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24 February 2024

Al Tayer addressing the Projects Forum: AED262 billion are cumulative savings made through investments in roads & transport infrastructure projects from 2006 to 2023

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By E247

 In a keynote speech titled "Leading Mega Projects and Strategic Transformations” to the Dubai International Project Management Forum (DIPMF), His Excellency Mattar Al Tayer, Director General, Chairman of the Board of Executive Directors of the Roads and Transport Authority (RTA) revealed that the cumulative savings of the substantial government investments of the Dubai Government in developing the infrastructure of roads and transport networks amounted to AED262 billion from 2006 to 2023. These savings are primarily from reduced time and fuel wasted due to traffic congestion, against AED140 billion allocated by the government for the development of roads and transport systems during that period. RTA’s reported revenues amounted to AED8.9 billion  in 2022.

Al Tayer noted in his address, which was attended by top officials and representatives of various entities that such investments contributed to a significant increase in the use of public and shared transport means with the number of riders soaring from 95 million in 2006 to nearly half a billion in 2022. This surge boosted the share of trips made by public transport from 6% to 21.6%. It also contributed to a dramatic 90% reduction in road accident fatalities from 21.9 per 100,000 population in 2006 to just 1.9 in 2022.

Leaders Directives and Support

“Thanks to the continued support and directives of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai along with the follow-up of His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Executive Council of Dubai; and His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, First Deputy Ruler of Dubai, Deputy Prime Minister and Minister of Finance, Dubai is advancing persistently towards offering an optimal environment and infrastructure focused on fostering happiness among citizens, residents, and visitors, and rendering the city the premier global destination for living in the world,” commented Al Tayer. 

“Under this visionary leadership, the RTA has seen remarkable successes in accomplishing mega projects on time. Notable among these are the Red and Green lines of the Dubai Metro, the Dubai Tram, Route 2020 of the Dubai Metro, and the Dubai Water Canal. Investment in infrastructure is a significant driver of the economic growth of every city worldwide. For instance, the Benefit-Cost Ratio (BCR) in some of our road projects is anticipated to reach AED8.8  by 2030 i.e. the economic return for every dirham invested is expected to reach AED8.8 .

 

Similarly, the Dubai Metro, having achieved a break-even point between benefits and costs in 2016, is projected to yield a return of AED4.3  for every dirham spent by 2030. Moreover, RTA’s projects and programmes resulted in a substantial reduction in carbon emissions during the period from 2014 to 2023, leading to savings nearing half a billion dirhams,” explained Al Tayer.

Effective Leadership

His Excellency Mattar Al Tayer emphasised the key role of effective leadership, a clear vision, and the unwavering commitment to realising that vision in the success of mega projects. “The visionary resolutions of the late Sheikh Rashid bin Saeed Al Maktoum in establishing Port Rashid, Jebel Ali Port, and Dubai International Airport were instrumental in supporting the significant economic transformation that Dubai has experienced over the past decades.

“Building on that legacy, the resolutions of His Highness Sheikh Mohammed bin Rashid Al Maktoum to establish the Emirates Airline, construct the Palm Jumeirah, and develop Dubai Metro Red & Green lines as well as the upcoming Blue Line of the Dubai Metro, were lauded as transformative projects that kept pace with the rapid development and population growth in the city and substantially contributed to enhancing the emirate's economy and fostering the well-being of residents. To quote an example, the projected total economic benefits of the Dubai Metro's Blue Line are estimated to reach AED56.5 billion by 2040,” he elaborated.  

Challenges in Project Fulfilment

Al Tayer delved into the multiple challenges encountered during the execution of large-scale projects such as changes in supply chains, the global competition for resources along with the associated logistical challenges impacting both cost and timelines, the regional competition for both highly skilled professionals and companies with technical know-how as a result of the prosperity seen by the region. Challenges also include interdisciplinary complexities between technical and technological specialities within a single project, the need to devise viable financing alternatives, manage relationships with a myriad of partners, and the need to strike a balance between interests and the anticipated benefits.

“In 2008, many countries halted their infrastructural projects due to the global financial crisis, but Dubai took a different path. His Highness Sheikh Mohammed bin Rashid Al Maktoum directed to continue with the construction of infrastructure projects and devising suitable solutions to safeguard the interests of contractors and project companies, rescheduling project timelines, and developing alternative strategies to complete project financing. For example, an agreement was made with international banks to fund the Dubai Metro project and such efforts culminated in the timely inauguration of the project on September 9, 2009,” explained Al Tayer.

