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Israel Freight Transport Report Q1 2010Published by: Business Monitor International Published: Jan. 6, 2010 - 62 Pages Table of Contents
AbstractIn January-September, the first nine months of 2009, the total number of containers handled by Israeli ports fell by 4% on comparable 2008 levels to reach 1.5mn twenty-foot equivalent units (TEUs), the Israeli Shippers’ Council (ISC), an industry lobby, said. However, there were signs of an upturn in Q309 with box exports up 12% year-on-year, lifting the total number of boxed handled (exports + imports) to 7% above Q308 levels. In total tonnage terms Q309 was down 10% on Q308.Since our last quarterly report we have again revised Israel’s growth prospects - this time another (small) upward revision. We now estimate a 2009 GDP contraction of 0.1% (was -0.9%) and expect growth of 2.6% (up from 2.4%) in 2010. For 2010-2014, economic growth will be an annual average of 2.7%, below the more robust 4.5% average registered over the preceding five years. The effect on our freight traffic forecasts for the period, compared with the earlier one, is therefore somewhat negative. We continue to make adjustments to our mode-specific estimates and forecasts, cutting back maritime freight growth because of the global recession in 2009, the downturn in the shipping cycle, and the difficulties facing Zim Integrated Shipping. The big road building programme may meet fiscal constraints. We have trimmed back rail freight based on the available published data. Despite the emerging recovery in market conditions, it will remain challenging for airfreight, road haulage and shipping sectors in particular. Taking all these factors into account, our forecasts for freight carried across all modes and measured in mntkm is now an annual average of 3.8% in 2010-2014. According to our latest estimates, transport and communications GDP rose by 0.3% in 2009, a little ahead of overall GDP that fell by 0.1%. For 2010-2014, we now expect the sector to grow a little faster than the wider economy. It will expand in value terms by an annual average of 3.0%, ahead of GDP at 2.7%. The total value of transport and communications GDP will rise to US$30.7bn in nominal terms by 2013, 12.5% of GDP. The sector employed 493,000 people in 2009. We see this rising to 544,000 by 2014. In common with Israel’s entire economy, the freight transport industry’s future, depends on the resolution of the current long-term struggle with the Palestinians. Withdrawal from the Gaza Strip was only a start towards the eventual normalisation of relations, and as the new military operations in early 2009 showed, security risks will continue in the forecast period. Israeli action to cut off the Gaza Strip shows the issue remains as volatile as ever. Tension has also been high with Iran, and political risk factors remain ever-present. After years of under-investment, the logistics sector appears to be getting more top-level support, despite continuing fiscal constraints. At the same time, the privatisation campaign and public-private partnerships have been pursued and may be given further impetus by the new government, partly to bring in outside capital and partly to engender more competition. Although our road-haulage projection is based on estimates, we expect moderate expansion, rising by an annual average of 2.6% per annum in 2010-2014. We believe freight carried by rail will grow by a similar annual average of 2.6%. Airfreight will expand by 3.0%, a modest figure when compared to more general trends in global aviation markets. Israel scores above the regional average in the freight rating, with a composite score of 60.4 (out of 100). Its strengths lie in the regulatory and competitive environment and its transport infrastructure growth. In contrast to its peers, it is weak in actual freight growth and in the transport intensity index - a measure of the dynamism of foreign trade. Get Full Details About This Report >> |
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