The UAE government has planned its economy and growth in a very detailed manner. The government supports different industries to ensure the diversification of its economy. UAE has different industries such as shipping, aviation, oil and gas, automobile manufacturing, construction, and tourism contributing to the economy significantly. The growth of all these industries is inter-connected and especially the growth of the aviation sector has proven vital to the overall development of the country.
The aviation industry in the country has defied all slowdown projections and is on its way to becoming a major economic contributor by 2037. The industry is currently responsible for 13.3 percent of the UAE’s GDP. Out of the different types of air transport, air cargo has been gaining significance in the last few decades. Air cargo is expected to elevate the UAE’s position in the logistics market quite significantly.
Let us discuss the importance of air cargo services in the UAE in detail for better understanding.
- Job Creation
As per the International Air transport association, the first and biggest impact of air cargo services on the UAE economy and the global economy has been through employment creation. The air travel industry is one of the largest employers in the country. As a direct impact by the employees of different companies, the industry contributes to 180000 jobs in 2017 in the UAE alone. Though this is by the whole industry, air cargo is a major part of it. Also, through the supply chain, these 1.8 lakh jobs have further contributed to employment opportunities to the tune of 1.2 lakh jobs in allied industries. These allied industries include airport operators, restaurants, on-site retail services, and navigation services. This industry is currently on a steep growth curve and slated for 170 percent growth by the year 2037. Even if the travel industry slows down, other essential cargo services and trade requirements are going to keep it going.
- Foreign Trade
In the past few decades, UAE has become a hub for import/export trade. The country has become a favored spot for manufacturers and buyers for all their trade requirements. This has been facilitated due to the ease with which goods can be moved in and outside of the country. UAE and Dubai especially have gained fame all over the world for their excellent connectivity for goods movements. Major automobile, chemical, and construction material manufacturers have seen a rise in demand for their products from neighboring countries as a result of UAE’s air cargo services. A well-operated air cargo service can uplift the volume of foreign trade in a country very easily. This is because even though it is expensive compared to other modes of transport, it makes it up in faster delivery time, safer delivery methods, and limitation-less shipping. You can easily ship sensitive and perishable items using air cargo.
Dubai is today the world’s most connected cosmopolitan city. The UAE is itself well-connected to the whole world and operates some of the busiest airports. Air cargo services are a major part of the aviation industry. Any downtime the industry sees due to a dip in tourism or spending power is easily managed by the air cargo division. To maintain connectivity to the world, air cargo services are very important. Right from mail to imported goods, air cargo makes it happen without any delays or damages. This connectivity also helps other industries in the UAE open up their business opportunities. Flourishing air cargo services allow manufacturers and traders in the country to export their products to various parts of the world. Air cargo services also connect the country to the world’s best products and services.
- Emergency Services
This importance of air cargo service has been highlighted quite well in the last few months during the coronavirus epidemic. Air cargo services have traditionally been a huge part of humanitarian aid all over the world in all times of distress. Being the fastest way of shipping essential goods, they have helped many countries over the past few decades. In the UAE, air cargo services have played a major role in transporting Covid-19 test kits, medicines, and other essential supplies from different parts of the world to the country. In the past as well, air cargo has been the preferred mode of transport due to efficiency, quicker turnaround time, more capacity, and easy access to remote places. As the world goes through one of the most testing times, this industry is going to play a very important role in recovery and fight against the pandemic.
- Food Security
The issue of food security has been paramount in the country for many decades now. Due to the nature of the land, it has been quite difficult for the country to be self- sustainable with their agricultural efforts. One of the major steps taken to combat the issue of food security by the government is to improve the food import industry. Food import is one of the most difficult trades out there. Due to the nature of the commodity, it can only be done by air. Air cargo services play a huge role in ensuring that food items such as vegetables, fruits, grains, and nuts are transported from different parts of the world to the UAE. Without a proper air cargo service provider, this would be impossible. Distributors in the UAE have a huge advantage due to the frequent air cargo services from the UAE to different parts of the world which allows them to source these items easily. The cost also significantly comes down as there are no separate logistic services set up for this industry alone.
Air travel has always been under scrutiny from other transport players due to the low-margin nature of the business. The aviation industry is also considered to be highly fickle as it depends on the tourism industry a lot. One of the few subsets of this industry to overcome all these barriers and transform into a successful vertical is the air cargo industry. It is now considered to be an essential service and as the world trade flourishes under globalization it will continue to grow. The air cargo industry has the potential to offset all the issues that air travel has faced to date.