The Port of Salalah, one of the three major ports in Oman, says its post pandemic priorities are focused on developing the local economy, generating employment and stimulating the growth of the Sultanate by offering its Salalah Value Proposition Strategy.

“As we are one of the biggest transshipment hubs in the region, our focus is on helping support the local economy and employment generation by taking the lead role in collaborating with key stakeholders to grow gate volume through our Salalah Value Proposition strategy,” Mark Hardiman, CEO of the Port of Salalah, in Oman, told the Gulf Industry in an exclusive interview.

The long term objective, he said is to actively contribute to Oman’s 2040 vision and objectives and support Oman’s economic diversification strategy.

Hardiman: strategist

“With a business commitment to expand our multi-service port capabilities, we are invested in the nation’s 2040 Vision and continue to play a significant role in diversifying the economy, lifting trade in the region, and contributing actively to Oman’s non-oil GDP,” Hardiman said.

According to him, the port is currently focused on increasing its gate volume by working on offering Salalah Value Proposition as an integrated supply chain solution covering the port, free zone, and the airport to businesses that would benefit from its geographic location, connectivity, access to emerging markets, and favourable business environment.

“This will further stimulate the growth of the Sultanate as a key component of the country’s wider economic development agenda, serving as the optimal location to cater to the changing logistics and manufacturing needs of bringing operations closer to market,” Hardiman.

“Through our proposition we expect to support local and international businesses to overcome some of the potential challenges resulting from supply chain disruptions in the future,” he added.

Elaborating on the strategy, Hardiman said that the port’s next phase of growth includes growing its gate volume and this is expected to be accomplished through three main focus areas: 

* Regional distribution hub for Eastern Africa, Indian Subcontinent, Horn of Africa; 

* Export oriented cluster for target commodity segments who would benefit from our key geographical position;

* Gate way to Yemen.

Port of Salalah: a leading regional gateway port

Last month, the Port of Salalah launched a multimodal transport solution to Al-Mazyunah free zone as part of its regional strategy, aiming to support the growth of SMEs in Oman and Yemen and attract new investors.

Designed to facilitate inland services, the new offering extends beyond the port and includes securing customs clearances and bonded trucking services to Salalah and Al-Mazyunah free zones hubs under carrier haulage.

The initiative, launched in partnership with Maersk, is to ensure seamless cargo movement where the customer gets single window service till final delivery location. This will not only ensure increased efficiency to the customer, but also has the potential to eliminate unexpected costs, including for example line demurrage and port storage, noted the port.

In addition, the partnership offers multiple transport options allowing customers to access Mukalla, Aden and other inland destinations in Yemen.

Salalah, which handles containers, liquid and dry bulk, currently serves large volumes of multiple commodities through Al-Mazyunah free zone.

Port of Salalah: attracting investments

Logistics hub

Strategically located on the trade crossroads between Asia and Europe, and serving the markets of East Africa, the Red Sea, the Indian Subcontinent and the Arabian Gulf – the Port of Salalah is operated by APM Terminals as part of the APM Terminals global terminal network.  The port operates both a container terminal and a general cargo terminal.

“We are one of the leading regional gateway port and transshipment hub on the Arabian Sea and the largest port in Oman, with over 4.3 million containers handled in 2020 annually,” Hardiman said.

According to Hardiman, despite the challenging situation caused by the Covid-19 pandemic, the port finished 2020 with record breaking container volume of 4.34 million TEUs (twenty-foot-equivalent units) and thereby laying a solid foundation for undisrupted operations also in 2021.

The port has also been ranked as the 6th most efficient transshipment port globally in handling container vessels, according to the Container Port Performance Index (CPPI) 2020 released by World Bank and IHS Markit, which analysed the services of 351 ports worldwide.

Peak Performance

Commenting on the port’s growth in 2020, Hardiman admitted that the shipping and maritime industry witnessed immense disruptions and obstacles last year due to the pandemic creating an anticipated supply-demand imbalance and network uncertainties.

“During this time, given it has been even more important than ever to keep supply chains open and to allow maritime trade and cross-border transport to continue, we have worked closely with our shipping line customer and landside customers to support in mitigating some of the negative impacts by accommodating their ad hoc requests,” he noted.

“Our team at Port of Salalah, has been exceptional in responding to meet the challenge with timely actions without compromising our productivity and efficiency. This includes pre-emptive actions to ensure smooth and uninterrupted cargo flows to landside customers and assisting shipping lines to arrive and sail in a timely manner,” he added.

Despite the challenges, the port has continued to record a year-on-year container volume growth of 4 per cent YTD September 2021 for Container volume and 17 per cent growth on General cargo volume for the same period.

“While the trend is expected to continue, we also see a risk due to the unpredictability of the current shipping markets leading to equipment and capacity availability for container business and higher charter rates for container and general cargo ships,” cautioned Hardiman.

Giving reasons what pushed cargo levels to a high point, he said: “As the situation is normalising, we are witnessing a higher demand for consumer goods and restocking by international businesses. Markets have started to re-open, and production schedules are ramping up after work was interrupted during the pandemic.  However, the local import/export businesses have been adversely impacted because of the soaring ocean freight rates and equipment and space shortages which has affected local shippers negatively.”

Meanwhile, in order to boost operational efficiency and productivity and to strengthen HSE standards at the port and the free zone, the port’s CEO said improvements in efficiencies and productivity is a continuous process at Port of Salalah, drawing in on the new way of working adopted by APM Terminals globally it has e adopted the lean methodology in our operations.

“We have been exploring ways to optimise operational efficiencies within the port and to improve our customer experience by empowering our colleagues through improved problem-solving skills and process improvements,” he said.

This also includes productivity improvements for faster turnaround of ships to small marginal improvements for e.g. Customer inquiries are now streamlined through a Single point of contact. This was developed as part of a Kaizen, part of Lean methodology. Customers now can send their inquiries, complaints, requests to an email address with faster turnaround of responses which is monitored for timely closure including rating us every time.

Also, safety remains to be the port’s top priority, he said “… and we consider this as our license to operate. We constantly work towards improving our safety performance with regular awareness sessions and training and continually implementing best practices and industry standards to improve the terminal’s Health, Safety, and Environment performance.”

As part of this, the port has created around 400+ lean practitioners to date amongst its employees. “We are committed to training more of our employees making them capable of identifying improvement areas and solving it themselves using their newly acquired skills. This will be significant in transforming our way of working by adopting a standardized working and robust performance plan to serve our customers efficiently,” the CEO said.

All along, the company has been focusing on digital interventions to enhance its multi-port capabilities and upgrade its service portfolio with new equipment and the introduction of digital automation for future industry demands. “While we are upgrading the terminal equipment as we speak with significant investments underway, we are also in active discussions with the government on infrastructure development for future capacity expansions,” Hardiman said.

Summing up the port’s contribution to the Oman market, Hardiman said that connectivity is one of the core foundations for economic growth, amongst other elements, as it helps attract investments. Oman has had one of the best connectivity index growths amongst the regional ports at 144 per cent. During this time, Port of Salalah’s connectivity index grew 155 per cent, which has been more than Oman’s average connectivity index growth, pointing to the fact that Port of Salalah de facto influences Oman’s overall container connectivity. This has augmented a local exports and imports growth by around 70 per cent in the past five years, making it more attractive for future investments and development, which also highlights the significant untapped potential growth that is left untapped, he noted.

Going forward, Hardiman said the port is working on some ‘ambitious plans’ which are currently on track and will be revealed in due course of time.