However, it also points to the size of the challenges MENA countries face in building cross-border transport systems capable of serving the region's burgeoning population and the demands of business and leisure travellers. Transport is a major economic sector, accounting for 5-15% of GDP, depending on metrics used. It is key to driving the extra trade and development that MENA countries need, but that kind of investment raises environmental issues too.
Roads are a tricky area. They can outshine other transport modes as drivers of development, even though accessibility to good roads remains a challenge for many areas. In 2004, some 80% of rural dwellers in the relatively more urbanised Gulf countries had access to an all-season road within 2 km of their homes, according to the World Bank's rural access index. For Tunisia the figure was less than half that, at only 36%. No surprise, then, that several countries, including Morocco, are now working with the World Bank or setting up public-private partnerships to improve their rural road networks.
Roads are not cheap. Apart from construction, there are maintenance costs to consider. Good road surfaces save fuel costs and help the environment while saving vehicles from unnecessary damage due to potholes. But maintenance budgets in MENA countries aren't always sufficient.
Until 2007, Egypt only spent an equivalent of 0.05% of GDP on road maintenance; today this amount has tripled to 0.15%. Morocco spends 0.20% of its GDP on road maintenance. The equivalent for a developed country such as the US is 0.30%. Nor do roads cure all transport ills. In cities, they can bring another set of challenges, led by congestion and pollution. In high-density Greater Cairo some firms encourage their employees to work from home rather than lose hours in traffic. In Dubai a 2007-2008 study revealed higher than average transport pollution, citing vehicle density and high emissions per vehicle as causes. Both cities have built metro systems to try to relieve the congestion.
Getting on track
Rail solutions, be they urban or regional, are attracting new attention in MENA, as in other regions, for their economic and environmental benefits. Emissions from road transport are one of the main contributors to the build-up of greenhouse gases in the atmosphere. Railways offer substantial savings of as much as a third on energy use and even larger reductions in CO2 emissions when used in combination with road transport. In short, climate change is also changing the economics of long-distance highway projects in favour of incorporating some rail component, both for people and freight.
Rail is also safer than roads. Road fatalities and accidents are a major economic cost and now considered a leading health issue by the World Health Organization. Road fatalities in some MENA countries are close to the average for OECD countries of around 10 deaths per 100,000 people, but a few, such as Libya, Oman and Saudi Arabia, record well above 20 deaths per 100,000.
The MENA region is reasonably well-endowed with railway track. Morocco and Tunisia, for example, have some 2,000 km of existing track; Algeria 3,500 km of track, and Egypt has about 5,000 km. For comparison with OECD countries, Portugal has some 3,000 km of track and France 30,000 km, while the US track length easily outstrips any other member country, at 225,000 km.
A closer look shows there is work to be done if rail is to become an infrastructure component capable of supporting progress and development in the MENA region. Many networks have fallen victim to underinvestment over the past 50 years, some have been abandoned: Libya, for example, no longer has a functioning rail service at all.
Where rail services exist, for freight and passengers, they are generally inefficient or underused. In Egypt, for example, only 3% of freight is transported by rail, compared with 14% in France. While some countries ship some raw materials by train, they could ship more manufactured goods too.
This is changing, however, with Morocco among the leaders. Until recently, phosphates represented some 80% of the freight moved by train there. Morocco is the world's third largest producer of phosphate rock, behind the US and China. Two years ago, a €288 million rail line was opened connecting the container port of Tanger-Med to the national network some 45 km away. Freight capacity is slated to reach 8.5 million containers by 2015.
Saudi Arabia has also taken to trains. It is investing US$2.8 billion in a 2,400 km north-south railway project whose new track, scheduled to be fully operational by 2013, will stretch from Jedda, the capital, to the Jordanian border and from the phosphate mines of Al Jalamid and the bauxite mines of Al Zubairah to the Arabian Gulf.
Passenger services also need serious attention. Whether by track per person or rail travel per passenger, the MENA region lags behind. Some countries are taking action to rehabilitate networks or improve travel times. Egypt is focusing on rehabilitating existing routes, with assistance from the World Bank, while Morocco is planning a high-speed rail line between Tangier and Casablanca for 2013 with the help of a consortium led by France's TGV builders, Alstom.
High-speed rail could be a boon to linking MENA cities in the future, but to improve service, expand rail access more widely and bring in investment, various other policy measures could be considered too, such as separating networks from operations, improving management incentives, and even introducing competition on busy routes.
Though road and rail offer great potential for investment and development within and between neighbouring countries, policymakers are looking to the skies to lift the MENA region as a whole and respond to business and tourist demands.
