(MENAFN- The Peninsula) Powered by Qatar's huge investments in the infrastructure and transportation sectors, Qatar's logistics industry is set to grow in a big way. The existing roughly estimated $150m business is expected to grow manifold in the next two-five years, according to a market leader.
The growth prediction is based on Qatar's commitment to carry out huge projects in a time-bound manner.
"The sheer size of infrastructure projects in Qatar demands the establishment of a world-class logistics set up. With over 32 major projects having been launched in Qatar, and many other in pipeline, the logistic sector is poised for a major growth trajectory," Ali bin Abdulatif Al Misnad (pictured), President, Qatar Association of Freight and Logistics (QAFL) told The Peninsula yesterday.
Qatar has already set aside $150bn for infrastructure projects over the next 10 years.
In 2012 alone $4.2bn worth of contracts has been awarded. The government is also working on the development of several key projects such as new international airport, new sea port.
It is developing hundreds of kilometres of roads at a cost of $4.4bn. Another $11bn contracts is in the tender phase. The preliminary works of $35bn project is fast picking up, said Ali Al Misnad, who is also the CEO of Al Baida Group, a 100 percent Qatari company and the leading market player in the sector.
Qatar's decision to develop more free market zones is expected to further push the growth prospects for the country's logistic sector.
The growth of logistics industry is closely connected to the economic cycle of the local economy. When the economic activity picks up, demand for transport and logistics services also picks up.
Logistics Industry's growth is a key economic indicator of a matured economy. The sector accounts for one of the key contributors to the growth story of local economy, he noted.
Qatar's emerging logistics industry is expected to see the entry of great professional players in the coming years.
The continued growth of this sector is set to increase demand for material handling equipment and solutions to improve the efficiency of loading and unloading and storing goods.
All this is taking place against the backdrop of the continued growth of the Qatari economy. "You cannot launch huge projects without the expertise of real professionals".
One of the key challenges faced by the Qatar's logistics industry, according to Ali Al Misnad, is the steady hike in the rentals of warehouses. "This is an issue to be addressed. The rentals have gone up something between 15 to 20 percent over the last three years, hitting the operation cost of logistics companies."
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