(3 Minutes Read)
APM Terminals have managed to put rival International Container Terminal Services, Inc’s (ICTSI) entry into South Africa’s largest container port on hold, adding another embarrassing setback to the African nation’s bid to privatise and improve their port facilities.
A South African court yesterday decided to temporarily block ICTSI’s 25-year deal with state-run Transnet to take over the running of a container terminal in Durban. APM Terminals took the matter to court when it lost the bid, arguing that ICTSI did not meet a stipulated solvency measure. The court found that Transnet’s decision to award ICTSI the contract was “potentially flawed and … unfair to the other bidders”.
Allowances were made for ICTSI that were not offered to its competitors; the judge declared. The temporary block will remain in place until the end of the court case, which could stretch into the new year. After 20 years of trying, the South African government took its first step towards port privatisation with the ICTSI award last July.
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Transnet selected ICTSI as the preferred bidder for a joint venture to develop and upgrade the flagship Durban terminal nine months ago so that it can handle 2.8m teu a year, up from the current 2m teu. The queues of ships have built up at ports across South Africa, with the country’s terminals repeatedly polling among the lowest productivity-wise in surveys carried out by the World Bank.
