Tunisia’s transport sector is set to receive a boost of attention as the new airport at Enfidha, a hour’s drive from the capital Tunis, is set to start operations.

The new infrastructure is set to galvanise foreign investment in industry as well as help the country better manage its tourism influx.

Initially expected to cost TD500m (€267m), the much-anticipated aiport ended up with a total cost of TD850m (€453m), according to media reports. Nonetheless, the structure represents a strategic development for the Tunisian economy. The turnover from the new Enfidha Airport is expected to reach €46m per year.

The airport is expected to handle about 7m passengers a year, and is conviniently located to serve the two important tourist areas of Sousse and Hammamet. Tepe Akfen Ventures (TAV), the turkish operator that will manage the new Enfidha Airport, will also manage the Monastir airport.

The finalisation of the project is already having an impact on the development of adjacent areas. The new industrial park at Enfidha will greatly benefit from the opening of the airport.

“Since the start, the industrial zone was conceptualised based on its proximity to the Enfidha airport. So the interest of our industrial park is largely increased by the conclusion of the project,” Isnardo Carta, the president and director-general of Développement Industriel Enfidha Tunisie (Diet), the industrial park at Enfidha, told OBG. “We have asked authorities to start with the second phase of the project, to begin development and commercialisation of the plots in the adjacent area, because the first phase of the industrial park has been practically filled.”

Other aspects of the air transport sector are being upgraded. With an increasing number of tourist flights being directed towards Tunisia, the country is also upgrading its air control systems. Spain-based IT provider Indra will fulfill a contract worth over €10m to help the Tunisian Office de l’Aviation Civile et des Aéroports (OACA) double its air traffic management capacity.

Three new radar stations will be added to the Tunis-Carthage Airport, in order to help with long-distance flights from Europe to Africa. Additionally, the same revamping eyes the creation of a new control centre on the island of Djerba, one of Tunisia’s main tourist destinations. This will increase the airport’s work span, allowing for landings even during unstable weather.

Development of marine transport is also a priority. Tunisia is strategically located at the centre of the Mediterranean, between Africa and Europe, but some of its port infrastructure is fast becoming outdated. Existing infrastructure limits Tunisia’s capability to handle sea cargo, as 50% of the world sea-transport fleet will be unable to access Tunisian ports by 2010 because of increasing vessel size, according to media reports.

However, Enfidha will receive a new port. The current port infrastructure is only equipped to handle ships laden with up to 25,000 tonnes, but logistical expansion will allow it to receive 80,000-tonne cargos. The Ministry of Transport also wants Tunisia’s maritime fleet to increase its participation in the country’s freight traffic, from the current 9% to 20% by 2016, local media reported.

The government is also looking at ways to enhance the country’s transport systems using IT. By 2011, Tunisia aims to have an electronic ticketing and payment system for the train network and Tunis trams, local media reported. This will also allow users to recharge transport tickets trough mobile phones.

Infrastructural and transport projects are also seen as a way to increase employment and fuel the local economy. Tunisia has increased state-led investment this year as a countermeasure to recession in European economies, which affected demand for its exports and services. It plans a 5.4% rise in state investment in 2010.

Improvement to its transport infrastrcture will allow Tunisia to have a more competitive economic expansion, but in order to to allow this to reach all sectors of the population, further development of road networks conecting the coastal areas with the interior of the country is also essential.

Qatar’s multibillion-dollar programme of expanding the country’s transport infrastructure is gathering pace.

With a firm opening date set for the Doha’s new airport, tenders called for the first stage of a rail link and plans to revamp the public bus service all announced in recent weeks.

Quite apart from the conventional reasons for building new transport infrastructure, such as meeting the needs of a rapidly expanding economy and boosting tourism, Qatar has other, more athletic goals in its sights.

The country is looking to improve its overall transport grid as part of its campaign to be granted the rights to host the Olympic Games. Having not been successful in bidding for the 2016 games, Qatar has put itself into the running for the Olympiad of 2020. It has also kicked off a campaign to stage the 2022 World Cup, the second-largest event on the global sporting calendar.

While the requirement of providing the necessary stadiums and facilities to host the games are of paramount importance when both the International Olympic Committee and FIFA make their decisions, the ability to be able to move fans, officials and competitors in and out of the host country and then between hotels and venues is also crucial.

