The Dubai Future Foundation has recommended developing a regional storage hub, allowing nearby countries to secure their supply chains.
In a report, “Life After COVID-19: Logistics”, it said a resilient supply chain is dependent on an increased dependence on automation and robotics in manufacturing and ports.
The report is jointly launched with the Dubai Future Council on Logistical Services to discuss challenges and opportunities faced by the industry during the coronavirus pandemic.
According to recent survey results revealed by the Institute for Supply Management, logistics companies report supply chain disruptions in vast variety, depending on the sector, location and mode, due to coronavirus-related transportation restrictions.
The report states that most countries have recognized the need for greater diversification of their supply chain.
The findings claim the need for higher buffers of inventory levels and the recent growth in e-commerce has put the focus of investors on logistic services and inventories near the ports.
There is a sufficient supply of industrial real estate in the free zones adjacent to ports. Some of the larger free zones in the region include King Abdullah Economic City (KAEC) in Saudi Arabia next to King Abdullah Port, Khalifa Industrial Zone Abu Dhabi (Kizad) in the UAE next to Khalifa Port, Jebel Ali Free Zone (Jafza) in the UAE next to Jebel Ali Port, and Free Zone in Oman next to Sohar Port.
Sultan bin Sulayem, Chairman and CEO of DP World, said: “What we have seen over the past three months is a focus on securing the supply chain and improving resilience. The advent of digital advancement has been significant.”
Khalfan Belhoul, CEO of the Dubai Future Foundation, stressed the importance of strengthening collaborations between the government and private sector, as well as international organizations, to not only support and build a resilient logistics sector, which is seen as one of the vital economic sectors in the UAE, but also to anticipate changes and propose suitable solutions to overcome those changes that are imposed by global health pandemic.
The report suggested free zones should introduce incentives to logistics tenants to support the industry. In addition, manufacturers should produce products with longer shelves-lives to minimize the impact of potential supply chain disruption.
