement with Royal Dutch Shell.According to a statement by RWE, this shipment was being regasified into an equivalent of 2.8bn cubicfeet of natural gas, and then being fed directly into the Kuwaiti gas grid. The shipment had been timed tocoincide with peak demand in Kuwait, where air conditioner use and gas-fired electricity generation arethe main drivers of consumption. Since our last report, we have adjusted our macroeconomic forecasts for Kuwait. The global downturn ishaving a real impact on the country. We now expect a gross domestic product (GDP) contraction of 2.2%in 2009 (was 1% previously). We see 2010 GDP increasing by 1.8% (down from 2.1% in our previousreport). For the 2009-2013 forecast period, therefore, we expect an annual average GDP growth of 1.8%,down from 7.7% in the preceding five years. The effect on our freight traffic forecasts across the twoperiods as a whole is therefore quite negative. However, the current wave of infrastructure investments isan important positive factor. As far as road haulage is concerned, we expect Kuwait to continue followingwhat could be called a ‘mature economy’ pattern, where freight turnover growth lags behind GDP. Congestion of the current motorway network and vehicle saturation are also factors to bear in mind wherethis is concerned. On maritime freight, despite the current market conditions, the country’s plans to boostoil exports will begin to have an impact towards the end of our forecast period. Although Kuwait hasbegun importing natural gas, the discovery of gas reserves also suggests that more hydrocarbons maybecome available for export on the long term. Our pipeline throughput estimate is intended to capture theeffect of new investments in storage facilities and pipelines. In airfreight, the difficulties of the nationalcarrier, Kuwait Airways, are high, but volumes may pick up from 2011 onwards. Considering all thesefactors, we now believe that freight turnover measured across road, sea and air - as expressed in milliontonne-km (mntkm) - will increase by an annual average of 1.3% over the 2009-2013 forecast period. Thiswill be on a par with growth in the wider economy. According to our latest estimates, transport and communications (T&C) GDP rose by a strong 8.3% in2008 - 2.1 percentage points (pps) faster than overall GDP, which we estimate to have increased by 6.2%.For the 2009-2013 forecast period, we expect the T&C sector to continue outpacing the economy as awhole. It will achieve average annual growth of 2.2%, versus the 1.8% for overall GDP. The total valueof T&C GDP will rise to US$7.98bn 5 in nominal terms by 2013, representing 5.2% of Kuwait’s GDP. Like all Gulf Co-operation Council (GCC) states, Kuwait does not disclose statistics, other than somebasic banking releases. Accordingly, it is difficult for BMI to establish solid facts relating to the transportsector. Nevertheless, in the five years to 2013, we forecast 1.1% average annual growth for road haulage,1.3% for maritime cargo and 2.4% for airfreight. We estimate annual average pipeline throughput growthof 2.5%. We expect that the bulk of transport will continue to be carried by waterways and consist largelyof oil and related goods. Transit trade, particularly that involving Iraq, will comprise raw materialsinvolved in Iraq’s re-building (aggregates, basic metals, etc.) and machinery related to building andconstruction work. Get Full Details About This Report >> |
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