Corporate Structure 

Al Tayer stated that RTA took proactive measures in anticipation of these challenges early on. It has established a comprehensive corporate structure to manage mega projects, which included: establishing a corporate project management office, developing an integrated technological system for portfolio and project management, and establishing a corporate system for value engineering studies, which has contributed to reducing costs for numerous projects. A notable example is the modification in the design of the arches for the Infinity Bridge project. By altering their function from a structural element to an architectural one, the project cost was reduced by 50%.

The structure also included the formation of a Mega Projects Forum comprising heads of companies involved in each project to discuss and overcome challenges, attract international companies, and evaluate alliances for major projects to ensure achieving the best value. It also included designing a specialised organisational and administrative structure for project management. For instance, for the Blue Line project, 16 dedicated teams comprising 100 specialists were formed to support the technical, contractual, and financial aspects of the project.

Future Foresight

In his address, Al Tayer highlighted the role of technological advancement in mobility projects. “Seven years ago, the Dubai Government envisioned the future of smart mobility. In 2016, His Highness Sheikh Mohammed bin Rashid Al Maktoum launched Dubai Strategy for Self-Driving Transport aiming to convert 25% of all mobility journeys in Dubai to smart, self-driving modes by 2030. 

In December 2023, His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, witnessed the inaugural demo ride of the Chevrolet Bolt electric autonomous vehicle, positioning Dubai as the first city outside the United States to deploy American General Motors Cruise autonomous vehicles. Plans are underway to expand this service to deploy four thousand vehicles by 2030. RTA conducted numerous studies and forged partnerships to launch air taxi services by 2026, a first in the region. 

The Digital Transformation Strategy 2030 encompasses delivering 82 strategic projects and initiatives, with an allocated budget of AED1.6 billion to lead globally in data-driven digital transformation. It also provides for establishing a fully flexible digital infrastructure, and developing 50 artificial intelligence use cases to provide innovative services such as predicting parking occupancy rates in Dubai through the RTA App and integrating advanced AI chat technologies, like ChatGPT, through the chatbot Mahboub.

AED4 billion 

Al Tayer reviewed RTA’s efforts to promote sustainability in line with Dubai's Zero Carbon Emissions Strategy. “RTA is making expeditious efforts to transform the entire fleet of public buses to electric and hydrogen-powered buses by 2050. Plans extend to transform taxis and limousines to electric and hydrogen vehicles by 2040, streetlighting systems to highly efficient, energy-saving systems before 2035, and constructing highly energy-efficient buildings by 2045. The strategy is expected to yield financial savings estimated at 4 billion dirhams, compared to the regular practices,” he noted. 

Al Tayer reflected on the need to bolster shared economies based on a change in traditional concepts of use and ownership, which will dictate the upcoming changes in transportation services. In this regard, several companies were launched to support Dubai's domestic product and achieve the primary objectives of the Dubai Economic Agenda (D33), aiming to position Dubai among the top four global financial centres.

He added, “Over the last two years, RTA has successfully launched Salik Company as a public joint stock company with a valuation of AED24 billion. It listed the Dubai Taxi Company on the Dubai International Financial Market, valued at AED6 billion. At the start of this year, RTA launched Parkin Company with an anticipated valuation of 6 billion dirhams. The subscription to the IPO of Salik Company and Dubai Taxi Company achieved record-breaking levels, reaching AED180 billion  and AED150 billion  respectively.”

Learned Lessons

Al Tayer concluded his keynote address by sharing valuable insights and lessons learned from his extensive experience in steering mega projects and strategic transformations. Key takeaways included the leader's presence in the field. He cited the quote of His Highness Sheikh Mohammed bin Rashid Al Maktoum “The right place for officials, ministers and leaders is the field”. “His Highness is always keen to be present in the field to perceive the needs of residents first-hand. Several projects undertaken resulted from visits and tours of His Highness. Examples include the Jumeirah Corniche project which His Highness envisioned as a tourist haven for Dubai's residents and visitors, and the cycling tracks which extended to 544 km in length by the end of the last year,” he elaborated.

Lessons learned also included proactive planning and future scenario analysis to step up the preparedness to adapt to changes, ensure uninterrupted business operations, bold decision-making, and prompt capitalising on opportunities to keep up with the swift pace of global developments across the board. Insights also include investing in massive economy-boosting projects, supporting manufacturing firms and research centres in developing systems and solutions tailored to Dubai's unique nature, adopting flexible business models including fostering strategic partnerships with the private sector, and reviewing plans every three years and carrying out updates to align with the evolving global landscape