A large spike in petrochemical trade is expected occur in the upcoming few years, which will coincide with the completion of the first inter-Gulf railway network, according to the Gulf Petrochemicals and Chemicals Association (GPCA).
The railway is said to be completed in the next four years and will cost approximately $200 billion. The Gulf Co-operation Council (GCC) railway will link the six Gulf countries, which will allow speedy travel by land.
In addition, plans to include other nations, such as Jordan and Iraq are being discussed and may be implemented once the railway has successfully connected the GCC nations.
As the petrochemical industry is a largely export-based industry, it is predicted that this new mode of transportation will facilitate a dramatic increase in trade.The GPCA reported that a total of 6.2 per cent of all exports occurred between Gulf nations.
Dr Abdulwahab Al-Sadoun, secretary general of the GPCA, says: “Railways will similarly have a positive effect on the intra-regional petrochemicals supply chain as it will enhance cross-border trade within the Gulf region, while minimising the risk of transporting chemicals across long distances.”
In addition, figures reveal that in 2012, 60.7 million tons of petrochemicals produced in the region were exported to distant nations, such as the China, the EU and North America.
While the railway still needs four years to reach completion, trade boosts are still expected to reveal themselves in the not-so-distant future. “The GCC railway network will enable the region’s petrochemical companies to optimise their supply chains,” explains Dr Al-Sadoun.
The GCPA has stated that they believe that the Gulf region as a whole will be less reliant on petrochemical trade post-2020. Industries such as aviation, food and beverages and urban planning are predicted to gain momentum with increased exposure. Exports from these industries are expected to spike as well.
Thursday, April 24- 2014 @ 9:57 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.