Kuwait Freight Transport Report Q1 2012
Includes 3 FREE quarterly updates
Kuwait's ports have struggled to recover the volumes they enjoyed prior to the global economic downturn, but BMI expects this largely to be achieved in 2012, with only total tonnage throughput at Shuaiba not forecast to recoup lost levels until 2013. We forecast slow but steady growth in volumes at Kuwait International Airport, though with a determination to make Kuwait Airways a viable company once more, this could rise. If there are continued instances of industrial unrest and strikes, however, as Kuwait's ports and airports saw towards the end of 2011, then we may have to revise our forecasts down. Kuwait's crude oil export facilities will continue to be busy in 2012. A pick up in demand as the US restocks inventories should boost throughputs, though there is the risk that another economic crisis could halt growth in Western oil demand once again.
Headline Industry Data
Agility's Share Price Jumps Amid Reports Of Kuwait Airways Purchase Plan
In mid-September 2011 beleaguered Kuwaiti logistics company Agility saw its share price pick up amid reports that the firm was in talks to purchase a stake in ailing Kuwait Airways, which was being prepared for privatisation. At the time, BMI noted that the development might help Agility offset the loss of its US Army contracts, and had excited investors. As it later transpired, Kuwait Airways is no longer for sale and is being restructured instead.
Strikes At Kuwaiti Ports Provide Downside Risk To BMI Estimates
The small Gulf country of Kuwait has been seeing strikes in its freight transport sector as workers seek improved working conditions. BMI notes that this follows a pattern we have seen of increased industrial action across the region, and provides downside risk to our throughput forecasts for the country's ports. Customs and port employees, who were on their second day of striking on October 11 2011, were seeking an increase in wages and better working conditions.
KOTC To Take Delivery Of Oil Tanker
Kuwait's state-owned Kuwait Oil Tankers Company (KOTC) was scheduled to take delivery of an oil tanker on September 30 2011, as part of plans to expand its fleet size. The oil tanker will have a capacity of 320,000 tonnes. It is the fourth tanker to be delivered to KOTC as part of an US$800mn contract for six tankers with South Korea. KOTC's chairman Nabil Bouresli added that the company is to finalise another deal before the end of 2011 for nine new tankers which are due to be completed in 2014 and 2015.
Risks To Outlook
The Middle East and North Africa region has seen huge upheavals since the start of 2011, and no country is immune from the repercussions on trade. Kuwait has not been severely hit by unrest, but it is still possible that demonstrations could develop as they have in other Gulf countries, which could adversely affect our port throughput forecasts. We have seen industrial unrest in Kuwaiti ports and airports, more instances of which in 2012 could affect our outlook.
Further potential downside risks to our throughput forecasts come in the form of the exposure to oil price volatility and a slowdown in global demand. Despite the broadly healthy picture of Kuwait's public finances, high reliance on oil, which accounts for 94% of total revenues, exposes the budget and, consequently, trade to oil price volatility.
Kuwait's ports have struggled to recover the volumes they enjoyed prior to the global economic downturn, but BMI expects this largely to be achieved in 2012, with only total tonnage throughput at Shuaiba not forecast to recoup lost levels until 2013. We forecast slow but steady growth in volumes at Kuwait International Airport, though with a determination to make Kuwait Airways a viable company once more, this could rise. If there are continued instances of industrial unrest and strikes, however, as Kuwait's ports and airports saw towards the end of 2011, then we may have to revise our forecasts down. Kuwait's crude oil export facilities will continue to be busy in 2012. A pick up in demand as the US restocks inventories should boost throughputs, though there is the risk that another economic crisis could halt growth in Western oil demand once again.
Headline Industry Data
- 2012 Port of Shuaiba tonnage throughput growth forecast at 4.8% and to average 5.0% to 2016.
- 2011 air freight tonnage growth forecast 1.4% and to average 1.1% a year to 2016.
- 2012 total trade growth forecast to grow 3.6% and to average 3.8% to 2016%.
Agility's Share Price Jumps Amid Reports Of Kuwait Airways Purchase Plan
In mid-September 2011 beleaguered Kuwaiti logistics company Agility saw its share price pick up amid reports that the firm was in talks to purchase a stake in ailing Kuwait Airways, which was being prepared for privatisation. At the time, BMI noted that the development might help Agility offset the loss of its US Army contracts, and had excited investors. As it later transpired, Kuwait Airways is no longer for sale and is being restructured instead.
Strikes At Kuwaiti Ports Provide Downside Risk To BMI Estimates
The small Gulf country of Kuwait has been seeing strikes in its freight transport sector as workers seek improved working conditions. BMI notes that this follows a pattern we have seen of increased industrial action across the region, and provides downside risk to our throughput forecasts for the country's ports. Customs and port employees, who were on their second day of striking on October 11 2011, were seeking an increase in wages and better working conditions.
KOTC To Take Delivery Of Oil Tanker
Kuwait's state-owned Kuwait Oil Tankers Company (KOTC) was scheduled to take delivery of an oil tanker on September 30 2011, as part of plans to expand its fleet size. The oil tanker will have a capacity of 320,000 tonnes. It is the fourth tanker to be delivered to KOTC as part of an US$800mn contract for six tankers with South Korea. KOTC's chairman Nabil Bouresli added that the company is to finalise another deal before the end of 2011 for nine new tankers which are due to be completed in 2014 and 2015.
Risks To Outlook
The Middle East and North Africa region has seen huge upheavals since the start of 2011, and no country is immune from the repercussions on trade. Kuwait has not been severely hit by unrest, but it is still possible that demonstrations could develop as they have in other Gulf countries, which could adversely affect our port throughput forecasts. We have seen industrial unrest in Kuwaiti ports and airports, more instances of which in 2012 could affect our outlook.
Further potential downside risks to our throughput forecasts come in the form of the exposure to oil price volatility and a slowdown in global demand. Despite the broadly healthy picture of Kuwait's public finances, high reliance on oil, which accounts for 94% of total revenues, exposes the budget and, consequently, trade to oil price volatility.
Contents
Executive SummarySWOT Analysis
Kuwait Freight Transport Industry SWOT
Kuwait Political SWOT
Kuwait Economic SWOT
Kuwait Business Environment SWOT
Industry Trends And Developments
Air And Logistics
Maritime
Market Overview
Global Oil Products Price Outlook
Industry Forecast
Air Freight
Table: Air Freight, 2008-2016
Maritime Freight
Table: Maritime Freight - Throughput, 2008-2016 (‘000 tonnes)
Trade
Table: Trade Overview, 2007-2016
Table: Key Trade Indicators, 2007-2016 (US$mn and % change y-o-y)
Table: Kuwait's Main Import Partners, 2002-2009 (US$mn
Table: Kuwait’s Main Export Partners, 2002-2009 (US$mn)
Political Outlook
Domestic Politics
Long-Term Political Outlook
Macroeconomic Outlook
Company Profiles
Kuwait Airways (Cargo)
Agility
United Arab Shipping Company (UASC)
Country Snapshot: Kuwait Demographic Data
Section 1: Population
Table: Demographic Indicators, 2005-2030
Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education And Healthcare
Table: Education, 2002-2005
Table: Vital Statistics, 2005-2030
Section 3: Labour Market And Spending Power
Table: Employment Indicators, 1997-2006
Table: Consumer Expenditure, 2000-2012
BMI Methodology
How We Generate Our Industry Forecasts
Transport Industry
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