Qatar has been working to build up an impressive resume of sporting events hosted, including the 2006 Asian Games and the recent friendly football match between Brazil and Britain. Of course, events such as the World Cup or the Olympics draw far more spectators and competitors than a single match or a regiona

l sports meet. Nevertheless, the Qatari Olympic Committee used the success of past events, and the vast expansion of the country’s transport network, in its pitch for the 2016 games.

The jewel in the crown of the transportation programme is the $14bn New Doha International Airport (NDIA), which is scheduled to start receiving flights in mid-2011. The first two stages of the project, which will be completed concurrently, will see the airport have a passenger-handling capacity of 24m a year, a figure set to double as subsequent stages are finished.

The airport is also intended to serve as a major air freight hub, with a capacity to handle 1.4m tonnes of cargo annually. This compares to the 466,600 tonnes handled at the existing Doha airport in 2008.

It is not just air travel that has been the subject of massive investments though. In late October, Qatari officials unveiled plans to radically reduce the county’s dependence on the automobile for domestic transport, releasing details of a proposed system that will combine rail and an advanced public bus service.

The rail component of the plan includes a 180-km long link connecting Doha with the Bahraini capital Manama, the line crossing the yet-to-be-built 40-km causeway between the two countries and another line running from NDIA to the Saudi border. There will also be 325 km of dedicated freight lines and four metro lines with a total length of 292 km, which will be served by 172 trains stopping at 69 stations.

One step in this process has already been taken, with five consortiums submitting bids in early November for a tender to construct a railway station at NDIA.

State transport firm Mowasalat is carrying out another part of the project. The company is conducting a feasibility study into implementing a bus rapid transit (BRT) system, which would see a series of centralised bus stations built, special bus lanes set aside on main traffic routes and a major increase in the numbers of buses and frequency of services.

The BRT system would be integrated with the metro and long-distance rail grids, putting in place a land-based transport network operating at local, national and international levels.

Again, there is a sporting link, with plans for both the BRT and the metro to be completed and ready to serve all major stadiums should Doha win the rights to stage either the 2020 Olympics or the World Cup two years later.

Whatever the outcome of Qatar’s bids for the world’s two premier sporting events, it will have an international-class transport network, one which some estimates say has a price tag of well over $21bn. Though seemingly high, this investment should equip the Qatari economy to play in the top flight.

UAE-based budget carrier Air Arabia, the Arab world’s largest listed carrier, announced its intentions to build a new hub in Egypt that would offer connections to Europe, Africa and the Middle East, one month after formalizing a partnership with Egypt’s Travco Group, the Middle East’s largest travel and hospitality group.

“At a time when the global aviation industry is witnessing serious challenges as a consequence of the worldwide financial crisis, we continue to move forward with our strategic expansion strategy, as demonstrated by this important announcement,” said Air Arabia Chairman Sheikh Abdullah Bin Mohammed Al Thani.

Despite the airline industry’s overall close historical correlation with broad market indices, “budget travel” represents an industry subgroup that, from an investment standpoint, can be as good a defensive play as any medical and consumer product company, brewery or tobacco firm.  Air Arabia may be a case in point, having been named the best low-cost carrier globally in a study conducted by Aviation Week magazine earlier this year.  Its gross  (20.31%) and EBITDA (16.94%) margins are leaders in the industry, as is its 3.1 quick ratio.

The company’s net profit for the first half of this year stood at AED 193 million, an increase of 21% from the first six months of last year.  Moreover, during the first half of 2009, the company registered a turnover of AED 922 million, up 6% from the first half of 2008.  Finally, its “average seat load factor,” which measures passengers carried as a percentage of available seats, was 80% for the first half of 2009.

However, those numbers dampened afterwards on the back of excess capacity diluting yields, and it remains to be seen whether or not Air Arabia will stand up to both economic and intra-industry pressure.  According to its CEO, Adel Ali, Middle East airlines are suffering disproportionately from yield dilution than carriers in other regions worldwide, due to excess capacity as a result of strong aircraft ordering, new market entry and the global economic downturn.

“There has been an 18% yield dilution in the Middle East basically because the capacity is more than the demand at the moment because of the recession.  This is more severe than the global average yield dilution of 12%”.  In the Middle East, the demand is growing, but not as fast as the capacity is growing.  Also because demand is growing, it becomes an attractive place for other GCC carriers and international carriers,” he told reporters.

Forecasts of three analysts for Air Arabia’s third-quarter profit ranged from AED 110 million to 129 million in a Reuters survey earlier in October.  And the airline also faces increased competition from local rivals, such as Kuwait’s Jazeera Airways and Dubai-owned flydubai.