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Djibouti plans new container terminal to bolster transport hub aspirations

28 March 2018 Comments (0) Actualites, Africa, Business, Economy, Infrastructure

ABIDJAN (Reuters) – Djibouti is in talks with French shipping company CMA CGM to develop a new container terminal at an initial cost of $660 million as part of the tiny African country’s bid to expand into a sea and air transport hub for the continent.

Aboubakar Omar Hadi, chairman of the Djibouti Ports and Free Zone Authority (DPFZA), told Reuters on Tuesday that the authority hopes to award the concession in July. It was also prepared to buy out DP World’s stake in an existing container terminal to end a row with the Dubai port operator and avoid arbitration, he said.

Djibouti’s strategic location has led the United States, China, Japan and former colonial power France to build military bases there.

Its ports already serve as an entry point for cargo which is then sent by smaller vessels to ports along Africa’s eastern coast, but it is now seeking to become a sea-air transshipment hub for the entire continent.

To do this, Hadi said DPFZA was also planning to construct a $350 million airport and expand Air Djibouti’s fleet of cargo aircraft.

The new container terminal project could break ground as early as September with construction expected to take 24 months, Hadi said, speaking on the sidelines of the Africa CEO Forum in Abidjan, Ivory Coast.

“We are going to build DICT, Doraleh International Container Terminal. This is a new plan,” he said. “We are in discussions with CMA CGM.”

The port authority was not in talks with any other potential partners, he said. CMA CGM did not immediately respond to a request for comment.

Once operational, Hadi said the port terminal would boast an annual capacity of 2.4 million twenty-foot equivalent units (TEU), but subsequent expansion phases would bring that up to 4 million TEUs.

Fifteen percent of the project’s cost will be financed through equity. Of that, the DPFZA will contribute 85 percent, with its concession partner providing 15 percent. The rest will be raised via international institutions and banks.

“We are targeting trans-shipment,” Hadi said.

 

DP WORLD DISPUTE

Meanwhile, Hadi said the port authority was ready to end a dispute with DP World over its cancellation of a concession contract for another facility, the Doraleh Container Terminal, by buying out DP World’s 33 percent stake.

Djibouti ended the contract with the Dubai state-owned port operator last month, citing a failure to resolve a dispute that began in 2012.

DP World has called the move illegal and said it had begun proceedings before the London Court of International Arbitration, which last year cleared the company of all charges of misconduct over the concession.

“We are prepared to pay them their 33 percent of shares,” Hadi said. “There is no need for arbitration. We are going to buy their shares.”

 

(Reporting by Joe Bavier; Additional reporting by Gus Trompiz in Paris; Editing by Aaron Ross and Susan Fenton)

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DP World wins 30-year Congo port concession

25 March 2018 Comments (0) Actualites, Africa, Infrastructure, Middle East

DUBAI (Reuters) – DP World said on Sunday it had won a 30-year management and development concession for a greenfield, multi-purpose port in the Democratic Republic of the Congo (DRC).

The Dubai-owned port operator will set up joint venture with the Central African country’s government to manage and invest in the Atlantic Coast’s Port of Banana, it said in a bourse statement.

An initial $350 million will be invested to construct a 600-metre quay and a 25-hectare yard extension with a container capacity of 350,000 TEUs (twenty-foot equivalent units) and 1.5 million tons for general cargo.

Congo has long looked to develop a port along its less than 50 km (30 miles) of coastline to handle larger vessels than those that can reach its existing shallow ports up the Congo River.

Construction is expected to start this year and take two years to complete. A total project cost of over $1 billion, spread over four phases, will be dependent on market demand.

DP World will control 70 percent of the joint venture with the government of the DRC retaining the remaining 30 percent, the statement said.

The award includes an option to extend the concession for an additional 20 years.

 

 

 

(Reporting by Alexander Cornwell. Editing by Jane Merriman)

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Ethiopia signs $600 million loan, grant deal with World Bank

20 March 2018 Comments (0) Actualites, Africa, Economy, Infrastructure

ADDIS ABABA (Reuters) – The World Bank agreed a $600 million loan and grant to Ethiopia on Tuesday to fund roads and other infrastructure projects in urban areas.

The Washington-based bank said the funds would “help strengthen the capacity and performance of local urban governments, expand sustainable urban infrastructure and services, as well as promote local economic development”.

Ethiopia’s urban population is growing by 3.8 percent annually on average, one of the fastest rates in sub-Saharan Africa and presenting challenges to infrastructure, services and jobs, the bank said.

“To successfully manage urbanisation … cities are likely to require fiscal transfers for the foreseeable future. This programme will help cities to realise their revenue potential,” Abebaw Alemayehu, the World Bank’s team leader for the project, said in a statement.

The programme will also support projects in 73 towns across the country and benefit more than 6.6 million people, he said.

