Addleshaw Goddard - Africa Group Newsletter April 2021

30 Apr

April 2021

Welcome to the April edition of the Addleshaw Goddard Africa Group Newsletter. We hope you enjoy reading a selection of business news and articles from around the continent.

Visit our dedicated Africa site site for more information about doing business in Africa and how Addleshaw Goddard can support you.

INTRODUCTION

We are pleased to present the latest edition of our Africa newsletter.

Throughout the centuries and around the world, ports play a crucial role in all economies. This is even more so for many countries in Africa, where maritime transport is the primary form of access to market, both for export (mainly of commodities such as cocoa, timber, iron ore, metals and oil and gas) and for import (mainly of machinery, equipment, vehicles, pharmaceuticals and consumer goods) as well as for the Intra-African trade.

My name is Ton van den Bosch. I am the head of our Singapore office and also a member of AG's Africa Group. Leveraging my experience as general counsel of a global listed terminal operator, I have been involved in various transactions, PPP's and project developments in the ports & terminals sector throughout Africa and work very closely with our teams in the UK and in the Middle East on Africa related projects and transactions.

For many countries, seaports are the gateways to trade and a crucial part of the supply chain with terminals connecting a vast hinterland. Some of Africa's ports are not very efficient and have been an obstacle to development, but we are pleased to see money being spent on modernising existing terminals and on greenfield projects throughout Africa, for example in Kenya, Cameroon, the DR Congo and in Ghana.

So this month, we cast a spotlight on development of ports and terminals in Africa and we have included news stories from across Africa. We hope you enjoy reading the report and please let us know if there is anything we can help you with!

AFRICA-BOUND: SHIPS SET FOR COSTLY DETOUR AMID SUEZ BLOCKAGE

Ships are beginning costly and time-consuming detours around Africa with the Suez Canal still blocked by a massive container vessel, as concerns mount that a complex rescue mission could take weeks.

The prospect of a longer-than-anticipated outage along what’s arguably the world’s most important maritime trade route threatens further turmoil in a shipping sector that’s already scrambling to keep sea transportation for everything from finished goods to energy and commodities on track.

To read this article click here

KENYA’S LONG-AWAITED LAMU PORT TO BECOME OPERATIONAL IN JUNE

An official at Kenya Ports Authority (KPA) has told China’s Xinhua news agency that the long awaited Lamu seaport will open for business in June.

Being built by China Communications Construction Company (CCCC), the port is part of Kenya’s bid to become the principal trade hub in East Africa.

It is also part of LAPSSET, which stands for the Lamu Port South Sudan-Ethiopia Transport Corridor. If all the proposed schemes are built, this will include roads, oil and fibre-optic lines, a 1,500km railway, an airport and a refinery, and will require investment of around $24bn.

To read this article, click here

DP WORLD COMMENCES OPERATIONS OF MPT AT PORT OF LUANDA

Dubai-based marine terminal operator DP World has commenced the operations of the Multipurpose Terminal (MPT) at the Port of Luanda in Angola.

After the signing of the 20-year concession agreement in January, the MPT was handed over to DP World Luanda by Porto de Luanda.

The company will invest approximately $190m for the development of the terminal.

To read this article click here

SOMALILAND AND TAIWAN: TWO TERRITORIES WITH FEW FRIENDS BUT EACH OTHER

Both Taiwan and Somaliland appear to be fully functioning states which proudly declare their independence yet neither is recognised internationally and now, as Mary Harper reports, they are moving closer together.

"Welcome to our humble office," says Chou Shuo-Wei Amir, the Third Secretary at Taiwan's diplomatic mission in Somaliland.

In fact, "humble" is misplaced as the mission is rather swish, located in a large villa next to the ministry of religious affairs in Somaliland's capital, Hargeisa.

To read this article click here

DUBAI'S DP WORLD SEEKS $210.2 MILLION IN DAMAGES FROM DJIBOUTI

Dubai’s DP World, one of the world’s largest port operators, is seeking $210.2 million in damages from Djibouti’s government in an ongoing legal battle over port concession rights, documents related to the dispute, seen by Reuters, showed.

DP World and Djibouti have since 2012 been locked in the dispute over DP World’s concession to operate the Doraleh Container Terminal, which is located in the Horn of Africa along key trade routes at the southern entrance to the Red Sea. Djibouti seized the terminal from state-owned DP World in 2018.

To read this article click here

BPE BOSS SEEKS INCREASED PPP IN MARITIME SECTOR

The federal government has called for more private sector partnership to attract the needed investment to drive the maritime sector and boost the economy.

Director-General, Bureau of Public Enterprise (BPE), Mr. Alex Okoh, stated this during a webinar session monitored in Lagos.

The BPE boss reiterated the need for an increase in the private sector involvement in the financing critical infrastructural development in the maritime sector in order for the industry to become a major revenue earner for the federal government.

To read this article click here

AFRICA’S GROWTH AND THE POTENTIAL OF THE BLUE ECONOMY

Africa is a complex continent. She is an eclectic mix of authoritarian regimes, where leaders have been in power for many decades; countries that are attempting to make their way towards democracy, even if progress is incremental and slow; and others that have had a stronger semblance of democracy for many years, though (in honesty) are still trying to find their feet.

To read this article click here

COVID RESPONSE DEFLATES PROJECT SPENDING ACROSS EASTERN AFRICA

Eastern African countries cut $68.3 billion spending on infrastructure projects last year, the largest decline in number of projects and value of projects in sub-Saharan Africa in a year.

This is as a result of the economic fallout from the Covid-19 pandemic sweeping across the region, hitting public finances and pushing governments into massive indebtedness.

To read this article click here

2023 LAUCH FOR GREENFIELD NIGERIAN PORT

Commercial operations at a new greenfield port development in Nigeria will begin in the first quarter of 2023.

The 90-hectare Lekki Deep Sea Port in Lagos Free Zone (LFZ) is being constructed by China Harbour Engineering Company

Ltd. (CHEC). Governor Babajide Sanwo-Olu was informed of the expected launch date by Du Ruogang, managing director of Lekki Port and representative of CHEC, now the major investor of the port project, said the Lagos State Government on its Facebook page.

To read this article click here

LUANDA TENDER CONTROVERSY

Serious questions are being asked about the recent tender award process for the multipurpose terminal in Luanda.

The recent award of the multi-purpose terminal concession in Luanda, Angola to DP World has been followed by escalating controversy. At the heart of the matter is the contention by other bidders that had the rules governing the tender process been properly followed, and not circumvented, then the result would not have been as declared.

To read this article click here

KEY CONTACTS