Somalia: Puntland ports minister grilled in parliament over Bosaso seaport deal

GAROWE, Puntland - Mohamed Abdi Osman [Majino], Puntland's minister for ports was on Wednesday grilled by members of Somalia's northeastern Federal State parliament over the expansion work and management of Bosaso port.

The parliament began reviewing the port deal following reports that P&O Ports, a subsidiary of the UAE's global operator DP World was yet to do any meaningful development since taking over the facility in 2017. The larger container ships can't dock at the Port due to lack of bulk terminal. 

Former President Abdiwali Mohamed Ali signed the 30-year concession agreement with the giant freight company in April 2017 which would later be ratified by parliament, but until today, no significant work has been done. The deal was worth $336 million and would have seen Bosaso playing a key role in the opening of Somalia.

The company, documents show, was to expand and manage the port for three decades, besides sharing revenue with the regional government. Bosaso is one of the strategic towns in the federal state of Somalia whose potential in expanding revenue collection has been one of the priorities of successive governments.

But on Wednesday, Osman told parliament that P&O Ports is set to hold a final meeting with the current Puntland government, a move which would determine among others, the viability of expanding the port. The company, Osman added, would return the project to local authorities if it's unable to execute the project.

According to him, President Said Abdullahi Deni will be heading to the United Arab Emirates [UAE] in August to deliberate the matter, and a Dubai court is expected to arbitrate the standoff between the freight company and the Puntland government.

Understandably, P&O Ports was set to start the construction in March this year but the work was put on hold due to raging Coronavirus pandemic. Since then, the company has remained mum about the project, a move that has forced Puntland to make follow-ups.

Puntland, Osman told MPs, would not withdraw from the agreement since it might ignite unending legal battles since the deal was signed in line with the international laws. Any withdrawal can lead to compensation charges at the international level in line with the best labor practices.

Parliament has since postponed the review of the agreement to allow negotiations in Dubai before any further steps are taken. Puntland is keen to develop Bosaso as a strategy to increase local revenues besides open the northern federal state to the rest of the world.

GAROWE ONLINE