DP World anger as Djibouti seizes Doraleh terminal

DP World claims it's Doraleh Container Terminal in Djibouti is the DP World claims it's Doraleh Container Terminal in Djibouti is the "best performing" on the east coast of Africa. Credit: DP World
Industry Database

DP World has reacted swiftly and angrily after the government of Djibouti seized control of Doraleh Container Terminal (DCT), describing the government’s conduct as “particularly oppressive and cynical”. 

In a strongly worded statement, DP World said: “The illegal seizure of the terminal is the culmination the government’s campaign to force the DP World to renegotiate the terms of the concession.”

The latest move comes a year after a London Court of International Arbitration tribunal threw out the government’s claims that the agreement was unfair, fully exonerating DP World and ordering the government to pay arbitration and other costs.

In response to the latest move, DP World, which has a 33% equity stake in the terminal, has started new arbitration proceedings in London to protect its rights ‘or to secure damages and compensation for their breach or expropriation’.

The Djibouti government awarded DP World a concession to design, build and operate Doraleh in 2006 and the terminal began operations in 2008. It has 1.25m teu capacity, a 1,050 metre quay with 18 metre depth, and eight super post-panamax twin lift cranes.

“The state-of-the-art terminal is the largest employer and biggest source of revenue in the country,” said DP World. “It has operated at a profit every year since it opened.

“We demand that the government will cease its unlawful conduct and continue to work as partners with us in the same spirit of cooperation that has been in place for the last 18 years, which has yielded hundreds of millions of dollars of direct and indirect benefits to Djibouti and enhanced its attractiveness as a leading investment destination in East Africa.”

The government stated it had “decided to proceed with the unilateral termination with immediate effect of the concession contract awarded to DP World and DCT would now be under the authority of the government-owned Doraleh Container Terminal Management Company”.

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