Nowadays, countries in the MENA area claim some of the best airports and airlines in the world. In less than 50 years, Dubai has become the world's 11th largest freight airport, handling 1.8 million tonnes of goods per year, and the world's 20th largest passenger airport, with 37 million passengers pouring through its terminals each year. Now UAE is building the Dubai World Central International Airport, which will have an annual cargo capacity of 12 million tonnes, more than three times that of Memphis in the US, today's largest cargo hub by weight, and a passenger capacity of more than 120 million, almost 50% more than Atlanta, now the world's busiest passenger airport. The airport is scheduled to be fully operational by 2017.
The UAE also boasts a successful airline: Emirates ranks among the top ten airlines in the world in terms of revenue and passenger kilometres. Jordan has used a public-private partnership to develop its Queen Alia International Airport. Airport International Group operates the airport and pays a concession fee of some 50% of general revenues. The partnership plans to open a new, US$750 million terminal in 2012 to handle 9 million passengers.
However, the skies have been cloudier on most other fronts. For the region as a whole, air transport connectivity is low, with most airports underserved in terms of networks and flights. Domestic air travel has been hampered by monopolistic national carriers, and by high take-off and landing fees, making it hard to provide competitive services and harder still to control costs. Again, opening up air space to competition could help address these problems. Lowcost carriers have started to provide services, particularly in the Gulf countries. Though they are not without their detractors and demand good regulation, they can help bring down costs and improve access for remote areas and smaller towns.
Facing transport problems is not a new challenge for the MENA region, whose ancient history is steeped in great adventures by land and by sea. Consider the medieval Moroccan geographer, Ibn Battuta, who left his country in 1325 and didn't return until nearly 30 years later, after having visited the lands of every Muslim ruler at the time and travelling as far afield as China and the Maldives. In all, he clocked more than 120,000 km, most of it by sea.
If Ibn Battuta returned today, he would be impressed by the region's state-of-the-art deep ports and dry docks, entrepôts and coastal economic zones. But though the region's coastline is long, there are relatively few large ports handling international trade. Those that do, vary in efficiency. Yet efficient port infrastructure can make a huge difference in shipping costs, as port handling accounts for about 40% of the total sea freight costs.
Not that the region is without its stars. According to the American Association of Port Authorities, Dubai ranked 8th for container handling in 2007, while other MENA container ports making the top 50 were Jeddah (33rd), Port Said (37th), Mina Raysut in Oman (38th) and Sharjah in the Emirates (50th). Dubai also excels at seaport management, and DP World in Dubai is now the world's third biggest port operator, with $3.3 billion in revenues and handling 27 million TEU (twenty-foot equivalent units). It also operates MENA's two biggest container ports and recently signed a 30-year concession to operate the port of Algiers.
The UAE's Jebel Ali hums along at 110 containers per hour and Alexandria in Egypt handles some 60 containers per hour. Egypt recently turned over management of operations at Port Said and Damietta to French giant CMA-CGM.
But a port is only as good as the road and rail network connecting it to the rest of the country. Some countries use dry ports, terminals situated in the interior linked by a high-capacity rail network to the maritime port, to bypass road congestion in and around big cities. Egypt, for example, opened a dry port in Sixth of October City, near Cairo, with rail access to coastal cities.
One area where port productivity could improve is in the simplification of importexport procedures. Establishing one-stop shops is a major objective. Egypt is testing one in the Suez Economic Zone, and in Morocco, the national port regulator is implementing a computerised system for a one-stop shop at Casablanca.
This cutting-edge approach would yield benefits if applied to transport development across the MENA region. Technology is still underused in travel services generally. For example, just 1% of ticket sales in MENA are made online, versus 15% in Asia/Pacific and 27% in Europe, a situation that consultants Booz Allen ascribe partly to low penetration of information technology and credit cards, as well as cultural preferences for human interaction. The region's airlines could do more to apply modernising technology, such as e-ticketing and self-checking baggage handling too.
Joining the dots across so many diverse countries is not easy, and technology applications could hold the key to resolving many transport challenges, from managing congestion and shipping to planning new track and roads in light of economic, social and environmental impacts. They would yield clear cost savings for passengers and firms too. The result would be a more effective transport infrastructure, more trade and development, and a stronger, more integrated MENA region. Ibn Battuta would certainly support that. Michael Fodor, Alain Paic
"More than meets the ice", OECD Observer No 267 May-June 2008
"Public-Private Partnerships Mooted to Boost MENA Travel and Tourism Infrastructure", 2007, at www.boozallen.com
© OECD Observer, No. 275, November 2009