Strategy and launch of a logistics-focused Free Zone for a Middle East government

A government in the Middle East was challenged by a lack of oil reserves and stagnant economic growth. The government was already building a state-of-the-art seaport destined to become a trans-shipment hub for the large volume of traffic crossing the area, but wanted to use the location to further advantage.

Challenge
The government had a plot of land surrounding the port, which it wished to turn into a Free Zone, capable of attracting port-related businesses that would provide skilled jobs to the local population. A.T. Kearney was asked to help develop the strategy and implementation plan for the Free Zone – with the stipulation that the total project, from concept to inauguration, be completed in the challenging timeframe of just 18 months.

Approach
Working with the client, the team developed criteria to determine the types of businesses that would be best targeted, based on macro-economic and trade-related data. The analysis supported the Free Zone’s focus on freight forwarding, value-added logistics and light manufacturing. Subsequently, the team created a business case for private sector operations in the Free Zone. Additionally, they scoured best international practices to establish solid governance principles for the Free Zone and provided a legal framework to bolster the business strategy. After A.T. Kearney drafted a detailed implementation plan covering all 18 months, the government invited the team to continue supporting them by updating the business plan, detailing operations (processes and procedures, organizational chart, resourcing plan, financial model), and supervising their initial marketing and business development activities.

Results
With A.T. Kearney’s help, the Middle East government signed a Memoranda of Understanding with anchor tenants for the Free Zone and sold out all of its available real estate, establishing the new zone as a serious logistics alternative in the Middle East.

Contact

For more information, contact Dirk Buchta.

For more information, contact Robert Ziegler.