Arabian Port Gains Investment in a New Container Terminal from a Top Shipping Industry Player

UAE – Continuing its policy of diversification within the logistics industry French group CMA CGM, which has roots firmly planted in the shipping sector, and particularly container traffic, has signed a 35 year concession agreement with the AD Ports Group for the establishment and management of a new terminal in the region.

Under the terms of the agreement, the new terminal will be established in Khalifa Port, the first semi-automated container port in the GCC region and managed by a joint venture owned by CMA CGM’s subsidiary CMA Terminals (with a 70% stake) and AD Ports Group holding the balance

The partners are expected to commit approximately $154 million to the project and, with construction starting in 2021, the new terminal is set to be handed over in 2024. Phase One is to have an initial quay length of 800 metres and an estimated annual capacity of 1.8 million TEUs. AD Ports Group will be responsible for developing a wide range of supporting marine works and infrastructure.

This development to include up to a total of 1,200 metres of quay wall, a 3,800-metre breakwater, a fully built-out rail platform, and 700,000 m² of terminal yard. The terminal will provide CMA CGM with a new regional hub and will thus enable the Group to develop its service offering between Abu Dhabi and South Asia, Western Asia, East Africa, Europe and the Mediterranean as well as the Middle East and the Indian sub-continent. Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, said:

“The ambitious project we are launching in Abu Dhabi marks an important milestone in CMA CGM’s development strategy in the region. This state-of-the-art terminal will contribute to enhancing Khalifa Port’s position as a leading global hub and to boosting the region's economy, accelerating trade flows in and out of Abu Dhabi. It will also enable our Group to expand its shipping and logistics network in the region, where we see a lot of growth potential.”

The French group is the third of the world’s top-four shipping entities to join forces with the Abu Dhabi facilitator of trade, logistics and industry MSC and COSCO having already committed. The agreement confirms Khalifa Port’s standing as one of only a few major ports in the world providing hubs for three of the world’s top shipping lines, as well as serving as an instrumental part of the global maritime trade connecting markets from east to west. H.E. Falah Mohammed Al Ahbabi, Chairman of AD Ports Group commented:

“One of the key factors that has greatly contributed to the economic growth of Abu Dhabi and the UAE has been our stable economic environment that is ripe for foreign investment. Coupled with competitive free zone and business engagement initiatives that aid foreign businesses in establishing a presence in the country with ease, the UAE has become a key investment destination among many of the world’s leading players seeking to extend their reach into the Middle East.

“This landmark agreement with the CMA CGM Group is a prime example of those continued efforts and one that will significantly accelerate trade and the development of industry in the UAE and beyond. As well as driving increased trade volumes through our port and elevating the UAE’s economic development, we expect the facility’s capacity and added trade links with other high-profile port destinations will drive investment into local businesses and our industrial zones, fast-track the development of key sectors including manufacturing and logistics, and raise demand for manpower.

“This agreement will aid us to realise our long-term ambitions to become a top 10 ports, industrial, and logistics operator by expanding our capacity and growth across the region and beyond. In all, we project that over the next five years the CMA Terminals joint venture will drive the further development of the Khalifa Industrial Zone Abu Dhabi (KIZAD), while simultaneously contributing significantly to the national GDP.”

Photo: H.H. Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, Member of Abu Dhabi Executive Council and Chairman of Abu Dhabi Executive Office, meets with officials from AD Ports Group and CMA CGM Group to witness the signing of a concession agreement between them.