x Abu Dhabi, UAESunday 23 July 2017

Rail links must stay on track in Gulf countries

The possibility of a railway network in the Gulf is again being considered after years of being ignored.

Only small sections of the Hejaz Railway in Jordan are still in operation. Salah Malkawi / Gallo Images / Getty Images
Only small sections of the Hejaz Railway in Jordan are still in operation. Salah Malkawi / Gallo Images / Getty Images

Not every significant event is met with a fanfare. For example, reports this month that Union Railway, the UAE company behind the national railway project, had opened bidding on its phase one rolling stock contract made only a modest splash in the local news cycle.

In an age when the UAE is quickly becoming one of the major global hubs for aviation, it is hard to become excited about the local advent of a mode of transport that stems from the 19th century. The indifference to rail in a region that continues to be beguiled by the car is such that, in those places where rail is to be found, it tends to be of the variety once merrily attacked by TE Lawrence. The Hejaz railway station in Damascus is today little more than a book stall. Jordan's only functioning stretches of rail are two old narrow gauge lines, one shuttling phosphate from Ma'an to Aqaba, the other shuttling railway enthusiasts from Amman to the Syrian border.

The 1975-1990 war was the final nail in the coffin for Lebanon's railways, while the only significant post-Ottoman railway construction in the Gulf was the Riyadh-Dammam line built in Saudi Arabia during the late 1970s. With the exception of Egypt, rail seemed to have passed the Middle East by. In recent years however, the tide has turned. Across the region, various governments have come late to the party and realised the potential benefits of rail to their nations' economies.

As is the case with Union Railway, most of these planned projects come in two stages: an industrial or commercial freight railway, followed at a later date by passenger services, often as a branch line or extension to the previous freight line. Certainly, this is the pattern currently being followed across the border in Saudi Arabia, where one of the biggest railway expansion programmes in the world is being carried out.

The 2,300km North-South Railway Project will link the northern bauxite and phosphate mines of Al Jalamid and Az Zabirah with both the capital Riyadh and planned processing facilities at Ras Az Zawr. In the same fashion as the Union Railway project, the first stage is for industrial freight rail linking the mines to the capital, while passenger services will follow at later stages (phase one of the Union Railway will transport sulphur from the Shah field to the south-west of Abu Dhabi city).

If we think about the pattern of economic and industrial development in the Levant and Gulf region, the current move towards rail makes perfect sense. Before the Second World War, railway lines in this area were exclusively imperial projects, designed in the case of the Hejaz railway to tie that increasingly restive province to Constantinople, or in the case of Germany's Baghdad Railway to open up oil fields and markets in the East.

After 1945, however, these projects became superfluous. With the exception of Soviet assistance and funding to Syria (itself something of a latter day imperial project), the grand networks envisioned, but only partially constructed in the heyday of empire, fell into neglect and disrepair. In the Gulf in particular, low population density spread across large areas, coupled with the absence of a strong centralising state, made passenger rail a low priority.

Given that the region's most prized raw materials - oil and gas - could be more profitably transported through pipelines, there was also no chance of foreign capital constructing a freight line on which a passenger network might be bolted on to. By the time the nation states of the Gulf had achieved sufficient capacity to nationalise their oil industries and take control of their own economic development, the advent of the car, coupled with relatively high levels of per capita GDP, meant that investment was naturally channelled towards road, rather than rail, infrastructure.

However, in recent years there has been a new economic phenomenon in the Gulf: the realisation among almost all oil economies that their future lies in diversification beyond hydrocarbons. In many cases, that means deepening the service sector and creating new jobs in areas such as finance, tourism, media and IT. However, just as importantly it has also come to mean taking advantage of natural resources that have previously been crowded out by oil and gas.

Most importantly, as in Saudi Arabia and the UAE, these resources tend to be in heavy mineral form. Despite its antiquity, rail remains the only cost-effective inland means of transporting such matter - roads simply will not withstand the punishment. The fact that these rail lines are connecting to major ports means that passenger stock can in many cases also be incorporated, opening up further economic possibilities.

In the sense that it marks a new stage of economic diversification at a national level, the growing penetration of rail in the Gulf is noteworthy. However, there is another, more fundamental reason why the growth of rail will be so significant to the future of the Gulf: last March, GCC heads of state agreed to link their national projects together in a pan-Gulf network, expected to encompass almost 4,000km of track.

In comparison, students of the history of European integration will be aware that this process began in earnest in 1952 with the founding of the European Coal and Steel Community - the world's first organisation based on the principles of supranationalism. Six nations came together to create a common market in two commodities, because they shared an economic and social interest in doing so. The GCC - coincidentally another six-state organisation based on those same principles - is also replicating the slow early years of the EU, a vastly expanded outfit that still struggles to agree on many items even 58 years after its original incarnation.

However, the creation of a railway linking the member states of the GCC would be a powerful physical manifestation of a common interest, with the potential in the longer term to act as a catalyst for greater economic and political co-operation among members, as well as cross-border investment. Just as importantly, it would also send a strong message to the rest of the world: that in the 21st century the peoples of the Gulf were able to surpass the empire builders of the 20th, and finally build a network that meets their own aspirations for their region.

In this sense, it could be instrumental in transforming the GCC into a genuine supranational organisation. Let's hope the project stays on track. 

Oliver Cornock is the regional editor of the Oxford Business Group