Armies of Liberation

NY: The Yemeni government is awaiting the final decision of the Dubai Ports International and its local partner, Bin Baqshan Group, about revising the contract of operating the Aden Free Zone and Aden Containers Terminal after the agreement was suspended by president Saleh last June, official source told NewsYemen.
A committee, including ministers and MPs and representative of trade sector, proposed some amendments in the contract relating to its duration, the amounts and the principles of arbitration between DPI and the government, in disputes, the source said.
The source said that the Yemeni-Saudi businessman, Abdullah Baqshan, the partner of DPI, received the notes of the committee and raised them to his partners in Dubai for study before making the final decision, revealing the government’s fears that Dubai cancels the contract.
Close sources to Bin Baqshan told NewsYemen that the DPI and Baqshan Group “feel unpleasant over the issue and the Yemeni government’s stand toward legal obligations”.
Sources said that DPI was seeking to make joint benefits from operating the Aden Free Zone.
Leadership of Aden Free Zone said that the difference between DPI and the government has bad impacts on the free zone, urging the two parts to quickly put an end for ’such a neglect that harms one of the most important economic projects in Yemen”.

YT:
ADEN, Oct. 4 — Negotiations with the Dubai Ports Authority are still in a stand-still while the Yemeni Government awaits the decision of the International Company and its local partner, The Buqshan Group, with regards to the president’s decision to halt the operation allowing the Dubai company to manage the Aden Container Port and renegotiate the terms of the agreement.

A committee headed by the Minister of Justice as well as several cabinet ministers and parliament members was formed in order to discuss the terms of the agreement which was signed in July 2005 in order to present the modifications on the terms found to be ‘unfair’ to the Yemeni side.

Sources close to the Buqshan group said Abdullah Buqshan is upset because of the government’s stance with regards to its legal obligations in accordance to the signed agreement.

He has forwarded the modifications demanded by the Yemeni side which include the duration of the agreement, financial returns and also terms of arbitration, to the Dubai Company, the source also said there are increasing fears they might simply cancel negotiations and void the agreement, which potentially might be a blow to the Yemeni side.

The agreement included three major activities, the operation of the industrial zone in the Aden Free zone, the operation of the cargo zone in Aden airport, and the operation of Aden’s container port. Experts indicate that Dubai was excited about the project and was formulating plans in order to develop and transform the port into a world-class center for international trade, but those plans have crumpled after the president’s decision.

YO:

The Yemeni government is awaiting a final decision from Dubai Ports International and local partners, including the Boqshan Group, over an agreement signed with the company to operate in the Aden Free Zone
President Ali Abdullah Saleh suspended the agreement earlier this year.

Parliamentary sources are skeptical of the Dubai Company’s intentions regarding the development of Aden Port, because it would occur at the expense of other ports, especially the Dubai Free Zone, since the two ports are supposedly rivals. In a previous press statement, Sakhar al-Wajeeh accused the government of ignoring the economy’s general welfare. He said his skepticism arose from conflicting personal interests that were revealed at meetings behind closed doors. He pointed out the increase in economic policy failures from the government.

Dubai International and local partners won a 35-year bid allowing them to operate Aden Container port for $85.5 million in rent, in addition to $400 million worth of technical and construction facilities. Dubai Ports International owns 51percent of the shares of Aden Company, while other local partners own 49 percent. Earlier this year, Yemeni Human Rights Watch in Britain accused government officials of plotting to favor the Dubai company’s bid, in spite of the fact that a Kuwaiti bid was worth $4.9 billion. The organization claims it has documents, which, if handed over to the World Bank, would void the agreement.

Yemeni Human Rights Watch doubts that the company can or will live up to its commitment to receive 700 thousand containers in its first year, and 900 thousand in the second year. The organization’s assessment indicates the port’s maximum capacity does not exceed 500 thousand containers. To reach the 700 thousand containers mark would require additional equipment that cannot be available within two months.

Dubai International currently runs the ports of Jabal Ali, Djibouti, Islamic Jeddah, and in the near future, Aden port as well. This will undermine any future competition for operations in Aden’s port. An expert study conducted by the World Bank confirmed that the development of Aden and Salaleh ports endangered any future growth of the Dubai Free Zone. The government terminated the contract binding it to Singapore Yemen Vest (and paid a $200 million compensation), ten years after lawmakers and economists warned about its viciousness.

According to a source, a committee headed by the Minister of Justice and made up of other ministers and members of parliament recommended making some amendments to the agreement, which was signed in June 2005. The committee recommended changing some figures in the agreement. The chairman of Boqshan Group, Abdullah Boqshan, submitted the committee’s letter to the company in Dubai to take its final decision.

Three international companies were competing to win the bid for operation in the area; Philippines’ International Ports services, Kuwait’s Gulf Company for Transport as well as the winning company, Dubai Ports International. Meanwhile, an official report pushed for the adoption of a YR 61 billion fund to finance infrastructure projects in the Aden Free Zone. According to another report from the Ministry of Planning and International Cooperation, establishing a heavy industrial zone in the Aden area would require YR 41 billion.