Under a 2015-2020 development plan, Ethiopia plans to set up less than 10,000 “rural development centres” in a bid to ease the influx of people to its capital Addis Ababa.

Earlier this month, the World Bank also approved a $375 million loan to Ethiopia to fund a national electrification project.

 

(Reporting by Aaron Maasho; Editing by Susan Fenton)

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Kenya raises $2 bln Eurobond but concerns over deficit linger

22 February 2018 Comments (0) Actualites, Africa, Economy, Infrastructure, Politics

NAIROBI (Reuters) – Kenya shook off a downgrade and the loss of access to an IMF standby credit facility to raise a $2 billion dollar bond at competitive yields, but market participants said on Thursday it still needs a credible plan to tackle its fiscal deficit.

Kenya received $14 billion worth of bids. It took just $1 billion in a 10-year note with a yield of 7.25 percent, and another $1 billion in a 30-year tranche with a yield of 8.25 percent, Thomson Reuters news and market analysis service IFR reported.

“They were in line with the yield curve,” said a fixed income trader in Nairobi.

The eventual yield reflected a tightening of the initial pricing area by about 30 basis points. It was close to the comparative yields for other African sovereigns like Nigeria, the trader said.

Last week, credit ratings agency Moody’s downgraded Kenya’s debt rating to B2 from B1 while officials were in the middle of the bond roadshow abroad, angering the government.

More bad news emerged on Tuesday, after the International Monetary Fund said it had frozen Kenya’s access to a $1.5 billion standby facility last June, after failure to agree on fiscal consolidation and delay in completing a review.

“They (the government) were able to weather the knocks of the Moody’s downgrade and the IMF issue,” said Aly Khan Satchu, a Nairobi-based independent trader and analyst.

But he warned that the government needed to convince investors it has a plan to tackle the fiscal deficit.

“People are worried about debt-to-GDP ratios and they want to see a stronger language about how this will be addressed,” he said.

Kenya’s total debt is about 50 percent of GDP, up from 42 percent in 2013. It has borrowed locally and abroad to build infrastructure like a new railway line from Nairobi to the port of Mombasa.

The finance ministry has published a plan to lower its fiscal deficit to 7 percent of GDP at the end of this fiscal year in June, from 8.9 percent in 2016/17, and to less than 5 percent in three years’ time.

Satchu said it was not enough for investors. They want to see more targeted infrastructure investments that will ensure a return, and attempts to reign in a ballooning public service wage bill and other recurrent expenditure.

“We have got to walk the talk. We are not even talking the talk yet,” he said.

 

(By Duncan Miriri. Editing by Katharine Houreld and Toby Chopra)

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Eskom says rolling cuts unlikely despite coal supply fall

30 November 2017 Comments (0) Actualites, Africa, Environment, Infrastructure

By Nqobile Dludla and Mfuneko Toyana

JOHANNESBURG (Reuters) – South African utility Eskom said on Thursday rolling power cuts are unlikely despite coal supply possibly falling below a 20-day requirement at its Hendrina power station.

On Thursday investigative news outfit AmaBhungane reported Eskom may be forced into nationwide electricity cuts after a coal mine linked to the Gupta family threatened to halt supply.

Eskom has been at the heart of allegations of illegal contracts and undue influence in awarding tenders to the Gupta family, friends of South African President Jacob Zuma.

Spokesman Khulu Phasiwe confirmed Eskom had held an emergency meeting last Friday to determine whether strategic coal stockpiles at Hendrina and other stations were sufficient after Tegeta Exploration and Resources threatened to halt supply to Hendrina.

Coal supply at Eskom’s power stations stood at 74 days’ worth in March but had fallen to 25 days’ worth at Hendrina by October and may have fallen below a 20-day requirement since, Phasiwe said.

He told Reuters the company was investigating whether supply at all its 12 power stations complied with regulations requiring at least 20 days’ worth.

South Africa had regular power cuts between 2008 and 2015, hitting key industries and knocking economic growth as demand exceeded capacity.

Quoting sources, AmaBhungane alleged that Tegeta has been exporting coal from its Optimum Coal Mine while limiting supply to Eskom.

“If it happens that for some reason they are unable to supply us with coal then clearly it means that they would have breached the contract and therefore it becomes a legal matter,” Eskom’s Phasiwe said.

A spokeswoman for Tegeta parent company Oakbay, founded by the Gupta family as its main investment vehicle in South Africa, said the company would likely comment on Friday.

The family agreed in August to sell Tegeta but the sale has not been finalised.

The Guptas are accused of using their links with the 75-year old Zuma to wield influence and win state contracts. Zuma and the family both deny any wrongdoing.

($1 = 13.6469 rand)

(Editing by Ed Stoddard and Jason Neely)

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