GCC countries need to adopt a structured technology adoption framework to overcome current challenges facing their transportation systems, according to a recent study by management consultancy, Strategy& (formerly Booz & Company).
The GCC transportation system is currently facing three main challenges, firstly as oil prices continue to decline, GCC governments are cutting investments and can no longer justify spending freely on transportation infrastructure projects, secondly the region suffers from significantly higher rates of death from road accidents than international benchmark leading to economic losses equivalent to 2.5% to 4.5% of the GDP among GCC states including non-fatalities, and lastly transportation carries steep environmental costs with emissions levels far higher than the world average of 1.03 tons of carbon dioxide per capita.
Commenting on these challenges, Dr Ulrich Kögler, partner at Strategy& in Dubai, said: Innovative new technologies including autonomous vehicles, electric cars, drones, and traffic management systems develop at unprecedented speed and are already allowing for the possibility of a smarter, safer, less expensive and more accessible transportation system coveted by governments around the world.
As the GCC population grows and urbanisation continues, governments have little choice but to upgrade their transportation systems. The wealth of existing and emerging new technologies can significantly help facilitate this process. Dubai is already taking measures to adopt more technologies into its transportation infrastructure, having recently announced plans to convert 25% of the emirates total number of passenger trips to autonomous by 2030.
Another key area that technology enabled transportation systems will support towards is substantially reducing the environmental costs and car emissions. In a bid to reduce car emissions, automobile manufacturers are making huge strides in electric powertrains; such cars could comprise 25% to 50% of the overall market by 2040, according to Bloomberg. GCC governments should prepare the ground for the wide adoption of electric cars, incentivise their use, and potentially even build a local industry around electric vehicles.
Commenting on the importance of adopting such a framework, Camil Tahan, Principal with Strategy& said: Technology offers GCC governments a means to not only address some of the most pressing fiscal, safety, environmental and accessibility challenges they face, but also build a state of the art transportation and logistics sector that can propel regional economies into the future and create significant employment opportunities.