Global maritime terminal operator DP World’s port-centric logistics model is transforming infrastructure worldwide. Vision speaks to Director of Corporate Strategy Ayesha Sultan Al Junaidy about connecting the international supply chain for the 21st century, and of the growing opportunities for women in the industry
Robust infrastructure is a key driver for sustainable economic development world-wide. One company spearheading global logistics initiatives, through its infrastruc-ture development, is maritime terminal operator DP World. The company has a portfolio of more than 65 marine terminals across six continents, including new developments underway in India, Africa, Europe, South America and the Middle East. One of DP World’s biggest develop-ments, the London Gateway project, is set to open in the fourth quarter of this year.
“It’s the UK’s first, 21st-century, major deep-sea container port and Europe’s largest logistics park,” says Ayesha Sultan Al Junaidy, Director of Corporate Strategy at DP World. “In June [UK] Prime Minister David Cameron visited the project to view construction progress and retailer Marks & Spencer announced its intention to build a £200m (US$310m) warehouse distribution centre there.”
Located 25 miles from London, DP World estimates that London Gateway will reduce carbon emissions by more than 148,000 tonnes annually by removing 2,000 heavy goods vehicles from the UK’s roads each day. The project will create approximately 36,000 jobs in the coming years, with DP World also forecast to contribute £3.2bn (US$5bn) to the UK’s GDP per annum, according to Oxford Economics.
DP World London Gateway is a prime example of DP World’s role in port-centric logistics solutions. The project is adjacent to what will be the largest rail-connected logistics park development in Europe, spanning more than nine million square feet, with 15 million consumers located within 80 kilometres of the site.
“A port-centric logistical model, can be defined as a distribution centre that is located at a port, as opposed to inland, bringing companies closer to the markets they serve and decreasing freight miles,” says Al Junaidy. “Any steps that can reduce the number of miles in a supply chain – that often starts in Asia and finishes far from its source – will reduce time and costs for business and consumer alike, and help the environment.”
Catering to customer demand for seamless trade, DP World perfected its port-centric logistics model in its home market of the UAE at Jebel Ali. “In Dubai, multi-modalism is king,” says Al Junaidy. “The Dubai Logistics Corridor (DLC) is a connectivity model that links sea, road and air, and connects Jebel Ali Port with the Jebel Ali Free Zone (Jafza) and the new Dubai World Central Al Maktoum International Airport. The DLC connects and integrates more than 6,500 comp-anies, providing shippers with a 45-minute link between port and airport, within a custom bonded corridor. Eventually rail will also be included in the DLC, with a link to the Etihad rail network. This mammoth under-taking, of linking sea, road, air, and eventually rail, has reinforced and supported Dubai’s non-oil trade, and cemented its position at the crossroads of world trade routes.”
As the flagship of DP World’s portfolio, Jebel Ali Port, ranked the ninth largest port in the world in 2012, has been built on the success of a port-centric, integrated logistics model, something the group has sought to replicate wherever possible. Over 75 per cent of DP World’s business comes from emerging markets, and that has been a key focus of its strategy. Locations recently benefiting from new harbour-side developments include projects in South America and Africa.
“The most significant shift currently is in traditional trade patterns, from East-West trade in northern hemisphere markets, to East-West trade in southern emerging markets,” says Al Junaidy. “In emerging markets rising income is driving the need for new port infrastructure.”
Across Africa, DP World operates eight marine terminals in Djibouti, Mozambique, Egypt, Algeria and Senegal, as well as stevedoring developments in four South African ports. The company employs more than 5,000 people on the continent and generating local job opportunities remains as much a focus for DP World as easing the passage of goods.
“The complexity of modern logistic networks today means hinterland connect-ivity, and not just ports in isolation, are the focus of attention. In Africa, the supply chain is an expensive and time-consuming challenge, particularly for landlocked countries,” says Al Junaidy. “Transport costs can make up 50 to 75 per cent of the retail price of goods in Malawi, Rwanda and Uganda. In practice, while shipping a car from China to Tanzania on the Indian Ocean coast costs US$4,000, getting it from there to nearby Uganda can cost another US$5,000.”
DP World’s developing market footprint is set to remain and potentially increase. In its August review of global container terminal operators, maritime consultancy Drewry forecasts that the sector will remain dynamic and profitable, with emerging markets expected to perform well.
Brazil, being the largest economy in Latin America, remains an important growth market for DP World. Set to open later this year is Embraport, next to the Port of Santos. Similar projects are also underway from North America to India, with DP World having invested more than US$6bn in the past six years to meet its customers’ requirements and support the development of efficient infrastructure.
DP World also invests in services “beyond the gate” in response to customers seeking greater efficiencies across the whole supply chain. In India, DP World has invested in a container train to improve the connectivity between ports and the hint-erland, says Al Junaidy. “We operate a con-
tainer freight station outside the port gates in Mundra, India and have invested in and operate inland depots in northern Europe and Vancouver, Canada.”
Products that stand to benefit from swifter transportation, and improved hint-erland connectivity, are often life’s necessities. “An innovative approach like the sea-land-air capability of the Dubai Logistics Corridor is useful when transporting high-value food, clothing and medicine, for ex-
ample,” says Al Junaidy. “The supply-chain industry has a crucial role to play in food security and supply. More and more food is being produced, and yet people go hungry, as food goes to waste and prices rise.”
