- Yesterday(Monday) the parliament debated copies of the concession agreement with the Speaker of the parliament Abdirahman Mohammed Abdillahi and his deputy present.
- Hon Mohamoud Hashi, presidency minister, patriotically urged the parliament to vouch either the merits or the demerits of the agreement as per obligation.
- DP World has a proven track record of doing shady deals with corrupt officials in order to win concession deals/contracts to manage many ports in the world.
By Gulaid Dalha
Hargeisa – The Independent – After the hottest debate between Somaliland citizens and the government on the DP World deal, the cabinet ministers have finally submitted the DP World contract to the parliament of Somaliland for approval.
Senior cabinet ministers including the Foreign Minister Dr Saad Ali Shire, Finance Minister Samsam Abdi Adan, Presidency Minister Mohamoud Hashi, Information Minister Addani and the country’s envoy to UAE Bashe Awil have put forward the deal for parliamentary debate on Saturday. Short after the distribution of copies about the concession agreement, the lawmakers asked questions to the ministers. Yesterday(Monday) the parliament debated copies of the concession agreement with the Speaker of the parliament Abdirahman Mohammed Abdillahi and his deputy present.
The motion on the privatization of Berbera port about the investiture by DP World presented by the government as it showed a spirited strive with the duo ministers of Presidency and foreign affairs making the front.
Hon Mohamoud Hashi, presidency minister, patriotically urged the parliament to vouch either the merits or the demerits of the agreement as per obligation. He appealed the parliament to approve the concession agreement.
In mid-May, DP World inked a $442 million contract with the government of Somaliland to develop and operate a regional trade and logistics hub at the Berbera Port.
A CLOSER LOOK ON DP WORLD
How DP World Operates and Wins Concession Contracts
To summarize the play by play strategy of DP World:
How will they invest about $442 million over 30 years to win the concession?
Investing $ 442 million over 30 years is $13.7 per year. One can point out that the Somaliland Ministry of Finance receives over $16.6 million per year from the Berbera Port Authority according to the 2016 budget. Hence, this investment is significantly lower than what the treasury receives.
This might not make any sense to anyone with a sane mind. However it will make sense when the real agenda is uncovered.
First there will not be any investment at all, only about $15 million money is intended to win for the concession and smooth things with some of the current out going ministers.
Establish a company that manages the port and give shares to certain important individuals and to Somaliland government.
This company has the right to keep around 90% of the port revenue, the right to hire and fire employees and has only to pay for Somaliland government 10% of the revenue and about $ 2 million fixed amount per year.
Instead of investing money the company now has 90% of the port money in which it will use to invest in simple projects, give it to its shareholders and keep certain powerful officers happy while not spending a penny of its own money.
Proof of the Strategy
DP World has a proven track record of doing shady deals with corrupt officials in order to win concession deals/contracts to manage ports. There has been several notable countries such as Yemen, Senegal, and Djibouti which accused DP World of corruption and which have kicked them out of their countries within the first few years into the concessionary contract.
In 2007, the Senegalese government signed a 25-year old concession agreement with DP World to manage its container terminal at Dakar Port. Nevertheless, after corruption allegations from the Senegalese government, DP World agreed to pay 48 million USD in June 2013 to compensate for the remaining balance of the concessionary contract . The Senegalese Justice Ministry accused DP World of having connived with Karim Wade, the son to ex-Senegalese president, who is being investigated over illegally acquired wealth estimated to around 1 billion USD. DP World won its concessionary contract when Karim Wade was a minister of the Senegalese government. Karim Wade was accused by the anti-corruption prosecutor of owning the DP World subsidiary in Senegal established to manage the container terminal.
In a similar case, during September 2012, DP World agreed with Yemeni government to divert its entire interest in Dubai and Aden Ports Corporation (DAPC) to Yemen Gulf of Aden Ports Corporation (YGAPC). Under the agreement, DP World has ceased its management of Aden Container Terminal (ACT) and Ma’alla Container Terminal at the Port of Aden with immediate effect and Aden Port Development Company (APDC), a wholly owned subsidiary of YGAPC, took full responsibility for the port’s operations. The Yemeni transport Minister Waed Abdullah Bathib and the country’s anti-corruption body claimed that DP World has not fulfilled its contractual obligations under the 30 year management contract signed in 2008. The Yemeni transport Minister Waed Abdullah Bathib told Reuters in early 2012 that the company had missed the target of raising container capacity to 900,000 20-foot equivalent container units by the end of 2011, and had also failed to build and provide infrastructure as specified in the 2008 agreement.
Last but not the least, there is also much publicized court case of Djibouti vs DP world in London in which the Djibouti government has accused DP World and its former port and free-zone manager Abdourahman Boreh of embezzlement, corruption and has rescinded DP World’s contract.
Boreh was accused by the government of Djibouti of corruption during his time as head of DPFZA when DP World was awarded the concession to run the terminal. The government rescinded the 20-year concession agreement amid claims the signed deal favored the Dubai port operator and went to court to seek damages as well as confirmation of the annulment of the contract.
During the cross-examination Borreh conceded and did not dispute many important disclosers of contracts in which the judge described them as “sham”. Here are some of the allegations and bribes that Borreh accepted:
The Djibouti government’s barrister accused Borreh of procuring himself improper payments, specifically Mr Borreh admitted that he did receive an annual $500,000 consultancy fee from DP World through an off-shore company he controlled called S-flame.
Borreh also conceded that DP World paid these amount through his Swiss accounts and the money transfer documents were presented in court.
Mr Borreh also admitted receiving $1.3 million payment as a security service contract from DP to his off-shore company S-flame.
Similarly Borreh admitted that he secured himself 15% share of DP’s Djibouti subsidiary called DP Djibouti without informing the president of Djibouti. Moreover, in Doraleh container terminal did not dispute that he received indirect 5% share first by paying $1 and then a massive discount at the market price. In addition Mr Borreh also expected to receive 5% of the dividends and 15% of DP’s world management fee for the duration of 50 year agreement.