NORTH AMERICA

Manta rumours

18 years ago

Reports from Guayaquil, Ecuador suggesting that Hutchison Port Holdings (HPH) might be close to finding a compromise with the Ecuadorian government over its pulling of its commitment to develop the $525m Manta box facility (TIDE) have proved groundless.

Port Strategy: HPH is said to be following through with its exit strategy

HPH has spent between $20m and $30m on developing the site as a hub port for the West Coast of South America but is unlikely to get any of it back.

TIDE managers were in talks with representatives of President Rafael Correa earlier this week, but a source at TIDE said that HPH “was still ploughing ahead with the exit strategy”.

HPH announced officially last week that it was pulling out of Manta “on the grounds that there are changes in the concession agreement, unilaterally imposed by the Ecuadorian government, which TIDE finds unacceptable”.

President Correa has been on the offensive against HPH for some months now as he tries to win voters in the Manta and Manibe region for the forthcoming Presidential elections in April.

HPH was given a 30-year concession to run the Manta facility – Terminales Internacionales de Ecuador (or TIDE) – in November of 2006 but Ecuador’s president Correa has become increasingly truculent with the terminal operator for, in his view, not keeping to the “investment time-table”.

And a leading regional manager for another international terminal operator, who knows Latin America well, told Port Strategy: “I don’t think that HPH will be that disappointed that they are leaving as it was a defensive move in the first place – to protect their interests in Balboa, Panama, and to stop other rivals moving into the region.

“The Manta project, to invest as much as $550m, was far too ambitious but the initial outlay, for the concession, was only $1m, so it was worth a gamble for them.”