The numbers certainly make for comp-elling reading, with a recent report by the Insti-tution of Mechanical Engineers on global food stating that up to 50 per cent of all food produced worldwide is never consumed. While numerous factors, from poor harvesting to inadequate storage facilities, are cited, lack of infrastructure and hint-erland connectivity also play a big part.
“The cold chain (temperature-controlled supply chain) in India for fresh produce – from farm to domestic or international markets through air or sea ports – leads to an estimated 40 per cent wastage of fruit and vegetables. A similar situation exists in Africa,” says Al Junaidy. “If this were addressed, through connecting the supply chain dots, it would open new markets and help to reduce waste of precious resources.”
When it comes to the means by which the majority of commodities get from A to B, ships carry 90 per cent of the world’s merchandise around the globe. Al Junaidy doesn’t foresee the trend changing any time soon. “The price of oil today means ships are still the most cost-effective mode of transport. The transport and logistics industry accounts for more than a third of the value of global trade and employs over 4.2 million people worldwide. Its social and environmental footprint is sizeable.”
Of the many milestones DP World has reached in its commitment to be greener, in June this year it signed a memorandum of understanding with the Dubai Carbon Centre of Excellence (DCCE). The five-year agreement grants the DCCE access to DP World’s operations, the aim being to identify energy-reduction opportunities for application across the entire organisation.
“Addressing our industry’s impact on the environment is not just the right thing to do, it is also good for business,” says Al Junaidy. “Minimising our use of energy reduces CO2 emissions, and it also reduces costs. DP World’s global operations have achieved a 22 per cent reduction in carbon emissions per box move since 2008. In the UAE, there was a 42 per cent reduction per box move in the same period.”
With the average concession life of its port operations being over 40 years, DP World invests in communities for the long term. Fostering close ties with the comm-unities in which it does business is integral to its corporate responsibility strategy.
“Partnerships play a key role in how we operate and are endemic in everything we do,” says Al Junaidy. “We partner to innovate, recently launching a seed accel-erator programme to encourage innovative entrepreneurship called Turn8. We also partner with global thought leaders on future trends and their impact on our industry, working with World Economic Forum, Said Business School - Oxford University, UK and the Global Agenda Council. And we are excited to be a Premier Partner actively supporting Dubai’s bid to host the World Expo in 2020, under the theme ‘Connecting Minds, Creating the Future’, with Mobility as one of the Expo subthemes. This forum will encourage dialogue and partnership to explore innovation, trends and opportunities in the industry.
“Sustainability of any enterprise depends on partnerships, especially between public and private sectors. And it’s not just for issues directly related to business, but also for issues that have an indirect impact on trade, for example, maritime piracy.”
On her pivotal role within the organ-isation, Al Junaidy considers herself an integrator, bringing business leaders, cust-omers and stakeholders together to engage in strategic discussions on the current landscape, future trends and sector-wide opportunities and challenges.
Al Junaidy completed her university education in the UK at the University of Southampton, graduating with a BSc Joint Honours in Mathematics and French and an MSc in Operational Research, including a term spent working with the European Air Traffic Control. She then joined a management consultancy and worked in the UK and France for clients that included governmental entities, pharmaceutical companies and in the banking sector.
She began working for DP World 10 years ago, at a time when it was growing from being a regional to a global port operator. “I joined at an exciting time, when we were acquiring CSX World Term-inals, and then P&O, leading global container terminal operators. I have worked across the fields of business development and strategy and I completed the leader-ship programme with the Wharton School of the University of Pennsylvania, in the US. DP World is among the top four global port operators and it is a privilege to have the opportunity to work as part of a team of dedicated professionals. It gives me great pride to work for such a large inter-national organisation that has its roots firmly in Dubai, with Jebel Ali, our flagship facility, ranked as the ninth largest port in the world.”
Al Junaidy is a board member of the DP World London Gateway Port and the DP World London Gateway Park boards, and is an Independent Non-Executive Director on the board of TECOM Investments, a subsidiary of Dubai Holding; Chair of its Audit and Risk Committee and Vice Chair of its Executive Human Capital Committee.
As a female executive working in what is a traditionally male industry, Al Junaidy says she is encouraged by the growing opportunities that exist for women. “There are more opportunities being given to women to work in our industry, not only in managerial positions, but also to be more involved in the business, in the operations field, driving quay cranes and managing ports, for example.
“In 2012, DP World hosted the Women’s International Shipping and Trading Assoc-iation at our Jebel Ali Port. International bodies such as the International Maritime Organization have deployed clear strategies to encourage integration of women in the maritime sector. There is also a drive to have more women on company boards.
“At DP World, our human capital team is focused on developing awareness of the opportunities available in the industry, as well as offering support through training and internships.”
Keenly aware of DP World’s potential to contribute to a country’s wealth, build local knowledge, increase competitiveness and encourage foreign direct investment, she also champions the grassroots societal impact. “We are fundamentally part of the communities in which we operate. We have seen first-hand the ways in which efficient infrastructure can transform economies and transform lives,” she says.
“As roads are built, rail connected and efficient sea and air ports established, people, the goods that they produce and the services that they provide are given access to opportunities to connect locally and globally. That is how trade prospers. As people connect through trade, barriers come down and understanding between people grows. This is true of all economies, and for some countries and communities transport and logistics in the form of a working supply chain is quite literally a lifeline.”