An extraordinary affair
Guinea's roller-coaster concessioning ride shows no signs of stopping any time soon
The early expulsion of Getma International, a subsidiary of the NCT Necotrans group, from its 25-year concession for the Conakry container terminal in Guinea has all the hallmarks of a most extraordinary affair.
Getma was awarded the concession in September 2008 and via its vehicle Societe du Terminal a Conteneurs de Conakry committed to an investment of over €100m (US$143.8m) in three main phases: the equipping of the terminal, the refurbishment of its existing structures and the expansion of the terminal by 120,000 sq m.
The Bollore group was an unsuccessful bidder as the table released by Getma, makes plain based on the respective proposals of the various bidders regarding an initial one-off fee and rental and royalty commitments over the first five years of the concession.
Yet in a remarkable turn of events after Getma’s expulsion from the concession, announced on national radio on 9 March 2011, Bollore was nominated to be the new concession holder by Guinea’s new President Alpha Conde on 11 March 2011.
Just two days after Getma was expelled, Bollore was named as the incoming new concession holder reportedly pledging a $500m investment. Further, the Government of Guinea decreed that Getma is not eligible for compensation citing a “breach of dealer obligations” but not initially elaborating on this statement.
Subsequently, in a public speech, President Conde alleged that the port authority of Conakry reported serious failures and breaches of the concession agreement including a lack of investment. Critics say that this is not the case and that this is simply one of many such expected manoeuvres by President Conde to reward his allies.
Getma, for its part, vigorously denies any allegations of wrong doing. It has initiated legal proceedings that it says will establish that its expulsion and the concession award to Bollore are part of a “pact of international corruption".
Robert Talbot, president of NCT Necotrans, in an open letter to the Prime Minister of Guinea makes the following points:
- That the alleged breaches of its obligations by Getma International are no justification for termination. And that it is the provisions of Chapter 4 of the concession agreement of 22/09/08 that provide for dealing with disputes and differences that should have been followed.
- That the suggestion made publicly by President Conde that Getma International is tax exempt and therefore exploiting the country is totally incorrect. Specifically, he states: “Getma International is not and has never been exempt from taxation.”
- That Getma International’s references produced for its bid contrary to allegations are impeccable and were thoroughly scrutinised by the technical committee responsible for the analysis of the bids.
Additionally, Talbot states that growing throughput at the terminal – 90,000 teu in 2009, 120,000 teu in 2010 and forecast traffic of 130,000 teu in 2011 - underlines Getma’s operating competency as does the introduction of its shipping line partner MSC. Further, he points out that significant investments have been made to the tune of more than €30m, and 400 jobs created.
Subsequent to this letter, Getma, after a legal wrangle, extracted details of the concession agreement made by Bollore in Conarky – one claimed to offer better terms for Guinea. It is, however, according to Getma not a like-for-like agreement. It is said to cover the whole port with roughly the same amount of money being paid to the Guinea authorities and with half of the investment commitment not taking place until after 2027.
The legal process Getma has initiated involves a request for international arbitration and secondly a claim made against Bollore at Nanterre’s Court for Trade Disputes.
Whatever the legal conclusions drawn, this story when finished will undoubtedly not reflect the finest moments of container terminal concessioning. It clearly has the potential to send the wrong message to the port investment community and particularly those considering in investing in what are acknowledged to be the riskier areas of Africa.
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